The famous video platform YouTube took the attention of Google in 2005, The technology giant wanted to buy the video platform for $15M at that time but ended up paying $1.65B in November 2006 instead. In November 2005, the platform was only 9 months old. Not many people knew about it, but Google and Yahoo executives had it in their sights and were beginning to consider acquiring it.
In the end, it was Google who managed to do it, the company ended up paying $1.65B for YouTube, an absolutely astronomical figure for the time. The funny thing is that a year earlier the company had offered $15M for the famous video platform.
Google tried to buy YouTube for $15M in 2005
It was almost the prehistory of the internet and video platforms did not have the current capacity or potential. YouTube was a place where people shared video clips from popular shows such as Saturday Night Live.
Since the networks did not have video platforms on the internet, there were those who uploaded those clips (without official permission) to YouTube. Of course, this led to problems, as demonstrated by the case of the famous ‘Lazy Sunday’ clip that had to be removed.
Hardly anyone could have imagined how much the video platform would grow over the years, but in November 2005 some executives of the tech giant were already thinking of acquiring the company for an almost symbolic $15M.
A leaked email on Twitter shows how Google was considering offering between $10M and $15M. The company didn’t want Yahoo! to buy YouTube too.
The date was '05 and the question was "should we buy YouTube for $15M?"
The answer at the time—many variations of which to be heard in planning meetings around the world ever since—was "no, we have their features mocked up and we're just short 1 engineer to kick their butt" pic.twitter.com/hLDUaFwtQr
— Gabriel Hubert (@gabhubert) March 16, 2021
But the company bought the video platform for $1.65 in 2006
As it turned out months later, Google Video could not compete with YouTube, which had become a viral phenomenon and was growing exceptionally fast. Google, which did not take advantage of that first opportunity, would end up paying 100 times more than it had planned just a year earlier: in November 2006 it announced the purchase of the video platform for $1.65 billion in stock.
That figure, which seemed absurd, has proved to be a real profit for Google. Making it financially profitable was no easy task. In 2014 they were covering expenses. But the famous video platform enabled Google to earn $15B in 2019, for example.
YouTube’s growth – thanks of course to Google’s resources – has been simply exceptional, and today it is difficult to understand our world without a platform on which has been the center of the whole phenomenon of ‘influencers‘.