♪ emily: it has changed the way we watch video, redefined going viral, challenged governments, and even launched the career of justin bieber. today, youtube, now owned by google has more than 1 billion users, uploading 300 hours of video every minute. it all started a decade ago with a trip to the zoo. and one of the founders says he is not quite done changing the way we are entertained. joining me today on "studio 1.0," youtube cofounder and former ceo, chad hurley. chad, thank you so much for being here. chad: thanks for having me. emily: in 2005, you activated

the url, youtube.com. right? chad: on valentine's day. emily: on valentine's day. chad: so romantic. emily: describe the last 10 years. chad: for me, it has surpassed all of my expectations. we were really simply trying to solve a problem for ourselves and our friends. how do you share videos that are sitting on your desktop? and despite observing our own problems and coming up with a simple way to re-encode these videos, and allow people to share these videos on the web, unlocked the potential for everybody else. emily: the very first video on youtube really was one of you guys going to the zoo. [video clip] >> the cool thing about these guys is that they have really, really, really long trunks. chad: not a cat video, but not bad. emily: 18 million views, almost 19 million views. chad: that video and many

others, we were uploading internally to test the system. yeah, shortly after that, we received quite a few other uploads around the world. emily: who is that? chad: jawed, one of the three of us that started the site. also steve chen. unfortunately, jawed decided to leave the company before we launched the service or had a chance to raise funding. he decided to go back to school, to stanford. it was really me and steve's journey after that, riding the wave of video and dealing with growth, eventually ending up at google. emily: you grew up in pennsylvania. indiana university of pennsylvania. you studied design there. chad: yeah. emily: what kind of kid were you growing up? chad: not the most academic child growing up. but i was curious about things. i enjoyed art. growing up, dabbling, i guess, you do not need to be an engineer to have a startup. you just need to be someone with ideas.

and you have to follow through in creating something that others can relate to. so for me, you know, art and startups are not too different. emily: how did you end up in silicon valley? chad: i read about a small startup beaming money through palm pilots. at the time, the company was called confinity. and they had a palm pilot program called paypal. i had recently graduated from college and was trying to decide what i wanted to do. i was sitting at home and decided to write them an e-mail. because on their website, they said they were looking for a web designer. i had a design background. luckily enough for me, they responded. about a week later, i was here in silicon valley working for them. emily: and the rest is history. chad: the rest is history, but i needed to find a place to live. that was the first challenge for me. when i moved out here in the summer of 1999, i had to sleep on someone's floor. emily: because there were so many people coming here for silicon valley? chad: it was during the dotcom boom. emily: as i understand it, you designed the very first paypal

logo they still use to this day. is that correct? chad: i think they have changed it, but yes, i was responsible for logo design, website design, the app. emily: do you see your design in the paypal logo today? it is an iteration of what you did, right? chad: yes, of course. emily: what determined how everyone in the paypal mafia ended up going their separate ways? and how did you and steve end up together? chad: after i left paypal, i would meet up with steve and a few other engineers for coffee on university avenue. and everyone had at that time a digital camera with video mode. this was right before cameras took off in cell phones. people had video files on their desktop they could not share, including ourselves. how do we make it as easy as sending an e-mail? that was really what inspired us. emily: this is 2005, before smartphones, really, before high-speed internet was the norm, how difficult was this to get off the ground? chad: i think because we knew

nothing about video, we were not scared about getting into it. i think the same thing with paypal and payments. i think if we realized how much fraud and how many other hoops we would have to jump through in the finance industry, we probably would never have started the project. same with video, dealing with bandwidth and hosting and streaming issues. so because of that, we were able to hit kind of the video market just at the right time. when people were getting broadband, when people were getting the devices in their hands. and we were i guess in the right place at the right time. emily: you sold to google the next year, right? so it was only like 18 months. for $1.65 billion. chad: it was a rocket ship. and it continued to be kind of this journey where we were holding on for our lives. even after we became more of a part of google. if anything, things just accelerated from there. obviously, we had more resources. but at the time we sold, we only had 67 people in the company. we had two or three engineers,

i.t. guys that would run around the country, maintaining our three data centers. at the time, you did not have the luxury of plugging into amazon web services or something. you actually had to go out and build your own machines. and beyond that, we were threatening, basically, both sides of the industry. both the internet industry, the googles, the yahoo!s, and microsofts that wanted to retain their control. but you had the traditional media world, the studios and labels and others, that wanted to retain control of distribution. they were attacking us, accusing us of not doing the right things around copyrights, when, in reality, we were building more tools than any of our competitors and more policies from day one that anybody else to deal with all these problems and eventually create solutions for them where they could monetize them. the music industry earns

billions of dollars off of youtube on an annual basis now. but with all these people were looking at us, and us just struggling to keep things up and running, we had no other choice, really, at the end of the day, than to be acquired by someone. for us, we were lucky enough to be acquired by google, who, in my mind, kind of took a chance on us. and that really youtube would probably not be here today or what it is today without their support. so i am really thankful we ended up there. emily: you felt you had to sell? chad: oh, yeah. i had no doubt if we had tried to go alone, we would have eventually been crushed by lawsuits or just not being able to scale. we would have loved to remain independent. and we wanted to see what we could do to go ipo and remain independent. but other forces did not allow us to. emily: what was it like transitioning over to google?

chad: one of the things larry, sergey, and especially eric told us when they first met us is, continue to run this yourself, continue your culture. we just care about growth. and really just let us know if anyone gets in your way. emily: there was always a question about how youtube was going to make money. what was so hard about it? ♪

♪ emily: now until more recently, there was always a question about how youtube was going make money. what was so hard about it? what was so hard about building it into a business? chad: i think people were, internally or externally, looking for this big answer. there has to be something other than just another video on top of a video. at the end of the day, i think it is just all about targeting, about providing choice to the viewer. there are more than enough ways to monetize the site just looking at traditional means of advertising.

but people are always looking for this bigger answer. i think they continue to this day. emily: you stepped down as ceo in 2010. why did you leave? chad: i just wanted new challenges. i mean, i just felt youtube was in great hands. we had really seen things through as a business. there were all these doubts when they first acquired us. but i felt when i left, i thought a lot of those doubts were answered, and it had really turned into a true business for google. emily: how much do you think youtube is handicapped by not having its founders there? chad: i think that, again, youtube has done the right thing and they will continue to do the right thing. what youtube is dealing with today is more competition. just because video is ubiquitous now. at the end of the day, it is just about youtube diversifying the business model. emily: what do you mean by that? chad: there are different ways people are paying and consuming video. right now youtube has been sort of one-dimensional for the most part which is advertising.

emily: what other business model should they be implementing? chad: you have different forms of v.o.d. i think it is giving these tools directly to creators and letting them determine how they want to monetize their content. if they want to charge their subscribers and how much. if they're going to charge subscribers, what type of content? there are other models to monetize it after that point to advertising. so i think it is more about options for the creators and providing tools. helping people create better content. they tried to do that with the studios, but i think there are more tools that can help the regular creator create content. emily: you think youtube should be charging consumers to watch certain videos. chad: i think that is an option that they have. emily: and should be paying creators more. because youtube has always been criticized for not paying creators enough. chad: i do think youtube should be more transparent with their terms and not make it a

negotiation. i think everyone -- it should be a level playing ground. part of the reason i started youtube was to democratize video. to do that, traditional studios, labels, and networks shouldn't get better deals than the regular creator. emily: what is a fair percentage? chad: who knows? it is up to them. emily: more than 50%? chad: potentially, yeah. emily: netflix, yahoo!, buzzfeed, hbo and facebook are doing native video. twitter is getting into video. what is the future of youtube in this world where original content is king and there are so many places to find it? chad: it is a good thing because it means more advertisers are going to move their money into online video. all the big players, facebook and twitter, doing online video means more money for everyone. emily: susan wojcicki is the ceo of youtube now. how often do you talk? do you ever pick up the phone and say, "hey, susan, i think you guys should be charging for v.o.d."?

chad: we trade e-mails from time to time. again, she has done a great job at google and will do a great job at youtube. we have had a chance to meet from time to time. i had not been back to the youtube offices in a while. i went back to grab lunch. surprised they are continuing to expand their offices. so it is always a treat to see that. but, no, just to speak with her in person, i think she is focused on the right things. and i have told her the same things i told you. you have to go back to your core. it is about providing tools to your creators. it is about supporting that community. some of the reasons why i left, i felt like i did not want to stick around to be the token founder. going to trot me around and talk about how he started youtube. it was about creating tools and opportunities for people to create better content. emily: you recently sparred with mark cuban online, who claimed youtube could not get anything right. you tweeted, "registering

domain, $20; selling domain, $1.65 billion; knowing mark cuban is still bitter, priceless." how do you respond to critics that say youtube had more potential? chad: well, i'm just giving mark a hard time. because he likes to talk a lot. it was a little tweet i thought he could take. but, you know, there are a lot of people that have opinions. but for the most part, i think people should focus on their own businesses. and focus on them creating opportunities for themselves instead of complaining about someone else. at the end of the day, sometimes it does comes down to jealousy. it comes down to missing that opportunity that he had with broadcast.com. he had a lot of the right ideas, but he was ahead of its time. in terms of the opportunies youtube will provide or has provided, i think they will only continue to grow.

the audience is larger than ever, which means the opportunity for google is bigger than ever. emily: do you have a favorite cat video? chad: well, there are too many. too many to pick one. emily: i have a favorite cat video called "surprise kitty." it's pretty awesome. chad: where he puts his paws up? emily: you know it. chad: i know them all. emily: it is estimated that you made more than $300 million in the deal. has money and success changed you? chad: i do not think so. i don't know. i still get up every day and go to work. i just feel there are still opportunities to solve problems and create solutions for people. emily: you were at kim and kanye's engagement. chad: oh yeah. emily: they were not happy with you afterwards. chad: i don't know why. emily: what happened? ♪

emily: so let's talk about mixbit, what you're doing now. where is it today? chad: still a work in progress. we are looking for our insight that will make what we are focused on, collaborative video, work. it's an app where you can invite individuals into a project and everyone can contribute video clips or photos and pick a theme. then we automate the editing process and automatically push all of that content together and create something visually interesting you can share with others. something you would not otherwise have the time or knowledge to do yourself. this is coming off the heels of me and steve working together on an incubator, all these other projects and offices running at the same time. that kind of slowed things down. my advice for any startups out there is focus on one thing and do it well. emily: so no incubator. chad: yeah, the team did not necessarily know who to listen to, me or steve, when we were coming in with opinions on things. where we are now with mixbit, moving forward, we have a great chance to figure it out. emily: how hard is it to succeed

as a video-related startup? chad: there are just more people using video, more people with devices, more ways that people are interacting with video than ever. it still remains to be seen how it plays out, but they captured people's imagination. that is the biggest challenge, is rising above the noise. finding a solution that people have an emotional connection with and actually want to use. so it is always a journey to find that. and if you do not put pressure on yourselves, people ask about replicating the success of youtube, that is not what i'm out to do. it is just enjoying the process and hopefully stumbling across that small insight. emily: why not retire? you certainly could. chad: i certainly could. a lot of people can retire. again, life is not about sitting around. it is about hopefully about making a difference. so that's what continues to drive me. emily: what do you think of

facebook and twitter's efforts in video? chad: with facebook, they have a feed. people are coming there to consume stuff. i do not know if it is very directed yet. they have not really nailed search. people do not come to search anything other than their feed. they will have to build a more dedicated hub towards video or push people into searching, making that more of a habit. but auto playing videos in the feed, i don't really -- they talk about the numbers, but i do not think it counts as much yet. emily: you were at kim and kanye's engagement. chad: yes. emily: they were not happy with you afterwards. chad: i don't know why. emily: what happened? chad: my friend was in town and said let's go to this thing kanye was having in the city. we did not know what it was. on the way up, we were searching and we said, it's kim's birthday. must be a birthday party. turns out it was not. i took some video and did not post it until the next day until i saw other people had posted

photos and videos on instagram. so i did not think it was a big deal. i asked my friend, and he did not seem to mind. after it got out there, it got a little attention. and kim and kanye wrote me an e-mail. so the rest is history. emily: they sued you. chad: yes. emily: what was the result of that? chad: they are still suing me. we will have to see what happens when this airs. it is an ongoing process. emily: you believe you are in the right. chad: yes. of course. emily: did you sign something when you walked in that said you would not share? chad: i do not know if i'm supposed to talk about it with the legal proceedings going on. but i did sign something eventually at the end of the night. emily: but not at the beginning. interesting. chad: we'll see what they have to say about that. emily: you are an investor in sports franchises, bought into the golden state warriors, a soccer team. chad: just an interest in a great group of people to work with. originally when joe lacob took over the team with peter guber,

i knew the guys and knew that they would build a great organization. and just being a sports fan and also just understanding the world of media. sports will retain their value over time because advertisers value live audiences. and you cannot replicate a live event. so those are some of the reasons why i got involved. plus, it doesn't hurt when they're doing so well now. emily: give me a "pinch me" moment. a moment where, you know, in the last decade where you are like, oh, my god. that was amazing. chad: we had a chance to do a few presidential debates on youtube. presidential debates. there were some surreal moments backstage, when you're meeting the democratic nominees or all of the republican nominees before a debate. just standing in line shaking their hands as they got on stage. definitely a surreal moment. emily: what is next for chad hurley? chad: continuing to focus on

mixbit. we have a great team, and i just think there is a tremendous opportunity in the world of video, if you are talking about live or the work we are providing with automated collaboration. emily: what is the myth of chad hurley and what is the reality? chad: the myth and reality? the myth is that every startup has a grand plan. that we knew what paypal was going to become from day one. or we knew that youtube was going to be huge. but the reality is that no one knows. not even me. all you have to do is take a chance and put yourself out there. and hopefully, what you create resonates with others. emily: chad hurley, thank you so much for joining us on "studio 1.0." it's been great to have you. chad: thank you. ♪

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