YouTube co-founder Steve Chen bets on Taiwan for next startup
SINGAPORE – Taiwan-born YouTube co-founder bets on the island for his next venture, praising his abundance of tech talent to compete with the United States
Steve Chen said in an interview that he plans to launch a global internet startup from Taiwan, where he has now relocated. He said the island had a lot of “very high quality engineers and product managers,” even compared to Silicon Valley in the United States, where he lived for 20 years.
Chen also said he believed YouTube would remove any threat from Asian rivals such as China’s TikTok, telling Nikkei Asia that only an “unforeseen technological leap” could end its dominance in the video sharing space.
Chen started YouTube in early 2005 with former colleagues at the online payment company PayPal. Their business was instant success, and the company was sold to Google in October 2006 in a deal worth $ 1.65 billion. Chen left Google in 2011 and since then mainly invests and advises startups.
Speaking to Nikkei on some aspects of the Asian tech scene, Chen said that platforms such as TikTok, the short video app owned by Chinese internet technology company ByteDance, “definitely meet a need for creators. of content and viewers â.
There is âvalue for any destination that attracts new content and rising stars of content creation, so YouTube should recognize that content creators are using an alternative platform,â Chen said.
However, Chen argues that “people tend to watch only the most recently uploaded videos on TikTok. On the other hand, YouTube is bigger because it tends to be a destination where you go to search and find some great stuff. content, new or old. “
YouTube has over 2 billion monthly logged-in users globally and has grown into a massive platform for various individual video creators, as well as a hub for movie studios, broadcast companies, music houses. discs and more. TikTok revealed in August 2020 that it has 689 million monthly active users worldwide.
“The only thing that would bring down YouTube at this point [would be an] unanticipated technological leap “that would see rapid adoption by Internet users around the world,” Chen said, drawing a parallel with YouTube’s initial success. The revolutionary aspect the platform offered at the time was that “you don’t did not have to download [videos, they played] in the browser, and you can embed the video on [platforms such as] Myspace, Facebook and eBay. “
Chen is now embarking on a new venture to recreate this success. He returned to Taiwan two years ago and said he was about to introduce a new internet service related to “welfare and mutual aid”. He said the idea originated during the coronavirus pandemic, but did not give further details.
Chen said he had a series of talks with government officials, incubators, venture capitalists and educational institutions after his return and felt that the people of Taiwan believed that there were downsides to starting a business on the island compared to other places such as Silicon. Valley.
“So I ended up starting [something] myself rather than advising [other entrepreneurs]; I just got on the battlefield “to create a global internet startup in Taiwan,” Chen said.
He said that “it is very easy to recruit high quality engineers and product managers” in Taiwan, but said that “what makes Silicon Valley more special is that fundraising is a lot. easier”.
Therefore, he said the new startup was based in Taiwan but was seeking funding from US venture capital providers.
Chen said it was an interesting time to start a business. Even big tech groups like Google and Facebook had to pay well for talent so their employees didn’t leave to start their own businesses, he said.
Looking back at the decisions Chen and his YouTube co-founders made nearly 15 years ago, he said he didn’t think the company would have survived without Google’s help.
As the video sharing site grew rapidly, users also began to post professionally made content, leading to huge copyright issues.
“It was so early; we didn’t have a monetization and revenue sharing strategy [system] that’s now in place, âhe recalls.
At the time of the Google acquisition, approximately 49% of the content on YouTube came from outside the United States, including many episodes of Japanese anime, and “whenever legal proceedings occurred [from abroad], we would just say that we are an American company, “Chen recalled. He added that if that content threshold ever exceeded 50%, they assumed that they would no longer be able to foil such lawsuits by calling themselves a American company.
So, Chen said, the question they were asking at the time was whether they would raise another round of venture capital, remain independent and fix the issues themselves or sell the business?
The co-founders also reached out to US web service provider Yahoo to see if they were interested in acquiring YouTube. âBut Google was able to act quickly,â Chen said.
US media group Viacom sued Google and YouTube for copyright infringement in 2007, and it took seven years for both sides to settle the case. In the meantime, YouTube, with help from Google, has partnered with other media companies by creating revenue-sharing models and developing technologies to detect copyright infringing video uploads. author.
Now YouTube is a fast growing revenue stream for the internet search group, with ad revenue topping $ 6 billion in first quarter revenue this year.