Sequoia Capital: Why We're Auctioning Our 2005 YouTube Investment Memo as an NFT
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Sequoia Capital: Why We're Auctioning Our 2005 YouTube Investment Memo as an NFT
In the next stage of digital evolution, the role of distribution gatekeepers will diminish. Creators will gain control over assets and shift them from aggregators to network participants.
Navigating Web3 tides with focused insightsAuthor: Sequoia
Translation: Alex
In early 2021, the total market value of cryptocurrency surpassed $1 trillion for the first time—a figure that even caught the attention of the most steadfast skeptics. By November, it exceeded $3 trillion, surpassing the market capitalization of any single company on Earth. Tens of thousands of developers are now building crypto projects, with the majority of this activity occurring within just the past three years. Today, there are over 7,000 tokens—nearly 12 times more than in early 2017.
Crypto is undergoing a Cambrian explosion. While we’ve invested in crypto for many years, the recent acceleration in the field has been astonishing. Last year, more than a quarter of all new partners at our U.S./Europe business were companies related to crypto. As part of our new structure, we will engage more directly in governance and token equity. The question is no longer whether crypto will achieve mainstream adoption, but how blockchain technology will transform the economy and our digital lives in the next generation.
We’ve learned from experience how easy it is to underestimate such shifts. For example, when we first met Chad Hurley, Steve Chen, and Jawed Karim, they had just begun creating YouTube, and we imagined future large-scale scenarios that might gain broad adoption. In our investment memo, the best-case scenario was potentially delivering 30 million videos per day. That represented 300x growth, which seemed ambitious at the time. But this was two years before the first iPhone launched and the rise of mobile, which would multiply global video consumption. Today, YouTube delivers five billion videos daily.
At this pivotal moment in crypto, we’ve been reflecting on our 2005 YouTube investment memo. We realize not only how central YouTube was in defining the last era of internet development, but also how foundational it was in setting the stage for the creator economy and what followed. To honor YouTube’s place in this story—and to celebrate the unpredictable benefits of foundational technologies like crypto—we will mint our original YouTube investment memo as an NFT and auction it on OpenSea.
The rise of blockchains echoes the rise of the internet itself: the direct, free flow of information between people on the internet laid the foundation for the direct, free flow of value on blockchains. This is not just a technological shift, but a cultural and psychological one that will enable new economic realities around the world. In the world of NFTs, anyone can create digital assets, and anyone can invest in them—bringing unprecedented diversity to asset valuation and trading.
We now see YouTube as a turning point that paved the way for how we think about the creator economy today. YouTube personalized the concept of digital asset ownership and brought widespread distribution of these assets into the mainstream. The YouTube investment memo is a time capsule from the edge of web2. It seems only right to pass it down to future generations. And what better moment than to auction it at the edge of web3?
In the next phase of digital evolution, the role of distribution gatekeepers will diminish. Creators will gain control over their assets and transfer them from aggregators to network participants. But blockchain’s impact extends far beyond how money and digital goods are valued and traded. Decentralized protocols and new entities like DAOs may reshape everything—from how products are built to how people communicate and form communities.
We cannot predict the full scope of change or how it will reshape culture. At these early stages, we don’t know what catalysts will unlock crypto’s potential or in which direction it will evolve. These catalysts could be technological, regulatory, or cultural. It remains unclear whether this transformation will come from new monetary diversities emerging around the world or from blockchain-powered decentralized applications—or both.
But it seems clear that blockchain technology is beginning to form new protocols for digital interaction at a foundational level. Innovation is accelerating both above and below layer 1 blockchains: one of the most exciting developments we’re seeing is the pursuit of a protocol that enables seamless interoperability across different blockchains. This effort can be compared to TCP/IP for encryption. What it will unlock, we can only imagine. Early internet enthusiasts knew it would change everything—but they couldn’t foresee stock trading on the iPhone. The same is true for crypto today.
Whatever the future of web3 holds, visionary founders will be the ones who shape it—just as Chad, Steve, and Jawed did before them. Our mission is to find the exceptional founders behind the next era of innovation.
The best way to prepare for the possibilities of emerging technologies is to learn and understand through insatiable curiosity. So starting next week, we’ll begin hosting a series of live conversations about crypto on Twitter. We’ll hear global perspectives on its potential and challenges—from technology and scale to regulation and business infrastructure—from founders and innovators pushing crypto forward. We’ll be learning publicly alongside some of the smartest minds in the space, and we’d love for you to join us. If you’re a crypto founder—or simply curious—we hope you’ll tune in and engage with us.
Ahead of the Twitter live conversations, good luck bidding on the 2005 YouTube memo. Proceeds from the auction will go to 0xPARC’s public goods ecosystem development pool (the Ethereum-based Cryptographic Applications Research Grant), which will allocate the funds for maximum benefit to the crypto community. We are minting the NFT as an ERC-721 token. The auction will take place on OpenSea and conclude on Tuesday, December 7. We are not retaining royalty rights—the winner will own 100% of the NFT. We’re remaking history—you can own a piece of it.
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