Youniversity: Investing The YouTube Way

Jawed Karim is most well known for giving the internet masses YouTube in 2005. Now he has teamed with two other angel investors, Kevin Hartz and Keith Rabois, to bring his next idea to life. He is launching Youniversity, an early stage angel investment collective.

Rather than form a regular investment firm and solicit applications and letters of interest, the three have formed something more like a coalition. Their plan is to find companies that all three believe in that are consumer internet start ups. Once they find one they all like, they will all invest their own money in the venture.

They have already quietly invested in two start ups under the umbrella of this new coalition. One is TokBox, a video chat service. The other is BluBet, a prediction marketplace. They were joined in their BluBet investment by the CEO of Flixster, Joe Greenstein.

Their budget for investment runs between $50,000 USD and $300,000 USD. The coalition will be pulling its potential start ups from alumni of Stanford University and the University of Illinois at Urbana-Champaign. When asked why the chose those two colleges for the lucky investment lottery out of all of the colleges in the nation, Keith Rubois responded that nearly every truly great internet start up company has involved a graduate of one of those schools.

Even more than graduates of the universities' involvement with start ups, the coalition is tied to them as well. Karim graduated from University of Illinois, and met his YouTube co-founders there as well. All three members of the coalition did their graduate degree work at Stanford. Alumni ties run deep.

Rabois and Hartz have solid financial roots to back the company's decisions, having been major players in Xoom and PayPal, respectively. With that kind of investment know-how and Karim's knack for the killer start up instinct, they should have no trouble finding (and funding) the next big thing.