BuzzFeed
BuzzFeed, Inc. is an American Internet media, news, and entertainment company with a focus on digital media. Based in New York City, BuzzFeed was founded in 2006 by Jonah Peretti and John S. Johnson III to focus on tracking viral content. Kenneth Lerer, co-founder and chairman of The Huffington Post, started as a co-founder and investor in BuzzFeed and is now the executive chairman.
Originally known for online quizzes, "listicles," and pop culture articles, the company has grown into a global media and technology company, providing coverage on a variety of topics including politics, DIY, animals, and business. BuzzFeed generates revenue through native advertising, a strategy that helps increase the likelihood of viewers reading through the content of advertisements.
In late 2011, BuzzFeed hired Ben Smith of Politico as editor-in-chief, to expand the site into long-form journalism and reportage under the BuzzFeed News banner. After years of investment in investigative journalism, by 2021 BuzzFeed News had won the National Magazine Award, the George Polk Award, and the Pulitzer Prize, and was nominated for the Michael Kelly Award. BuzzFeed News later moved to its own domain rather than existing as a section of the main BuzzFeed website. On April 20, 2023, Peretti announced that BuzzFeed would be shuttering BuzzFeed News and focusing its news efforts into HuffPost, laying off about 180 workers.
History
Prior to establishing BuzzFeed, Peretti was director of research and development and the OpenLab at Eyebeam, Johnson's New York City-based art and technology nonprofit organization, where he experimented with other viral media.In 2006, while working at the Huffington Post, Peretti started BuzzFeed as a side project, in partnership with his former supervisor John Johnson. In the beginning, BuzzFeed employed no writers or editors, just an "algorithm to cull stories from around the web that were showing stirrings of virality." The site initially launched an instant messaging client, BuzzBot, which sent users a link to popular content. The messages were sent based on algorithms which examined the links that were being quickly disseminated, scouring through the feeds of hundreds of blogs that were aggregating them. Later, the site began spotlighting the most popular links that BuzzBot found. Peretti hired curators to help describe the content that was popular around the web. In 2011, Peretti hired Politico's Ben Smith, who earlier had achieved much attention as a political blogger, to assemble a news operation in addition to the many aggregated "listicles".
In 2016, BuzzFeed formally separated its news and entertainment content into BuzzFeed News and the newly formed BuzzFeed Entertainment Group, which also includes BuzzFeed Motion Pictures., BuzzFeed had correspondents from 12 countries, and foreign editions in Australia, Brazil, France, Germany, India, Japan, Mexico, Spain, and the United Kingdom., BuzzFeed employed around 1,700 employees worldwide, although it announced plans in November of that year to lay off around 100 employees in the US, 45 in the UK, and 100 in France in June 2018.
On January 23, 2019, BuzzFeed notified all employees via memo that there would be an upcoming 15% reduction in workforce affecting the international, web content, and news divisions of the company. The layoffs would affect approximately 200 employees. In 2020, BuzzFeed signed a deal with Universal Television to produce content based on its stories.
Three top BuzzFeed News editors in March 2022 announced that they would be resigning and the newsroom would face voluntary layoffs or job cuts. The cuts came after BuzzFeed investors encouraged Peretti to shut down all of BuzzFeed News, but he refused, CNBC reported.
Funding
BuzzFeed raised $3.5 million in 2008 through Hearst Ventures and SoftBank. In 2011, BuzzFeed ran more than 100 social media campaigns, resulting in their revenue tripling compared to 2010. In January 2012, BuzzFeed announced that it had earned $15.5 million in funding from New Enterprise Associates, Lerer Ventures, Hearst Interactive Media, SoftBank, and RRE Capital to expand the site's content. Later, in October 2012, BuzzFeed ran sponsored content for the Obama administration leading to an increase in ad revenue. By January 2013, BuzzFeed announced that New Enterprise Associates had raised $19.3 million. The company was reported to be profitable in 2013.In 2014, it was reported that BuzzFeed had passed $100 million in revenue. In August 2014, BuzzFeed raised $50 million from the venture capital firm Andreessen Horowitz, more than doubling previous rounds of funding. The site was reportedly valued at around $850 million by Andreessen Horowitz. BuzzFeed generates its advertising revenue through native advertising that matches its editorial content, and does not rely on banner ads. BuzzFeed also uses its familiarity with social media to target conventional advertising through other channels, such as Facebook. In December 2014, growth equity firm General Atlantic acquired $50 million in secondary stock of the company.
In August 2015, NBCUniversal made a $200 million equity investment in BuzzFeed. Along with plans to hire more journalists to build a more prominent "investigative" unit, BuzzFeed planned on hiring journalists around the world and plans to open outposts in India, Germany, Mexico, and Japan. It planned on hiring staff for its UK bureau, its rapidly-expanding motion picture unit and its food-themed business, Tasty. NBCUniversal invested an additional $200 million in 2016 after the two companies had collaborated on many projects, namely the Rio Olympics. The companies planned to work together to market themselves to advertisers. Together, Comcast and its NBCUniversal subsidiary own about a third of BuzzFeed. BuzzFeed has said that it intends to stay independent.
After laying off 100 employees in 2017, BuzzFeed laid off 200 of its employees in 2019 to help facilitate growth despite raising revenue by 15% from 2017 to 2018. Facebook began funding two BuzzFeed News shows in 2019 for Watch. Because of the COVID-19 pandemic, on March 25, 2020, BuzzFeed announced in an internal memo that it would cut employee salaries on a sliding scale of 5% up to 25%. Peretti said he would not be taking a salary until the end of the pandemic. Many staffers expressed relief at this announcement as there were no layoffs. On May 13, 2020, the company shut down its divisions in the UK and Australia, furloughing 10 news staff in the UK as well as four in its Australian outpost.
According to a news from June 24, 2021 on Variety, BuzzFeed, valued at $1.5 billion through a SPAC deal, is to go public and acquire Complex Networks for $300 million.
BuzzFeed raised $16.2M in its latest funding round, which was Post IPO round held on Dec 03, 2021.
Acquisitions and stock listing
BuzzFeed's first acquisition was in 2012 when the company purchased Kingfish Labs, a startup founded by Rob Fishman, initially focused on optimizing Facebook ads.In October 2014, BuzzFeed announced its next acquisition, Torando Labs, which would become BuzzFeed's first data-engineering team.
On November 19, 2020, BuzzFeed announced that they would acquire HuffPost in a stock deal that made Verizon Media minority shareholder in BuzzFeed.
In June 2021, BuzzFeed announced its plans to go public via a special-purpose acquisition company and planned to acquire Complex Networks. After initially listing on Nasdaq at $10 a share, valuing the company at around $1.5 billion, the share price subsequently declined to under $1 by 2023, leading to a delisting notice by Nasdaq in May 2023, requiring them to raise the share price above $1 within 180 days or risk being removed from the exchange. Once the deadline for this notice passed in November 2023 with the stock price still below $1, they were given a further 180 days until May 2024. By January 2024, the stock price of the company had declined 98% since its initial listing, with the entire company now only worth around $37 million, and the company was significantly burdened with debt. In May 2024, BuzzFeed implemented a 4:1 reverse stock split, bringing them above the $1 a share threshold.
According to Reuters, in early 2024 British media group The Independent reportedly discussed a multi-year agreement to acquire control of BuzzFeed and Huffington Post's operations in the UK and Ireland.