As part of a broader effort to turn around the faltering media firm and extract profits from a company that has lost 90% of its value since it floated in 2021, BuzzFeed is closing down its BuzzFeed News section. The action highlights the greater strain the digital media sector is under and shines a light on a corporation that lagged in addressing methods to increase profits and control costs.
BuzzFeed News received numerous honors, including a Pulitzer Prize. Journalists inside and outside the company publicly lamented the esteemed news organization’s closure.
CEO Jonah Peretti said in a message to colleagues that he over-invested in the company and placed an undue reliance on social media distribution, which he said was a major factor in the news division’s failure.
- He mentioned further areas that he and his team handled poorly, saying that “in particular, the process of integration of BuzzFeed and Complex, and the combined efforts of our two business organisations, should have been executed more promptly and better.”
- Peretti announced a 15% workforce reduction at BuzzFeed, the parent firm of BuzzFeed News, HuffPost, Complex, and Tasty news websites. He announced that the shutdown of BuzzFeed News would start on Thursday.
- According to someone familiar with the situation, BuzzFeed News employs roughly 60 people. Some impacted BuzzFeed News employees will receive job offers from BuzzFeed and HuffPost.
- “Moving further, we will have just one news brand in HuffPost, which is valuable and has a dedicated direct front page audience,” Peretti said.
- Around 180 employees, including chief sales officer Edgar Hernandez and chief operating officer Christian Baesler, will be impacted by company-wide layoffs. Marcela Martin, president of BuzzFeed, will take over responsibility for revenue.
The Big Picture
Formerly a digital media darling, BuzzFeed has become a warning example for its contemporaries, largely because it intended to go public via a SPAC in 2021. The company had a value of over $700 million at the time of its listing.
- On Thursday, the stock’s share price dropped 20% to 71 cents. It is currently valued at about $100 million.
- The mass layoffs on Thursday are the most recent in a series that has seen BuzzFeed undergo many rounds of layoffs over the past year. Last year, it offered voluntary buyouts to around one-third of the 100 staff working in the news division.
- According to a document obtained by Axios, the digital media magazine Insider informed early on Thursday that 10% of its staff would be let go.
What They’re Saying
Current and former BuzzFeed employees expressed regret about the shutdown of BuzzFeed News on Twitter.
BuzzFeed News’ former deputy editor-in-chief Tom Namako, who left the company last year to work for NBC News, tweeted, “BuzzFeed News deserves so much better and better and has for a long time.”
“BuzzFeed News invested venture capital in something highly beneficial and required: excellent reporting publicly available for anybody to read. Every reporter who started their career in journalism during the turbulent 2010s and didn’t work there was envious of it. What a loss,” senior HuffPost correspondent Alexander Kaufman tweeted!
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