Before it IPO’d last year BuzzFeed told potential investors revenue in 2021 would reach $521 million and $1.1 billion by 2024, as a result of their “rapid scale and monetisation with a deep understanding of virality and social”. 2021 revenue actually came in at just $398 million in its first annual results as a public company. The combination of Buzzfeed with HuffPost and Complex Networks missed its promised revenue target by $123 million.
Mark Schoofs, editor-in-chief of BuzzFeed’s news division, is leaving the company, as are two other news editors, ahead of the firm offering voluntary redundancies to “accelerate the timeline to profitability … That will require BuzzFeed News to once again shrink in size”. Schoofs said in an internal memo that there would be a “shift in editorial focus and structure”. The fact is, he admitted, “The company has subsidized BuzzFeed News for many years”. News just doesn’t have the same appeal as Buzzfeed’s youth-focused woke popular culture content.
Buzzfeed also had a credibility problem trying to do serious news. Titles that run articles about pizzas that look like labias can of course do serious news, consumers however got confused as to the woke news brand’s values. Advertisers too want clear categories. Latterly Buzzfeed News was trying a Guardian-style begging model to pay its way. That clearly isn’t working… BuzzFeed posted a net loss of $528,000 for the year.
UPDATE: CNBC reports
BuzzFeed is shrinking its money-losing news organization, the company announced Tuesday, amid what people familiar with the matter describe as broader investor concern that the division is weighing down the company.
Several large shareholders have urged BuzzFeed CEO Jonah Peretti to shut down the entire news operation, said the people, who asked not to be named because the discussions were private. BuzzFeed declined to comment.
BuzzFeed News, which is part of its content division, has about 100 employees and loses roughly $10 million a year, two of the people said.
See also: Why BuzzFeed Doesn’t Make Money