BuzzFeed votes to go public amid staff walkout

By Beverly J. Oaks Last updated Dec 3, 2021

Shareholders of 890 Fifth Avenue Partners, a special purpose acquisition company, on Thursday approved a merger with BuzzFeed. BuzzFeed will also complete its acquisition of Complex Networks, a media company managed in a joint venture with Verizon (VZ) and Hearst, Friday. The newly combined companies will start trading on Monday under the symbol BZFD.

BuzzFeed has raised around $ 16 million through the PSPC deal, which is far less than expected. When BuzzFeed announced its intention to go public in June, it said 890 Fifth Avenue Partners had around $ 288 million in cash. But the vast majority of investors have pulled out, as The Wall Street Journal reported earlier Thursday. BuzzFeed also raised around $ 150 million in debt financing for an expected total increase of around $ 166 million.

Over the past 15 years, BuzzFeed has grown from a website known for its viral content to a digital media company with a portfolio of brands and an award-winning news division. Last year, BuzzFeed signed a deal with Verizon to acquire HuffPost, the digital media brand Jonah Peretti co-founded the year before BuzzFeed launched. In June, BuzzFeed News received a Pulitzer Prize.

But even before the decision was finalized, key tension in the industry surfaced earlier today: in preparation for the vote that will make the company public, some of its staff staged a strike to attract the ” attention to the ongoing issues regarding negotiating their collective agreement

“We’ve been negotiating our contract for almost 2 years, but BuzzFeed will not budge on critical issues like wages – while preparing to go public and further enrich executives,” the union said. tweeted. “[W]We go out to remind that there is no BuzzFeed News without us. “

BuzzFeed had been praised for its ability to appeal to a younger audience, covering new trends in an accessible and engaging way. It has garnered interest from mainstream media, including NBCUniversal, which invested $ 200 million in BuzzFeed for a valuation of $ 1.7 billion in 2016.

But BuzzFeed then struggled to respond to the requests that accompanied its high valuation as it was in competition with other media companies as well as technology platforms such as Google (GOOG) and Facebook (FB) for advertising dollars. Facebook also implemented news feed algorithm changes that reduced audience traffic for many publishers, including BuzzFeed.

“There has been a period of exuberance and hype around digital media, and this cycle of hype has allowed a lot of capital to flow into the space,” Peretti told Recode in June. “And then there was a time when there was a lot more skepticism and a demand to start a real business. And now we’ve built a real business.”

Indeed, BuzzFeed and its fellow digital media companies of the 2000s have grown – or, in some cases, exploded. Some have found their way out through mergers or acquisitions with other media companies. Mashable sold to Ziff Davis. Bustle, now BDG, bought Mic. Vice Media acquired Refinery29. PopSugar has joined Group Nine Media. Vox Media merged with New York Media.

Now the executives of these media companies have their eyes set on BuzzFeed’s debut on the stock exchange as they contemplate their own PSPC deals. Vice-co-founder Shane Smith told Insider last month that his company’s board and management team suspended their previous PSPC plans, but that could change.

“If the time is right and we predict an explosion in 2022 and the traffic and events do what we think they’re going to do, then the sky is the limit,” Smith said.

Correction: Due to an editing error, a previous version of this story misinterpreted the size of the staff walkout.

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BuzzFeed votes to go public amid staff walkout

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