Let’s hope all those wannabe digital media entrepreneurs are paying attention to the slow disintegration of BuzzFeed, the media star of 2016. We broke the news today that BuzzFeed’s big hope for paying off its debt and turning itself around isn’t going as planned. The company will shortly sell most of its Complex Network assets, but for just above $100 million, about a third less than what CEO Jonah Peretti was hoping the assets would fetch. Even after the sale, BuzzFeed will need another $100 million to pay down debt that comes due at the end of 2024, money it doesn’t have.
And given that BuzzFeed’s market capitalization is now down to $36 million—the stock is now trading around 25 cents—and the company is barely breaking even, its options appear very, very limited. One obvious solution would be to sell food website Tasty, arguably its most valuable business, which I hear could fetch $100 million. (Including First We Feast, another company-owned food site, would make Tasty even…tastier.) With both gone, BuzzFeed would be debt-free but tiny, consisting of the BuzzFeed website and HuffPo. Still, it would be profitable.
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