New York-based website BuzzFeed is in the process of cleaning up its news department as the digital media company amid reports that shareholders have urged founder and CEO Jonah Peretti to shut it down completely.
The newsroom, which reportedly loses Buzzfeed about $ 10 million a year, offers volunteer buyouts while some top editors leave, CNBC reports.
The departures include Mark Schoofs, editor-in-chief of BuzzFeed News, and deputy editor-in-chief Tom Namako, who on Tuesday announced a switch to NBC News Digital. Ariel Kaminer, the editor-in-chief of studies, is also leaving.
Several key shareholders have asked founder and CEO Jonah Peretti to shut down all news operations.
On BuzzFeed’s earnings call on Tuesday, CEO Jonah Peretti said the company is accelerating its investment in vertical video, which is popular on apps like TikTok.
BuzzFeed founder and CEO Jonah H. Peretti speaks on Nasdaq in December 2021
The New York-based Buzzfeed offers volunteer buyouts in its high-profile newsroom of 100 people, and some top editors are leaving
A BuzzFeed News logo adorns a wall inside BuzzFeed’s headquarters. The media and news company was founded in 2006
As for the news division, it needs to “get smaller” and “prioritize the coverage areas our audiences connect with the most,” Peretti said in a note to staff.
On the earnings call, he said the company needs to make BuzzFeed News’ a stronger financial contributor to the bigger business’, and to do so will involve focusing on big news, culture and entertainment, celebrities and ‘life on the internet. ‘
But in a meeting that was recorded and leaked to Business Insider, Peretti took a more realistic approach to what happened to his news department.
Peretti said the strategy will now be “the biggest news and scoops of the day, the best coverage of the Internet, culture, our own lives, our health and faster investigations,” according to the audio.
“I will no longer provide grants [the news division] with revenue from other divisions and that is a change from the past, he added. ‘We did that for many years, but now we need to transform news into a sustainable business.’
By the time staff were allowed to ask questions, several reporters said Peretti had already left the meeting.
BuzzFeed News is unprofitable, but has won awards, including its first Pulitzer last year, and its staff has been regularly poached by traditional news organizations.
A spokesman for the business, Matt Mittenthal, said about 35 people were eligible for the acquisitions, but the company does not expect everyone to take one.
Several executives on the call hoped to avoid layoffs and hoped the voluntary acquisitions would save enough money to avoid them.
Buyouts will be offered to news staff on the survey, inequality, policy and science teams, as BuzzFeed focuses more on big news and lighter content.
BuzzFeed Founder and CEO Jonah H. Peretti and BuzzFeed Celebrate BuzzFeed Inc.’s Nasdaq IPO Day December 6, 2021
Mark Schoofs, editor-in-chief of BuzzFeed News, announced his departure ahead of cuts to the newsroom
Deputy Editor-in-Chief Tom Namako and Chief Research Officer Ariel Kaminer both left the company
Rosalind Adams, an investigative reporter for BuzzFeed News, tweeted: ‘We have had the freedom to hunt down wild, impossible stories. It’s a sad day to see @BuzzFeedNews move away from appreciating that work. ‘
In addition to the acquisitions at the editorial office, the company also said it is cutting 1.7 percent of its staff.
In an application to securities regulators in January, Buzzfeed said it had 1,524 U.S. and international employees, so the cuts would amount to about 25 people.
BuzzFeeds shares have fallen more than 40 percent since the company was listed in early December via what is known as a SPAC, merged with a company that is already trading, rather than a listing.
The company had a solid year in 2021, it reported Tuesday in its earnings announcement. Its revenue rose 24 percent to $ 397.6 million thanks to increases in e-commerce and advertising revenue, and its profits more than doubled to $ 25.9 million.
The shares in Buzzfeed Inc. rose 32 cents, or 6.5 percent, to close Tuesday at $ 5.27.
But it expects revenue to fall in the current quarter if it includes the acquisition of Complex Networks, a group of pop culture sites BuzzFeed acquired last year.
The redundancies separate from the news department will come from BuzzFeed Video and the editorial side of Complex.
BuzzFeed also acquired HuffPost in early 2021 and laid off several dozen of its employees shortly after.
The last direct layoffs of Buzzfeed employees came in July 2020, when the company fired 70 percent of its fired employees.
The shares in Buzzfeed Inc. rose 32 cents, or 6.5 percent, to close Tuesday at $ 5.27.