BuzzFeed is shutting down what’s left of its award-winning news department, marking the end of an era for a website that once promised to change the industry.
Founder Jonah Peretti told staff Thursday that “the company can no longer continue to fund BuzzFeed News” and would seek substantial company-wide layoffs.
He said the entire company had been hit by a pandemic, a troubled stock market, a tough economy, a declining stock market, a slowdown in digital advertising and changes in audience habits.
Peretti suggested that there may not be a sustainable business model for high-quality news online. He wrote: “I made the decision to heavily invest in BuzzFeed News because I love their work and their mission so much. This made me slow to accept that the big platforms would not provide the necessary distribution or financial support to support free and premium journalism designed specifically for social media.”
BuzzFeed raised hundreds of millions of pounds from investors in the early 2010s as it navigated the explosion of social networks like Facebook and Twitter to distribute content. In addition to producing viral content such as quizzes and lists, he invested in original news reporting, in the belief that this would attract a higher quality advertiser.
This costly process involved hiring hundreds of journalists around the world and culminated in the company winning a Pulitzer Prize for its reporting.
Peretti said he regretted not holding the company to “higher standards of profitability” and said it had “exhausted many other cost-saving measures to preserve as many jobs as possible,” including cutting costs and closing physical offices.
In addition to shutting down BuzzFeed News, Peretti said there would be significant job cuts in the rest of the business, including the departure of two leaders.
BuzzFeed also owns HuffPost, which will continue to publish news, but has also seen significant cutbacks in its coverage in recent years.
BuzzFeed’s financial challenges mirror the challenges of the online news industry. At one point in 2014, Disney considered buying the site for around $1 billion, but no deal could be reached. The company finally went public seven years later when its share price crashed, and the business is currently valued at less than $100 million.