Buzzfeed

Who are these guys that call themselves BuzzFeed?

1. Well it would seem they’re rather popular with traffic that draws 150 million average monthly viewers.

2. They created Numbered lists and this is what the site is most famous for and drives much of its audience.

3. But lastly, unhappy with their current status, BuzzFeed wants to be known for much, much more.

Can you believe BuzzFeed just closed a new $50 million investment from Andreessen Horowitz, a prominent venture capital firm in Silicon Valley. The investment values the company at about $850 million, “according to a person with knowledge of the deal”. Horowitz should look around… Hey what about Simon’s 10Q Interviews… Ok perhaps not!

Now the question is can BuzzFeed maintain the agility and skills of a tech start-up while building the breadth of a large media company. I am guessing the answer is yes but only time will tell.

“As we grow, how can we maintain a culture that can still be entrepreneurial?” said Jonah Peretti, the company’s co-founder and chief executive. “What if a Hollywood studio or a news organization was run like a start-up?”

So, BuzzFeed Hires Greg Coleman as President… Makes sense, he’ll probably make it all go viral…

BuzzFeed Politics Writer Is Fired Over plagiarism… Ooops!

BuzzFeed, based in New York, started in 2006 as a kind of laboratory for viral content — It produces highly shareable lists and videos that pepper social media sites. But way back when it began adding more traditional content, and therein began creating a track record for delivering breaking news and deeply reported articles, and it has tried to marry its two halves in one site.

But what has really set BuzzFeed apart, Mr. Peretti said, is its grasp of technology. The company, which now has 550 employees, has been especially successful at distributing its lists and content through mobile devices and through social sites like Facebook and Twitter.

The photo-sharing site Pinterest, in particular, now drives more traffic to BuzzFeed’s Life section than Twitter does, Mr. Peretti said. Social media accounts for 75 percent of BuzzFeed’s referral traffic, according to the company.

Chris Dixon, a general partner at Andreessen Horowitz, who will join BuzzFeed’s board, said: “We think of BuzzFeed as more of a technology company. They embrace Internet culture. Everything is first optimized for mobile and social channels.”

Still, the company faces the same problem that more traditional publications do — rates for traditional online advertising, on general interest sites like BuzzFeed, have dropped consistently from year to year.

To keep up, sites must either perpetually increase traffic at a steady clip, or innovate and move into new and potentially more lucrative areas like so-called native advertising and video.

Already, BuzzFeed’s revenue is largely derived from BuzzFeed Creative, the company’s 75-person unit dedicated to creating for brands custom video and list-style advertising content that looks similar to its own editorial content. Mr. Peretti declined to share financial details, but he said BuzzFeed’s revenue for the first half of 2014 was twice as much as the first half of 2013. According to Mr. Dixon of Andreessen Horowitz, BuzzFeed is expected to generate revenue in the triple-digit millions of dollars by the end of 2014.

Nice work if you can get it…

Some analysts consider BuzzFeed’s continued reliance on social media sites for traffic as a major liability. Way back in in 2011, The Washington Post introduced its Social Reader application, a major initiative that allowed their users to read and share articles from the newspaper within Facebook’s News Feed. Initially this appeared to be a great idea and created loads of web traffic for the publication. But when users complained about bring spammed by constant notifications of what their friends were reading, Facebook changed its News Feed settings, and traffic plummeted.

“If Facebook decides to tinker with its algorithms tomorrow, these viral publishers could be gone in the blink of an eye,” said Nate Elliott, an analyst with Forrester Research. “They’re putting their entire existence in another company’s hands.”

This is not Mr. Peretti’s first media enterprise, however. He was a co-founder, along with Arianna Huffington and the venture capitalist Kenneth Lerer, of The Huffington Post. That online media start-up, which relied heavily on showing up in Google search results for traffic, was sold to AOL in 2011 for $315 million. Mr. Lerer, also a BuzzFeed co-founder and investor, will soon take a more active role at BuzzFeed as executive chairman.

The company also plans a fast expansion into international markets, already a major driver of the site’s new-user growth, with plans to open offices in Japan, Germany, Mexico and India this year.

And the future of BuzzFeed may not even be on BuzzFeed.com. One of the company’s nascent ideas, BuzzFeed Distributed, will be a team of 20 people producing content that lives entirely on other popular platforms, like Tumblr, Instagram or Snapchat.

Initially, it will not be a direct revenue stream for the company. But Mr. Peretti says he thinks it will ultimately give the company a much larger reach than traditional counts of web page views can measure.

“We’re organizing ourselves to be a media company for the way people consume media today,” Mr. Peretti said.

Watch out Murdoch you have company…