BuzzFeed's Strategic Move Amid Financial Challenges

BuzzFeed announced on Thursday the sale of First We Feast, the creator behind the popular YouTube show 'Hot Ones,' to a group led by a Soros Fund Management affiliate for $82.5 million. This move comes as the media company navigates a cash crunch.

First We Feast's Independence and Expansion

First We Feast will operate as an independent entity, with founder Chris Schonberger taking the helm as CEO and 'Hot Ones' host Sean Evans serving as Chief Creative Officer. The company plans to continue producing 'Hot Ones' and expand its advertising partnerships.

BuzzFeed's Shift in Focus

BuzzFeed aims to refocus its efforts on high-margin, tech-enabled revenue streams such as programmatic advertising and affiliate commerce. The company has been struggling as digital advertisers increasingly favor social media platforms like TikTok and Instagram.

Acquisition and Show Success

BuzzFeed acquired First We Feast in 2021 as part of its $198 million cash and equity deal. 'Hot Ones' has become a significant success on the internet, featuring celebrity guests eating increasingly spicy chicken wings while being interviewed by Evans. The show has hosted a diverse range of guests, from Conan O'Brien to Margot Robbie and Hugh Jackman, with episodes typically garnering tens of millions of views.

Debt Reduction and Revenue Expectations

BuzzFeed has reduced more than $150 million of debt since December 31, 2023, and anticipates fourth-quarter revenue to be between $54 million and $58 million, excluding expected contributions from First We Feast. The company reported $64.3 million in revenue in its most recent quarterly report.