Max Zahn
·Reporter
Mon, December 6, 2021
Digital media company BuzzFeed (BZFD) went public on Monday after a SPAC merger that valued the firm at $1.5 billion, setting it apart from peers like Vox and Vice that remain private.
But some employees aren’t celebrating. The milestone comes days after dozens of workers at the outlet’s news division, which won a Pulitzer Prize this year, walked off the job in protest of a move they say enriches executives while the company refuses a union contract that would raise salaries for employees and bolster worker protections.
BuzzFeed strongly contests that characterization, saying the move to go public will benefit management and workers alike, and that the company is eager to reach a deal with the unionized workers.
The clash marks a flashpoint of worker unrest in the digital media sector, a rare source of union growth in recent years that could draw heightened attention as online outlets begin turning to public markets.
“We are the reason they have a product to take public,” says Addy Baird, a BuzzFeed reporter and chair of the BuzzFeedNews Union, which formed in 2019 and has been bargaining with the company for a contract since that year. “We can’t wait anymore.”
All 61 members of the BuzzFeedNews Union walked off the job last Thursday, the same day the company’s shareholders voted in favor of the plan to take the company public, Baird said. The issues of primary concern for union employees include salary increases, the ability to perform freelance work and post content outside BuzzFeed channels, and the use of traffic metrics in employee evaluations. The union also accused BuzzFeed of needlessly delaying negotiations.
Speaking to Yahoo Finance, the company noted that the union represents a small portion of the roughly 1,100 employees who work at BuzzFeed. As part of the SPAC merger, the company acquired the sports and entertainment publishing company Complex for $300 million, expanding the staff to 1,400, BuzzFeed said.
Contract negotiations were set aside for several months at the outset of the pandemic by emergency talks between management and employees over how to adapt the workplace, BuzzFeed said. The next round of negotiations will take place on Tuesday.
“There’s a bargaining session planned for tomorrow where we look forward to making more progress with the union,” a company spokesperson told Yahoo Finance in a statement. “Today, the company is celebrating an incredible milestone: becoming the first publicly traded digital media company, with Complex Networks in our ranks, and equity for more deals ahead. We couldn’t be more excited about everything that lies ahead for BuzzFeed and its employees.”
NEW YORK, NEW YORK - DECEMBER 06: BuzzFeed CEO Jonah Peretti stands in front of the Nasdaq market site in Times Square as the company goes public through a merger with a special-purpose acquisition company on December 06, 2021 in New York City. Shares of the digital media company, trading under the new ticker “BZFD,” rose 12.7% to $10.84 as markets opened Monday.
(Photo by Spencer Platt/Getty Images)
In its latest proposal, BuzzFeed offered workers a $50,000 salary floor and a guarantee of 1% annual raises, Baird said, deriding the terms as below industry standards. In a public statement about the walkout last week, the union highlighted the challenge of living on such a salary in high-cost cities like New York and San Francisco, where some BuzzFeed offices are located.
"It's incredibly frustrating for us," Baird says. "We're for starters asking them to move on their pay minimums. Engage in the process; stop slow-walking it."
BuzzFeed says it has offered an average overall wage increase of 2.5% across the membership of the union, but that individual annual raises would range from 1% upward depending on merit.
BuzzFeed is expecting $521 million in revenue in 2021, including income generated by Complex Systems.
The company expects to raise $16 million dollars from the SPAC deal, after investors pulled 94% of the $287.5 million raised by the SPAC, an updated filing showed last week. The stock price fell slightly in early trading on Monday and was down over 7% as of 2:30 p.m. EST.
The company and the union have reached tentative agreements on a host of non-economic proposals, including remote work as well as health and safety measures, BuzzFeed said.
The BuzzFeedNews Union belongs to the NewsGuild, which represents workers at many publications, including Reuters, Business Insider, and The New Yorker. The workers at BuzzFeedNews are willing to carry out additional protests if the two sides cannot reach an agreement, Baird said.
"We’re clearly able to mobilize quickly and effectively, and will continue to do so until we have a fair, strong contract that we’re ready to ratify," Baird says. "As far as the immediate future, our next big thing is getting to the bargaining table."
Max Zahn is a reporter for Yahoo Finance. Find him on twitter @MaxZahn_.
Read more:
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BuzzFeed shares fall in debut after investor withdrawals rock SPAC merger
Mon, December 6, 2021
![]()
Jonah Peretti, founder and CEO of BuzzFeed, poses with employees to celebrate the company's debut outside the Nasdaq Market in Times Square in New YorkMore
(Reuters) -Shares of BuzzFeed Inc plunged as much as 17% in their Nasdaq debut on Monday, after its merger with a blank-check company was hit by a flurry of investor withdrawals last week.
New York-based BuzzFeed's stock opened up 14% at $10.95 but reversed course to trade as low as $8. At 1:10 p.m. ET, the shares were down 5% at $9.10.
The company was one of the 10 trending stocks on Stocktwits.com, a platform commonly seen as a measure of interest from retail investors.
After shareholders redeemed a majority of their stake, BuzzFeed said last week it would receive only 6%, or nearly $16 million, of proceeds from the trust account of the blank-check company 890 Fifth Avenue Partners Inc, named after the fictional Avengers mansion.
Special purpose acquisition companies typically sell shares at $10 apiece, put the cash in a trust account and then search for a company to buy. Its shareholders can choose to redeem their shares in return for cash.
Tightening scrutiny from the U.S. Securities and Exchange Commission and saturated demand have weighed on the SPAC market, which soared in popularity last year.
BuzzFeed's deal is a barometer of investor interest for peers like Vox Media, which is reportedly considering a SPAC merger. Magnum Opus Acquisition Ltd, the SPAC merging with Forbes, has been trading below its issue price of $10.
BuzzFeed also secured $150 million through a convertible note financing.
The company, which produces news, videos and online quizzes, was founded in 2006 by Jonah Peretti and John Johnson, and saw a rise in popularity among the youth.
In 2016, the company was valued at $1.7 billion after Comcast Corp-owned NBC Universal's investment.
BuzzFeed bought news website HuffPost last year and also acquired youth entertainment company Complex Networks in June this year.
(Reporting by Mehnaz Yasmin in Bengaluru; Editing by Maju Samuel)
BuzzFeed Tumbles in Turbulent Debut for Digital Media
Gerry Smith
Mon, December 6, 2021,
(Bloomberg) -- BuzzFeed Inc. shares fell in their first day of trading, a sign investors are wary of the digital media company after a shaky lead-up to its public debut.
The stock, which trades on the Nasdaq under the ticker symbol BZFD, was down 12% at 11:15 a.m. in New York, after surging earlier in the day. Shares of the blank-check company that BuzzFeed merged with to go public had closed at $9.62 on Friday.
BuzzFeed’s debut as a public company marks a major milestone for the online media company that Jonah Peretti co-founded 15 years ago. It’s also a sign of how other digital media companies could perform on the public market. Among today’s crop of large online publishers, BuzzFeed is the first to have its shares trade.
“The big thing digital media needs for consolidation is a strong public company and we wanted to be the first,” Peretti said in an interview.
BuzzFeed’s journey to the public markets got off to a tough start, however. The company planned to raise $288 million in cash through its merger with a blank-check company, 890 5th Avenue Partners Inc. Instead, most of that business’s investors opted not to participate in the transaction, an option available to participants in special purpose acquisition companies like 890 5th Avenue.
That had left Peretti with just $16 million of the originally intended funds as the company readied its debut.
Peretti said he expected investors would pull their money out because the market for SPACs has cooled. It “won’t meaningfully change our strategy,” he said, noting that BuzzFeed will still have money raised from a $150 million convertible note that’s part of the transaction. As a public company, BuzzFeed can also use its stock as a currency to buy other businesses, he said.
BuzzFeed’s arrival as a public company will lead to management changes. The company is in talks to name Michael Del Nin as its new president, Peretti said. Del Nin was formerly co-chief executive officer of Central European Media Enterprises Ltd., one of Europe’s largest television broadcasters, and an executive at Time Warner Inc., now known as WarnerMedia. He would report to Peretti.
Track Record
Del Nin has a track record leading an exchange-listed company that Peretti doesn’t have.
“I’m an entrepreneur,” Peretti said. “I don’t have public market experience so we’re adding that to the team as part of this transaction.”
Investors have poured more than $190 billion into SPACs since last year, according to data compiled by Bloomberg. While they are seen as being a fast way to go public, they often underperform traditional initial public offerings.
Peretti said BuzzFeed likely would have done an IPO if the pandemic hadn’t disrupted its business. He called the SPAC “a means to an end.”
BuzzFeed’s big moment has also been soured by a labor dispute. On Thursday, BuzzFeed News employees walked off the job to protest what they say is the company’s failure to agree to a fair labor contract.
“It’s a negotiation and it’s hard and there’s disagreement around points,” Peretti said of the walkout. “The bargaining table is where they wanted to have those conversations, so that’s where we’re having them.”
As part of going public, BuzzFeed also acquired youth-focused media company Complex Networks from Hearst Corp. and Verizon Communications Inc. Last year, BuzzFeed bought HuffPost.
Peretti described BuzzFeed and Complex as complementary businesses, with Complex stronger in male-focused topics like sneakers and streetwear.
Third Quarter
Last month, BuzzFeed said its third-quarter revenue grew 20%, helped by an improvement in ad sales. But it also saw a slowdown in sales of goods, citing supply chain issues, and it expects that to continue in the fourth quarter. BuzzFeed sells, among other things, a line of cookware at Walmart named after its food brand Tasty. The business is seen as a way for BuzzFeed to rely less on advertising.
BuzzFeed’s multiple revenue lines allow it to adapt when one area of its businesses slows, according to Peretti.
“The most important thing is we have a resilient, diverse business that can manage through changes in the marketplace,” he said.
Peretti co-founded BuzzFeed in 2006. From the start, the company had a unique ability to create posts that took off on the internet, like “What Colors Are This Dress?” and making a watermelon explode on live video using rubber bands. But it also has gone through its share of struggles, including multiple rounds of layoffs over the years, partly because tech giants have dominated the online ad landscape.
Peretti predicted the company would be making more acquisitions as a public company, including, potentially, subscription-based publishers.
“This gives us this new platform to do a lot of things that were impossible to do before as a private company,” he said. “It’s an exciting moment for us.”
(Updates with share trading beginning in first paragraph. A previous version corrected the description of Nasdaq ceremony.)
In its latest proposal, BuzzFeed offered workers a $50,000 salary floor and a guarantee of 1% annual raises, Baird said, deriding the terms as below industry standards. In a public statement about the walkout last week, the union highlighted the challenge of living on such a salary in high-cost cities like New York and San Francisco, where some BuzzFeed offices are located.
"It's incredibly frustrating for us," Baird says. "We're for starters asking them to move on their pay minimums. Engage in the process; stop slow-walking it."
BuzzFeed says it has offered an average overall wage increase of 2.5% across the membership of the union, but that individual annual raises would range from 1% upward depending on merit.
BuzzFeed is expecting $521 million in revenue in 2021, including income generated by Complex Systems.
The company expects to raise $16 million dollars from the SPAC deal, after investors pulled 94% of the $287.5 million raised by the SPAC, an updated filing showed last week. The stock price fell slightly in early trading on Monday and was down over 7% as of 2:30 p.m. EST.
The company and the union have reached tentative agreements on a host of non-economic proposals, including remote work as well as health and safety measures, BuzzFeed said.
The BuzzFeedNews Union belongs to the NewsGuild, which represents workers at many publications, including Reuters, Business Insider, and The New Yorker. The workers at BuzzFeedNews are willing to carry out additional protests if the two sides cannot reach an agreement, Baird said.
"We’re clearly able to mobilize quickly and effectively, and will continue to do so until we have a fair, strong contract that we’re ready to ratify," Baird says. "As far as the immediate future, our next big thing is getting to the bargaining table."
Max Zahn is a reporter for Yahoo Finance. Find him on twitter @MaxZahn_.
Read more:
Thousands of Amazon workers in NYC want a union. Will they win?
COVID-19 vaccine mandates: Unions divided over 'complex problem' for organized labor
Teamsters launch campaign to organize Amazon workers
BuzzFeed shares fall in debut after investor withdrawals rock SPAC merger
Mon, December 6, 2021
Jonah Peretti, founder and CEO of BuzzFeed, poses with employees to celebrate the company's debut outside the Nasdaq Market in Times Square in New YorkMore
(Reuters) -Shares of BuzzFeed Inc plunged as much as 17% in their Nasdaq debut on Monday, after its merger with a blank-check company was hit by a flurry of investor withdrawals last week.
New York-based BuzzFeed's stock opened up 14% at $10.95 but reversed course to trade as low as $8. At 1:10 p.m. ET, the shares were down 5% at $9.10.
The company was one of the 10 trending stocks on Stocktwits.com, a platform commonly seen as a measure of interest from retail investors.
After shareholders redeemed a majority of their stake, BuzzFeed said last week it would receive only 6%, or nearly $16 million, of proceeds from the trust account of the blank-check company 890 Fifth Avenue Partners Inc, named after the fictional Avengers mansion.
Special purpose acquisition companies typically sell shares at $10 apiece, put the cash in a trust account and then search for a company to buy. Its shareholders can choose to redeem their shares in return for cash.
Tightening scrutiny from the U.S. Securities and Exchange Commission and saturated demand have weighed on the SPAC market, which soared in popularity last year.
BuzzFeed's deal is a barometer of investor interest for peers like Vox Media, which is reportedly considering a SPAC merger. Magnum Opus Acquisition Ltd, the SPAC merging with Forbes, has been trading below its issue price of $10.
BuzzFeed also secured $150 million through a convertible note financing.
The company, which produces news, videos and online quizzes, was founded in 2006 by Jonah Peretti and John Johnson, and saw a rise in popularity among the youth.
In 2016, the company was valued at $1.7 billion after Comcast Corp-owned NBC Universal's investment.
BuzzFeed bought news website HuffPost last year and also acquired youth entertainment company Complex Networks in June this year.
(Reporting by Mehnaz Yasmin in Bengaluru; Editing by Maju Samuel)
BuzzFeed Tumbles in Turbulent Debut for Digital Media
Gerry Smith
Mon, December 6, 2021,
(Bloomberg) -- BuzzFeed Inc. shares fell in their first day of trading, a sign investors are wary of the digital media company after a shaky lead-up to its public debut.
The stock, which trades on the Nasdaq under the ticker symbol BZFD, was down 12% at 11:15 a.m. in New York, after surging earlier in the day. Shares of the blank-check company that BuzzFeed merged with to go public had closed at $9.62 on Friday.
BuzzFeed’s debut as a public company marks a major milestone for the online media company that Jonah Peretti co-founded 15 years ago. It’s also a sign of how other digital media companies could perform on the public market. Among today’s crop of large online publishers, BuzzFeed is the first to have its shares trade.
“The big thing digital media needs for consolidation is a strong public company and we wanted to be the first,” Peretti said in an interview.
BuzzFeed’s journey to the public markets got off to a tough start, however. The company planned to raise $288 million in cash through its merger with a blank-check company, 890 5th Avenue Partners Inc. Instead, most of that business’s investors opted not to participate in the transaction, an option available to participants in special purpose acquisition companies like 890 5th Avenue.
That had left Peretti with just $16 million of the originally intended funds as the company readied its debut.
Peretti said he expected investors would pull their money out because the market for SPACs has cooled. It “won’t meaningfully change our strategy,” he said, noting that BuzzFeed will still have money raised from a $150 million convertible note that’s part of the transaction. As a public company, BuzzFeed can also use its stock as a currency to buy other businesses, he said.
BuzzFeed’s arrival as a public company will lead to management changes. The company is in talks to name Michael Del Nin as its new president, Peretti said. Del Nin was formerly co-chief executive officer of Central European Media Enterprises Ltd., one of Europe’s largest television broadcasters, and an executive at Time Warner Inc., now known as WarnerMedia. He would report to Peretti.
Track Record
Del Nin has a track record leading an exchange-listed company that Peretti doesn’t have.
“I’m an entrepreneur,” Peretti said. “I don’t have public market experience so we’re adding that to the team as part of this transaction.”
Investors have poured more than $190 billion into SPACs since last year, according to data compiled by Bloomberg. While they are seen as being a fast way to go public, they often underperform traditional initial public offerings.
Peretti said BuzzFeed likely would have done an IPO if the pandemic hadn’t disrupted its business. He called the SPAC “a means to an end.”
BuzzFeed’s big moment has also been soured by a labor dispute. On Thursday, BuzzFeed News employees walked off the job to protest what they say is the company’s failure to agree to a fair labor contract.
“It’s a negotiation and it’s hard and there’s disagreement around points,” Peretti said of the walkout. “The bargaining table is where they wanted to have those conversations, so that’s where we’re having them.”
As part of going public, BuzzFeed also acquired youth-focused media company Complex Networks from Hearst Corp. and Verizon Communications Inc. Last year, BuzzFeed bought HuffPost.
Peretti described BuzzFeed and Complex as complementary businesses, with Complex stronger in male-focused topics like sneakers and streetwear.
Third Quarter
Last month, BuzzFeed said its third-quarter revenue grew 20%, helped by an improvement in ad sales. But it also saw a slowdown in sales of goods, citing supply chain issues, and it expects that to continue in the fourth quarter. BuzzFeed sells, among other things, a line of cookware at Walmart named after its food brand Tasty. The business is seen as a way for BuzzFeed to rely less on advertising.
BuzzFeed’s multiple revenue lines allow it to adapt when one area of its businesses slows, according to Peretti.
“The most important thing is we have a resilient, diverse business that can manage through changes in the marketplace,” he said.
Peretti co-founded BuzzFeed in 2006. From the start, the company had a unique ability to create posts that took off on the internet, like “What Colors Are This Dress?” and making a watermelon explode on live video using rubber bands. But it also has gone through its share of struggles, including multiple rounds of layoffs over the years, partly because tech giants have dominated the online ad landscape.
Peretti predicted the company would be making more acquisitions as a public company, including, potentially, subscription-based publishers.
“This gives us this new platform to do a lot of things that were impossible to do before as a private company,” he said. “It’s an exciting moment for us.”
(Updates with share trading beginning in first paragraph. A previous version corrected the description of Nasdaq ceremony.)
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