Despite having $500 million in funding, Buzzfeed is asking for donations.
The last few days, Buzzfeed has been testing a donation button on their Buzzfeed News page. Despite its incredible popularity, the company, and digital media companies in general, have not been able to pull satisfying revenue. Despite diversifying to video, and trying new things, it seems like the material simply isn’t holding readers’, investors’, or viewers’ attention.
Since 2016 Buzzed has not been able to raise additional funds and has had to fire a number of employees. Despite what their working culture may seem like in their many YouTube videos, the truth is the company just can’t keep up.
Buzzfeed has also been said to have missed its revenue target by around 20% on 2017, so the need for external contributions might be explained by that.
In contrast with struggling new-media models, old media seems to be thriving. Companies like the New York Time have seen an significant increase in their market shares. The world-renowned company now has a market cap over $3.9 billion. On February of this year, they reported to have 2.6 million digital subscriptions, which translated into over $1 billion in revenue on 2017. This, compared to Buzzfeed’s estimated $220 million revenue, might be the reason the platform is seeking new alternatives.