When BuzzFeed BZFD -- Get Free Report burst onto the internet in 2006, it had such an impact on the landscape that it changed the language of the new media permanently.
The brand's explosive growth left a unique footprint on the web, known at first for its millennial focus and pop culture-fueled listicles. Its offices sang with canary yellow walls, vivid red chairs, and meme-inspired decor. Every writer hoped one day to work at BuzzFeed.
The brand seemed to shine brighter as it moved forward, as it moved forward with its award-winning reporting via BuzzFeed News. After 15 years in business, BuzzFeed announced it was going public in 2021, which seemed to indicate that even brighter days were on the horizon for the media brand.
Some people told a different story when listening in on social media. For some, working for BuzzFeed was not the dream they imagined it would be. In the year 2019 BuzzFeed laid off 15% of its staff, with BuzzFeed Chief Executive Jonah Peretti announcing in a memo to staff that the company planned to restructure to improve its operating model.
Two years later, more cuts have been announced, and they could threaten the brand in a way it's never had to face before.
What is happening at BuzzFeed, And Why?
During BuzzFeed's first earnings call Tuesday, founder Jonah Peretti said the company planned to make cuts to its staff to boost its news division's profitability.
In an email to staff on Tuesday, BuzzFeed Editor-in-Chief Mark Schoofs said that in order for BuzzFeed to reach its next growth, it would require BuzzFeed News to shrink in size. Schoofs said that BuzzFeed tried to reduce head count through voluntary buyouts rather than layoffs, which suggests he may have taken that deal himself. Executive Editor Samantha Henig will serve as interim editor-in-chief until BuzzFeed finds a new person to fill the role.
Tom Namako, deputy editor-in-chief, and Ariel Kaminer, executive editor of investigations, are leaving the company. While Buzzfeed reported a 24% revenue growth year over year and $600 million earned via commerce content, it also said it expected a low single-digit revenue decline in Q1.
BuzzFeed's stock had a rough start on its first day of trading. The internet media industry has been a rocky boat in a stormy sea for a while, but the pandemic has battered its already thin defenses, leading to major outlets having to fire employees or let them go altogether, despite some ups and downs today.
BuzzFeed was first affected in 2020, first furloughing 74 employees and then eliminating 50 of their jobs altogether. The BuzzFeed News Union said they would have to take a 20% pay cut and work 20% less, although at the time still having a job was a much better option than having none.
After buying HuffPost in February 2021, only three weeks later, Peretti announced that HuffPost Canada would be shuttered and 47 U.S. employees would be cut, and HuffPost's 2020 losses exceeded $20 million.
The company is wrestling with other problems as well. On March 15, the New York Times reported that employee complaints had been filed with the American Arbitration Association accusing BuzzFeed of poor execution of its IPO.
Nearly 80 employees say that BuzzFeed did not properly instruct them on how to trade their shares, and they were not able to trade until the price had dropped 60%. They are seeking compensatory damages of more than $8.7 million.