BuzzFeed Sells Complex: Is the Reign of BuzzFeed Over?

Three years ago, BuzzFeed bought media company Complex. Now, it’s selling the youth-centered outlet to Ntwrk in a $108.6 million all-cash deal.  

Along with the $108.6 million, BuzzFeed received approximately $5.7 million for usage of the company’s New York offices and “severance- and other employment-related costs.” 

In December 2021, BuzzFeed acquired Complex Networks for $294 million, with approximately $198 million in cash and $96 million in equity. This included Complex’s First We Feast brand, known for its “Hot Ones” series. This part of Complex was not sold to Ntwrk and will remain with BuzzFeed. 

“The sale of Complex represents an important strategic step for BuzzFeed, Inc. as we adapt our business to be more profitable, more nimble and more innovative,” says Jonah Peretti, chief executive officer, BuzzFeed. “This is also an opportunity to unlock greater value for the Complex brand by combining it with Ntwrk’s expansive, commerce-driven business.” 

Concurrently, 16% of BuzzFeed’s staffers are being laid off as the company tries to get back on track financially. The layoffs will not affect Complex staff as they move over to NTWRK. BuzzFeed says the move will yield approximately $23 million in annualized compensation cost savings. This is the second time BuzzFeed has cut its staff in less than a year. In April 2023, the company shuttered its BuzzFeed News division, laying off around 180 people. 

“The changes we announced today will enable an exciting next stage for our company, with increased focus on our iconic brands – BuzzFeed, HuffPost, First We Feast and Hot Ones, and Tasty a more efficient cost structure and operational model and the ability to accelerate innovation powered by AI and interactive content formats,” says Peretti. “I look forward to sharing more in the coming months.” 

In 2013, BuzzFeed began its peak in media, reaching more than 130 million unique visitors and raking in millions of YouTube views. It grew its multiple brands and began licensing in the home and food and beverage space, among others. Revenue grew by millions of dollars year over year for nearly a decade, but now, the finances tell a different story. According to the NASDAQ, in 2022, BuzzFeed’s revenue was $436.67 million, with 9.84% growth. That growth has stopped, and a decline has begun. BuzzFeed had revenue of $352.98 million in the 12 months ending September 30, 2023, down 21.17% year-over-year. In the quarter ending Sept. 30, 2023, revenue was $73.30 million, a 29.34% decrease year-over-year. The decline of BuzzFeed begs the question of whether or not its licensed products will continue to sell or if those licensed products could help the brand regain its footing. Tasty and First We Feast, in particular, are money-makers for the company, but resources may be directed elsewhere for additional cost-saving and debt-settling measures. 

With this deal, however, comes the potential for licensing growth. The e-commerce platform, Ntwrk, hopes to use Complex to drive direct-to-consumer shopping opportunities. As a partner in the new venture, Interscope Geffen A&M (IGA) and Capitol Music Group will be the first Universal Music Group labels to collaborate with the new company to deliver experiences and exclusive collaborations. This new platform will be accessible to artists from all major and independent labels. Investors in the company include Goldman Sachs, Jimmy Iovine, Main Street Advisors and Universal Music Group. 

“This partnership will give our artists access to a dynamic network to deepen connections with superfans through unique collaborations and cultural moments,” says John Janick, chairman and chief executive officer, Interscope Geffen A&M, who will also serve on the board of the new combined company. “We share a collective vision on how D2C, experiential, brand partnerships and content are mutually reinforcing cornerstones of the fan experience. We will continue to sign and elevate new generations of great talent, and we believe that we can best serve these artists through a holistic set of capabilities.” 

The new company will be led by Aaron Levant, who cofounded NTWRK alongside Jamie Iovine and Gaston Dominguez-Letelier in 2018. Since its inception, he has served as chief executive officer and has extensive experience working with the Complex brand, co-creating ComplexCon alongside Marc Eckō, Complex’s founder, in 2016. 

“Complex has been a beacon of culture and innovation for over two decades,” says Aaron Levant, chief executive officer, Complex. “My journey with Complex began as an admirer of their original magazine in 2002, and it has now come full circle as I step into the leadership role. Alongside this impressive team, we will create the definitive global content, commerce and experiential platform of convergence culture.” 

Additional details of BuzzFeed’s restructuring are expected on Feb. 28.