NBCUniversal is hip to what the kids are doing nowadays, daddy-o: it’s all happening on the Internet, and it wants in, baby! Toward that end, the TV and movie giant is preparing to invest in two online-only news outfits, BuzzFeed and Vox, in a bid to increase its exposure to millennial audiences, according to a report in Recode, citing unnamed sources familiar with the deals.
NBCU is preparing to invest $250 million in BuzzFeed and an unknown amount in Vox.
The investments are hardly a done deal, and there’s no guarantee they will go through -- but if NBCU does end up in Fat City with those hepcats, the investments would value BuzzFeed at $1.5 billion and Vox at around $850 million. That’s a big increase for both over previous rounds of investment, which valued the millennial listicle juggernaut it at $850 million and Vox at $380 million.
In addition to buying some expertise in millennial tastes and digital media trends, the investments could give NBCU a new outlet for its own content. Of course, for this strategy not to end in a humiliating train wreck for all concerned, NBCU will first have to produce content that appeals to millennials -- you know, like “Coach,” starring Craig T. Nelson again, or “Hollywood Game Night,” whose latest episode featured guest stars like TV personality Rosie O’Donnell and celebrity chef Rocco diSpirito! What, something I said?
Anyhoo, the digital publishers are already going concerns, with or without NBCU’s investments: according to the same report, BuzzFeed had revenues of over $100 million last year and is on track to take in $250 million this year. No word on Vox revenues this year, but last year it took in around $60 million.
Investments and acquisitions have become a popular strategy for big legacy media companies seeking a shortcut to digital cred. Thus Disney acquired Maker Studios for at least $500 million in 2014 (possibly more if performance goals are met) while A&E, co-owned by Disney and Hearst, invested $250 million in Vice Media. Way back in 2011, AOL (not exactly a legacy media organization, but kind of) acquired the Huffington Post for $315 million.