Founded by Jonah Peretti in 2006, content company BuzzFeed began its operations in a dingy office in China Town, New York and soared to popularity on the back of shareable content such as cat images, memes and listicles. The company is now attempting to do a lot more in the area of real-time news. It has recently seen an infusion of $50 million of funding from venture capitalist firm Andreessen Horowitz and the deal valued the company at about $850 million.
BuzzFeed?s high profile vice president (international) Scott Lamb was in India recently for the ?Social Media Week? event in Mumbai. Lamb is the originator of the popular Disaster Girl meme and in 2011, Gizmodo named him one of the Internet?s ?Most Viral People?. In this conversation with FE BrandWagon?s Anushree Chandran, Lamb talks about the company?s expansion plans in news related areas and growth on the back of native advertising. Edited excerpts:
Tell us about the early days of BuzzFeed?
When I started out with BuzzFeed in 2007, we had two editors and a little office in Chinatown. The office was also inhabited by a developer and a designer. Today, we have 200 editors worldwide and 575 people. We have offices around the globe and are a 24 hour news organization.
Today, about 150 million users come to our website. Over half our users check out our content on mobile while 75% of our traffic is from social media websites; 50% of our users are between the ages of 18-34. We are also increasingly international, which is exciting because it is my job to grow our international presence. I get about 50 million unique visitors coming from overseas. A lot of the growth has actually come in the last two years. Marketers want to know how to make something go viral. There is no formula, but there certainly is emotive thinking and instinct. In our early days, BuzzFeed was very experimental. An image of a little girl was sent to our chief executive Jonah Peretti?and you would take one look at the girl, and immediately think that she?s done something wrong. We called her ?Pyromaniac Girl? and published it on the web around disaster pictures. We later felt that Pyromaniac Girl was too negative and projected her as a psychopath. We gave her a more ambiguous name?Disaster Girl. Soon people started posting her picture on all kinds of disaster photos. She became the ?Disaster Girl? meme. That?s how the journey began.
You?ve recently seen an infusion of $50 million from venture
capital firm Andreessen Horowitz. How do you plan to use that money?
We would want to keep some of it as a war chest in case we run into a rough patch in the business. But certainly, international expansion is what we are looking at. We are hoping to go to newer cities such as Tokyo and Mexico City. 2015 is a blank slate for now, but we?d like to expand more in Asia and in Europe. We want to increase our foreign reporting. We have correspondents from across the globe, whether it is in Africa or the Middle East or from Ukraine.
Additionally, we are investing a lot in video. There are various video formats that are available to people?six-second videos as in Vine and feature-like movies as well. BuzzFeed is doing some very short, sharable videos on the web. When we look at global media companies, their main investment is on people. In that sense, we are not different from a traditional news company and we would be hiring a lot more people. Lastly, there will be acquisitions. We have acquired a few small companies in advertising, data and images. In some countries, there may be a natural player in the area that we operate in. For instance, a website in Nigeria that puts out amazing content and could potentially transform into BuzzFeed. We may decide not to start from scratch in a particular market and acquire instead.
Could you elaborate on your business model and operational revenues?
I cannot talk numbers, but we are a very profitable company. Our business model is advertising, but not display advertising. We focus on native advertising?content in the context of the user?s experience? instead. BuzzFeed?s expertise is in viral and shareable content. An advertiser such as Pepsi says to us??Hey, we want to make cool stuff which people are likely to share online?. It could be a video, or a quiz. We have a creative team that is separate from the editorial team and works with the advertiser or agency on such content. To sum up, we give advertisers the benefits of paid media and the bonus of people sharing their content. Brands come to us because we specialize in social media. We put up disclosures on sponsored content, so that people know that it is by a brand. Other forms of advertising are increasingly being ignored by users.
Do you see yourself as a news company or more of an entertainment company?
The fact is that we want it all. Look, a television network has a news division but it also puts out sitcoms through its entertainment division. BuzzFeed effectively follows the same model. People have started taking the internet very seriously. You can?t be a print or a television company anymore. You need to be unique. BuzzFeed wants to do all the different parts of what it means to be a media company online. We aspire to be one of the titans over the next 20-30 years.
Given the revenue pressures faced by traditional print and media companies, will they eventually be forced to adopt your kind of business model?
It is hard to say. I do think that legacy media companies, be it print or television, have a lot of value to offer. The problem for them is managing the cost structures and keeping the operations going. We are nimble. This makes us much more competitive compared to these legacy corporations. I feel that they are in a difficult position. It is much easier to be the exciting new start-up, and define yourself as to where you are going, than to be a legacy publication. I talk to a lot of newspaper companies. Some of them are very proactive when it comes to adapting to change. Others are just covering their ears.
You have a lot of detractors who doubt your news gathering ability and dismiss you as a click-bait site.
Click-bait is basically over-promising with the headline and under-delivering on the story. This is not something we do. At BuzzFeed, we believe that if you trick readers, they won?t trust you and will not check out your content. There are only so many times you can say ?This video is going to change your life? or ?You won?t believe what happens next?. The fact is that we have just begun with news. As a company, we are young. As a news organization, we are even younger. We have only started getting into investigative journalism. We have written pieces on some organizations in the US that I won?t specifically name. But whenever we have run a story that could invite litigation, we make sure that it is perfectly fact checked and our lawyers have taken a look at it. It?s the same as any media company across the world. If you have a great story?you run it and deal with the consequences.
Are you planning on exploring Indian languages?
Yes, definitely. We have three foreign language editions?Spanish, Portuguese, and French. We will be launching in German and some other languages as well. We very much believe in building content that is not just in English. Then again, we are looking at building content that?s not in any language at all. It?s just visual. To start with, there are 200 million English speakers in India? that?s a large audience to have as a base. Let?s get to a 100% of that. Down the line we would love to expand in Indian languages. It is going to be complicated because of the sheer numbers, but that is a challenge we are willing to look at. It?s a good problem to have.