BuzzFeed is shutting down its news arm and laying off 15% of staff as CEO Jonah Peretti concedes mistakes and some insiders complain of 'brutal' mismanagement

• BuzzFeed News is shutting down as part of 15% cuts at the company that sent its stock price tumbling.
• Top execs Christian Baesler and Edgar Hernandez, who joined when BuzzFeed acquired Complex, are exiting.

BuzzFeed is shutting down BuzzFeed News along with making layoffs of 15% in divisions across the organization, or 180 people, according to a memo from CEO Jonah Peretti that was shared with Insider.

Two top BuzzFeed execs, Christian Baesler, COO, and Edgar Hernandez, CRO, are leaving the company as well, but will stay on through April and May, respectively, per the memo. (Read the full memo below.)

BuzzFeed News was a passion project for Peretti. It gained attention with splashy investigations, winning a Pulitzer Prize for international reporting in 2021.

But over the years, he's come under criticism for not holding it to higher profitability standards. At one point, shareholders urged him to shut it down, according to reports.

In his memo to staff, Peretti admitted making mistakes that led to the cutbacks. He blamed difficulty in integrating BuzzFeed and Complex, which BuzzFeed acquired in 2021. He also conceded he overinvested in BuzzFeed News and didn't hold the company to high enough profitability standards.

"I could have managed these changes better as the CEO of this company and our leadership team could have performed better despite these circumstances," he wrote. "Our job is to adapt, change, improve, and perform despite the challenges in the world. We can and will do better."

The news was met with anger and sadness from company insiders. "It breaks my heart — the mismanagement of this whole thing has been brutal," said one. Elsewhere there was criticism of the wisdom of taking digital media, which has struggled overall to find a profitable model, to the public markets.

Peretti controls the company — though the clock is ticking for him to get the share price up. The onetime digital media darling has struggled to live up to expectations since raising millions in venture capital and then going public in December 2021 via a special-purpose acquisition company. Investors withdrew most of the money raised by the SPAC, leaving BuzzFeed with little funding to expand, and the ad market took a turn for the worse.

To get BuzzFeed's SPAC deal done, Peretti agreed to give BuzzFeed's biggest shareholder, NBCUniversal, up to 1.2 million of his 6.4 million shares in December if the price falls below $12.50 on a certain date, according to a filing.

BuzzFeed's stock price has plunged since its public debut of around $10 to under $1 per share. Today's news caused it to tumble again, nearly 24%, to 72 cents a share by midday; its market cap to fall below $100 million, roughly a third of what BuzzFeed paid for Complex less than two years ago.

The company has trimmed staff in two rounds of layoffs since going public, most recently cutting 12% of its team in December, or 180 staffers. A handful of top execs from BuzzFeed's Complex Networks left as part of that round, including Complex's president, Justin Killion. In a separate high-profile departure, Buzzfeed's CTO Peter Wang left in February after three years.

The rest of the media industry hasn't been immune to cuts in the past year as advertisers have slashed spending amid a softening economy.

The newly departing execs, Baesler and Hernandez, were longtime figures at Complex who joined BuzzFeed through its acquisition of Complex. The goal was to expand BuzzFeed's audience and ad base through Complex, a digital media company focused on hip-hop and sneaker culture.

Once the companies combined, the two execs were promoted to C-level roles. But after the deal closed, insiders began to feel that BuzzFeed, which is driven by short-form video and listicles, mismanaged the brand and failed to appreciate the value of Complex's long-form, host-driven video series like "Hot Ones" and "Sneaker Shopping."

BuzzFeed is set to announce its first-quarter financial results on May 9. BuzzFeed declined to comment on the record.

Read BuzzFeed CEO Jonah Peretti's memo to staff about layoffs and the shutdown of BuzzFeed News:

Hi all,

I am writing to announce some difficult news. We are reducing our workforce by approximately 15% today across our Business, Content, Tech and Admin teams, and beginning the process of closing BuzzFeed News. Additionally, we are proposing headcount reductions in some international markets.

Impacted employees (other than those in BuzzFeed News) will receive an email from HR shortly. If you are receiving this note from me, you are not impacted by today's changes. For BuzzFeed News, we have begun discussions with the News Guild about these actions.

As part of today's changes, both our CRO Edgar Hernandez and COO Christian Baesler have made the decision to exit the company. I'm grateful to both of them for their passion and dedication to Complex and to BuzzFeed, Inc. Christian will be with us through the end of April, and Edgar through the end of May to help with the transition.

Marcela Martin, our President, will take on responsibility for all revenue functions effective immediately. In the US, Andrew Guendjoian is our new Head of Sales, and Ken Blom will continue in his role as Head of Revenue Operations. Globally, International Sales will move under Rich Reid, Head of International and Head of Studio, also reporting to Marcela.

I have great confidence in this revenue leadership team, and the early plans I've seen from them to accelerate performance from our Business Org. We will share more on their plans in the Business All Hands next week (and we are extending an invite company-wide).

The changes the Business Organization is making today are focused on reducing layers in their organization, increasing speed and effectiveness of pitches, streamlining our product mix, doubling down on creators, and beginning to bring AI enhancements to every aspect of our sales process.

While layoffs are occurring across nearly every division, we've determined that the company can no longer continue to fund BuzzFeed News as a standalone organization. As a result, we will engage with the News Guild about our cost reduction plans and what this will mean for the affected union members.

HuffPost and BuzzFeed Dot Com have signaled that they will open a number of select roles for members of BuzzFeed News. These roles will be aligned with those divisions' business goals and match the skills and strengths of many of BuzzFeed News's editors and reporters. We raised this idea with the News Guild this morning and look forward to discussing it further. Moving forward, we will have a single news brand in HuffPost, which is profitable, with a loyal direct front page audience.

I want to explain a little more about why we've come to these deeply painful decisions. We've faced more challenges than I can count in the past few years: a pandemic, a fading SPAC market that yielded less capital, a tech recession, a tough economy, a declining stock market, a decelerating digital advertising market and ongoing audience and platform shifts. Dealing with all of these obstacles at once is part of why we've needed to make the difficult decisions to eliminate more jobs and reduce spending.

But I also want to be clear: I could have managed these changes better as the CEO of this company and our leadership team could have performed better despite these circumstances. Our job is to adapt, change, improve, and perform despite the challenges in the world. We can and will do better.

In particular, the integration process of BuzzFeed and Complex, and the unification of our two business organizations, should have been executed faster and better. The macro environment is tough, but we had the potential to generate much more revenue than we delivered over the past 12 months.

Additionally, I made the decision to overinvest in BuzzFeed News because I love their work and mission so much. This made me slow to accept that the big platforms wouldn't provide the distribution or financial support required to support premium, free journalism purpose-built for social media.

More broadly, I regret that I didn't hold the company to higher standards for profitability, to give us the buffer needed to manage through economic and industry downturns and avoid painful days like today. Our mission, our impact on culture, and our audience is what matters most, but we need a stronger business to protect and sustain this important work.

Please know that we exhausted many other cost saving measures to preserve as many jobs as possible. We are reducing budgets, open roles, travel and entertainment, and most other discretionary, non-revenue generating expenditures. Just as we reduced our footprint in NYC last year, we will be reducing our real estate in Los Angeles -- from four buildings down to one, which saves millions in costs as well as mirrors our current hybrid state of work.

I've learned from these mistakes, and the team moving forward has learned from them as well. We know that the changes and improvements we are making today are necessary steps to building a better future.

Over the next couple of months, we will work together to run a more agile and focused business organization with the capacity to bring in more revenue. We will concentrate our news efforts in HuffPost, a brand that is profitable with a highly engaged, loyal audience that is less dependent on social platforms. We will empower our editorial teams at all of our brands to do the very best creative work and build an interface where that work can be packaged and brought to advertisers more effectively. And we will bring more innovation to clients in the form of creators, AI, and cultural moments that can only happen across BuzzFeed, Complex, HuffPost, Tasty and First We Feast.

It might not feel this way today, but I am confident the future of digital media is ours for the taking. Our industry is hurting and ready to be reborn. We are taking great pains today, and will begin to fight our way to a bright future.

On Monday we'll begin to have conversations with each division about the way forward. And in the meantime, I hope you can take time for yourselves this weekend.

Thank you for supporting one another on a difficult day.