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March 30, 2017

BuzzFeed IPO rumoured for next year

The digital media firm was valued at $1.7bn in its last round of funding.

By CBR Staff Writer

Digital news and entertainment site BuzzFeed is reportedly planning to issue an initial public offering next year after the recent public debut of social media platform Snap.

Axios, citing industry sources, reported that BuzzFeed is readying to go public in 2018.

However, the details about the valuation to be sought by the company in the offer were not revealed.

The Snapchat parent company got listed earlier this month, after issuing an IPO which was the largest US tech public issue since Facebook in 2012.

Started by Huffington Post co-founder Jonah Peretti, BuzzFeed is backed by Comcast subsidiary NBCUniversal.

In November last year, the New York-based online media firm raised $200m from its existing investor NBCUniversal to fund its expansion plans. With the investment, NBCUniversal increased its funding to BuzzFeed to $400m.

buzzfeed 2The funding round valued the online news outlet at about $1.7bn, The Wall Street Journal reported.

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BuzzFeed’s valuation in that round was “essentially unchanged” compared to the $1.5bn valuation it got in NBCUniversal’s previous investment in the company in 2015.

BuzzFeed chief executive and founder Jonah Peretti said in a statement: “The investment allows us to remain a fully independent company but have access to and resources from the strongest and best media company there is.”

According to CrunchBase, NBCUniversal’s cash infusion into BuzzFeed in late last year took the overall funds raised by the media firm to $496m.

In 2015, it earned revenue of $170m, which was 20% lower than the initial estimate made by the company for the year.

BuzzFeed’s earnings were affected by various factors including slower-than-expected revenue growth in content licensing and the problems in monetisation of certain platforms, such as Facebook, where it has huge audience base.

With an entertainment studio based in Los Angeles, the company has offices in cities around the world including London, Paris, Berlin, Madrid, Sydney, Mumbai, Tokyo, Sao Paulo, Mexico City and Toronto.

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