BuzzFeed Acquires Complex Networks for $300 Million

Following the company’s announcement to go public

Last week, BuzzFeed announced that it plans to acquire Complex Networks from Hearst and Verizon for $300 million. Complex Networks is a global entertainment company that targets millennials and Gen Z through pop culture categories including streetwear and style, food, music, sports, sneakers and more. BuzzFeed, known for its celebrity gossip, quizzes and listicles, will pay $200 million in cash and offer $100 million in equity of BuzzFeed. The deal is expected to close in the fourth quarter of 2021.

“I’m incredibly excited to welcome Complex Networks to BuzzFeed. Complex is one of the most interesting and dynamic companies in the space, and a true leader in culture and entertainment,” said Jonah Peretti, BuzzFeed founder and CEO, in a June 24, 2021 news release. “The fact that the Complex audience skews more male and more diverse than BuzzFeed will make our company stronger. And I want to thank Rich Antoniello for agreeing to come on as an advisor to BuzzFeed — he’s one of the most innovative, visionary entrepreneurs I know.”

About Complex Networks

Rich Antoniello and Marc Ecko co-founded Complex in 2002 as a media brand, which has since evolved into a multiplatform “content powerhouse” that includes Complex (pop culture), First We Feast (food entertainment), Pigeons and Planes (music and discovery), Sole Collector (sneaker news) and the ComplexCon festival. After the deal closes, Antoniello will become founder-at-large with a two-year advisory role to Peretti. Christian Baesler, who is currently president of Complex Networks, will become the company’s CEO. Justin Killion, current general manager and EVP for operations and content at Complex, will become the company president. Complex will continue to maintain its editorial independence, but will benefit from BuzzFeed’s reach, experience and structure to continue its growth.

“For nearly 20 years, Complex Networks has been an outlier and a rocketship in our industry. Our success has been our differentiated offering, building a real and loyal community, and never losing focus of our mission to champion the people, brands and new trends audiences need to know now and will obsess over next,” said Antoniello. “In Jonah and BuzzFeed, we’ve found unparalleled vision; a deep respect for our company culture, brands, and editorial independence; and a partner with business lines that will enable us to take Complex Networks to an entirely new level. With this move, we’re joining another rocketship and just getting started.”

“BuzzFeed’s unique approach to data, creativity and commerce opens up many new opportunities for Complex Networks’ continued growth. Just like us, they’ve been deliberate and unwavering in their path to success,” said Baesler. “I’m grateful to Rich for his partnership and entrusting me to lead Complex Networks through this new chapter. I’m also excited to work with Jonah and the BuzzFeed teams to expand on the incredible momentum Complex Networks has experienced over the last two decades.”

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BuzzFeed portfolio

This acquisition will expand BuzzFeed’s portfolio which will include:

  • BuzzFeed Entertainment
  • BuzzFeed News – HuffPost
  • Tasty Lifestyle Brands
  • Complex Networks
BuzzFeed Inc. will include BuzzFeed Entertainment, BuzzFeed News and HuffPost, Tasty Lifestyle Brands and Complex Networks
Image courtesy of BuzzFeed

Currently, BuzzFeed’s media properties are free, though HuffPost launched a paid membership program in 2019. That paid membership is currently on hold. Significant changes to the company, however, also create opportunity. Will BuzzFeed consider shifting its business model to a subscription-based one or test subscription products, like newsletters?

BuzzFeed to go public

BuzzFeed plans to go public by merging with 890 Fifth Avenue Partners, a tech, media and telecom special purpose acquisition company (SPAC). The SPAC has $288 million in cash in its trust account, and BuzzFeed has secured an additional $150 million in convertible note financing led by Redwood Capital Management and including CrossingBridge Advisors, Cohanzick Management, and Silver Rock Financial LP. Once the deal closes, the parent company will be known as BuzzFeed, Inc. and listed on the public market under the BZFD ticket symbol.

Insider Take

Whether you are a fan of BuzzFeed’s style of entertainment journalism or not, they know how to attract an audience. This partnership between BuzzFeed and Complex Networks seems ideal with Complex’s popularity with younger audiences. The acquistion will also make BuzzFeed more valuable and, ideally, help the company to have a successful launch on the public market.