Digital first pioneer BuzzFeed has sold First We Feast, producer of Hot Ones (pictured) to a consortium led by an affiliate of Soros Fund Management LLC in an $82.5 million all-cash deal. The proceeds of the transaction will be used to help pay down the company’s debt.
According to Buzzfeed, the divestiture of food, drink, and pop culture-focused brand First We Feast completes the Company’s strategic shift away from lower-margin content products, allowing for a greater focus on high-margin, tech-enabled revenue lines, including programmatic advertising and affiliate commerce. At time of writing, First We Feast’s YouTube channel had around 14.2 million subscribers.
“The sale of First We Feast and continued reduction of our convertible debt marks an important step in BuzzFeed’s strategic transformation into a media company positioned to fully benefit from the ongoing AI revolution,” said BuzzFeed founder and CEO Jonah Peretti. “In the coming years, we will continue to invest in our most scalable and tech enabled services, launching new AI-powered interactive experiences, and delivering for our loyal audience and business partners.”
Alongside the sale, Buzzfeed also issued guidance for the fourth quarter ending December 31, 2024 on a continuing operations basis, which excludes expected fourth quarter contributions from First We Feast. Revenues are expected to be in the range of $54-58 million, while EBITDA will be in the range of $4-9 million.
“As we close out 2024, we are poised to deliver year-over-year growth in Programmatic Advertising and Affiliate Commerce combined revenue for the third consecutive quarter,” said Matt Omer, CFO of BuzzFeed. “We now have removed more than $150m of debt since December 31, 2023 and enter 2025 with a stronger balance sheet, so that we can focus on growth and driving expanded profitability.”
The Company acquired First We Feast as a part of Complex Networks in December 2021 for $198 million in cash and 2.5 million split-adjusted shares of equity. Complex was sold to NTWRK earlier this year for $108.6 million plus $5.7 million in related fees.
