Ziff Davis, the digital media unit of J2 Global Inc., recently signed an agreement to purchase the struggling online news publisher Mashable for $50 million. Mashable recently completed a $15 million fundraising round and the price at which it is being purchased is one fifth of its valuation of $250 million.
Founded by Pete Cashmore in 2005, the company confirmed in August that it was seeking a buyer. Terms of the agreement are not yet known. J2 Global declined to comment while Mashable didn’t immediately respond.
In a letter to the staff, CEO Pete Cashmore wrote:
As you know we recently announced a funding round to expand our storytelling to television. We are now equally adept at telling stories in text and video, and those stories now live on social networks, over-the-top services and TV. Our ads live there too, with branded content now at the center of our ad offering.
To reflect these changes, we must organize our teams in a different way. Unfortunately this has led us to a very tough decision. Today we must part ways with some of our colleagues in order to focus our efforts. Everyone affected by these changes has already been notified.
We are certain this is the right direction for Mashable. But that doesn’t make it any less difficult to say goodbye to our friends and teammates. Mashable is a very close-knit family and I value the contributions of each and every member. Every one of these people has made an indelible impact on our company and our lives. They have earned our respect and our friendship, and we are very fortunate to have worked alongside them. We will miss them and we will offer services to help them transition into new roles.
I must also share the news that Jim Roberts will be moving on from the company. Jim has been instrumental in building Mashable into a truly global media brand. He has built an editorial team that stands for trust, credibility and accuracy, allowing us to compete with some of the world’s most established media companies. He is an incredible leader and mentor who has inspired us all to reach new heights. It has been an honor to build this brand together.
Seth Rogin will be moving on to a new venture. I’m very proud of the work Seth has done building our revenue operation. He has brought together an exceptional sales team that serves the world’s biggest brands. It’s been a pleasure to work together and I wish him the very best in his new role.
Later today we’ll host an All Hands meeting to explain how media is changing and how we’re positioning ourselves to stay ahead of the market. But I wanted to give you a preview to help make sense of these changes.
In 2016 we’re focused on growing Mashable across every platform. This calls for us to talk in a singular voice wherever our brand appears. It requires us to use data to respond to the needs of our audience. And it means that our ads must travel with our content.
Let’s start with data. As we put our content in more places, our data platforms keep us connected to our audience’s needs. Mashable Velocity allows us to predict which stories will resonate with our audience and focus our editorial efforts. Knowledge Graph, meanwhile, lets us map the interests of our readers and viewers, serving the right content to the right people at the time. This expertise provides us with a significant competitive advantage, and this year we’ll invest further in our data offerings to make sure we remain connected to our audiences on every platform.
But data is only part of the story. We believe that our true competitive advantage comes from our unique voice and the constant flow of original ideas from our creative teams. As our audience consumes more stories on more platforms than ever before, your unique ideas, perspectives and voice help us stand out.
So what is that voice? Mashable is entertaining, informed and optimistic. We tell stories of digital culture. And we keep our audience connected to the pulse of the social web.
As our stories now live on multiple platforms, it’s doubly important that everything we create reflects that voice and ethos. That’s why we took the tough decision to move away from covering world news and politics as standalone channels. Instead, we will focus on telling these stories from a digital angle. We’ll spend more time focusing on our core coverage — technology, web culture, science, social media, entertainment, business and lifestyle, all told through the digital lens. We’ll also develop our real-time news coverage, keeping our audience up to date on breaking news and cultural trends being discussed on social networks.
The newest platforms in our lineup include over-the-top video networks and television. To realize the massive opportunity that these platforms represent and to keep our voice consistent across every platform, it’s clear that all our video producers should live on the same team. As part of Mashable Studios, our writers, animators and video producers will now have the opportunity to work on our most important video projects — from digital shows to television to branded series.
Which brings us to advertising. What our advertisers value most about Mashable is the same thing that our audience values: Our content. The world’s biggest brands come to us to tell stories of digital culture, innovation and technology in an optimistic and entertaining voice. As a result, branded content has become our fastest growing revenue stream over the past year. Content is now at the core of our ad offering and we plan to double down there.
To execute this strategy, we are welcoming two new team members today:
— Greg Gittrich is joining us as Chief Content Officer to unify our voice across all platforms and infuse data into our creative process. Greg is a true multi-platform editor: He has edited major newspapers, run the digital arm of TV networks, and turned editorial articles into TV shows. His passion is combining creativity with data to tell unique stories.
— Ed Wise is joining as our Chief Revenue Officer to grow our sales expertise in branded content and bring our ads to TV. Ed previously ran the branded content sales teams at both Funny or Die and Turner Broadcasting. His focus at Mashable will be to connect big brand advertisers with our phenomenal branded content teams.
Please join us at the All Hands meeting later today to discuss these changes and address any questions you may have.