Editor's Note: Inc. Magazine announced its pick for Company of the Year on Tuesday, November 29. It's Riot Games! Here, we spotlight BuzzFeed, one of the contenders for the title in 2016.
As election day settled into evening on November 8, most of New York City's tech employees bounced from their offices in the Union Square or Flatiron neighborhoods to bite their nails in the company of friends and potent drinks. But as the sun set on East 18th Street, dozens of the employees of BuzzFeed planted their butts in folding chairs, rows upon rows set up right in the cafeteria they'd lunched in earlier. They were a live studio audience for an entirely new sort of election night broadcast.
Much of the sprawling New York City headquarters of BuzzFeed had been transformed into a hub of video production, live broadcasting, and result analytics. The cafe's lounge now featured a high glass table with a panel of entertainment stars (including one of the Try Guys) and political reporters. A classroom-style conference room was now a fully operating network control room, replete with rows of switchboards and monitors. Downstairs, on another floor, a little social media hub with another dozen employees ticked away. Even a brand-new barroom became a set, as crews filmed bartenders shaking drinks for celebrity guests and BuzzFeed staffers competing in beer pong.
All of this was broadcast live over Twitter.
The all-night internet broadcast was the result of a partnership with Twitter, a bold move to cap off a year of formidable change at BuzzFeed, which was founded in 2006 by Jonah Peretti. Once hailed as a new-media "listicle" traffic king, by early 2016 BuzzFeed had established itself as a cross-platform content-generation powerhouse prone to experimentation (and willing, able, and eager to apply its virality lessons to paid content designed for advertisers).
But by April, Financial Times reported that BuzzFeed had missed its own revenue target for 2015, and halved its projection for 2016. Direct traffic to the site slowed its growth, and, according to ComScore, by July it drew just 72 million visitors in the United States--about the number it did back in mid-2014. (Mobile traffic and social shares and views of BuzzFeed content elsewhere online are not accounted for in this type of analysis. BuzzFeed denies the financial report.)
Then in August, BuzzFeed announced a company-wide reorganization. It would be split into two distinct departments: BuzzFeed News and a newly formed BuzzFeed Entertainment Group--essentially giving the heads of each (Ben Smith in New York and Ze Frank in Los Angeles, respectively) additional authority and autonomy. It would also give news some heft in creating its own video. That and an investment of an additional $200 million from NBC Universal, which had previously invested $200 million in the company, make it clear that video is the future. Well, video, and rabid experimentation.
Take Tasty, for example. The BuzzFeed food-video franchise was launched just last year, and now is the most popular media page on all of Facebook. More than half of all Americans who are on Facebook see a Tasty video each month. Put another way, that's more than 1.7 billion views each month. And the company has served up more than a billion views of branded content along with those steady little wordless videos of ingredients getting dumped into mixing bowls.
Video already represents more than 50 percent of BuzzFeed's total revenue. That's likely to tick up to 75 percent over the next two years, The New York Times reported earlier this year and BuzzFeed confirms.
Perhaps more interesting is that BuzzFeed has already spun off two separate entities from Tasty. One, Nifty, is showing promise in distributing videos of quick-and-easy life hacks over social media. According to Frank, the head of BuzzFeed Entertainment Group, learning the motivation for individuals' viewing and sharing such videos is at this point almost as important as simply getting them to watch. "The idea is that we are generating a whole series of learnings that can help advertisers understand the relationship people have with their brands," he says. Frank maintains that "people love brands," but that there's a poor general understanding of how to foster genuine human connections online--especially when corporate messaging starts interjecting itself.
Ambitiously, Frank's global team, which totals 385, thinks it can reconfigure--or even upend--the traditional Los Angeles television and movie studio model. Scores of multihyphenate director-producer-actor-social-media-whizzes are in charge of the creation and development of online shows and new series, in something of the mold of the existing "The Try Guys" or "Violet."
"If you're deeply committed to innovation, you have to resist that there's only one innovation paradigm," Frank says. "You have to foster a lot of different models for trying to crack new things."
--This article was updated on November 21, 2016, to reflect the confirmation of the $200 million investment from NBCUniversal.