BuzzFeed: An Open Letter to Ben Horowitz

http://www.mondaynote.com/2014/09/07/buzzfeed-an-open-letter-to-ben-horowitz/

by nns • 12 years ago

91 31 12 years ago

jgalt212• 12 years ago

Wasn't this Chris Dixon's deal? I mean, I'm sure Ben and other partners had to sign off on it, but I think Chris lead this one.

erdemg• 12 years ago

Yep. Here's what Chris Dixon wrote about the deal. http://cdixon.org/2014/08/10/buzzfeed/

staunch3• 12 years ago

He pretends people call Buzzfeed a "toy" (like 3d printers) when in reality they call it "trash" (like tabloids). Head in sand.

sparkzilla• 12 years ago

OMG. WTF. LOL. TRASH. FAIL. WIN.

jokull2• 12 years ago

His main argument is that by funding BuzzFeed he is "contributing to intellectual decrepitude" of young readers. This is an outrageous statement. BuzzFeed started out with socially optimised content and were one of the first to recognize the power of sharing over front page habits. Today they employ many great journalists and are creating high quality content that is much easier to consume and spreads more quickly (admittedly along with some pretty banal stuff). A16Z enter the partnership based on future prospects, nothing else. BuzzFeed may or may not become a good source of enlightened reporting in the future, but at least that is their goal and they have a pretty good chance at it for a generation that mostly consumes through social media.

blutoot• 12 years ago

I actually commend BuzzFeed for having unabashedly liberal social viewpoints. So maybe through listicles and what not, it can help push for more openness in our society to heterogeneity.

smacktoward• 12 years ago

That sounds more like Upworthy, which was founded by two former leaders of MoveOn.org (Eli Pariser and Peter Koechley) with the explicit goal of presenting liberal/progressive ideas in viral, shareable packages. (See http://www.nytimes.com/2013/10/14/business/media/upworthys-v... for more background on this.)

nateparrott• 12 years ago

Exactly. Sites like BuzzFeed and Vice have some pretty trashy stuff, so people dismiss their small forays into "real" journalism as irrelevant posturing—but I don't think that's the case. In the past, quality journalists went to quality publications because the only place to find quality journalism was in a quality publication. Now, with people getting their articles from aggregators, social media and cross-linking, it's no longer important what publication a writer writes for. A journalist for BuzzFeed can write (nearly) the same article they would for the New York Times, and (nearly) the same people (within the younger audience, at least) will be able to discover it. The publication is less relevant as an institution and a brand — BuzzFeed, HuffPo and the ilk are just investors and CMS's for the work of individual writers.

Tl;dr: online news has been unbundled.

pearkes• 12 years ago

I think you're absolutely correct about the writers having potentially equitable quality, but I would challenge the following statement:

The publication is less relevant as an institution and a brand

Journalism, and journalists, need to be trusted to deliver researched and verifiable content. This seems to be enforced because of reputation – i.e, the reputation of a publication.

When an organization does what BuzzFeed does to earn eyeballs, dollars and readership, it makes you question what they would do in more serious, "important" topics, such as describing world events to future voters.

I have trouble trusting BuzzFeed as an organization, as with Vice, due to this "trashiness". I think we all should.

rokhayakebe• 12 years ago

Are you saying their plan all along was to bait readers by pandering to their needs, THEN slowly spoon-feed them smarter content?

jokull2• 12 years ago

Or widen the readership. You can either convert causal readers to serious readers, widen the audience to include more serious minded readers, or mix both. I think there’s a winning combination in there.

In any case they wouldn’t be the first media outlet to engage readers on the easily digested stuff but sprinkle in more challenging pieces. That’s pretty standard affair for most magazines and newspapers. Their innovation is in making sure their content gets shared, and that doesn’t just apply to listicles.

boomzilla• 12 years ago

I looked at a16z portfolio [1] and could not find any "real" liquidity event, meaning IPO or big acquisition. There are a number of really high valuation companies, though, which are mostly based on the last round funding, often led by a16z. Now, a natural question is who exactly is benefiting from the high valuation? OK, certainly not the employees as most of them are not vested, and even if they have, they can't sell to anyone, and there is no cash dividend. The founders and top management sometimes can negotiate a better deals financially in these funding rounds [2], and in general can be resume boosters for them, so they do benefit somewhat from the high valuation. The LPs are not exactly getting anything at this time as the gain is not realized yet. That leaves the VCs who have a huge incentives to lead big rounds, as their incomes are proportional to the size of the funds they raise from LPs as detailed in this HBR article [3]. Given this dynamics, I am not surprised to see average startups with average products get funded at a hugely inflated valuation. I just hope that the LPs are investing with their own money, and are not retirement fund managers (specifically, not MY retirement fund).

[1] http://a16z.com/portfolio/

[2] http://allthingsd.com/20111001/vcs-unite-chamath-palihapitiy...

[3] http://blogs.hbr.org/2014/08/venture-capitalists-get-paid-we...

joshu• 12 years ago

Big events take proportionate longer. A16z simply hasn't been around long enough yet.

RoboTeddy• 12 years ago

Oculus VR might count

npalli• 12 years ago

> I looked at a16z portfolio [1] and could not find any "real" liquidity event, meaning IPO or big acquisition.

Here are the exits for a16z.

http://en.wikipedia.org/wiki/Andreessen_Horowitz#Exits. Most of them were high profile exits.

spuiszis• 12 years ago

The a16z website shows the current portfolio (most recent, un-exited investment) and does not display their entire investment history. If you check out their Crunchbase profile[1], they have already had some big exits with Groupon, Zynga, Skype and Instagram, which is quite impressive since they only started investing 3 years ago. I'm sure there have been some other medium/large M&A liquidity events as well but it usually takes 3-5 years to figure out if your VC portfolio is any good and 7+ years to realize any returns. LPs know this and funds usually have a 10 year life cycle, sometimes with options to extend it a year or two [2].

[1]http://www.crunchbase.com/organization/andreessen-horowitz/i... [2]http://www.amazon.com/Venture-Deals-Smarter-Lawyer-Capitalis...

diminish• 12 years ago

actually even the current portfolio is impressive, only few of them ipoing would make a16z cherish. In addition, they have bold investments such as cyagenmod...

camillomiller• 12 years ago

Is anybody here really convinced that buzzfeed isn't a fad? Its numbers are so badly intertwined with social media platforms that they actually depend on the continued success of the platform themselves. How is that a good business strategy?

jitnut• 12 years ago

As long as they can figure out to stay on top new social properties whether is snapchat / instagram / whatsapp / something new, I think they will do fine. Of course not the same hockey stick growth. I was reading an piece on Buzzfeed growth http://www.inc.com/christine-lagorio/buzzfeed-secret-growth-... . Seems like they gonna hire people just for that.

thrush• 12 years ago

I found this to be overly critical of Buzzfeed's content, and I believe that Buzzfeed's potential and current success comes from the content structure. I personally have faith that people are interested in consuming useful and intelligent information in order to improve their knowledge, so that they may perform better in the future for tasks like voting. With this assumption, it's amazing how much traffic BF generates with the allegedly weak quality of content that it possesses, which essentially is proof that something else must be working. Now that we have a proven structure for content, we simply need to fill in content. Isolated to one region, like the US, the content to be filled in we are all familiar with. But imagine that we expand to all regions. It must be at least an order of magnitude easier to start a news site using BF's strategy in any place, like Africa, which I would guess is at least part of the reason that a16z chose to invest.

xux• 12 years ago

The author is shorted sighted. I'm surprised so many people on HN following his thought patterns, because what Buzzfeed is doing is nothing short of classic disruption.

In a disruptive startup, you always start with a _worse_ product that appeals to a marginally group of users who'll fervently love you.

The demographic that's on Buzzfeed all the time, is the type who wouldn't be reading news anyways. So what if they look at cats and take quizes, and once in a while eyeball an article about Ferguson / Ukraine / ISIS that they wouldn't have done anyways. Look at http://www.buzzfeed.com/world, how many of those are linkbaits? How many are quality contents? It's not unimaginable that overtime, the (vegetable news) : (shitty news) ratio can increase.

Hating on Buzzfeed is like hating on Pinterest in early days because it was made for a bunch of old women, or AirBNB because it promotes unsafe and unregulated travel, or Dropbox because it promotes uncontrolled privacy by moving your stuff online. You can't please everyone all the time, so you start with a niche and increase quality overtime to appeal the the mass audience.

Why can't people accept that Buzzfeed, at its current state, isn't meant to appeal to everyone? Those who bash at Buzzfeed sound like the mindless YouTube comments on Justin Bieber's videos saying how shitty his music is. It's not for you. Don't listen to it.

riffraff• 12 years ago

the piece relies on "We never saw a down/mass market product morphing into a premium media", so yes, for him it is unimaginable.

I don't know if that is true, but if you argue against the letter you should refute _that_ argument.

joeroot• 12 years ago

Vice is a fairly compelling case. They started with trashy "Do"s and "Don't"s, and now have reporters embedded within ISIS.

nl• 12 years ago

Rolling Stone.

Cosmopolitan magazine.

Vice has been mentioned.

staunch3• 12 years ago

Jonah Peretti figured out how to spam the web better than anyone with the Huffington Post. He also figured out how to get away with it. It's been called the veneer strategy. The idea is to take a little bit of legit content and make it look like that's the site. In reality all of your real traffic comes into your many thousands of shitty linkbait articles. This throws off Google's spam team and confuses people about what you're doing. Hopefully you sell before the house of cards comes crumbling down.

There's a reason McDonald's sells salads and it's not because they believe it's the future of fastfood. It provides cover when the idea of sickening billions with shitty food occasionally heats up.

http://www.mcdonalds.com/us/en/food/full_menu/salads.html

drey• 12 years ago

Do you happen to have any links to read more about this veneer strategy?

nashequilibrium• 12 years ago

I'll say this for what its worth, i have been very surprised at how good their business articles are!

philwelch• 12 years ago

Is it really worthwhile to invest all of our innovation in trying to figure out how to make more addictive, mindless tabloids? Huffington Post and Daily Mail are bad enough.

asaramis• 12 years ago

This is a perfect combination of every short-sighted, angry old media, and old man rant I've ever come across. I mean, to go from hating on BuzzFeed to somehow ending up on the "Africa is one single country and let's help it" trope is quite impressive.

Best article that sums up what Buzzfeed is really about, and why I believe it is incredible for the future of journalism is this piece by Felix Salmon. Basically, he makes the point that Buzzfeed is in effect a massive advertising agency, and their content efforts are all experiments to better understand how to reach younger people. They then make money off of selling that expertise to brands.

That is a much more sustainable, legitimate form of funding a news business vs. the world of doing anything you can to get eyeballs to your page and selling ads around it. It means constant experimentation in the fields of communication and storytelling built on the back of an incredible technology company.

The best part of the entire Filloux piece, it was Chris Dixon who led the investment (someone pointed that out nicely in the comments). Does he not even realize that VC firms almost always have internal dissension and investments aren't unanimous? He has zero way of knowing Ben Horowitz's take on the investment.

https://medium.com/@felixsalmon/normally-when-some-big-deal-...

BuzzFeed: An Open Letter to Ben Horowitz

Related Stories