Vivek Ramaswamy, a former Republican presidential candidate and biotech entrepreneur, has acquired a minority stake in Buzzfeed, the digital publishing company that closed its media outlet last year. The purchase caused Buzzfeed’s stock to rise by about 20% to $2.99 on Wednesday. Ramaswamy now has a 7.7% stake in Buzzfeed, as reported in a filing with the Securities and Exchange Commission late Tuesday. He believes that Buzzfeed’s stock is undervalued and is interested in discussing with the company’s board and management.
Buzzfeed has faced financial difficulties since going public in 2021. The company began implementing job cuts towards the end of 2022, citing a challenging digital advertising environment. In early last year, Buzzfeed News, the company’s Pulitzer Prize-winning digital media outlet, was shut down. CEO Jonah Peretti announced layoffs across various departments in addition to the news division. Despite these measures, Buzzfeed reported a first-quarter loss of $35.7 million with a decline in advertising revenue by 22% and content revenue by 19%. The company is expecting a further decline in revenue.
Ramaswamy’s involvement with Buzzfeed comes after his decision to suspend his bid for the 2024 Republican presidential nomination and endorse former President Donald Trump, following a fourth-place finish in Iowa’s leadoff caucuses. Ramaswamy, the son of Indian immigrants, made a vast fortune at the intersection of hedge funds and pharmaceutical research after graduating from Harvard University and Yale Law School. He has now turned his attention to investing and acquisitions, with his latest move being acquiring a stake in Buzzfeed.
The acquisition of Buzzfeed by Ramaswamy reflects his belief in the undervalued potential of the company despite its recent financial struggles. By purchasing a significant stake and expressing interest in engaging with the management, Ramaswamy aims to work towards generating value and improving Buzzfeed’s financial performance. His background in biotech entrepreneurship and involvement in politics at a high level position him well to navigate the challenges and opportunities of investing in the digital publishing industry.
Overall, Ramaswamy’s acquisition of a stake in Buzzfeed marks a significant development in the company’s financial trajectory. With his background in biotech entrepreneurship and experience in politics, Ramaswamy brings a unique perspective to the table. By expressing confidence in Buzzfeed’s potential and seeking to engage with the management, he aims to drive value and address the company’s financial struggles. This partnership could signify a new chapter for Buzzfeed as it navigates the complexities of the digital publishing landscape under Ramaswamy’s guidance and vision.
