Ramaswamy’s new fight is with BuzzFeed

Vivek Ramaswamy’s recent acquisition of a nearly 10% stake in BuzzFeed is raising unexpected questions about the future of the digital media company and fueling speculation about the conservative firebrand’s next moves.

Ramaswamy, an investor who became known as a Republican presidential candidate by embracing conspiracy theories and enthusiastically supporting former President Trump, is introducing a new right-wing direction for the digital publisher.

But experts and observers in the technology and media sectors say Ramaswamy’s power will be limited, despite a splashy investment in BuzzFeed to keep his name in the news and maintain relevance as he hopes to win a Republican vice presidential nomination.

“Just like in the Republican Party presidential primaries, when you have a crowded field, you need to get attention,” commented Johanna Dunaway, Director of Research at the Institute for Democracy, Journalism and Citizenship at Syracuse University. “Given the location, the tone and the timing in which this happened, it seems like Trump is the one he’s trying to get attention from.”

After accumulating an 8.37 percent stake in the media company over the past three months, Ramaswamy laid out his vision for BuzzFeed in a letter to his board of directors on Monday.

The former Republican candidate said the company had “lost its way” and called for the addition of several directors to its board, the hiring of creators to produce multimedia content and proposed “large-scale” staff cuts.

Ramaswamy wrote that the new directors would help bring “intellectual diversity” to the company’s leadership, rather than the racial and gender diversity initiatives that he, like many conservatives, said were indicative of a liberal bias in the media.

He proposed that the company hire notable right-wing figures such as Tucker Carlson and Candace Owens as content marketers and influencers.

Perhaps most notably, the Republican demanded that BuzzFeed admit that it “repeatedly lied about issues of national importance” and “echoed easy, politically expedient narratives in search of clicks.”

BuzzFeed leadership has signaled that it does not intend to agree to Ramaswamy’s proposal.

In a written response to his proposal, obtained this week by The Hill, BuzzFeed co-founder and CEO Jonah Peretti rejected a series of criticisms from the conservative and said he had a “fundamental misunderstanding” about how the company operates. .

“I’m very skeptical that it makes business sense to turn BuzzFeed into a creative platform for fiery political pundits,” Peretti wrote in his response. “And we definitely won’t apologize for our Pulitzer Prize-winning journalism.”

A representative for Ramaswamy declined Thursday to answer questions from The Hill about how he planned to wrest control from Peretti and make the changes he is proposing, but teased an upcoming press conference call about his investment in the company.

During an interview with Semafor’s “Mixed Signals” podcast, Ramaswamy suggested that BuzzFeed’s financial problems could present an opportunity for him to take the company private.

“This is a company that has more debt than cash. This debt matures in December. So anyone who thinks Jonah Peretti is responsible for this deal because some piece of paper says he has voting rights on the shares is delusional,” he said. “People talk about going private. Are there things to do with debt? Are there things to do with, you know, other forms of financing or growing or eliminating parts of the business? I presented my current views in the letter.”

BuzzFeed was founded in 2006 and rose to prominence using games, quizzes and puzzles to amass millions of loyal followers a day before investing heavily in news reporting and political coverage ahead of the 2012 election.

The company underwent a controversial public offering in 2021 and has since faced difficult financial times.

Like many digital publishers, BuzzFeed has made deep staff cuts in recent years and experimented with artificial intelligence (AI) to create content.

BuzzFeed News officially closed in the spring of 2023, cutting 15 percent of its workforce after determining it “could no longer continue to fund” a news operation “as a standalone operation.”

Earlier this year, the company announced plans to lay off another 16% of its staff and sold Complex — a pop culture media startup it acquired for nearly $300 million in 2021 — at a significantly discounted price.

Experts say Ramaswamy’s ideas are unlikely to help the company’s financial situation.

“One of Buzzfeed’s biggest problems is that they’ve spent over a decade chasing trends – social media, video, affiliate revenue, etc.” Sean Griffey, co-founder and CEO of Industry Dive, wrote on X. “Vivek’s suggestion that they focus on ‘creators’ and unique voices is more of the same. Throwing darts hoping for magic.”

Despite Ramaswamy’s nearly 3 million shares in BuzzFeed, which makes him the second-largest Class A shareholder, experts and observers note that his stake in the company translates into very limited voting power.

As of December, Peretti and his affiliates owned 96% of the company’s Class B shares, which have about 50 times more votes than its Class A shares.

That translates to about 64% voting power, which BuzzFeed acknowledged limits other shareholders’ ability to influence major transactions or initiate a change of control.

A growing number of observers have predicted that Ramaswamy will likely be powerless in his attempt to drag BuzzFeed to the right.

“In this case, the possibility of a proxy battle literally doesn’t matter because you can’t beat Peretti in the vote. So what are you really doing, Vivek?” technology columnist Elizabeth Lopatto wrote in The Verge this week. “You chose Buzzfeed because the shares are cheap and because you have a grudge against a historically liberal outlet.”

Some have drawn parallels between what Ramaswamy is proposing for BuzzFeed and the sweeping changes billionaire Elon Musk made to X, the platform formerly known as Twitter, after he bought the company in 2022.

Like Musk, Ramaswamy appears to be “trying to get BuzzFeed to hire or pay more attention to certain conservative voices,” noted Jill Fisch, a business law professor at the University of Pennsylvania, during an interview with The Hill.

Conservatives have long criticized the policies and influence of mainstream media and technology companies, with some activist entrepreneurs creating their own alternative companies catering to right-wing clients.

Since taking control of Twitter, Musk has eliminated several content moderation policies and allowed previously banned individuals such as Trump and Republican Rep. Marjorie Taylor Greene to return to the platform.

This story originally appeared on thehill.com read the full story