Ziff Davis, another media company, is said to be purchasing Mashable for less than fifty million. The price would make a marked dive from the company's recent evaluation and funding from outside sources.
Ziff Davis Buys Mashable
By: Mark Angelo
The internet can be a highly unpredictable place for workers,
company owners and investors. One day, a company is worth a lot
of money. The next, the company’s values can fall precipitously.
Such is apparently the case for Mashable. While the online
publisher once saw fast and impressive growth very quickly, the
value of the company has apparently cooled down considerably.
Ziff Davis, another media company, is said to be purchasing
Mashable for less than fifty million. The price would make a
marked dive from the company’s recent evaluation and funding
from outside sources. In the spring of 2016, officials at Time-
Warner were the winners in a funding round that led the market to
value the company at about $250 million. Investors poured
roughly fifteen million dollars into company coffers at that time.
Those at Ziff Davis have made it clear they are going to lay off
about fifty staffers as part of their overall plans to restructure it.
Employees who are not being directly laid off are expected to be
offered other jobs with Ziff Davis. The goal for Mashable right
now, according to those involved in the deal, is to think about ways
to refocus the company’s content. Officials plan to focus more
attention on technical content and other content that is related to
the tech world. The company’s founder, Peter Cashman, will be
staying on. He believes that Ziff Davis loves Mashable and
appreciates their editorial insights into the tech world. However,
he also admits that there will be cost cutting measures in place
once the takeover is complete and that such measures will also
include layoffs for current staffers.
Ziff Davis is a digital media company. Owned by J2, they specialize
in providing content that invites viewers to click on affiliate
commerce links. These links are usually found in the text of an
article. The reader is encouraged to head to the link to see more
information about a product or service they might like to buy or
use. In turn, the company gets a share of the profit should they
buy it. In many cases, Ziff Davis will also earn a commission
merely for bringing readers to another site. The company has
purchased many low cost content providers in the past.
The Effect on Other Media Publishing
Officials believe that this lapse in value indicates there may be
problems for those online companies that rely on digital
advertising to help generate a significant chunk of their overall
revenues. Google and Facebook are seen as the company that have
captured the lion’s share of this type of revenue. Many observers
believe that such industry giants will continue to enjoy even more
such online funding and capture an ever greater share of ads. In
response, other company that have similar models such as
Buzzfeed have also seen layoffs. It remains to be seen if this is a
momentary trend or indicative of a larger potential upheaval.
Mark Angelo co-founded the Investment Manager in August 2009 and two affiliated
investment managers in 2000 and 2016. http://www.yorkvilleadvisors.com/