“It’s a question of ambition and opportunity for us, and we are ambitious,” said Jim Bankoff, CEO of Vox Media. “We will assess our options, but we will do so from a position of strength.” He refused to comment on financial details or potential transactions.
According to three people with knowledge of the situation, Group Nine had discussions with major publishers, including Vox Media, about a possible merger for its own SPAC listing, but none have come to fruition. Ben Lerer, Group Nine’s CEO, stated in an interview that the company is “in an enviable position” due to recent sales growth.
“Obviously, the SPAC allows us to be even more ambitious,” he said.
A deal with one of Group Nine’s largest backers, Discovery Inc., could be an option. In order to compete in streaming, the media behemoth recently orchestrated a daring takeover of WarnerMedia. Through content partnerships, Group Nine’s properties have helped drive hundreds of thousands of new customers to Discovery’s streaming platform, making it an appealing takeover target.
During the pandemic, the digital ad market thrived as people increased their online spending; BuzzFeed, Vox Media, and Group Nine all benefited. Nonetheless, their profits paled in comparison to those of the digital behemoths.
“Facebook, Google, and Amazon are crumbs on the cake of Vox, Group Nine, and Buzzfeed,” said Brian Wieser, lead analyst at GroupM, the media investing arm of ad giant WPP.
This disparity highlights the need for ad-driven publishers to grow in size.
BuzzFeed’s entry into public markets will almost certainly give it an advantage. In addition to cash, it will be able to use its stock as currency in another transaction similar to the HuffPost acquisition.
“We’ll have opportunities to pursue more acquisitions, and there are more exciting companies out there that we want to pursue,” said Jonah Peretti, co-founder and CEO of BuzzFeed, last month.
In a recent interview, when asked if BuzzFeed would consider entering the subscription business, he said, “Sure, we’d consider it.” “Well, why not?”