BuzzFeed acquires entertainment firm Complex Networks from Hearst and Verizon
BuzzFeed has announced that it has agreed to acquire Complex Networks - a global youth entertainment company with massive reach spanning style, food, music, sneakers and pop culture - from Hearst and Verizon.
The announcement follows BuzzFeed’s disclosure that it is seeking to go public by merging with 890 Fifth Avenue Partners, a special purpose acquisition company (SPAC) with $288 million in cash in trust.
BuzzFeed has also secured approximately $150 million in convertible note financing led by Redwood Capital Management and including CrossingBridge Advisors, Cohanzick Management, and Silver Rock Financial LP. The $300 million acquisition of Complex - consisting of $200 million in cash and $100M of equity in BuzzFeed - is expected to close in the fourth quarter of 2021 after the merger of BuzzFeed and 890 Fifth Avenue Partners.
Complex was co-founded by Rich Antoniello and Marc Ecko in 2002 as a media brand, and has evolved into a content powerhouse spanning digital, video, audio media, and live events with an online community that reaches a multicultural audience who share a passion for what's now and next in pop culture and style.
Today, Complex Networks includes Complex (pop culture), First We Feast (food entertainment), Pigeons and Planes (music discovery), Sole Collector (sneaker news), and its festival of cultural convergence ComplexCon. Following the transaction, Complex Networks will remain editorially independent, but benefit from the application of BuzzFeed’s data science, distribution network, and lines of business - including commerce - to accelerate revenue growth.
Following this acquisition, BuzzFeed will become even better-positioned to thrive in an age of media consolidation. BuzzFeed has the strongest portfolio of brands in key categories: Complex Networks, encompassing streetwear and fashion, food, music, and pop culture; two Pulitzer Prize-winning newsrooms, BuzzFeed News and HuffPost, that hold the powerful accountable; BuzzFeed, the flagship entertainment brand that curates the internet and culture, and brings joy to its audience with quizzes, lists, and more; and Tasty Lifestyle Brands, which includes the world's largest food network and several other lifestyle brands that help its audiences live better.
Jonah Peretti, Founder and CEO, BuzzFeed: “ “I’m incredibly excited to welcome Complex Networks to BuzzFeed. Complex is one of the most interesting and dynamic companies in the space, and a true leader in culture and entertainment. The fact that the Complex audience skews more male and more diverse than BuzzFeed will make our company stronger. And I want to thank Rich Antoniello for agreeing to come on as an advisor to BuzzFeed -- he’s one of the most innovative, visionary entrepreneurs I know.”
Rich Antoniello, Founder and CEO, Complex Networks: "For nearly 20 years, Complex Networks has been an outlier and a rocketship in our industry. Our success has been our differentiated offering, building a real and loyal community, and never losing focus of our mission to champion the people, brands and new trends audiences need to know now and will obsess over next. In Jonah and BuzzFeed, we've found unparalleled vision; a deep respect for our company culture, brands, and editorial independence; and a partner with business lines that will enable us to take Complex Networks to an entirely new level. With this move, we're joining another rocketship and just getting started."
Christian Baesler, President, Complex Networks: "BuzzFeed's unique approach to data, creativity and commerce opens up many new opportunities for Complex Networks' continued growth. Just like us, they've been deliberate and unwavering in their path to success. I'm grateful to Rich for his partnership and entrusting me to lead Complex Networks through this new chapter. I'm also excited to work with Jonah and the BuzzFeed teams to expand on the incredible momentum Complex Networks has experienced over the last two decades."
When the transaction closes, Complex Networks Founder and CEO Rich Antoniello will become “founder-at-large” and shift into a two-year advisory role to BuzzFeed and CEO Jonah Peretti, providing counsel on new partnerships, acquisitions, and major strategic initiatives. Christian Baesler, currently President of Complex Networks, will assume the role of CEO. And Justin Killion, current GM and Executive Vice President for Operations & Content at Complex Networks, will become its President.
Since Rich Antoniello founded Complex Networks in 2002, the company has evolved, grown, and thrived, despite an array of headwinds and industry skeptics. Complex iterated constantly: from print to digital, launching a vertical ad network in 2007; from text to video, with the launch of Complex Video in 2012; and finally, to in-person experiences and events, with the launch of ComplexCon in 2016, the largest and most innovative media brand festival. Along the way, Complex Networks has achieved a truly diversified revenue model, reducing advertising to less than 50% by 2017--with the rest spanning across e-commerce, licensing, syndication, live and virtual events, and creative services.
BuzzFeed has also announced that it will merge with 890 Fifth Avenue Partners Inc., a tech, media and telecom Special Purpose Acquisition Company (“SPAC”) to become a public company. 890 Fifth Avenue Partners Inc. has $288M in cash in its trust account.
The transaction includes an additional $150 million in convertible note financing led by Redwood Capital Management and including CrossingBridge Advisors, Cohanzick Management, and Silver Rock Financial LP. Upon closing of the transaction, the parent company will be known as BuzzFeed Inc., after the merger and be listed on the public market under the ticker symbol “BZFD.”