BuzzFeed, founded in 2006, is one of the leading digital media platforms. The company is known for bringing popular memes and entertainment content to life, as well as official journalism. BuzzFeed began its business by offering entertainment content to its customers, but over time, BuzzFeed began to develop in the field of video content and professional journalism. In 2012, journalist Ben Smith joined the BuzzFeed team to create and develop a new direction of news. Ben was nominated for a Pulitzer Prize a few years later. By the way, the Pulitzer Prize is one of the most prestigious US awards in the field of literature, journalism, music and theater. In 2020, Mark Skoufs took over as Editor-in-Chief of BuzzFeed News and also successfully entered the Pulitzer Prize nomination the following year.
In the early years, BuzzFeed built its business around a native advertising strategy, in which paid ads appeared on the page in a format that matched the style of the main content. However, after several years of its activity, the platform faced the threat of competition from social networks, which began to change their rules of the game. To maintain the required level of competition, the company has changed its approach to advertising in favor of more innovative technologies, focusing on e-commerce and content licensing.
According to BuzzFeed, the company's revenue grew more than 50% in the second quarter of 2021 compared to the same period a year earlier. The growth of the indicator became possible due to the improvement of marketing policy and business scaling. Advertising revenue grew 79% in the second quarter of this year to $ 47.8 million. The second quarter of 2020 was the worst quarter for advertising during the COVID-19 pandemic, but we see market activity showing an impressive recovery this year. It is important that the company shares our views and in 2020 BuzzFeed acquired rival company HuffPost and we consider this deal to be beneficial for the overall business in the mid-term.
In November 2016, BuzzFeed held its final investment round, during which it raised $ 200 million and was valued at $ 1.7 billion.In June, it became known that the company intends to enter the public market through the SPAC mechanism of the merger with the 890 5th Avenue Partners under the ticker ENFA. Following the merger, the new public company will trade under the ticker BZFD. The public listing transaction is expected to close in Q4 of this year or Q1 2021. According to market rumors, the transaction may take place at the level of $ 1.5-2 billion.
High competition in the media market can be singled out among the main risks, however, we understand that the company has firmly established its position in the market. We believe that going public will allow the company to raise funds for more aggressive marketing activities or even M&A deals. The company has good fundamental prerequisites, since by the end of 2021 the management predicts revenue growth to $ 521 million compared to $ 321 million in 2020. At the end of 2022, the figure may even be $ 624 million, which corresponds to 20% growth year-on-year. The company expects revenues to exceed $ 1 billion by 2024. Looking back, we can see how Buzzfeed has grown in market position. Over the past 15 years, the company has shown impressive results. Thanks to its successful activities in the M&A market, the company manages not only to increase its market share, but also to demonstrate impressive results. We believe that going public will provide an opportunity for BuzzFeed to grow its business further.