Lefty Millennial Media Companies Are Collapsing, Investors Pull Out
Lefty Millennial Media Companies Are Collapsing, Investors Pull Out. Vice and Vox have both missed revenue projections, Disney has written down their investment in Vice by 157 Million dollars, and Buzzfeed resorted to selling cookware at Walmart.Social justice, the far left, and intersectional feminism were easy ways for companies to generate anger to get clicks but as Facebook and Google derank this type of content these media companies are losing money and slowly collapsing.Will this mean regressive leftists lose mainstream appeal as the media activists that support them lose their jobs? Or will these companies double down to the extreme in an effort to scrape what little money they can from the bottom of the digital barrel?
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Investors have begun shying away from new media companies for a variety of reasons, one of which is their dependence on what's called FAANG, which typically means like Amazon, Facebook, Google.
Most of these new media companies, they have exorbitant evaluations, but they just chase the algorithm.
They don't produce quality content, they're not tracking down big stories, they're writing hit pieces on PewDiePie because it's simple clickbait that generates money and doesn't really serve anybody.
But eventually, that stops working.
People get fed up.
People like PewDiePie.
But more importantly, Facebook changed its algorithm, and Google periodically changes its algorithm, too.
Which means these companies are bad investments.
The Washington Post has published this story, and it actually paints a pretty interesting picture of how things are going to change.
Mike.com is a really interesting example.
At one point, they were valued at $100 million.
They recently laid off most of their staff and sold for $5 million.
So I'll say this.
If you think the hit pieces were bad a few years ago, if you think they're bad today, how do you think these companies are going to react as they slowly start dying off?
It's gonna get a lot worse.
So today, let's take a look at what the Washington Post has to say about investment in these companies, and take a look at one of the best examples of the failures of new media and why they're a bad investment, Mike.com.
But before we get started, please head over to timcast.com forward slash donate.
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From the Washington Post, new media hits stumbling block scaring away some investors.
Cites reliance on Facebook, Google seen as a contributing factor.
As legacy news companies suffered tremors over the past decade, money from venture capitalists poured into upstarts that promised to leverage a keener understanding of online reading habits to create a giant killing class of new media ventures.
Today, the money is starting to dry up.
Big ambitions have been downsized, and the tremors that continue to shake many newspapers are now moving through new media companies.
Among those facing headwinds are BuzzFeed, Vox, and Vice.
Another one, Mike, last week abruptly laid off most of its staff, and the company that a year ago was valued at $100 million garnered a fire sale offer of $5 million for its remnants.
The numbers tell the story.
Investors closed 27 deals worth about $206 million in 2014, but are on track to close just 19 such deals worth $130 million this year, according to PitchBook, a private capital market data provider.
One reason for the wariness among venture capitalists is many sites relied on Facebook and Google to build their audience.
But just as many financiers were pressing to see more tangible financial results, Facebook changed its algorithm to favor posts from friends and family rather than news organizations.
Some new digital media firms saw audience declines.
Others scrambled to alter their business models on the fly, making expensive bets on video that did not pan out.
The most recent example of industry troubles is Mike.
A millennial-friendly news site which was recently sold to Bustle Digital Group A publishing company focused on female readers.
Last year, the site received $25 million from venture investors, giving it a valuation of more than $100 million according to PitchBook.
A year later, it was sold to Bustle for a reported $5 million.
Mike said in a statement that their business model isn't settled.
And if anyone claims to know how this stuff actually works, they don't, saying that it's actually categorically false.
But I can actually paint out a picture, at least in my opinion, of why Mike.com failed.
As the Washington Post noted, Many of these companies relied on algorithmic feeds in order to generate traffic and make revenue.
But those algorithms can change.
What ends up happening is these companies like Mike, like BuzzFeed, etc.
They chase what people click on.
And anger generates the most traffic.
That's how they make money.
Pissing you off.
And I would say, for the most part, that's not untrue for content that I make.
Obviously, people on YouTube are beholden to similar algorithmic trends.
Though, I would say, for the most part, there are some people who try to resist it.
There are certainly those who exploit it.
The problem for these big companies is that when these algorithms change, they cease to exist.
They cease to exist.
But for smaller creators with low overhead, we can actually survive changing winds.
But I want to go through an example of why Mike failed.
We'll start with a story from 2015.
How this media startup became a $100 million company by courting millennials.
While Mike still has a modest valuation compared with competitors like BuzzFeed and Vox, its co-founders are confident that the company can be the voice of the digital generation.
Except they can't.
And I think it's funny the Wall Street Journal even used the same photo.
Mike Network sold to Bustle for about five million.
They failed.
And I can only wonder why.
But Mike.com chased the far left.
And according to sources I have within Mike, the founders are anything but progressives.
I was told, and they could be wrong, but I was told by sources that these men who founded Mike are actually libertarian capitalists who did not believe most of the ideology pushed by Mike.
But I want to use a specific example that I really think hits why Mike failed.
This is a very famous incident that occurred in 2016 before Trump had been elected.
Mike tweeted, And now here's the video, which I have highlighted in the past, but I want to bring up again.
You can see that this woman is pretty angry.
She's accusing this man of having groped her.
They say that she was pepper sprayed.
She's a 15 year old.
We're going to go through the progression of how this story actually played out and why Mike is a failure.
She yells.
The guy has his hands up saying, I never touched you.
Police said the girl punched a man in the crowd who groped her.
Mike cut out.
You notice that white flash.
Let's play that again.
There's a flash.
You see her arm retracting before she gets pepper sprayed.
Mike, cut that part out.
This is one of the problems of digital media chasing these algorithms.
They want to get you angry.
They want her to be the victim.
Now, the Young Turks actually did a better job in showing what happened.
The Young Turks actually have the clip, and they show this woman actually punch the man, which you can just see.
Mike, cut that punch out.
People don't like it when you lie to them and they can find out.
But more importantly, the Young Turks did still portray this young woman as a victim, though they did mention she punched this guy.
The important thing you need to realize, for one, it was reported a day later.
She was not assaulted by this man.
And two, the girl actually faced charges for punching the man in the face.
She was pepper sprayed in defense by another person, she punched the guy we saw, and the real story was that this young woman punched a guy, was not assaulted by him in any way, and police then said she was facing disorderly conduct charges.
This is just one example.
And I know there have been people who have complained, oh, Tim, you don't have examples of left-wing violence, you only ever talk about the bike-lock basher.
No, I don't.
Maybe you just don't watch enough of my videos.
Because this was an instance where a young woman punched a man in the face, and it appears that she falsely accused him before striking him in anger, and then being pepper-sprayed afterwards, and actually faced charges.
But the story pushed out by Mike was chasing the algorithm.
Do I think Mike was trying to purposefully be biased?
Yes, I do.
Personally, I do.
Because they edited out the part where she punched him, even though it was less than a second of video footage.
They didn't need to do that.
What happens is, they want to chase anger.
They want to rile up a certain group of people to get them to click, to share, because the algorithm promotes it.
The main culprit in the culture war, in my opinion, is social media companies.
Banning certain people, promoting certain ideas, it inflames people, it makes tensions worse, and then you have venture capital funding these media companies to then produce this hate bait, this hateful content in an effort to get traffic.
But later we learn from real journalists, local news outlets, the young woman was actually facing charges herself and was never actually assaulted.
There's a couple more examples that I want to bring up of the death of media.
Probably one of the most prominent and hilarious, but also said at the same time is this paragraph from Washington
Post After reportedly missing revenue projections last year BuzzFeed
launched an aggressive effort to diversify its revenue including selling cookware at Walmart I
Kid you not Walmart sells BuzzFeed brand cookingware
If that is not an example of media failing, then I don't know what is.
Or better yet, I should say, that is a sign that BuzzFeed is willing to do whatever it takes to survive.
And you have to realize that when algorithms feed into anger, That is going to be one of the strategies.
BuzzFeed actually isn't that bad.
I actually think BuzzFeed does a relatively decent job.
But there are certain individuals at BuzzFeed who do an overwhelmingly bad job.
And I don't know why BuzzFeed keeps them on staff, and I've actually talked to the editor-in-chief about it.
So I can say, out of all the companies, BuzzFeed is willing to answer questions about this and respond pretty quickly, so they have my respect in that regard.
But not when it comes to the lies pushed out on social media, which to me seem like an effort to generate traffic for a dying brand.
But I want to shift sites now to the paragraph just before this one.
Mike is not the only new media company to struggle recently.
In November, Disney said it would write down the value of its investment in Vice Media by $157 million.
Vox is expected to miss projections this year.
Vox, in my opinion, jumped the shark.
They called Laci Green red-pilled and aligned her with the alt-right in an attempt to smear PewDiePie.
I'm sorry.
Laci has millions of fans.
Yes, she probably lost some fans when she decided she wanted to open a dialogue with people who are anti-SJW or anti-feminist, but many of the people who watch her videos are still pretty overtly feminist and still support her.
And not only that, Laci's videos are still mostly about sex education, and she doesn't really have political videos.
Not like I do, at least.
Why then would they try and align Lacey Green?
Because they need villains.
They need you to be angry, to chase the algorithm.
But when the algorithm changes, they start failing.
Vice was considered the golden child of new media.
They were supposed to be the CNN of the street, take over.
But now their evaluation is going down and Disney is writing down their investment.
Even Vice couldn't weather this.
But Shane Smith, the CEO, predicted it.
Years ago, he said there will be a bloodbath.
And he stepped down, he sold stock.
The guy seems like he knows what he's doing.
Now there's a reason why I'm talking about all this.
Because what do you think is going to happen?
If you think that fake news from Mike was bad back when they were worth a hundred million dollars, how do you think it's going to look once they start fading into non-existence?
Now don't get me wrong, Mike is pretty much gone.
So they probably won't say anything because they've failed.
But what about BuzzFeed?
They're desperate enough to start selling cookware.
Clearly the media business isn't working out too well for them.
They need to get more extreme.
But...
I see two potentials.
Either they've realized the algorithm change means this model won't work anymore, and rage bait isn't going to do anything for them, and maybe they'll chill out.
Maybe they'll try offering a more premium product that is more accurate in an effort to attract subscriptions.
Washington Post actually points this out.
They end the story by saying people are looking for quality journalism, which increasingly exists behind a paywall or requires a subscription, Mather said.
Washington Post, Wall Street Journal, New York Times, Financial Times, they have paywalls.
And they're doing really well with their paywalls, because people actually do want, they want the truth, to an extent.
You know, people want confirmation bias, don't get me wrong.
But there's a difference between having your biases confirmed by an organization that is trying their best to be honest, and an organization that is just trying to rile you up in an effort to generate revenue.
So back to my main point, I think either we're going to see these companies go more extreme as they slowly start to fizzle out of existence, or they will actually start to chill out and try to attract more prominent, reasonable dialogue, because they want subscribers from the middle.
I look at people like Dave Rubin, Jordan Peterson, the Weinsteins, the intellectual dark web types.
These are people who are pretty moderate and range from left to right, and people like them.
In fact, the intellectual dark web, when it comes to politics, has some of the top Patreon Pages, in terms of revenue and patron amount.
Granted, there are many other left-wing ones as well.
But I think it's fair to say that people are looking for moderate voices, and that's probably why my channel keeps growing, my second channel keeps growing, it's probably why there are a lot of moderate YouTubers who are doing fairly well.
But let me know what you think in the comments below.
Do you think I'm wrong?
Do you think it's possible these companies become increasingly more unhinged and desperate because they're failing?
Or do you think they're going to try a different model and maybe revert to selling cookware at Walmart like BuzzFeed is doing?
I would say I would much rather see Vox produce outerwear or some kind of home toiletry than to write smear pieces about people that are demonstrably false.
But you let me know what you think, we'll keep the conversation going.
You can follow me on Twitter, at TimCast.
Stay tuned, new videos every day at 4pm, and I'll have more videos up on my second channel, youtube.com slash TimCastNews, starting at 6pm.
