The company, based in New York, has seen its Web traffic more than quadruple over the past year, vaulting it into the top ranks of news sites. BuzzFeed is now completing work on its 2014 budget and will soon present the numbers to the board, one of the people said. This year’s revenue projection was raised from $40 million in the middle of 2013 because the startup was growing faster than expected, according to the person.
BuzzFeed, started in 2006 by Huffington Post co-founder Jonah Peretti, relies on Facebook and other social networks to spread its articles and videos, which can range from weighty political coverage to photo lists such as “The 29 Most Important Twerking Moments Of 2013.” It attracted more than 130 million unique visitors in November, its biggest traffic month ever, the company said yesterday in a statement.
BuzzFeed’s staff has figured out how to write headlines and organize stories in ways that resonate with readers, said Alberto Ibarguen, president of the John S. and James L. Knight Foundation, whose endowment invests in BuzzFeed viral-content competitor Upworthy.
“It’s a way of getting people’s attention on subjects that matter,” he said in an interview. “Of course, I want to be where the eyeballs are if I’m an advertiser.”
Unlike traditional news sites, BuzzFeed doesn’t rely on banner ads. Instead, it creates sponsored versions of its articles for advertisers, such as a list of animated images that promotes Google+ Photos or a feature on winter attractions in New York that plugs the state lottery’s holiday scratch-off games. The startup, which has more than 300 employees, is profitable, Peretti said in September.
Ashley McCollum, a spokeswoman for BuzzFeed, declined to comment on any financial projections, other than confirming that the company is profitable.
Mr. Peretti, who serves as chief executive officer, created BuzzFeed as an engine for viral content. In the early days, most of the stories were chosen using algorithms, not curated by humans. Since then, the company has built up an editorial staff and branched out into creating original videos.
BuzzFeed attracted as much traffic last month alone as in its first four years combined, boosted by a change in Facebook Inc.’s algorithm that spotlights more of its stories in user news feeds, according to yesterday’s statement.
The company’s growth has helped entice big-name advertisers, including General Electric and Toyota. Its ads, which are designed in house for clients, propelled sales more than threefold in 2012, BuzzFeed said in January. The company also gets about a quarter of its revenue from ads it runs on websites other than BuzzFeed, Chief Operating Officer Jon Steinberg said at the time. Those ads often appear on Facebook or Twitter.
As of September, the company expected to do 600 to 700 social-advertising campaigns this year for advertisers.
The company said in January that it raised $19.3 million in funding from an investor group led by venture firm New Enterprise Associates, bringing its total to $46 million.
Previous investors such as Lerer Ventures, Hearst and SoftBank also participated in the funding round, the startup said.
— Bloomberg News —