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NBCUniversal Buys Big Chunks of Vox Media and BuzzFeed

NBCU's investment includes a commercial partnership with Vox.

Photo by Michael Nagle/Getty Images
Peter Kafka covers media and technology, and their intersection, at Vox. Many of his stories can be found in his Kafka on Media newsletter, and he also hosts the Recode Media podcast.

Last week Re/code reported that NBCUniversal was investing in BuzzFeed and Vox Media.

Now those deals are done, and NBCU and Vox Media are announcing their deal today.

The headline for now: The media giant is investing $200 million in Vox Media, at a pre-money valuation of $850 million, according to several sources. Which is another way of saying Vox Media is now worth more than $1 billion, after raising around $300 million altogether. (NBCU owner Comcast had previously invested in Vox Media, via its investment arm Comcast Ventures.)

BuzzFeed, meanwhile, is expected to be worth $1.5 billion after its NBCU investment, which multiple sources say is also $200 million — not the $250 million we had previously reported. We believe that secondary sales are involved in each investment — that is, early investors or employees may be selling shares as part of these rounds.

The BuzzFeed-NBCU deal will be announced later this week, said several sources.

As my old boss Henry Blodget once said, we are conflicted up the wazoo on this one, first and foremost because Re/code is owned by Vox Media*. And there are things that are more uncomfortable than writing about your employer, but this is right up there, so I’ll be brief:

Vox Media CEO Jim Bankoff — again, my boss — says that in addition to the NBCUniversal investment, the two companies now have a commercial partnership. That means, among other things, that they will collaborate on digital advertising, will work together on video advertising and video programming, and that you will likely see Vox Media employees more frequently on NBCU-owned networks like CNBC. (Re/code already had and continues to have a news partnership with CNBC).

I asked Bankoff whether Vox Media intended to program an NBCU-owned channel, as Vice Media would like to do with A&E’s H2 channel. “No real comment on that,” he said.

As far as the NBCU/BuzzFeed deal, neither company is commenting on that one today.

As I have previously reported, and Gawker confirmed via leaked financials it published today, BuzzFeed has been on a tear over the last few years: It generated revenue of $20 million in 2012, $60 million in 2013 and more than $100 million in 2014. People familiar with the company said it had a revenue goal of $250 million in 2015.

The premise for both investments is relatively straightforward from NBCU’s perspective: The company, which has more or less ignored digital publishing since Comcast acquired it a few years ago, gets significant stakes in fast-growing digital publishers. That may help them learn a bit about the industry, and it will also make it easier for them to acquire one or both companies if it wants to pull that trigger down the road.

The trade-off for Vox Media and BuzzFeed is also fairly easy to parse: The two companies give up a chunk of equity for cash, which they can use to fuel their significant growth ambitions. They also get strategic relationships with one of the biggest players in the TV world — which still dwarfs digital publishing when it comes to ad dollars and overall revenue.

* Would you like to read about more conflicts? Here you go: NBCU used to own a stake in Revere Digital, the former parent company of Re/code. And as I said, I used to work for Henry Blodget at the predecessor to his Business Insider company, which means I now have a financial interest in two different digital media companies. Go, digital media companies!

Additional reporting by Kara Swisher.

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