BuzzFeed Bails on "Hot Ones" in $82.5M Deal, But Investors Are Still Sweating as Shares Fall 19%

BuzzFeed is officially out of the hot seat (literally and financially).  After months of watching their debt pile up like empty chicken wing bones, the media giant announced on Thursday that it sold First We Feast, the company behind the viral YouTube sensation Hot Ones, for $82.5 million. 

And yes, that means BuzzFeed’s debt situation is finally getting some much-needed relief. It’s like they’ve just gone from eating the hottest wing on Hot Ones to sipping a nice cold glass of milk.

So who’s buying First We Feast, you ask? A pretty interesting group of folks, including an affiliate of Soros Fund Management (yep, that Soros), Hot Ones host Sean Evans, First We Feast founder Chris Schonberger, and (wait for it) Rhett and Link’s Mythical Entertainment. If that’s not a recipe for success, I don’t know what is.

And the deal also gives BuzzFeed the chance to pay down a huge chunk of its $124 million debt… by $88.8 million, to be exact. BuzzFeed now gets to sit back with more cash than debt, which feels like winning the lottery after a really, really bad month at work.

Now, let’s talk about Hot Ones for a sec. If you’ve somehow missed it, Hot Ones is the show where celebrities sit down with Sean Evans, answer deep questions, and eat increasingly spicy wings. Think of it like a game of truth or dare, except instead of dares, it's just murderously spicy food. 

Over the years, Evans has made stars sweat through interviews with Gordon Ramsay, Jennifer Lawrence, Billie Eilish, and even Shaquille O'Neal. It's become THE celebrity interview show on YouTube, with 14 million subscribers and billions of views. (Honestly, if you've never watched, do yourself a favor and look up the “Spicy Wings” challenge. It’s TV gold.)

But despite its massive success, BuzzFeed just couldn't make it work long-term. They bought First We Feast as part of the 2021 deal when they snagged Complex Networks for a cool $294 million. 

But fast forward to 2023, and BuzzFeed sold Complex off to an e-commerce company for $108.6 million (don't worry, they made a few extra bucks in related fees), while still holding on to First We Feast. Now, that chapter is officially closed, and BuzzFeed’s offloading its spicy wing empire.

So, what happens next for First We Feast? It’s going solo. The company will continue to operate independently, with Evans sticking around as Chief Creative Officer and Schonberger staying on as CEO. Expect more wings, more heat, and a lot more Hot Ones in your future—because apparently, there’s no such thing as “too much spice” in 2024. With new funding, they’ll be expanding into live events, new platforms, and (who knows) maybe even more shows that make celebrities cry over hot sauce.

Alright, now that Hot Ones has left the nest, what’s BuzzFeed going to do with itself? Well, this is where things get interesting. The company’s looking to pivot, ditching expensive content like Hot Ones in favor of tech-heavy, money-making strategies. The plan is to lean into AI-powered (no surprise here) content creation and more programmatic advertising. Basically, BuzzFeed wants to stop wingin it over original programming costs and focus on making money through tech and digital ads. 

Is this new strategy going to work? Who knows. At least they’re not sweating over Hot Ones anymore.

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Stock.News has positions in BuzzFeed and Alphabet mentioned in article.