LOL! Vivek Ramaswamy's Dumbass Plan to Save BuzzFeed

Loser presidential candidate has bad idea, tweets it

“This will be,” Vivek Ramaswamy told Forbes, “the highest return on investment endeavor ever taken up in the pharmaceutical industry.”

Ramaswamy, just 30, had discovered the soft underbelly of the pharmaceutical industry. It turned out that major drug companies were letting lifesaving, and valuable, drugs sit on the shelf. Forbes, smelling success, gushed that it was was excited to add him to the billionaires list.

He had a few minor successes on that front already, but his real big project was intepirdine, a drug to improve memory and cognitive functions in Alzheimer’s patients — a drug that, who knows, could revolutionize human brainpower. GlaskoSmithKline owned the patent on the drug, and was doing absolutely nothing with it.

Ramaswamy’s Roivant Sciences — that’s Return-On-Investment-vant Sciences —acquired intepirdine from GSK for the low-low price of $5 million and got to work on commercializing the drug, codenamed RVT-101.

So confident was Ramaswamy that he stuck RVT-101 in another Bermudian-registered company, and took it public. It went public with a $3 billion valuation, the largest biotech IPO ever.

When Forbes profiled the hot shot, in 2015, clinical trials for RVT-101 were underway: Sure, they might cost hundreds of millions of dollars, but it was just one step towards revealing how the big, lazy, useless pharmaceutical companies squandered these humanitarian, capitalist, wünderdrugs.

The results of the clinical trials came two years later: They were a total failure.

Hundreds of millions of dollars, and countless hours, had been squandered on the trials — which is a normal, disappointing part of medical research. Except GSK had already extensively tested intepirdine. Four rounds of trials had already shown the drug to be worthless in treating Alzheimer’s, and this fifth trial was no different.

The value of Rawaswamy’s company plummeted by three-quarters. It limped on for years, but was finally liquidated last year.

Far from being the highest-return of any investment, it was one of the biggest losers in the biotech space ever. Rawaswamy, personally, was fine: His stocks all flowed through Roivant. Others, like the California State Teachers’ Retirement System, lost real money.

But that was Rawaswamy’s thing: Promise huge by leveraging distrust of institutions, crowd in the suckers, and pivot to something better.

When Rawaswamy recounted this saga years later:

My goal was to challenge big pharma’s bureaucracy with a new business model — which proved to be easier said than done. I started by developing a drug for Alzheimer’s disease that resulted in the largest biotech IPO in history at the time, though a few years later that drug failed spectacularly. Failure hurt, and I was chastened by it.¹

Nevermind that none of this is true — Ramaswamy was not the first to try and commercialize abandoned drugs, he didn’t develop the drug, and he certainly wasn’t chastened by his failure. It’s part of his mythos.

Ramaswamy, as we know, went on to mount a quixotic run for president, then a grovelling plea to be selected as vice president, and, most recently, an attempt to become an activist investor in BuzzFeed.

This week, on a very special Bug-eyed and Shameless, we take a quiz: Which terrible Vivek Ramaswamy idea to revive Buzzfeed are you?

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“BuzzFeed has lost its way,” Vivek Ramaswamy writes in the opening of his letter to the moribund media company’s board of directors.

Ramaswamy has a plan to get it back on track. He is now, after all, the second-largest Class A shareholder, with an 8% stake in the company — and growing, he promises.

“I own your stock because I believe BuzzFeed can still become a more valuable company than at its initial listing, but this requires a major shift in strategy,” he writes. But, he knows, “there will be a temptation to reject what you are about to hear on partisan grounds.”

That’s an understatement.

BuzzFeed, for a point of reference, was particularly responsible in helping ‘woke’ transition from Black vernacular — “do not be deceived by trickery or lies,” as they explained it in 2015 — to wide usage. Ramaswamy, on the other hand, wrote a book called “Woke, Inc,” which introduces such poorly-constructed concepts as the “Woke-Industrial Complex.” It is fair to say that the two are on different sides of most, if not all, issues.

But nevermind that, Ramaswamy writes in his letter. He is a successful entrepreneur with an eye for undervalued assets, and BuzzFeed is in need of a shakeup. (In his self-aggrandizing, of course, his marketing of these assets was a success.)

BuzzFeed, he goes on, had relied too much on Facebook, and its current reliance on Google will end in a similar tragedy. Its stock price and income have both cratered, and, now, “almost two decades after its founding, BuzzFeed is now effectively a startup with a paltry ~$100 million market capitalization,” he writes. “I view that as an opportunity.”

What BuzzFeed needs to do is “pivot,” Ramaswamy writes, “and time is of the essence.”

He proceeds to sketch out “the path forward.” It is quite possibly one of the most ill-informed, ass-backwards, half-cooked, and terminally unaware reinvention plans for the media I’ve ever read. When I opened this letter last night, I knew I had to break it down in excruciating detail.

It is also, and I cannot stress this enough, completely pointless. Jonah Peretti, BuzzFeed’s CEO, owns about 64% of the voting shares in the company, meaning that Ramaswamy can’t really do much more than write letters.

But what a letter it is.

So let’s dive into it, shall we?

1. Get back to startup size. You require a complete, ground-up re-think of every single piece of content being produced at the company, with a keen eye to the coming impact of AI on referral traffic which I do not believe is yet accounted for in BuzzFeed’s projections. […] Rather than cutting from the top, the company should start from zero and retain only the resources required to create and monetize BuzzFeed’s highest-value content. This will almost certainly require large-scale headcount reductions, dumping your legacy digitized print business model, and divesting assets to repay debt. The result should be a dramatically smaller, more focused, more nimble, less levered, day 1 profitable company. This should be achievable in 2-3 months.

Maybe you haven’t followed BuzzFeed’s slow-motion epic fail — it certainly seems that Ramaswamy hasn’t.

But BuzzFeed has been cutting from the bottom-up, axing its ‘print’ business model, and selling off assets for years.

At the end of 2022, BuzzFeed had 1,368 employees across seven countries. By the end of 2023, that number was down to 925. In February, it laid off more than 140 more employees, and has probably shrunk more since then. It has shut down its News division and sold off sites like Complex. Its remaining staff is essentially a skeleton crew — its army of advertising executives and brand managers trying desperately to keep striking deals, drawing on its tiny editorial team and dwindling number of users who are generating content for free as the company tries to claw its way back to profitability.

CEO Jonah Peretti announced plans to essentially have the site run itself: Mixing AI advertising and AI content to stuff algorithmically-generated pablum down the gullets of a fleeing consumer base.

That includes a chatbot for Tasty, its food vertical, named Botatouille. I downloaded the app and after trying, and failing, to convince the chatbot to serve up recipes for eating an array of endangered and unethical animals, it finally sent me a list of tomato soup recipes written by Campbell’s. Thanks.

BuzzFeed is, for all intents and purposes, shedding its status as a media company. It wants to become an AI content company — a pale facsimile of a pale facsimile of a pale facsimile of something interesting.

So Ramaswamy’s leading idea is for BuzzFeed to keep doing what it’s already doing.

2. Focus on audio & video content. The creator economy is one of the few parts of the digital media business that is thriving. […] The good news is you already have a template for how to take advantage of this opportunity: First We Feast is an unqualified success, with break-out hit “Hot Ones” generating millions of views per episode, not to mention cultural relevance. […] You have the pipes, but you’re missing the fluid. With fresh audiovisual content and a fresh new brand (see below), you have an opportunity to create real value quickly. Attracting top video talents doesn’t have to be expensive: adopt an “eat-what-you-kill” model for the content creators you attract. Give them uncapped upside in what they generate, allowing you to attract top content creators for lower base salaries, while giving them the know-how, tools, and monetization support that they wouldn’t have on their own.

Sometimes tech bros get a lot of grief for coming up with futuristic, elaborate, overly-complicated solutions for long-standing problems that ultimately re-invent the thing they’re trying to defund. (An app that connects you with a ride-sharing vehicle, following a predestined route on the blockchain? Congrats, Geoff, you’ve come up with the city bus.) I’m not sure we give enough grief to the equally-impressive thickness of investor bros.

For starters, “make content that everyone watches” is kind of the name of the game — and it is famously quite difficult.

But Hot Ones — a show about eating hot sauce — is a good example of it a massive hit, arguably BuzzFeed’s biggest in a long time, which it acquired by buying up Complex in 2021.

Even a hot sauce-addled luddite could wrap their head around this problem. Youtube, generally, pays out somewhere in the ballpark of $20,000 per million ad views. (Not to be confused with video views.) While there is a whole cottage industry of guessing at how much a Youtube video makes in ad revenue, it’s probably generous to think that the First We Feast channel pulls in about $300,000 per month. At the high end, you’re looking at $3 million a year from a property that requires a pretty sizeable team.

BuzzFeed, for context, reported $115 million in advertising revenue and $83 million in content revenue in 2023. (Hot Ones probably fed dollars into both those buckets, thanks to a major licensing deal.) Both of those numbers fell 30% over the year prior.

So dire was BuzzFeed’s financial position that it sold off Complex and Hot Ones’ entire library.

While he doesn’t really explain what he means by “audio,” we can infer he means podcasting. Anyone who works in podcasting (as I have) will laugh in your face, and then the back of your head, and then your silhouette as you walk off into the sunset, if you tell them that podcasting is a major growth opportunity.

Meanwhile, this “catch what you kill” approach that Ramaswamy describes is literally Youtube. He’s reinvented Youtube.

Why would any successful video creator join BuzzFeed for a meagre salary, just so the company can post their video to Youtube and take a cut of their ad revenue? The venn diagram of ‘successful, out-of-the-box viral content creators who will immediately produce smash hits’ and ‘content creators who are willing to take piss-poor salaries because they need BuzzFeed’s platform, monetization tools, and know-how’ is two circles located miles apart.

If Ramaswamy did an iota of research, he would know that the trend in recent years has gone the opposite direction — content creators fleeing their ailing media companies and breaking out on Youtube solo. The ex-BuzzFeed Try Guys being a prime example.

This whole strategy is also just a revamp of Facebook’s long-abandoned “pivot to video” — a phrase which, when uttered, prompts all journalists who worked in the industry in 2010s to disperse like a murder of spooked crows. What we discovered from that disastrous experiment is that trying to produce video at an industrial scale is really expensive and involves producing way more duds than hits. And it ultimately brings you back to a fundamental problem — one that Ramaswamy identifies, then seems to immediately forget about — it leaves you beholden to another company. The truth is that the video pivot actually was working, until Facebook decided to suddenly de-prioritize news and creator content, in favor of user-uploaded junk.

Even today, a slight tweak to the Youtube algorithm could be disaster for video-heavy outlets like Vox. One day, the site rewards long-form content. The next it’s driving users to short ‘Reels.’ The next it’s back to long-form. Now it’s nature content. Oh, no, cooking videos. Anime. Kids’ programs. Silent movies. Back to kids’ programming, but now it’s in the liminal space.

If your strategy involves aligning with another company’s priorities, then you’re always on the edge of disaster.

Ramaswamy isn’t done yet.

Go for talents across the political and cultural spectrum. Be bold. Don’t be afraid to challenge your audiences. From Candace Owens to Destiny, Tucker Carlson to Bill Maher, Aaron Rodgers to Charles Barkley, no talent should be off-limits to platform, hire, or acqui-hire. No other content publisher is doing this across the spectrum today. By adopting this strategy, you would fill a wide-open vacuum in media and lay the foundation for the most important asset that BuzzFeed lacks today: a brand.

There is no greater sign that the American far-right has lost its mind than Vivek Ramaswamy suggesting BuzzFeed’s path to salvation is through Candace “Let’s Ban Porn” Owens, Aaron “AIDS is Fake” Rodgers, and the-most-GenX-of-the-Boomers Bill Maher.

First off, publishers are doing exactly what he is describing. The Daily Wire, which is basically just Evil BuzzFeed, has tried to drive its business by touting culture warriors like Owens.

And, certainly, The Daily Wire is a success for what it is. It reported $200 million in revenue in 2022. (BuzzFeed, for reference, reported $437 million in revenue over the same period.) Most recently, it has bragged about $22 million in revenue from selling anti-woke razors.

But The Daily Wire was built from the ground up by relatively popular right-wing polemicists like Ben Shapiro, and marketed itself as a place to go to see facts and logic OBLITERATE the WOKE and that sort of thing. Its attempt to do other stuff, particularly kids programming (Dispatch #62) and adult cartoons, has not made much of a stir.

These acquisitions are also very expensive. Joe Rogan famously costs Spotify $250 million. You can’t win Charles Barkley onto your platform by promising “monetization support.”

So, in summary: Dumb.

3. Make BuzzFeed a bold, distinctive brand. Distinguish yourself from competitors by openly admitting your past journalistic failures and redefine BuzzFeed’s brand around the pursuit of truth. […] Public distrust of the media is now at an all-time high – because corporate media organizations have systematically and repeatedly lied to their audiences. Customers are now fleeing in droves. BuzzFeed surely understands this:

• You were the first to publish the Steele Dossier – an unvetted, unverified opposition research document that was full of false and salacious information that spawned the wasteful Mueller investigation and divided our country for years.

• BuzzFeed News reported that President Donald Trump directed Michael Cohen to lie about construction of a building in Moscow, yet you couldn’t provide any evidence to back it up — drawing a direct rebuke from Robert Mueller himself.

• You reported that Hunter Biden’s emails were “stolen”, yet the only evidence you cited was a link to another BuzzFeed story citing Twitter’s censorship of the New York Post story that broke the Hunter Biden laptop news.

• See your takedown of Kevin Spacey, who — say whatever you might about him – has now been acquitted three times on two continents for criminal accusations that never should have passed journalistic muster.

• Or see your whitewashing of Che Guevara’s bloody history.

• Recall your incendiary reporting about the World Wildlife Fund funding guards “who have tortured and killed people,” only for the public to later learn that WWF was cleared of complicity.

• The list goes on.

The silver lining is that your competitors’ records are equally bad. Jussie Smollett. Bubba Wallace. Covid-19 origin. Duke Lacrosse. Americans are desperately turning to other sources of information, such as independently distributed audio and video podcasts.

I am, to echo my fallen BuzzFeed comrades, obsessed with this list.

I’ll start by noting that Ramaswamy seems, again, unaware that BuzzFeed News no longer exists. The News homepage is now a sad testament to a once-great outlet, and home to a crack investigative team — it’s teeming will low-rent celebrity news and a sad memorial to its past glory on the sidebar. (Full disclosure: I spent a year on contract with BuzzFeed News, right after I left VICE News. I am, yes, cursed.)

Some of Ramaswamy’s criticisms are, of course, perfectly valid. BuzzFeed News got some stuff wrong, and made some bad editorial calls — like every outlet. The great thing about the media is that it constantly engages in pointed self-reflection. BuzzFeed got the tar kicked out of it for the Steele Dossier boondoggle and BuzzFeed’s leadership went to great lengths to explain why it made the decisions it did.

BuzzFeed’s batting average was considerably better than, say, The Federalist, which Ramaswamy cites, a conspiratorial rag whose Wikipedia page doesn’t have a “controversies” section because the entire page is controversies.

It’s also funny to see Ramaswamy accuse others of editorial failures. In his bewildering defense of Kevin Spacey, he suggests that because Spacey was acquitted in a criminal single trial (he won a second civil case) BuzzFeed’s reporting was shoddy. More than 30 men have accused Spacey of sexual assault or inappropriate behavior — some have never brought charges, and others have died before their cases were heard.

But Ramaswamy, of course, lives in a radical different media environment than the vast majority of people. He lives in one where Hunter Biden is a daily obsession and ‘the Russia hoax’ is a going concern. He lives in a world where you can just fire off a list of proper nouns and have everyone immediately know what you’re talking about.

Mikhael Gorbachev. Paula Deen. The West Nile Virus returns. Yale rugby.

Against this backdrop, you have a historic opportunity to redefine BuzzFeed and set yourself apart from every other major media organization. Address your audience directly and candidly admit:

We failed in our obligation to tell you the truth. By both omission and commission, we repeatedly lied on issues of national importance, and so did the rest of the media. We echoed easy, politically convenient narratives in pursuit of clicks. We failed to fact-check. We ceased being intellectually curious. We lost sight of fairness. We condemned half the country instead of seeking to understand their views and report them fairly. Now we are taking responsibility for our failures, as a company and as an industry. We apologize. We’re now building a new kind of media company centered on the PURSUIT OF TRUTH. We won’t do it through a centralized news operation. We’re doing it by platforming a diverse range of thoughtful talents – and we’ll pursue TRUTH together through an open exchange of ideas.

The funny thing about Vivek Ramaswamy is that, even if I believe him to be a blowhard and relentless self-aggrandizer, I actually believe that he drinks his own kool-aid. He believes in himself.

That’s why it’s so refreshing to see someone of his ilk lay out a, seemingly, earnest indictment of the media. Because it is so deeply batshit.

The average person does not keeping a running grievance list for an outlet they will consider reading. If they do, they are unlikely to change their mind because of a hackneyed open letter. The biggest problem for media companies is not winning over the haters, it’s reaching neutral non-readers. (Dispatch #83)

Politicians, on the other hand, definitely owe a more serious apology to the concept of truth.

Vivek Ramaswamy said January 6 seemed like “an inside job,” said the race great replacement conspiracy theory was a “basic statement” of the Democrat’s policy, claimed “more people are dying” from climate change policies than climate change, and cooked up a bizarre theory about the relationship between being able to run a mile and math scores.

Requirement for Success: Diversity of Thought. To pull this off, you need true diversity of thought in your leadership. Rather than dwelling on the number of mandatory “Diversity, Inclusion, & Belonging” trainings and sessions that you cite in your most recent annual diversity report, the new BuzzFeed should focus on fostering true intellectual diversity, both in its rank-and-file and in its leadership. You’ll have a better shot at success on this new plan if you worry less about your leadership “looking like” the rest of America, and more about whether they’re “thinking like” the rest of America.

There is a deeply lazy and rotten idea at the core of Ramaswamy’s whole philosophy. It goes like this: Intellectual diversity maps exactly onto the American two-party system, and controlling for race, religion, sexuality, or gender is actually detrimental to intellectual diversity, because only the left are Gay and/or Black and/or women.

But whatever the merits of that debate, I can guarantee you it will have zero impact on BuzzFeed’s bottom line.

Because what Ramaswamy and other would-be media disruptors fail to understand is that the model itself is broken — and it’s been broken thanks in large part to the venture vultures who have swooped in to peel off its dividends.

Outlets like VICE and BuzzFeed were sound brands with strong identities, diverse offerings, loyal fanbases, and a deep pool of talent — all the things Ramaswamy talks about. But rather than steady growth, they took on major hedge fund investments to finance growth, used debt to pad their valuations, followed tech platforms’ instructions for growth, and broke into industries in which they had no competitive advantage. Then, they watched the house of cards fall apart when their revenue failed to justify their investments.

This is just a story in miniature of what has happened to every major newspaper across North America (minus the New York Times, a crossword company with a news division.) Pivoting to video, finding new platform partners, leveraging AI, forcing ideological diversity: These are expensive and time-consuming side quests that distract from the main mission: Making people pay for news.

We have a few models that seem to be working — small newsrooms funded by subscriptions, bigger outlets funded by high-price corporate or philanthropic partnerships, niche publications with pricey memberships — but they are all defined by a steady, predictable income sources.

The great downside of this emerging model — which doesn’t so much ‘work’ as it does ‘barely sustain an insufficient journalism industry for our insane times’ — is that it is a massive retreat from the days when we had big, central points of discussion and shared reality.

For a minute, it felt like BuzzFeed could be the next generation of outlets that mixed aggregation, investigative journalism, the social internet, and virality in a way that could make sure that we still have those shared platforms. But now it’s dead, and Ramaswamy’s solution is to turn it into another brainworm farm for the tragically online.

No one is going broke going woke, nor will anyone get rich by going Vivek.

I’ll leave you with this depressing graph, from the Times:

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That’s it for this week!

Coming shortly will be a rather dense newsletter on the state of play in Gaza — it’s taking me a bit more time to put together than anticipated. So apologies for the generally slow pace of newsletters in recent weeks.

Over at Foreign Policy, I’ve got a look at the state of Russia’s liberal opposition. There will be more to come on that soon, so stay tuned.

In honor of Vivek Ramaswamy’s dumbass plan to save BuzzFeed, here’s a special deal on a one-year Bug-eyed and Shameless subscription:

1. Woke Inc, Vivek Ramaswamy