BuzzFeed Inc. Quietly Shutters Catalyst, Complex Media’s Audience Network

Entertainment publisher BuzzFeed Inc. quietly shuttered Catalyst, the audience network originally launched by Complex Media in March 2020, over the summer, according to three people familiar with the program. 

The publisher did not respond to a request for comment.

The closure reflects a broader effort from BuzzFeed Inc., which acquired Complex Media in December 2021 for $300 million, to streamline its business by paring down its assets and focusing its resources. The company shuttered its news division, BuzzFeed News, in April and has experienced multiple rounds of layoffs in recent years.

BuzzFeed Inc. has embraced artificial intelligence as a potential means of creating content with lower labor costs, and it is actively seeking a suitor to sell Complex Media. It faces a total debt load of more than $200 million, which could come due as early as next December, and is not profitable.

BuzzFeed Inc. is not the only digital media publisher trimming assets in response to financial headwinds. Vox Media stopped licensing Chorus, its proprietary CMS, last December, and The Washington Post has reportedly mulled selling its in-house publishing tech Arc XP. 

Cutting Catalyst to save resources

Like other audience networks, Catalyst aggregated the reach of smaller publishers into a single offering, which it could then use to land larger advertising deals. 

In exchange, Catalyst members reduced their ad sales expenses and received a cut of the generated ad revenue. At the time of its closure, Catalyst had approximately 100 publisher partners, according to a person familiar with its business. 

Catalyst generated between $10 million and $15 million in revenue and was profitable, in part because it had fewer than five full-time employees dedicated to the effort, according to the person. 

But the program required a considerable volume of accounting and administrative resources, in large part because of its payment supply chain. 

Brands and agencies working with Catalyst often operated on a net 90-day payment cycle. If a client took three months to pay an agency, and the agency took three months to pay Catalyst, it could be challenging for Catalyst to pay its members in the agreed-upon timeframe, according to a person familiar with its business. 

Although Catalyst generated ample revenue on paper, these payment bottlenecks throttled its cash flow, according to the person. 

“If you have a small accounting department having to service 100 different publishers regularly, even if it is profitable, sometimes the juice is not worth the squeeze,” said the person.

BuzzFeed itself has a creator network, which still remains operational, but it reaches a different demographic than Catalyst, according to a person familiar with the business. 

Less competitive than its peers

According to one executive whose company explored joining Catalyst, the network failed to offer competitive terms compared to its peers, such as the audience networks Raptive and SheMedia. 

During the exploration process, Catalyst offered this publisher lower revenue projects and would not consider a guaranteed payment. 

It also offered fewer ancillary benefits than competitors, such as opportunities for brand exposure, access to direct marketing teams and other intangibles that can make audience networks more valuable than their advertising offerings alone. 

According to the executive, Catalyst also took longer to produce projections compared with competitors. 

However, compared to companies that function primarily as audience networks, it would naturally have fewer resources at its disposal.

“When I found out that the offering was ending, I was not surprised,” the executive said. “I have a lot of respect for Complex, but not going with Catalyst was an easy decision.”