BuzzFeed Solicits Donations for Newsroom; U.K. Guardian Clears $130 Million from Readers

BuzzFeed News has joined the Guardian and the Washington Post in requesting donations to fund its newsroom, asking readers to “help us report to you.”

According to a report from the Wall Street Journal, BuzzFeed News has become the latest media outlet to ask readers for donations to pay for the operation of its newsroom. On Monday, the site revealed a new feature at the bottom of their articles which allows readers to donate a sum between $5 and $100. The donation feature asks readers to “help us report to you” and adds that by donating, readers will join a community that will help to shape BuzzFeed News. According to the Journal, when a website launches a donation drive, it is often a precursor to introducing a paywall or subscription requirement.

This business model has had some success: the Journal also noted that the Guardian, a U.K.-based newspaper, raised $130 million from reader revenues from April 2016 to March 2017.

BuzzFeed donators will receive perks not available to free users, such as updates on big investigations and new programming that the site is developing, according to the Journal‘s source. The source stated that if this is successful it could lead to an expanded membership service, but the site currently has no plans to make readers directly pay for its content.

BuzzFeed launched a new “site” for its news division in July, the domain buzzfeednews.com, in an apparent attempt to separate its “real reporting” brand from the main site’s extreme clickbait antics.

BuzzFeed has tested a number of new revenue-generating models in recent months such as the introduction of automated or “programmatic” ads on the site, merchandise licensing around the site’s Tasty Food vertical and production deals with Netflix and Twitter. Matt Mittenthal, a spokesman for BuzzFeed News, commented on the new donation drive saying: “Following some of our peers in the industry, we see this as one more way to support our reporting and keep BuzzFeed News free for everyone.”

It was reported in November that BuzzFeed missed its yearly revenue target of approximately $350 million by around 15 to 20 percent, which resulted in the layoff of approximately 100 employees. BuzzFeed CEO Jonah Peretti said in a memo at the time:

As our strategy evolves, we need to evolve our organization, too — particularly our Business team, which was built to support direct sold advertising but will need to bring in different, more diverse expertise to support these new lines of business. Unfortunately, this means we have to say goodbye to some talented colleagues whose work has helped us tremendously.

Buzzfeed News was reportedly considering an IPO in 2018, but the revenue miss damaged those chances, according to the Journal.