By: Hadassa Kalatizadeh
In a rapid turn of events, Ozy Media announced its closure.
Ozy Media, the digital media startup, became the subject of intense scrutiny last week for its business practices. As reported by the NY Times, the company, which is led by Carlos Watson- an investment banker and former MSNBC host- announced on Friday it would be shutting down, as a result of the swift flight of investors and advertisers. The company, founded in September 2013 and headquartered in Mountain View, California, had been a favorite for Silicon Valley investors. The company had a large number of loyal readers from the younger generations, and it had successfully produced news podcasts, television series and events. Over the years, the company had raised over $80 million from some of the biggest names in finance. Ozy Media employed about 75 people, who helped create articles, videos, podcasts and newsletters.
The downward spiral began just one week ago, with a report from a NY Times journalist, which said an executive at the company had impersonated a YouTube executive during a February conference call with Goldman Sachs bankers, when the company was trying to raise $40 million. Following the expose, Mr. Watson apologized to Goldman, and in an email to the Times, said the imposter was co-founder and Chief Operating Officer, Samir Rao, who had been going through a mental health crisis at the time and was “now thriving again.”
On Monday morning, Watson relented, taking back the closure in interviews. Contacting the “Today” show, he told anchor Craig Melvin, “We’re going to open for business,” Watson said. “This is our Lazarus moment, if you will. This is our Tylenol moment. Last week was traumatic. It was difficult, heartbreaking in many ways.” Still, it may be too late to bring the company back to life. As per CNN, the company-wide emails have already been shuttered, with emails to employees, to Watson and Rao all bouncing back. Three of the five board members have already resigned, as well as star anchor Katty Kay, formerly from BBC.
In another interview with “Squawk Box” on Monday, Watson, ever the self-promoter, said he “owns” the company’s missteps. “We definitely should have been better with data” and marketing. But, he added, “Just because something is sloppy or stupid doesn’t mean it’s illegal,” Watson said. He also repeatedly attacked NY Times columnist Ben Smith, who had written the expose about the Ozy’s misrepresentations. Watson referred to the article last week as “ridiculous hitjob”.
