Ozy Media to cease operations amid tumult
Digital-media startup faced high-profile defections, advertiser pullback after New York Times article raised questions about business practices
Ozy Media said it would cease operations, less than a week after a New York Times article raising questions about the company’s business practices led to high-profile departures and a pullback from some major advertisers.
"At Ozy, we have been blessed with a remarkable team of dedicated staff. Many of them are world-class journalists and experienced professionals to whom we owe tremendous gratitude and who are wonderful colleagues. It is therefore with the heaviest of hearts that we must announce today that we are closing Ozy’s doors," the board said in a statement Friday.
The company had been through a whirlwind after the New York Times reported Sunday that Ozy Chief Operating Officer Samir Rao had impersonated an executive from Alphabet Inc.’s GOOG 2.40% YouTube on a February fundraising call with Goldman Sachs Group Inc. Ozy Chief Executive Carlos Watson in a statement Sunday said Rao’s behavior on the call stemmed from mental-health issues.
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Since then, Marc Lasry, an investor in Ozy and the co-owner of the Milwaukee Bucks National Basketball Association team, stepped down from Ozy’s board, citing a lack of relevant experience; Katty Kay, a high-profile Ozy recruit who was a correspondent and anchor for the BBC, left the company; and several major advertisers of Ozy put their ad campaigns on hold, The Wall Street Journal reported Thursday.
On Tuesday, Ozy’s board said it has hired the law firm Paul, Weiss, Rifkind, Wharton and Garrison LLP to "conduct a review of the company’s business activities."
Ozy Media said it would cease operations, less than a week after a New York Times article raising questions about the company’s business practices led to high-profile departures and a pullback from some major advertisers. (Photo by Matthew Eisman/Get
The fallout had also spread to Ozy’s investors. SV Angel surrendered its shares in Ozy, an unusual move for a venture-capital firm. Axios earlier reported SV Angel’s move. Axel Springer, another Ozy investor, has said it supported the board’s investigation into the company’s business practices.
Ozy had raised $83 million as of April 2020, and had a valuation of $159 million, according to PitchBook Data, a startup-research firm.
Beyond Axel Springer and SV Angel, the company had raised money from backers including Emerson Collective, the philanthropic organization founded by Laurene Powell Jobs. Ozy has also attracted investment from Lasry and David Drummond, the former chief legal officer of Google parent Alphabet.
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Watson co-founded Ozy in 2013 after stints as a banker at Goldman Sachs and serving as an anchor on MSNBC. The company’s name comes from "Ozymandias," a poem by Percy Bysshe Shelley about a statue of a ruler whose kingdom has been eroded by time. On its website, Ozy says it interprets the poem as "a call to think big while remaining humble."
Ozy published articles, videos and podcasts focused on current events. Watson hosted a talk show that has featured sit-downs with musicians and actors including Matthew McConaughey, Scarlett Johansson and "Hamilton" star Daveed Diggs. Ozy also hosted Ozy Fest, an event series featuring boldfaced names in entertainment, politics and business.
