Vice, the brash media company that once threatened to upend the traditional news industry, has filed for bankruptcy.
While bankruptcy won’t upend Vice’s daily operations, the company has already slashed its budget, going through multiple layoffs and closing its Vice World News division. A sale process will follow, and the leading buyers are a group of Vice’s lenders.
That group of lenders includes Fortress Investment Group and Soros Fund Management, according to The New York Times. The lenders have secured a $20 million loan to continue operating Vice, and put up $225 million to acquire the now-flailing organization.
Earlier this month, the NYT reported that Vice was nearing bankruptcy.
Once valued at an eye-popping $5.7 billion, Vice attracted investments from media conglomerates such as Disney and Fox. But none of Vice’s investors will make any profit from the sale. As a result, the NYT is calling Vice one of the “most notable bad bets in the media industry.”
That’s definitely not the distinction that co-founder Shane Smith imagined when he launched Vice, or when the company captured hoards of millennials with its gonzo journalism and on-the-spot reporting from far-flung and dangerous outposts such as North Korea and Liberia.
Though Vice garnered attention and eyeballs, profit didn’t follow. Like other digital media companies, Vice counted on social media sites such as Facebook and Twitter to drive traffic, and in turn, drive ad revenue. But that didn’t happen, as the bulk of digital ad dollars went to tech platforms, and not publications.
Vice is far from the only former media darling from the mid-aughts and 2010s to encounter hard times. Last month, BuzzFeed laid off 15% of its staff and shuttered its Pulitzer Prize-winning news division.