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The company will own a 97% stake in the digital news website, with Bezos Expeditions owning the rest
Despite its relatively young age, digital business news website Business Insider is a company that has been rumored to be up for sale for years now. For a long time, though, nobody seemed to be willing to meet its asking price. Now, finally, it has found a buyer willing to put up the necessary cash.
German publishing giant Axel Springer has purchased a majority stake in the company, it was announced on Tuesday.
Business Insider is valued at $442 million (currently approximately EUR 395 million). As a previous investor, Axel Springer already owned a 9 percent stake and, Iin this deal, it will be purchasing an additional 88 percent, for $343 million (currently approximately EUR 306 million). That will giving it a total of 97 percent ownership. For reference's sake, that is more than the $315 million that AOL paid for the Huffington Post in 2011.
The other three percent of the company will be continue to be owned by Bezos Expeditions, the personal investment company of Jeff Bezos, which has made numerous investments in Business Insider over the last few years, starting with a $5 million investment in 2013.
Business Insider was founded in 2007 by Kevin P. Ryan and Henry Blodget, who was five years removed from being banned from trading on Wall Street. It now has 76 million unique monthly visitor
It seems like not much will change for Business Insider going forward. Blodget, who is Chief Executive Officer and Editor-in-Chief of the site, and Julie Hansen, who is Chief Operating Officer and President, will continue to lead Business Insider in their respective roles.
In addition, the two executives "will also remain significantly invested in Business Insider through an extensive, long-term equity incentive." Obviously keeping Blodget and Hansen around is a priority for Axel Springer.
There will be one change to the company: Kenneth Lerer, Managing Partner at Lerer Hippeau Ventures, Co-Founder of Huffington Post and Chairman of Buzzfeed, as well as an early investor in Business Insider, will receive a seat on the Board of Directors at the company.
For Axel Springer, getting its hands on a digital news website, particularly one aimed at the financial sector, seemed like a major priority for the company, considering that it tried to buy the Financial Times from Pearson this summer, before losing its bid to Japan's Nikkei, who bought it for $1.3 billion.
The Axel Springer company is the largest publishing house in Europe and controls the largest share of the German market for daily newspapers. Its publications include Die Welt, Bild (which is the newspaper with the largest circulation in Europe), Auto Bild (an automobile magazine with the largest circulation in Europe), and the German edition of Rolling Stone magazine, among numerous others.
The addition of Business Insider’s 76 million unique monthly visitors will increase Axel Springer’s worldwide digital audience by two-thirds to approximately 200 million users, making the company one of the world’s six largest digital publishers in terms of reach.
Being acquired by Axel Springer will allow Business Insider to continue to grow its international presence, where it already has local editions or licenses in seven other countries
It will be introducing a German edition in the fourth quarter of this year, which will be operated by finanzen.net, a company of Axel Springer SE.
Business Insider has raised $55.6 million in funding. In addition to Axel Springer, Bezos and Lerer, other investors have included Marc Andreessen, RRE Ventures, Allen & Company, Institutional Venture Partners, and Kohlberg Ventures.
Full disclosure: I was a writer for Business Insider from 2010 to 2011.
(Image source: https://www.businessinsider.com/)
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