Digital-media startup faces high-profile defection after New York Times article raised questions about business practices, advertisers backtrack
OG Media said it would cease operations after less than a week new York Times The article, which raised questions about the company’s business practices, has led to high-profile departures and backlash from some major advertisers.
“At Ozzy, we have been blessed with a remarkable team of dedicated staff. Many of them are world-class journalists and seasoned professionals, for whom we are extremely grateful and who are wonderful collaborators. So it is with the heaviest heart that we must Announce today that we are closing OG’s doors,” the board said in a statement Friday.
The company went through a whirlwind after the New York Times reported on Sunday that OG’s chief operating officer Samir Rao took over Alphabet Inc.’s GOOG 2.40% of YouTube’s share on a February fundraising call with Goldman Sachs Group Inc. was appointed to the executive. OG Chief Executive Officer Carlos Watson said in a statement Sunday that Rao’s behavior on the call stemmed from mental-health issues.
Major OG Media advertisers suspend ad campaigns amid uproar
Since then, Mark Larry, an investor in Ozzy and co-owner of the Milwaukee Bucks National Basketball Association team, has resigned from Ozzy’s board, citing a lack of relevant experience; Katy Kay, a high-profile OG recruit who was a correspondent and anchor for the BBC, left the company; And several of Ozzy’s major advertisers have halted their ad campaigns, The Wall Street Journal reported Thursday.
On Tuesday, Ozzy’s board said it had hired law firms Paul, Weiss, Rifkind, Wharton & Garrison LLP to “review the company’s business activities.”
The result had spread to OG’s investors as well. SV Angel surrendered its shares in Ozy, an unusual move for a venture capital firm. Axios had previously reported on SV Angel’s move. Another Ozzie investor, Axel Springer, has said he supported the board’s investigation into the company’s business practices.
According to startup-research firm Pitchbook Data, OG had raised $83 million as of April 2020 and was valued at $159 million.
Beyond Axel Springer and SV Angel, the company had raised funds 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’s parent Alphabet.
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Watson co-founded Ozzy in 2013 after working as a banker at Goldman Sachs and 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 destroyed over time. On its website, Ozzy says it interprets the poem as “a call to think big while remaining humble”.
Ozzy publishes articles, videos and podcasts focused on current events. Watson hosted a talk show sit-down with musicians and actors including Matthew McConaughey, Scarlett Johansson and “Hamilton” star Daveed Diggs. Ozzy also hosted the Ozzy Fest, a series of boldfaced names in entertainment, politics and business.