News site The Messenger on Wednesday dismissed a report that the money-bleeding startup would shut down by the end of the month as “beyond absurd.”
Board members met last Friday and weighed closing Jimmy Finkelstein’s embattled company — which just launched last May — after learning that it is “on track to run out of cash at the end of January,” Semafor reported earlier in the day.
However, a spokeswoman for The Messenger shot down the accuracy of the rival news outlet.
“We have already secured investment as part of our second raise, and so the notion of us discussing closure is beyond absurd,” the rep told The Post.
News of The Messenger’s possible demise came a day after Finkelstein said he would slash about two dozen of the company’s nearly 300 staffers and confirmed the exit of president Richard Beckman, as The Post reported.
Finkelstein, who founded the site with a $50 million cash infusion, reportedly called the meeting to discuss the dire state of the company’s coffers, according to multiple sources who spoke to Semafor.
The sources reportedly said the organization “only had enough money to last several more weeks” and that it would need to make “steep cuts” to secure additional funding to survive.
The insiders noted that Finkelstein was also open to selling the business, reported Semafor, which was co-founded in 2022 by former New York Times media columnist Ben Smith.
Messenger’s rep declined to discuss the company’s finances when contacted by The Post.
Finkelstein (left) weighed with The Messenger’s board whether to shutdown the site amid dwindling cash, Semafor reported. Patrick McMullan via Getty Images
The Post reported that Beckman, an exec known for aggressively drumming up advertising revenue, did “not see eye to eye” with Finkelstein on the direction of the business.
Beckman did not mention the status on the business in his exit note Tuesday as a reason for leaving, but instead cited his short-term health issues and his desire to retire to his home country of England.
Finkelstein, on the contrary, did refer to the difficult economic environment, which has squeezed advertising and digital media companies, in general.
Critics doubted that The Messenger, which launched in May, would be able to hit revenue goals laid out by its top brass. The Messenger
“The economic headwinds have left many media companies with significant challenges,” he wrote in his memo obtained by The Post. “The Messenger, as a start-up, has not been immune to those challenges, and we are now taking essential steps to become a slightly leaner company.”
Ahead of the Messenger’s launch, critics told The Post in March that Beckman’s “pie-in-the-sky” growth projections were “delusional” and that the $50 million that Finkelstein raised to launch the site is “only a fraction” of the bill required to cultivate a first-rate media property.
Beckman reportedly told confidants that The Messenger is “out of money.” Richard Beckman/Facebook
Shortly after the site launched, journalists began fleeing the Messenger, griping that they joined the site to do original reporting but that they were mostly aggregating clickbait news stories in order to drum up traffic for ad dollars.
Meanwhile, Beckman, who had crowed to the New York Times that the site would generate more than $100 million in revenue in 2024, told employees this fall that the site was “out of money,” the Daily Beast reported.
Source link: https://nypost.com/2024/01/03/media/the-messenger-shoots-down-report-of-news-sites-demise-beyond-absurd/