Digital OZY Media Abruptly Shutters

Ozy Media, the digital media company that came under intense scrutiny for its business practices in recent days, announced on Friday that it was shutting down, following a sudden flight of investors and advertisers and bringing to a close a strange chapter in the annals of online journalism, reports The NY Times.

It was a precipitous fall for a company that was once a darling of Silicon Valley investors who believed in the vision of its leader, the former MSNBC anchor Carlos Watson. Watson had aimed to create a sparkling multiplatform media company that would appeal to a diverse generation of younger readers looking for the kind of content not provided by establishment news organizations.

When the end came, it came swiftly, five days after The NY Times published an article that raised questions about the company and its leadership team. The report detailed an episode in which a top executive at Ozy appeared to have impersonated a YouTube executive during a conference call with Goldman Sachs bankers in February while the company was trying to raise $40 million.

The abrupt collapse riveted media observers not because Ozy had a large number of loyal readers — that, in the end, was the problem — but because many had wondered how the company had managed to survive. The answer had to do with a charismatic and relentless founder, a great story and a slick brand that was perfectly tuned to appeal to noted Silicon Valley investors and powerful advertising executives.

Ozy, whose motto was “the new and the next,” had its headquarters in Mountain View, Calif., not far from the start-ups that had built themselves into multibillion-dollar giants. It employed roughly 75 people to create articles, videos, podcasts and newsletters on a range of topics, from espionage to the appeal of Grandma’s kitchen. Many of the videos and television shows that Ozy also sold starred Mr. Watson in conversation with politicians and pop culture celebrities, a group that included Joseph R. Biden Jr., Hillary Clinton and John Legend.

Ozy’s appearance of success depended to some degree on the performance of its videos on YouTube. On the conference call in February, the person posing as a YouTube executive told the Goldman Sachs team that Ozy was a great success on the platform.

Also Friday, Ozy Media CEO and founder Carlos Watson has resigned from the NPR board, the latest in a series of setbacks for the embattled media organization.

NPR reported that Watson’s resignation letter arrived to the board’s chairman just prior to the governance committee meeting later in the day to determine his status. Watson joined NPR’s board in 2016 and was re-elected for his second, three-year term on the board, which would have begun this month.