Last updated: January 29, 2015 3:41 pm
News websites Business Insider and Mashable have separately received more than $40m in venture financing, signalling the increased investor optimism around online journalism start-ups.
Business Insider, the business site run by former Wall Street analyst Henry Blodget, said on Thursday that it had raised $25m from investors including German media group Axel Springer and Amazon chief executive Jeff Bezos, who was already an investor.
Mashable, whose news is aimed at young audiences, has raised $17m in an investment round led by the venture arm of Time Warner, the media group.
The investments come amid the vertiginous rise of social media sharing and sponsored content. Last year, BuzzFeed raised $50m from Silicon Valley venture capital firm Andreessen Horowitz, valuing the viral content site above traditional media players such as the Washington Post.
Business Insider has 70m unique visitors a month, while Mashable has 42m, the companies said. Neither discloses financial performance, but Mashable said its revenue rose 45 per cent in 2014.
Andreas Wiele, head of marketing at Axel Springer, said: “[W]e are strengthening our footprint in the English-speaking digital media market.”
Axel Springer and Time Warner are among a number of traditional media companies that have increased their venture investments in order to tap new growth opportunities and hedge against possible declines in their core businesses. The German group has invested in US online content site Ozy. Time Warner, owner of HBO and the Warner Bros film studio, is a backer of Bustle, a US news site aimed at young women.
Mr Bezos had previously contributed to a $5m fundraising by Business Insider, and sought to introduce some of the site’s approach to online news at the Washington Post, which he bought for $250m in 2013.
Mashable and Business Insider, which were launched in 2005 and 2007 respectively, have both recently launched local editions in the UK, and Mashable also has an Australian site. Mashable said the new funding would allow it to hire more than 100 employees and invest in video and technology.
Pete Cashmore, Mashable chief executive, said in a note to staff on Thursday that the site would hire more staff globally, with a focus on Asia. He said the bulked up video operations would increase editorial output and the content Mashable produces for its advertising partners.
Gawker, one of the first viral news sites, is also planning to raise around $15m of debt this year, its founder Nick Denton has said. It is reorganising after its traffic fell significantly behind that of its rival BuzzFeed.
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