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The BuzzFeed application is displayed on an Apple iPhone.

Andrew Harrer/Bloomberg

Shares of digital media company


BuzzFeed

turned lower Monday during the stock’s trading debut on the Nasdaq.

The stock, trading under the new ticker “BZFD,” fell 9.8% to $8.33 on Monday. The stock rose sharply when trading began. Earlier in the session it rose to as high as $14.77.

BuzzFeed announced its plans to go public through a merger with special-purpose acquisition company 890 5th Avenue Partners Inc. in June. The merger raised roughly $16 million, after investors withdrew about 94% of the $287.5 million previously raised by the SPAC, according to a Dec. 2 securities filing. The company also raised an additional $150 million in convertible note financing as part of the SPAC deal.

Only a small percentage of BuzzFeed shares will be available for public trading as a result of the investor withdrawals and the fact that some stakeholders are prohibited from selling shares for several months, according to The Wall Street Journal. 

Investors in SPACs don’t know what kind of deal the SPAC will pursue, and are allowed to withdraw their money before the merger is completed. A person familiar with BuzzFeed’s strategy told the Journal that the investor withdrawals were expected and won’t affect the company’s plans.

BuzzFeed owns digital media sites BuzzFeed News, HuffPost, and Taste. It also recently acquired Complex Networks, an online media site popular among young men, from Hearst and Verizon for $300 million. The SPAC deal intended to raise money for the acquisition, as well as fund other potential M&A activity.

“Our next chapter as a public company will help BuzzFeed, Inc. become a hub for even more brands and creators, visionary founders and CEOs, high-quality content for the tech platforms, and so much more,” said BuzzFeed founder and CEO Jonah Peretti in a statement.

Investors trying to determine whether BuzzFeed is for them needn’t worry — BuzzFeed has a quiz for that. Plugging in their choices in animals, aliens, chicken wing spiciness levels, and power vests could tell investors whether they’ve “got their finger on the pulse” or not. The quiz does warn, however, that “literally, only a giant idiot would listen to this for investment advice.”

Write to Sabrina Escobar at sabrina.escobar@barrons.com

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