INSIDE BUZZFEED: The Story Of How Jonah Peretti Built The Web's Most Beloved New Media Brand

Jonah Peretti stretches out casually in his chair, sneaker over knee, in his downtown New York office.

The office is encased in glass, a transparent layer barely separating him from his newsroom of editors. They're staring at glass screens, too—and connecting with millions of readers who gaze at their creations through similar panes.

I met the curly-haired, 38-year-old CEO at the end of the work day, on a day when his site had run a post about the world's cutest corgi and an eight-minute video about Hillary Clinton. That eclectic mix spread far and wide across the Internet.

The six-year-old BuzzFeed is now read by 30 million visitors a month, according to its internal statistics. And most don't come in through its homepage or Google searches. They come because a friend, colleague, or celebrity recommended an article to them—bouncing from glass screen to glass screen, a network of human connections overlaid on digital ones.

That network has long fascinated Peretti, the Web's king of viral content. While his site encourages readers to laugh out loud at its stories, he made no jokes as he discussed the history of his company, the future of media, and his plans to make his funny site be taken seriously by the world.

In the 45-minute discussion, Peretti revealed:

• How BuzzFeed began as a bot but grew to find human editors indispensable

• How he handled parallel entrepreneurship, running both BuzzFeed and HuffPo at once

• Why Union Square Ventures gave BuzzFeed a term sheet, but never ended up investing

• Why BuzzFeed doesn't care about Google or search traffic numbers

• How BuzzFeed is generating millions of dollars a year without running a single banner ad

• How Peretti really feels about his site's cat-loving reputation

• How BuzzFeed is working on becoming a global brand

To share or not to share—that's Peretti's life mission

One question has always nagged at Jonah Peretti: "What makes ideas spread?"

He first wondered this in college, when he ordered a customized pair of Nike shoes with the word "sweatshop" written on them. Nike refused to fulfill the order, and Peretti sent the email chain with customer service to twelve friends. Those friends forwarded it on and, eventually, it reached millions of people. Peretti's email exchange with Nike was covered in the Wall Street Journal and prime-time news.

The desire to learn why people share things has dictated Peretti's career. He later started The Huffington Post with Ken Lerer and Arianna Huffington. In its early days, it was chiefly known as a political blog, with Huffington as the big personality at its core—but Peretti's quiet focus on content that would spread formed an equally valuable part of the site's DNA.

While there, Peretti began a side project to experiment with viral content.

"BuzzFeed started as a lab with a small team where we would play with ideas," he said.

It was funded by John Johnson, who started a nonprofit Peretti worked for, and Ken Lerer, Peretti's Huffington Post cofounder.

Peretti's first hire was Peggy Wang, whom he'd taught as a student at a private high school in New Orleans. (She's still working at BuzzFeed as a senior editor today.) Next he hired a Huffington Post contractor followed by a product person.

One of the first products BuzzFeed Labs built was an instant messaging client, BuzzBot, that would message users a link to the hottest thing on the Web that day. Its IMs were based on algorithms that examined the acceleration of links; BuzzBot grabbed feeds from hundreds of blogs and searched for new links that were spreading to other sites quickly.

"It was this awesome thing, but we couldn't scale it," Peretti said.

The next idea BuzzFeed Labs tried was a site that highlighted some of the popular links that BuzzBot found.

Peretti began recruiting human editors to manage the daily links.

"We found that using the detector worked well, but having the detector plus a person to frame the link was good," he said.

The first product BuzzFeed's website launched with was just five or six links per day. Half were from the trend detector, and half were links Wang found across the web.

Peretti was still working for The Huffington Post, splitting time between the two offices. His daily routine involved picking up 15 sandwiches at a Vietnamese shop between the two and feeding editors at each place.

It wasn't long before the link-based site started to attract visitors. Bloggers frequently used it as a resource to find stories. He decided to raise a round of financing when the site had about 600,000 monthly uniques.

Union Square Ventures almost invests 

Union Square Ventures, the famous backer of Twitter and Tumblr, almost invested in BuzzFeed. The firm liked Peretti, but it wasn't sure it liked all the humans he wanted to hire.

"They didn't like that we had editors," Peretti explained. "A lot of people [not just USV] were pro-tech, anti-human."

Peretti ended up taking an investment from SoftBank instead. Eric Hippeau, who was a partner there, offered him a chance to stay involved in both The Huffington Post and BuzzFeed at the same time.

"We think Jonah is a great entrepreneur and that he has built a great business," Union Square Ventures partner Brad Burnham told us. USV's Burnham and Fred Wilson looked at the BuzzFeed deal together. "We miss great companies all the time.... Luckily in the venture business you do not [always] have to be right."

For a long time, Peretti did two full-time jobs. "I did parallel entrepreneurship, which was very hard to do," he said. "It was hard to keep your head straight, and know which ideas were with which company. A lot of the stuff BuzzFeed figured out, HuffPo was able to benefit from."

As the company grew, it needed a more active leader. Fortunately for Peretti, an opportunity to make a clean break from The Huffington Post presented itself. AOL purchased The Huffington Post for $315 million in February 2011.

"It was so liberating to just do one company, and to be able to focus entirely on what my first love was, which was figuring out why people share things, and how ideas spread," he said.

2011 was also a good time for a social media brand to be created. When BuzzFeed was founded in 2006, Facebook was only two years old. Twitter would launch that March—and went years before people took it seriously. The Web had changed a lot, and it was finally ready for Peretti's grand vision.

Sharing means not caring—about Google

With Facebook and Twitter on the rise, BuzzFeed liberated itself from the constricting practice of optimizing its content for search engines like Google.

That's because sharing became more important than searching as a way for people to find BuzzFeed content.

"We've spent two years not looking at Google search numbers," Peretti said. "A sort of 'aha' moment for me was when I got a few emails from people saying, 'I didn't find anything good to share on BuzzFeed today, I'm upset.'"

Peretti realized people weren't visiting his site just to entertain themselves. They wanted to find things for family members, friends, and Twitter followers.

"That means we can't have an algorithm that is targeting content only a reader will like," Peretti explained. "They want to see content that someone else in their life that they care about will like, even if they don't like it very much. At The Huffington Post, we thought of the front page as a one-stop shop for everything you'd need in news. And Google is just a search box and you, and that's all you personally need. Now we're faced with a different environment where you're thinking about these networks of people who are sharing with other people in their lives, and that changes how you think about your front page."

So while Peretti says he cares about direct traffic to BuzzFeed—people who type buzzfeed.com into their browsers and make it a regular stop—he'd rather have readers tweet out an article than actually click on it. Facebook is a more powerful traffic driver than direct visits, says Peretti, and social accounts for "well over 50%" of BuzzFeed's total visitors.

Some people turn up their noses at popular content. But for Peretti, the fact that people are sharing content with their friends is a key indicator of its quality.

"I care a lot about the quality of the content we create," says Peretti. "I care about if we're moving the conversation, and does our reporting move the conversation? I care about telling the public new information and breaking a story. I care a lot about whether we're consistently creating content that people think is worth sharing. I think about unique visitors as a proxy for, if people are sharing our content, then that should grow our uniques. There are things we could do to juice our uniques that we don't do, and there are things we can do to juice our pageviews that we don't do. We're focused on the long term of having really healthy metrics and having people really love the site."

Killing the cats every way possible

One of BuzzFeed's first viral posts was a meme it created called "Disaster Girl." It was a picture of a girl standing in front of a house that was burning down, and she had a sly look on her face, like she set the house on fire.

The picture was being sent all over the Web, and BuzzFeed saw an opportunity. The editors cut the girl out of the photo and placed her in front of other things that made her look guilty.

"That was an early one where we felt like we were participating in the creation of culture, not just saying what's hot," Peretti said.

BuzzFeed also found another viral tactic early on: cute animals.

"We started with cute kittens and Internet memes and humor because that's where the social Web was when the company started," says Peretti. The business still produces those hit stories, but Peretti's team is trying to skin its cat reputation.

"We've expanded to things like long-form reporting and scoops because those became a big part of what the social Web is all about," Peretti says. "We're going to evolve with the social Web."

We asked Peretti if BuzzFeed's animal-friendly reputation bothers him, and how he plans to be taken more seriously as a news organization.

BuzzFeed's politics content, he says, is already well-respected.

In hiring Ben Smith from Politico as the site's editor-in-chief, Peretti brought attention to the site's original-content strategy.

"Our political reporting is so good and we've broken so many stories that those folks are sometimes surprised that we have other stuff on the site," Peretti says.

He's making other moves to bolster BuzzFeed's reputation, like opening an LA office that will focus on video production and covering the entertainment industry and expanding globally.

Millions of dollars generated and not a single banner ad

BuzzFeed doesn't just want its content to be viral—it wants advertisers to experience virality, too.

It's a good idea in theory—what advertiser wouldn't want to sponsor an article that millions of people read?

BuzzFeed recently hired former ad-agency executive and Facebook veteran Jeff Greenspan as its chief creative officer, with the mission of boosting so-called "native" advertising—ads that fit into and play off of BuzzFeed's content, rather than just sitting on the same page like a banner ad.

But it's difficult to guarantee viral hits, or to convince 22-year-old media buyers to do a lot of extra work buying ad placements that can't be easily filled out on a spreadsheet or purchased through a trading desk.

Peretti says his ad team, run by BuzzFeed president Jon Steinberg, starts conversations with brands' chief marketing officers, not junior buyers. It looks for advertisers and agencies with open minds. Now that BuzzFeed has a few successful campaigns under its belt, like Schick's Shave The World "Razorbombing" campaign, which generated about 19 million views on BuzzFeed alone, the sales job is getting easier.

"Most advertisers would rather do a BuzzFeed Time Machine sponsored by GE and have all of this cool stuff to show friends, 'Look what we did with this client!'" says Peretti. "That's so much better [than banner ads]. We just need to create campaigns for a few people who are forward thinking so they can see it works and help others get over the fear of trying [a customized content sponsorship] too."

Today, BuzzFeed doesn't have a single banner ad on its site. Eschewing the standard media moneymaker, it will generate what industry sources say is close to $20 million this year.

"How do you reimagine things, and bring back catchy, engaging advertising?" says Peretti. "You can't really do it in banners because there's no space. But you can do it if you give people a full post or a bigger canvas to work with."

On the strength of its banner-busting strategy, BuzzFeed raised $15.5 million last year at a deal that, rumor has it, valued the company at as much as $150 million.

The future of BuzzFeed: People are the new distribution network

Peretti's goal now is to create a great media company for the social age.

"That means we have to continually surprise people, we'll have to continually evolve and change what we do," he says.

"The way we covered politics this year is the way we're going to cover entertainment next year," says Peretti. "We want to do on YouTube what we've done on Facebook and Twitter and see what we can do with great original videos. But that's all toward this larger goal of building a great news organization, entertaining content, and great branded content for a world where people don't just come to consume content, they come to share it."

Peretti says that so much of media's history has been thinking about consumption. Now it's time to shift that thinking towards sharing.

"If people become the distribution network, that should be something good for media, good for reporting, and good for journalism, because it's closer to humans and further away from the constraints of the medium or the particular way something will be broadcasted. People are what spreads the media, and that's a stronger and better signal than a media company could [build alone]."

Please follow SAI on Twitter and Facebook.

Join the conversation about this story »