Feeds

Digg, deep in the hole, sells self for $500K

All that's left is to shovel in the dirt and plant the daisy

Internet Security Threat Report 2014

Social news- and link-sharing site Digg has sold itself to New York technology incubator Betaworks for the paltry sum of $500,000.

The Wall Street Journal reports that Betaworks does not plan to retain any of Digg's current employees.

"Over the last few months, we've considered many options of where Digg could go," writes Digg CEO Matt Williams, "and frankly many of them could not live up to the reason Digg was invented in the first place – to discover the best stuff on the web. We wanted to find a way to take Digg back to its startup roots."

To put the jaw-dropping sale price into perspective, $500,000 is the bare minimum needed to open a McDonald's franchise. It's less than the average price of a one-bedroom starter home in San Francisco, where Digg is currently headquartered. It's what Facebook's Mark Zuckerberg earns in annual salary – but that's not including bonuses and equity grants.

It's also just 0.2 per cent of the $300m Digg was reportedly shopping itself for in 2007.

But those were headier days. Digg was once considered one of the most promising social media sites on the web, but its popularity waned with the rise of such competitors as Facebook, Reddit, and Twitter.

It had come close to being acquired several times over the years, and it made no secret that it was actively seeking a buyer – but it never found one. In 2008, Google reportedly walked away from a deal that would have valued Digg at $200m.

Along the way, the company has hemorrhaged money, and cost-cutting measures haven't been enough. In October 2010 it cut a third of its staff, leaving it with just 47 employees. By then it had already lost both cofounders.

In May of this year, 15 members of Digg's engineering team jumped ship to join SocialCode, a social media advertising agency owned by the Washington Post, leaving Digg with less than half its former staff.

This week, TechCrunch reported that Digg had raised a new round of funding from one of its existing investors. If it hadn't, sources speculated that it might have run out of cash in six months.

Following Thursday's merger, Betaworks plans to merge Digg with News.me, a Betaworks-funded startup that markets an app for iOS devices that aggregates news links from social media websites.

"We are turning Digg back into a startup," writes Betaworks founder John Borthwick, who will be taking over as Digg CEO. "Low budget, small team, fast cycles."

We'll see if it works this time. ®

Choosing a cloud hosting partner with confidence

More from The Register

next story
Spies, avert eyes! Tim Berners-Lee demands a UK digital bill of rights
Lobbies tetchy MPs 'to end indiscriminate online surveillance'
How the FLAC do I tell MP3s from lossless audio?
Can you hear the difference? Can anyone?
Inequality increasing? BOLLOCKS! You heard me: 'Screw the 1%'
There's morality and then there's economics ...
Google hits back at 'Dear Rupert' over search dominance claims
Choc Factory sniffs: 'We're not pirate-lovers - also, you publish The Sun'
While you queued for an iPhone 6, Apple's Cook sold shares worth $35m
Right before the stock took a 3.8% dive amid bent and broken mobe drama
4chan outraged by Emma Watson nudie photo leak SCAM
In the immortal words of Shaggy, it wasn't me us ... amirite?
prev story

Whitepapers

Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.
Intelligent flash storage arrays
Tegile Intelligent Storage Arrays with IntelliFlash helps IT boost storage utilization and effciency while delivering unmatched storage savings and performance.
Beginner's guide to SSL certificates
De-mystify the technology involved and give you the information you need to make the best decision when considering your online security options.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
Secure remote control for conventional and virtual desktops
Balancing user privacy and privileged access, in accordance with compliance frameworks and legislation. Evaluating any potential remote control choice.