Feeds

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

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

Protecting users from Firesheep and other Sidejacking attacks with SSL

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. ®

Website security in corporate America

More from The Register

next story
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
Apple CEO Tim Cook: TV is TERRIBLE and stuck in the 1970s
The iKing thinks telly is far too fiddly and ugly – basically, iTunes
Israeli spies rebel over mass-snooping on innocent Palestinians
'Disciplinary treatment will be sharp and clear' vow spy-chiefs
Huawei ditches new Windows Phone mobe plans, blames poor sales
Giganto mobe firm slams door shut on Microsoft. OH DEAR
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Found inside ISIS terror chap's laptop: CELINE DION tunes
REPORT: Stash of terrorist material found in Syria Dell box
OECD lashes out at tax avoiding globocorps' location-flipping antics
You hear that, Amazon, Google, Microsoft et al?
Show us your Five-Eyes SECRETS says Privacy International
Refusal to disclose GCHQ canteen menus and prices triggers Euro Human Rights Court action
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.
Saudi Petroleum chooses Tegile storage solution
A storage solution that addresses company growth and performance for business-critical applications of caseware archive and search along with other key operational systems.
Security and trust: The backbone of doing business over the internet
Explores the current state of website security and the contributions Symantec is making to help organizations protect critical data and build trust with customers.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.