Digital news startup The Messenger shuts down less than a year after burning through $50 million

The Messenger, a digital news startup founded by media executive Jimmy Finkelstein, is shutting down in less than a year, marking a significant setback in the internet media landscape, Axios reported, citing insider information.

The announcement follows recent reports hinting at staff layoffs within the startup, which employed approximately 300 people before its closure. Having launched in May with an initial investment of $50 million, The Messenger gained attention for its focus on politics, general news, and sports coverage. Despite efforts by CEO and founder Jimmy Finkelstein to secure additional funding to sustain operations, including discussions to extend the business’s runway, no viable deal materialized, Axios revealed.

The startup achieved a notable milestone in September with the acquisition of prominent sports personalities such as Seth Davis, Jeff Goodman, Ryan Nanni, Arash Markazi, Mike Tanier, Neil Paine, Kaelen Jones, and Christian Red, among others.

Despite these efforts, Finkelstein’s last-minute fundraising endeavors failed to garner sufficient support, leaving The Messenger vulnerable amid challenging industry conditions. In a staff memo obtained by Axios, the inability to secure necessary funds was attributed to broader media sector challenges.

“Unfortunately, as a new company, we encountered even more significant challenges than others and could not survive those headwinds.”

Finkelstein broke the news of the site’s abrupt closure to senior editors shortly after 4 p.m. ET on Wednesday. However, non-senior employees were left in the dark until after 5 p.m. ET, when Finkelstein’s email had already leaked and spread across social media platforms and within the company itself.

Jimmy Finkelstein delivers news of the shutdown to staff: pic.twitter.com/fNzHkigSEP

— Ben Mullin (@BenMullin) January 31, 2024

Following the release of the story by the New York Times on X (formerly Twitter), employees swiftly sought clarification in the Slack channel. However, Editor-in-Chief Dan Wakeford, in the process of gathering information, responded that he had not yet received any updates.

Below is the message Wakeford later delivered to The Messenger employees at around 4:38 p.m. ET:

“I’m devastated we have ended like this, and I am sorry the last few weeks have been torturous.

Please reach out to me if there is anything I can do to help, such as references, job referrals, or advice. ANYTHING. I am here for each and every one of you.

The editorial team built a brand from scratch in a short amount of time and achieved our goal of creating a neutral news brand that fits perfectly into a middle lane, appealing to insiders and outsiders.

You should be proud of your work. This team has been amazing, and the end result is not because of your brilliant work. The team consists of some of the top journalists in the business and has created best-in-class breakthrough work and accurate, neutral writing, reporting, and editing.

We delivered beyond expectations in just seven months – with the traffic results to prove it.

Again, I apologize. I am here for you and wish this could have ended differently.”

Meanwhile, adding to The Messenger’s woes, The New York Post also reported that Richard Beckman, the president of the embattled startup, has announced his departure from the company on Tuesday as it initiates another round of layoffs.

Beckman, a former Conde Nast executive known for his assertive business approach and nicknamed “Mad Dog,” played a key role in generating revenue for the website, which was launched in May. Before the startup’s debut, Beckman had confidently predicted in a New York Times profile that the site would achieve over $100 million in revenue in 2024, attract 100 million monthly readers, and employ hundreds of reporters nationwide.

Once brimming with the latest stories and captivating articles, The Messenger website now displays a blank page adorned only with the company logo and contact email address.