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CNN is shutting down Beme, the Casey Neistat-run video company it acquired in 2016 for $25 million.
Neistat revealed the news Thursday morning in a video on his YouTube channel. “Finding the words here is challenging,” he admitted, before announcing that he and Beme co-founder Matt Hackett were moving on from the venture and leaving CNN.
They started Beme some three years ago as an app designed to take short, non-editable video clips. Many were surprised when CNN announced that it would acquire the company and give it the mandate to develop innovative news formats.
For the last year, Beme has operated independently out of a startup-like office in SoHo, several miles from CNN’s Columbus Circle headquarters. The company launched a YouTube channel, Beme News, in which Neistat hosted weekly videos that touched on a range of subjects. Meanwhile, the company also began developing new products, including Panels, an app that provides real people’s perspective on the news, and the yet-to-launch Wire, a machine-learning platform for journalists.
CNN is absorbing Beme as part of the shutdown of the company. Beme News will continue under CNN Digital Studios. The apps will become core CNN mobile products.
Most of Beme’s 20-person staff will be offered positions at CNN, though some could be laid off. “You can’t be afraid to take chances if you want to stay on top of an industry that is changing every day,” Andrew Morse, CNN Digital’s general manager, said in a statement. “This was a chance worth taking — we built products and developed key talent that have made CNN stronger.”
In many ways, Neistat seemed an unlikely partner for CNN. The filmmaker first connected with CNN president Jeff Zucker because Zucker’s son was a fan. Zucker initially offered Neistat a TV show but was turned down, and they eventually decided to work together through Beme. But the company was slow to launch, and Neistat seemed hesitant to box the company into a daily YouTube news show. It has produced 40 videos in the last six months and garnered 269,000 YouTube subscribers.
“Maybe I struggled more in that environment than I had anticipated,” Neistat acknowledged in his video. He also said that working with CNN “has been incredible” and revealed that he will stay on as an executive producer on Beme News.
In a town hall with staff on Thursday, Zucker called the Beme acquisition a “big bet” but said “if I had to make the call to make it again, I would,” according to attendees who viewed the event. He also explained, “The content we created specifically around Casey has not come together like we expected it to.”
The entire digital media industry is facing mounting competition for advertising dollars. It has led to layoffs at companies, including BuzzFeed and Funny or Die.
In a blog post, Hackett acknowledged that it was difficult to build Beme into a sustainable business. “This is not the story of the aging conglomerate that couldn’t innovate and rejected the young startup blood,” he wrote. “Ultimately, while we have built some valuable things, we didn’t hit the escape velocity the business needed to exist independently.”
Jeremy Barr contributed to this report.
Jan. 25, 10:52 a.m. Updated to include Zucker’s statements from a CNN town hall.
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