Ozy Media closes its doors after advertisers leak and president resigns
Ozy Media announced Friday night that it would close its doors after major advertisers suspended their campaigns and the billionaire president of the digital media startup resigned amid a spate of bizarre scandals – including surprise allegations by reality TV star Sharon Osbourne.
“At Ozy, we are fortunate to have a remarkable team of dedicated staff. Many of them are world-class journalists and experienced professionals to whom we owe immense gratitude and who are wonderful colleagues. It is therefore with the heaviest heart that we must announce today that we are closing the doors of Ozy, ”said a statement from its board of directors, according to the New York Times.
Friday evening, the site was still online. There was no immediate indication of when or how the lights would go out.
Ford, Airbnb, Goldman Sachs and Target are among companies that previously halted campaigns with the media company, costing Ozy up to $ 5 million in revenue, The Wall Street Journal reported Friday, citing anonymous sources.
Ford confirmed the news by saying, “We are suspending our advertising while Ozy Media tackles their current business challenges.” Airbnb, Goldman Sachs and Target did not immediately return requests for comment.
On Thursday evening, billionaire Marc Lasry, owner of the Milwaukee Bucks NBA team and CEO of buyout firm Avenue Capital, resigned as chairman of Ozy after just three weeks on the job.
“I think to move forward, Ozy requires experience in areas such as crisis management and investigations, where I don’t have any particular expertise,” Lasry said. “For this reason, I resigned from the board of directors of the company. I remain an investor in the company and wish it the best for the future.
Separately, on Thursday, reality TV star Sharon Osbourne said the company’s co-founder and CEO Carlos Watson falsely claimed that she and her husband, heavy metal legend Ozzy Osbourne, were investors in the company.
Earlier this week, a New York Times Report found out that Ozy’s co-founder and COO, Samir Rao, posed as a YouTube executive during a call with potential investor Goldman Sachs. This article and several follow-ups also claimed that Ozy frequently inflated key business metrics with other investors and even lied to his own employees about business operations.
Since then, the FBI has reportedly started investigating the phone call claiming Rao to be a YouTube executive in order to raise money from investors. Although Ozy has not released a public statement, Watson tweeted on Monday that the Times article was a “hitjob”. He hasn’t tweeted since.
The dust with the Osbourne started in 2017 when the couple filed a trademark lawsuit on the annual concert and festival of Ozy Media, which is called Ozy Fest. For years, The Osbournes had produced the Ozzfest music festival, which featured artists such as Black Sabbath, Tool, and Slayer.
“Fun fact: Our friend Ozzy and Sharon briefly chased us, then we decided to be friends and now they’re investing in Ozy,” Watson said on CNBC two years ago.
It was an outright lie, according to Sharon Osbourne, who spoke to CNBC Thursday.
“This guy is the biggest crook I have ever seen in my life,” she said, adding that Watson tried to intimidate her during the filing of the complaint, saying Ozy Media had plenty of resources and could prolong the legal battle so much that the family would be faced with exorbitant legal costs for years to come.
The two sides settled after the Osbournes disbursed $ 300,000 in legal fees. The regulations required Ozy Media to submit musical acts and advertisers to Osbourne for approval, to ensure there was no overlap.
SV Angel, one of the early investors in Ozy led by legendary Silicon Valley venture capitalist Ron Conway, sold the shares he had acquired in the company in 2012, Axios reported.
Separately, veteran journalist Katty Kay, who joined Ozy in May, announced her resignation from the media company after write on twitter that she found the allegations “deeply disturbing”.
Ozy’s board announced earlier this week that it had hired a law firm to launch an external investigation “following reports of conduct that do not meet our values standards.” The board also said it asked Rao, the chief operating officer at the center of some of the allegations, “to take time off while awaiting the results of the investigation.”
However, in the original Times story that sparked the wave of activity among the media darling, Lasry – then chairman of the board – said the board was aware of the incident and supported the way he had been treated.
“The board has been made aware of the incident and we fully support the way it was handled,” he said. “The incident was an unfortunate one-time event, and Carlos and his team showed the kind of compassion we would all want if either of us faced a difficult situation in our own lives.”