Back in 2008, Digg was rumored by Tech Crunch to be in negotiations with Google, who reportedly offered $200 million dollars for the social aggregation site. Digg had just raised a reported $29 million in venture capital and was valued at about $164 million. They still turned down the $200 million offer to become a part of Google News.
How things have changed. Now The Wall Street Journal reports Digg has sold to New York technology development firm Betaworks for a price of . . . wait for it . . . $500,000. Put another way, that’s 99.75% less than Google offered them four years ago. Put yet another way, it would take 70 Diggs to buy one Myspace. Ouch. Play them off, Johnny.
It was only a of couple years ago that Digg still had more traffic than Reddit and was crushing it at driving traffic on the web. When UPROXX’s own Gamma Squad was relatively new and trying to find our audience, Digg graciously drove about quarter million new visitors to something I posted. They were doing the same for many fledgling websites at the time. Very shortly thereafter, they unveiled an unpopular site redesign at the same time Reddit was blowing up. Along with the redesign came criticisms about how a small handful of sites were taking up over half of the Digg front page, a lack of diversity more severe than ever seen at the site before. The exodus from Digg to Reddit was enormous. Soon those of us around here at UPROXX were wondering what just happened as incoming Digg traffic morphed from “awesomely huge” to “is Digg still a thing?”
Well, Digg still is a thing, sort of. The site continues to draw 7 million visitors per month. That’s fewer visitors than Reddit, but nothing to sniff at. Betaworks plans to absorb Digg into their new start-up News.me (launched April 2011). The site sends users news stories based on what their Twitter and Facebook friends are talking about. News.me has about 10 employees, and none of the remaining Digg employees are being offered jobs with Betaworks.
Our condolences to the Digg employees who won’t be offered jobs with News.me. Some of those people really helped us out a few years ago, and it sucks to see them taking the hit for a few bad business moves that they probably had no say in. The lesson to be learned from this is probably the same lesson gamblers should heed: when someone offers you a massive pile of FU money, just take it. Don’t hold out for a little bit more and lose 99.75% in the waiting.
(Thanks to Jim Romenesko for the heads up.)
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