Amazon CEO Jeff Bezos displays a Kindle.Ben Margot
Jeff Bezos of Amazon is making his first significant investment in the news media by leading a $5-million financing package for the Business Insider website.
The move was announced on Friday by Henry Blodget, chief executive of Business Insider, who wrote in a staff memo: "Basically, Jeff Bezos is making a significant investment in the company. Our existing investors are also chipping in some more. In total, we're raising $5-million."
Mr. Blodget, who is also editor-in-chief, said that Mr. Bezos, founder and chief executive of Amazon, "sees some parallels" between the ecommerce company and Business Insider.
Mr. Blodget, who as an equity analyst during the first dot-com boom made a seemingly outlandish but ultimately accurate prediction that Amazon's stock would jump from $240 to $400. He was later banned from the securities industry, in 2003, after being charged with civil fraud over his coverage of technology companies.
Mr. Bezos owns at 19.1 per cent stake in Amazon, valued at more than $22-billion. Through Bezos Expeditions, his personal investment company, he has invested in a range of futuristic projects, philanthropic pursuits and disruptive digital companies.
Bezos Expeditions oversees his investment in the 10,000 year clock, designed to keep time accurately for the next 10 millennia; his $15-million donation to create the Bezos Center for Neural Circuit Dynamics at Princeton, his alma mater; the education-focused Bezos Family Foundation; and his stakes in companies including Airbnb, MakerBot and ZocDoc.
The existing investors include Institutional Venture Partners and RRE Ventures.
Mr. Blodget said the financing would allow Business Insider to invest in its editorial operations, technology and client teams.
Amazon has been increasing its own production of original digital content since it acquired the Internet Movie Database in 1998. It now produces printed books and ebooks from its publishing business and is working on its own television and film productions.
Mr. Blodget said the investment grew out of a dinner he had with Mr. Bezos about a year ago.
"We talked about the business, and he was excited about it . . . A few months later, he expressed an interest in investing. My reaction was basically 'Hell, yeah!'."
In an official press release Mr. Blodget said: "Obviously, at Business Insider, we write about Amazon occasionally, along with some of Jeff's other ventures (rockets, rocket engines, and other cool stuff.) In the future, our articles on these topics will disclose that Jeff is an investor in the company."