Comcast (CMCSA) media subsidiary NBCUniversal is showing its confidence in internet media company BuzzFeed, agreeing to invest an additional $200 million and extending the companies' strategic partnership.
The new investment will expand the advertising and sales relationship between the two New York companies, NBCUniversal said on Monday, with BuzzFeed helping NBCUniversal produce and distribute content from the latter's Content Studio. For its part, NBCUniversal will present BuzzFeed content to advertisers.
Buzzfeed, which reaches more than 500 million people across the world, will be able to boost its journalistic efforts as well, growing across all platforms and increasing its digital video operations, the statement said. The new funding from NBCUniversal values BuzzFeed at about $1.5 billion, according to Business Insider.
The funding comes amid a time of major change at once-darling BuzzFeed as the company shifts its focus toward video. In August, the company reorganized into two new departments, BuzzFeed News and BuzzFeed Entertainment Group.
CEO Jonah Peretti told employees that the change would help the company "take full advantage of many formats and technologies," according to a company memo cited by Reuters. Peretti added that video staff would be integrated into every department, because "having a single video department in 2016 makes about as much sense as having a mobile department."
The New York Times reported in September that video makes up about 50% of BuzzFeed's total revenue. In the next two years, video will dominate about 75% of the company's advertising sales.
NBCUniversal invested an initial $200 million in the internet media company in August 2015, and the media conglomerate clearly liked what it saw. Since then, the companies have collaborated on several projects including coverage of the 2016 Rio Olympics on Snapchat, co-sales of advertising deals and content partnerships such as featuring BuzzFeed's Tasty videos on NBC News' Today.
"Over the past year, BuzzFeed has proven to be a valuable partner across our business," NBCUniversal's President of Digital Enterprises, Maggie Suniewick, said in Monday's statement. "We are looking forward to using the power of our brands to collaborate in more innovative ways that drive value for both companies."
Peretti added that the investment will allow his site to operate independently while still benefiting from NBCUniversal's resources.
NBCUniversal also put $200 million into media company Vox Media last year in an effort to cross-promote the two brands and collaborate to create new advertising products.
NBCUniversal, of course, isn't alone in reaching out to smaller digital media companies. In October, Discovery Communications (DISCA) invested $100 million in digital venture Group Nine Media, which owns titles like NowThis and Thrillist Media Group. Disney (DIS) has had $400 million invested in Vice Media since late 2015. Media upstart company Refinery29, which is targeted at millennial women, got $45 million in funding from Time Warner's (TWX) Turner Broadcasting this summer.
Refinery29 co-CEO Philippe von Borries told The Wall Street Journal in October that his digital media company has been "aggressive about being on every platform first, and the next one is TV."
Partnering with these larger conglomerates such as NBCUniversal or Turner gives media companies a chance to tap into big audiences and ad money, as well as the chance to push their content onto TV. Von Borries noted that TV is still "one of the most efficient businesses that exist today."
For the media giants themselves, investing in smaller digital ventures could help draw in more advertising. Thrillist founder Ben Lerer told Fortune recently that both TV and digital are "massively important" for advertisers, and to reach the biggest audience, companies need to work across both platforms.
Shares of Comcast were up about 1.2% to $69.02 on Tuesday afternoon.
BuzzFeed did not immediately respond to a request for further comment.