Facing a cash crunch and significant debt, BuzzFeed founder Jonah Peretti is betting the company's future on a skunkworks subsidiary called Branch Office, which will use artificial intelligence to build new applications like games and communities. BuzzFeed lost $10.9 million in cash last year and carries $58.4 million in debt, forcing Peretti to pivot from its struggling digital advertising model. He aims to reduce reliance on ad revenue by generating income from A.

I. products through subscriptions and in-person events, citing the growth of competitors like Semafor. Branch Office, inspired by Nintendo and operating independently, is developing games like Conjure, BF Island, and Quiz Party, emphasizing human connection and community – aspects Peretti believes will dominate the A. I. era.

However, investors remain skeptical, recalling NBCUniversal's $400 million investment at a $1.7 billion peak valuation that failed to prevent the company's decline, including the 2023 shutdown of its Pulitzer-winning news division.