A day after Defy Media informed employees it was closing its Beverly Hills office, the full story became more clear: the whole company is shutting down. The employees in its New York corporate office now have to sell off its properties, like the Smosh franchise. The firm’s closure seems to have happened suddenly—from what we hear, management was encouraging teams to bring on new business even as of last Friday.
In the memo to employees, published in this Hollywood Reporter story, executives blamed “market conditions” for its shutdown. That’s likely a reference to the extremely tight digital ad market (for any company that isn’t running a big scale platform) and dearth of a reliable market of outlets who buy content. Defy had raised tens of millions of dollars, so this is a major downfall. It shows just how unfriendly the landscape is for digital media companies and serves as a grim prelude to the similar stories that are likely to follow in the near term.