Failed Digg Sells for $500,000 (or $16 Million) to Betaworks (and Others)

Seems like only yesterday every conversation was around Digg, and how they had become the biggest and best social site on the web.

Rivals like Reddit and StumbleUpon were virtual unknowns as Kevin Rose and Digg took the majority of the media attention and credit for building one of the first major social aggregation sites around.

Content marketing, and the beginnings of social media marketing in general, were born off the massive successes publishers and sites were getting from having their content go popular (hitting the front page of the site).

The traffic Digg could send would crush just about any server around (the Digg Effect), and you could earn more links from one promotion than you could from a year of link building.

Google would later enter into talks to potentially buy Digg at an estimated value of around $200 million, but as talks fell apart and the deal died, the site began to decline as Kevin Rose moved on to other projects and Digg started looking at ways to become profitable.

With the launch of Digg V4, which was an entirely new code base and basically an entire new team, Digg pretty much lost all its final core members, who moved on to Reddit and other sites, primarily because Digg introduced auto-submissions from publisher feeds.

After getting well over 5,000 front pages on Digg through the years, we stopped even submitting and moved on ourselves.

Now after raising a total of $45 million and failing to ever really become profitable, Digg is being purchased by Betaworks for a mere $500,000.

UPDATE: Techcrunch has published the following information which indicates the sale price was much larger than $500,000.

Rumor has it that the price was just $500k, but that number doesn’t really make a lot of sense, given that the site still gets enough traffic to make more than that in a year by just selling ads. Talking to AllThingsD, Digg CEO Matt Williams confirmed that “the overall consideration is significantly larger” and includes a combination of cash and equity. Another source close to the negotiations tells us that the price was indeed not $500k. We haven’t been able to pinpoint the exact price yet.

UPDATE 2: Techcrunch has released a lot more details on the amount that was paid for Digg and it was well over $500,000… to the tune of around $16 million.

 

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