The online media company whose co-founder pretended to be a YouTube executive in an apparent attempt to attract investors has hired a law firm to investigate its practices.
Ozy Media, whose website promises users that it will ‘defy convention, change perspectives and ignite ideas’, has hired Paul, Weiss, Rifkind, Wharton & Garrison to review the company’s business, the statement said.
This follows a report in the New York Times that broke details about the imitation and questioned the hearing figures and marketing demands of Ozy Media. The law firm’s review was subsequently reported by the Wall Street Journal.
Samir Rao, co-founder and chief operating officer, is in the middle of the news report’s main allegation that he pretended to be a YouTube executive earlier this year on behalf of a conference with Goldman Sachs, a potential investor.
Ozy Media confirmed that the incident took place, which was reportedly the result of an episode of mental health.
Rao was requested to take leave by the board pending the outcome of the investigation.
Harry Hawks, a media veteran and former CFO of Hearst Television, was appointed interim CFO during the review.
Katty Kay, a veteran BBC journalist who left the organization in May to work for Ozy, said on Wednesday she had resigned. “The allegations in the New York Times, which surprised me, are serious and very worrying,” she said.
Carlos Watson, CEO, co-founder and public face of Ozy Media, issued a statement earlier this week that he sent to staff regarding the New York Times article.
It contains a quote from Marc Lasry, the billionaire co-owner of the Milwaukee Bucks basketball team that chairs Ozy Media, confirming that the board has been informed of the Goldman Sachs call and the way it handles be, supported. “The incident was an unfortunate one-off event,” Lasry said in the quote.
Ozy Media was founded in 2013 as a digital media startup by Watson and Rao and has since expanded into podcasts, TV and events. The German Axel Springer, partners at the private equity firm Clayton, Dubilier & Rice, which is trying to buy the British supermarket Morrisons, and Lasry is one of those who invested in the business.
The New York Times questions Ozy’s claim in 2019 that it reached 50 million unique users per month, comparing it to data from Comscore, which measures online engagement, showing figures at a fraction of that level.
Watson responded to staff members posted on Twitter that the company has a database of 26 million subscribers to newsletters, an audience of 25 million for its podcasts and online TV series and a “social reach” of 30 million . ‘Ozy’s growth. . . was completely real, ”reads the statement.
The company said it was unaware of any investigation into its practices after the New York Times wrote that Google, which owns YouTube, had notified the Federal Bureau of Investigation of the conference with Goldman Sachs.
Watson also said on Twitter that he was ‘sad’ about the report, which he described as a ‘ridiculous job’.
Ozy Media did not immediately respond to a request for comment. Rao could not be reached for comment.