Japanese publisher Uzabase recorded a $55m loss on the deal as it sold global business publisher Quartz to its chief executive and co-founder Zachary Seward.
The management buyout will see Seward take an 88.9% stake in the company with staff also taking shares.
Uzabase CEO Yusuke Umeda is lending Quartz the funds necessary for it to continue operating “for the time being” as Seward looks for other investors.
The publisher bought Quartz from Atlantic Media for $75m in July 2018 and had planned to make it profitable within three years by launching a paywall.
However, in an investor statement yesterday, Uzabase said: “Due to the Covid-19 pandemic unfolding from the beginning of 2020, there has been a strong trend of corporations curbing advertisement placements, especially in the US.”
However, Uzabase said Quartz had continued to “underperform the plan set at the time of restructuring”.
It said that final losses booked this year from the withdrawal of Quartz will be around Y5,810m ($58m).
Quartz was launched by Atlantic Media in 2012 and had grown to annual revenue of around $30m by 2016.
The Quartz formula of a sleek website and app married to agenda-setting newsletters and more targeted advertising seemed to be the future of digital media for many.
Launched as a free, digital competitor to The Economist it offered a fresh take on the big global issues that business leaders needed to know about.
It organises its coverage around Obsessions (or themes) rather than traditional patches and often has a quirky take on the news of the day with a strong emphasis on data.
Less than a year after launch, Quartz was claiming 2m unique visitors per month and by 2017 it claimed to reach 100m readers a month across all platforms.
Its business model originally centred around high-quality targeted native advertising and content campaigns.