Embattled Ozy Media continues to make headlines as founder-CEO Carlo Watson told the Today show the company is not in fact shutting down as it had previously announced in the wake of a fast unfolding financial scandal where he had been conspicuously absent.
Watson said he stayed quiet all last week as his company flamed out because he’d gotten “some very bad advice from crisis communications folks.” Now he’s speaking out, “engaging,” he said, including a pot shot at Sharon Osbourne, whom Watson has previously described as a friend and investor in Ozy Media. Osbourne denied both when asked by CNBC last week as the company imploded, and called Watson “insane.”
The two had a 2017 legal fight over Ozy Media’s Ozyfest festival’s alleged infringement on the Osbourne’s Ozzfest event name. She said Watson had offered them shares of his company to settle the lawsuit but that she declined.
Watson, however, insisted to Today that the eventual settlement had indeed included handing Osbourne shares of Ozy Media. “And lets be really clear. I am not going to raise money by telling sophisticated people that Sharon Osborne is an investor. No smart person is going to say, ‘Oh great, you’ve got Sharon Osborne.'”
Watson also stated this morning that he had no knowledge and was not a participant on the now infamous conference call where his co-founder and Ozy COO Samir Rao impersonated a YouTube executive, triggering the scandal. The call was with bankers from Goldman Sachs, which was considering a $40 million investment in Ozy. Asked by NBC’s Craig Melvin. if he’d heard from the FBI or law enforcement, Wastson said, “I definitely haven’t.”
“We’re going to open for business, so we’re making news today,” Watson said. “This is our Lazarus moment, if you will, this is our Tylenol moment. Last week was traumatic, it was difficult, heartbreaking in many ways.”
The reversal comes after Ozy Media announced Oct. 1 it was shutting down days after an explosive NYT report triggered accusations of financial fraud and increased scrutiny of the company’s business. Watson said that decision to shutter was reconsidered over the weekend.
“At the end of the week, we did suspend operations with a plan to wind down,” he said “And as we spent time over the weekend we talked to advertising partners, we talked to some of our readers, some of our viewers, our listeners, our investors… I think what we do with newsletters, what we do with TV shows, original TV shows, podcasts and more, I think has a place.”
NYT columnist Ben Smith last Monday reported that Rao had impersonated the YouTube executive on a Feb. 2 conference call. Posing as the YouTube executive, he asked via email to switch from a Zoom video call to a voice teleconference at the last minute. But the voice sounded odd and electronically altered, prompting a Goldman banker to follow up with the executive’s office directly to discover he was not on the call and had no knowledge of it. Days later Watson revealed that the voice had been Rao. The reason given was mental health issues.
Watson this morning called it “a tragic situation” but said “I am grateful, though, that Goldman didn’t invest, because that would have been the worst all.”
And he claimed that “several months later, to Goldman’s enormous credit, they stepped forward (in) a new advertising partnership with us, recognizing that the larger Ozy company does some pretty special things with premium content, forward looking content and really a diverse set of audiences.”
A top journalist Katty Kay quit last week, so did billionaire Marc Lasry, chairman of the board. Watson said the board currently consists of himself and Silicon Valley investor Michael Moe. He declined when asked to reveal its financial backers.
The notice of the shutdown late last week thanked staffers: “Many of them are world-class journalists and experienced professionals to whom we owe tremendous gratitude, and who are wonderful colleagues. It is therefore with the heaviest of hearts that we must announce today that we are closing Ozy’s doors.”
Watson Monday tried to clarify another of the conflicting accounts swirling around Ozy content — that it had planned a show, The Carlos Watson Show, to run on A&E in a partnership with the network. However, nothing as yet is particularly clear.
“Originally we did conceive of the show for A&E. We’d had a two year partnership with A&E… We talked to them about it. They moved too slowly on it. We notified them that we weren’t going to do it there but move it to YouTube. The gentleman you mentioned there, who was part of the story, knew we had moved it to YouTube and yet now comes forward and says ‘I didn’t know, I didn’t know.’ Of course he knew.”