There are no slow news days in America anymore, and yet, the media is ailing.

Layoffs at BuzzFeed, Verizon Media Group, and newspapers owned by Gannett left over 1,000 journalists and media professionals out of work this week. BuzzFeed announced plans to cut 15 percent of its staff; VMG cut 7 percent, including journalists at HuffPost. The list of those who are out of work includes a Pulitzer Prize–winning cartoonist; the social media savant responsible for “The Dress,” BuzzFeed’s famous viral post; and a dizzying number of reporters. The layoffs are part of a trend toward austerity measures for digital media companies. In 2018, Vox, Vanity Fair, Vice, GQ, Vogue, Teen Vogue, the New York Daily News, Good Media Group, Glamour, The Outline, Refinery29, and CNN experienced layoffs. Mic let go of most of its staff. Lena Dunham’s Lenny Letter shut down, as did beloved teen-focused Rookie magazine. LGBTQIA publication Into shuttered this month. While a few prestigious organizations, including The New York Times, The Washington Post, and The New Yorker, have received a “Trump bump” surge in readership during the Trump presidency, so many other outlets are financially flailing with no uptick in sight.

How did things get so dire? There are many theories: Craigslist killed journalism. Technology killed journalism. The 24-hour news cycle killed journalism. But this wasn’t a single-shooter assassination. Both new media outlets, like BuzzFeed, and legacy media outlets, like the newspapers owned by Gannett, are in trouble, but their roads to perdition were different. Legacy print media’s crisis started decades ago, as newspapers consolidated into huge, publicly traded companies. With the rise of publishing on the internet, these companies started to lose subscribers amid steeper competition. Meanwhile, free online ads decimated their classified ads business. Hedge funds began picking off financially vulnerable publications by buying out desperate owners and plundering them for short-term profits. Gannett is considering a sale to—you guessed it—a hedge fund.

While the rise of the internet upended traditional journalism, it enabled a new kind of media company to prosper. For a while, it seemed like some digital outlets figured out how to build a viable business in online publishing. However, the past few years have exposed the precariousness of the entire industry. Facebook and Google’s emergence as publisher-platforms with near-unfettered power has cratered the advertiser-supported model. (Facebook and Google gobble up a whopping 84 percent of online advertising revenue.) As the big social networks grew in prominence, many publishers relied heavily on the traffic their platforms generated, becoming beholden to fickle and secret algorithms. Additionally, the metrics that Facebook provided to advertisers falsely inflated how much people like online video, which spurred many news organizations to “pivot to video” out of desperation, only to see their audiences dwindle. Other ways to make money, like affiliate links or premium content subscriptions, have not made up for the absurdly asymmetrical breakdown of ad dollars between the tech giants and the media companies that provide content for their platforms. BuzzFeed is a particularly apt case study of digital media’s modern dilemma because it once looked like it was paving a path forward for media organizations to thrive online.

Jonah Peretti, who got his start in digital media at The Huffington Post, launched BuzzFeed in 2005 as a side project in the mode of a technology startup more than as a news operation, an R&D lab for figuring out how to grab attention on the internet. (The original name was Contagious Media.) In his original vision, Peretti essentially hoped to do what Facebook and Google do currently: act as a publisher-platform to dominate the spread of online content. His idea attracted substantial investor backing in 2008.

The decision to get into the news business came later, in 2011, and it required additional investment to hire journalists. BuzzFeed raised even more funding in 2013 when it began investing in its video operation. After taking over $50 million in outside financing, BuzzFeed reportedly became profitable in 2013, although it failed to turn a profit in subsequent years consistently; last year, the company lost money. In 2014, Peretti spoke glowingly about the benefits provided by venture capital. “I think VCs in general are great to be partnered with if you have the same goals,” Peretti said in an interview. “If you want to build a giant company relatively quickly, in an emerging space where the market isn’t mature enough to generate a lot of revenue early on, then VCs are the perfect partner.” To date, the company has raised over $500 million from investors, with the majority coming from NBCUniversal.

There’s nothing wrong with taking money from investors, of course, but it presents a challenge for a company that emphasizes newsgathering, which is expensive and relies heavily on online ad revenue. BuzzFeed generated $300 million in 2018, which sounds like happy news, but the high cost of doing journalism coupled with the state of online advertising meant that it disappointed investors, who are focused on profit, not Pulitzers, even in the news industry. BuzzFeed grew rapidly for years but is now struggling to balance its commitment to profitability with its commitment to journalism. This week’s layoffs have made that clearer than ever. BuzzFeed News, the company’s journalism arm, lost many reporters dedicated to covering politics, national affairs, cybersecurity, health and wellness, and LGBTQIA issues. These reporters did not factor into the calculus deemed necessary to accelerate growth.

There is a chance BuzzFeed’s founder has finally soured on the startup model. Peretti explicitly cited the desire to move away from outside funding as the impetus for the drastic cuts. “The restructuring we are undertaking will reduce our costs and improve our operating model so we can thrive and control our own destiny, without ever needing to raise funding again,” he said in an email to staffers in advance of the layoffs. There may be another explanation. Last year, Peretti hypothesized that he might have to merge BuzzFeed with its rivals to better negotiate with Facebook and Google, and it appears he is considering another merger; Recode reported that BuzzFeed is considering a merger with digital publisher Group Nine. These layoffs may have been motivated by an attempt to please another set of prospective outside backers after all.

The idea of a supergroup of media outlets banding together to fight the tech giants might seem a bit silly if it weren’t such a clear indicator of how grim the situation is. The prospect of government regulation dismantling Facebook and Google’s digital advertising duopoly seems unlikely. At this time, the best hope new media companies have, just like legacy outlets, is benevolent billionaire backers not fixated on maximum growth. Tethering a media outlet to the whims of the ultrawealthy is, of course, not ideal—but then again, as this week proved, yoking most of the media to the profit models demanded by investors and shareholders can be even worse. Over the past decade, BuzzFeed represented the potential that the social web offered more than perhaps any other media company. For a time, it seemed as though it was possible for a publisher to game the algorithms and do serious, smart, funny work. This restructuring is a grim reminder that even media companies optimized to work on the tech giants’ platforms have been unmoored by how much power they wield. BuzzFeed is still an impressive media outlet capable of great things. But the odds of BuzzFeed or any other media company forging a sustainable path within the current power structure has never looked worse.