BuzzFeed is huge amongst the aged 18-24 crowd. I can't walk past a computer screen that doesn't have one of those "24 Reasons We All Hate Mornings" posts. They remind me of the "what would you call X" websites that were insanely popular a year ago.
They are heavy buyers of Facebook ads so I imagine a fair bit of traffic comes from those + the fact they have a sense for "viral" content. Although Peretti says they are profitable in his internal memo, I am quite skeptical until they release some real numbers to back that up -- I wouldn't be surprised if Facebook buys them.
I wouldn't be surprised if Facebook buys them
That would be a really, really weird choice. Facebook has an incredible number of editorial partners, I doubt they'd be too happy if Facebook bought one of their competitors.
In some sense, they must get a lot of bot traffic who only scrape the site to see what's "hot" because BuzzFeed itself is a highly optimized version of Yahoo Popular News. And BuzzFeed probably has little incentive to police these bots because that would drive their pageview numbers lower. At the end of the day, they probably have low value traffic and their ads sell cheap. But the BuzzFeed is probably not too concern about CPM because when the do sell they will try to frame the valuation around pageviews and not revenues.