Ozy Media is not dead despite initially announcing it was shutting down last week following critical reports about its business practices, the company's CEO told TODAY exclusively on Monday.
“We’re going to open for business, so we’re making news today," Ozy CEO Carlos Watson told TODAY's Craig Melvin. "This is our Lazarus moment, if you will, this is our Tylenol moment. Last week was traumatic, it was difficult, heartbreaking in many ways."
Watson's reversal comes after Ozy Media made an announcement on Oct. 1 that it was shutting down the company, just five days after a report by The New York Times detailed alleged misconduct by one of the company's top executives on a conference call, as well as increased scrutiny of the company's business practices.
“At Ozy, we have been blessed with a remarkable team of dedicated staff,” a statement from the company’s board of directors read. “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.”
Behind the rise and fall of Ozy MediaOct. 4, 202102:15
But Watson now says that decision has been reversed.
"At the end of the week, we did suspend operations with a plan to wind down," he told TODAY. "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 Ozy is part of this moment, and it’s not going to be easy, and I think what we do with newsletters, what we do with TV shows, original TV shows, podcasts and more, I think has a place.”
The initial announcement of a closure appeared to mark a stunning fall for Ozy, which had raised tens of millions in investor funding since its founding in 2013 as a media company aimed at a younger audience with a focus on its YouTube shows.
The report by New York Times media columnist Ben Smith cited four anonymous sources alleging that Ozy COO Samir Rao impersonated a YouTube executive on a Feb. 2 conference call with banking giant Goldman Sachs, which was looking to invest $40 million in the company.
The voice on the call purporting to be from YouTube told the Goldman executives about Ozy's success on the platform in racking up views and advertising dollars, but it was allegedly Rao himself speaking.
Executives grew suspicious when the voice sounded digitally altered, and YouTube's security team began an investigation, according to the report. Google, which owns YouTube, contacted the FBI.
Watson issued an apology to Goldman Sachs and then told Smith in an email that Rao was having a mental health crisis when he allegedly impersonated the YouTube executive.
Smith told MSNBC last week the behavior was “part of a pattern of deceiving investors, advertisers, the media, all sorts of people, about what was going on with that company."
In his sit-down with TODAY, Watson said he had no knowledge that Rao was going to impersonate a YouTube exec on a call with Goldman.
"No — and it's sad, and it's difficult," he said. "It was wrong. Obviously, they figured it out very quickly."
Watson also said he was not on the conference call.
"Part of the fund-raising process, you end up talking to a lot of people, and I'm not on every call," he said.
He added that he has not heard from the FBI or law enforcement about any alleged criminal activity or fraud relating to the phone call.
"I definitely haven't, but here's what I will say," Watson said. "That's a tragic situation, it's horrible, nothing good about that at all. I am grateful that ultimately Goldman didn't invest because that would've been the worst of all."
Watson also said that several months after the conference call, Goldman Sachs began "a new advertising partnership" with Ozy.
"I think that was a recognition that as tragic and not OK as that was, that the larger company, Ozy, has done some pretty special things when it comes to premium content, forward-looking content, and really a diverse set of audiences," he said.
Goldman Sachs and Rao did not respond to requests for comment from TODAY about the alleged phone call. Google and the FBI did not respond to requests for comment about an alleged investigation.
Watson, 52, a former MSNBC anchor, has been the public face of the company as the CEO and host of a talk show with numerous high-profile guests.
The company was also known for the prominent speakers at its annual gathering, "Ozy Fest."
The name "Ozy Fest" started a trademark lawsuit with TV host and reality star Sharon Osbourne and heavy metal legend Ozzy Osbourne, who own the rights to the Ozzfest concert series.
Watson told CNBC two years ago that they had put their legal issues behind and the Osbournes were now invested in Ozy. But Sharon Osbourne said on CNBC last week that wasn't true, and that Watson "is the biggest shyster I have ever seen in my life."
Watson fired back at Osbourne on Monday. He claimed that Ozy gave the Osbournes shares in the company as part of an agreement to settle the legal battle over "Ozy Fest," thus making them investors.
"Let's be really clear, I'm not going to raise money by telling sophisticated people that Sharon Osbourne's an investor," Watson said. "No smart investor is going to say, 'Oh great, you've got Sharon Osbourne.'"
"The last couple of days gave a lot of people a chance to take cheap shots," he added. "That's not to say that there aren't things that we can do better. We need to do better on data, we need to do better on marketing, I think there's some things we can do better on leadership and culture."
In a tweet last week, Watson called The New York Times story a "hit job" and added that the company was "strong and undeterred."
"Building something new, fresh and worthy is not for the weak," Watson tweeted on Sept. 27.