Ozy Media CEO claims his scandal-ridden company will reopen, but doesn't explain how

Key Points
  • Ozy Media isn't shutting down, co-founder and CEO Carlos Watson told CNBC on Monday.
  • Watson had informed employees Friday that the board had voted to close down the company.
Ozy Media's Watson addresses numerous scandals leading to company's downfall

The CEO of scandal-ridden Ozy Media, Carlos Watson, on Monday tried to explain away the various transgressions that led to his company's demise last week while pledging to revive the media company despite the flight of investors and advertisers.

It's another dramatic twist in Ozy Media's sudden downfall. Watson had informed employees Friday that the board had voted to shut down the company, CNBC reported.

"We were premature," Watson said of the decision in an interview on CNBC's "Squawk Box." He added that over the weekend, the company had "good conversations" with investors and advertisers.

"We have lots of things we have to do to improve, but I very genuinely feel like we have a meaningful, transformational voice," he added. "At our best, this will be our Lazarus moment."

It's unclear if the company's staff will return or how Watson, who co-founded Ozy Media, plans to continue operations, and when. A spokesperson didn't immediately respond to a request for comment. The company had 75 full-time employees, according to Axios.

The New York Times first reported last week that the company's chief operating officer, Samir Rao, impersonated a YouTube executive on a call with Goldman Sachs while seeking out a $40 million investment. The company also allegedly inflated viewer metrics.

That report set off a week of probing and departures from the company.

Billionaire investor Marc Lasry resigned as chair of Ozy Media last Thursday, saying the company required experience in crisis management and investigations. Former BBC anchor Katty Kay also resigned from the company.

Ozy Media's Watson on path forward: We're going to have to change substantially

CNBC reported Thursday that Watson lied when he claimed Sharon and Ozzy Osbourne invested in his company. The Osbournes filed a trademark lawsuit in 2017 over the company's name Ozy Fest, which is the firm's annual concert and festival.

"The final resolution was that they would get stock in our company," Watson said. "In my mind, people who own shares in our company are investors."

Ozy also promised former producers that it was filming a show for A&E, which later turned out to be a lie, according to the Times. The program eventually appeared on and YouTube.

Watson told CNBC on Monday the company "originally conceived" the show with A&E. "We realized that they were on a different timetable than we were, so we shifted to YouTube," he said.

"There's no doubt about it that last summer, as the show started, we originally hoped we were going to do it with A&E," he added. Watson then name-checked a handful of celebrity guests who appeared on the show.

The Times also reported Ozy touted "The Carlos Watson Show" as "Amazon Prime's First Talk Show." However, Ozy had been uploading the show to the platform through a commonly used service that receives no promotion from Amazon. The company later complained and Ozy apologized, according to the report.

"We definitively made some mistakes ... I know we want to have larger conversations about whether mistakes are ingrained in who we are or whether, like a lot of young companies, we made mistakes but that was the 20%, not the 80% of who we are," Watson told CNBC.

In the interview, Watson repeatedly defended his media company, while also peppering in some admissions of wrongdoing.

"It was an incredibly salacious week," he later said, criticizing the media reports about his company. Watson then added the company should have been better on data, marketing, and leadership and culture.

-- CNBC's Alex Sherman contributed to this report.

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