Digg was one of the pioneers in social media. Its site essentially made it easy to share stories and rank them. From its launch in 2004, Digg saw explosive amounts of traffic, but it wasn’t sustainable. According to a piece in yesterday’s Wall Street Journal, Digg has sold for a mere $500,000.
The buyer is Betaworks, which develops apps for Apple’s (NASDAQ:AAPL) iPhone and iPad. The company believes it can revive the Digg platform, which still attracts 7 million monthly active users.
Over its history, Digg was able to raise a total of $45 million in venture capital (the valuation reached a peak of $160 million). Some of the investors were tier-1 players like Greylock Partners and Highland Capital Partners.
Yet Digg was unable to keep up against rivals like Facebook (NASDAQ:FB) and Twitter. The site also underwent several makeovers that caused tremendous user backlash. And yes, there were problems dealing with manipulation of the rankings.
Regardless, Digg shows that the social media space can be brutally tough.