Participant, Maker of Films With Social Conscience, Calls It Quits

For 20 years, Participant Media has been Hollywood’s pre-eminent maker of activist entertainment, backing socially conscious films like “An Inconvenient Truth,” a climate change cri de coeur, and “Wonder,” about a boy with birth defects. Its movies have won 21 Academy Awards.

But the company never quite managed to do good while also making money, at least not consistently. Matt Damon in a fracking drama (“Promised Land,” a 2012 Participant effort) has a hard time competing with “Avengers: Infinity War” in 3-D.

On Tuesday, the company’s founder and financial lifeline, the eBay billionaire Jeff Skoll, pulled the plug — a decision based, at least in part, on the atrophying entertainment business. Participant relies on studios and streaming services to distribute its content, and those partners are cutting back — especially on the “niche” films and shows in which Participant specializes — as they contend with continuing weakness at the box office, higher labor costs and increased profit pressure from Wall Street.

Streaming services like Disney+ and Netflix have started to sell ads, and advertisers prefer all-audience, apolitical content. Eat-your-broccoli documentaries and dramas that explore underrepresented communities (both Participant sweet spots) are harder to sell than ever.

“The entertainment industry has seen revolutionary changes in how content is created, distributed and consumed,” Mr. Skoll said in an email to Participant employees that was viewed by The New York Times. A spokesman said Mr. Skoll was unavailable for an interview.

Participant will immediately lay off most of its 100 employees. A skeleton staff will remain for a time to work on coming films like “Out of My Mind,” about a nonverbal sixth grader with cerebral palsy, and “BLKNWS,” about what the media leave out, or misrepresent, in reporting on Black culture.