Vice Media filed for chapter on Monday, punctuating a yearslong descent from a new-media darling to a cautionary story of the issues dealing with the digital publishing business.

The chapter is not going to interrupt every day operations for Vice’s companies, which along with its flagship web site embrace the advert company Advantage, the Pulse Movies division and Refinery29, a women-focused website acquired by Vice in 2019.

A bunch of Vice’s lenders, together with Fortress Funding Group and Soros Fund Administration, is within the main place to amass the corporate out of chapter. The group has submitted a bid of $225 million, which might be lined by its present loans to the corporate. It might additionally take over “important liabilities” from Vice after any deal closes.

A sale course of follows subsequent. The lenders have secured a $20 million mortgage to proceed working Vice after which, if a greater bid doesn’t emerge, the group that features Fortress and Soros will purchase Vice.

Nonetheless, the desires that Vice executives as soon as had of a inventory market debut or a sale at an eye-popping valuation have been wiped away. The corporate was thought of to be price $5.7 billion at one level.

Investments from media titans like Disney and shrewd monetary traders like TPG, which spent lots of of tens of millions of {dollars}, will probably be rendered nugatory by the chapter, cementing Vice’s standing among the many most notable unhealthy bets within the media business.

Like a few of its friends within the digital-media business, together with BuzzFeed and Vox Media, Vice and its traders guess massive on the rising energy of social media networks like Fb and Instagram, anticipating they’d ship a tide of younger, upwardly cell readers that advertisers craved.

Although readers got here by the tens of millions, new media firms had hassle wringing income from them, and the majority of digital advert {dollars} went to the key tech platforms. Final month, BuzzFeed shut down its namesake Pulitzer Prize-winning information division after going public at a fraction of its earlier valuation, and Vox Media earlier this 12 months raised cash at roughly half its 2015 valuation.

“There are undoubtedly commonalities within the hardships media organizations have been dealing with and Vice isn’t any exception,” mentioned S. Mitra Kalita, the founder and writer of Epicenter-NYC, a neighborhood journalism firm based mostly in Queens. “We now know {that a} model tethered to social media for its development and viewers alone is just not sustainable.”

The chapter submitting will give the corporate some reduction from its onerous debt load as its lenders, together with Fortress, search to salvage their investments. Vice Media raised a $250 million mortgage from Fortress and Soros Fund Administration in 2019 because it struggled to make a revenue. It has been in default on that mortgage for months.

“It’s the lender coming in and saying, ‘I’m achieved funding the losses — if I’m going to fund the losses, I’m going to take management of the corporate,” mentioned Eric Snyder, chairman of chapter on the regulation agency Wilk Auslander. “It’s common for the lender to come back in and inform the debtor, the borrower, ‘You’re placing this out of business, you’re going to make a movement to promote, we’re going to place in a primary bid.’”

Fortress sees a seamless function at Vice for Shane Smith, the brash co-founder who turned synonymous with the corporate’s gonzo journalism from unique locales and oversaw a boundary-pushing tradition that was rife with allegations of sexual harassment, in line with an individual aware of the matter. Hozefa Lokhandwala and Bruce Dixon, co-chief executives at Vice, may even keep on.

In an announcement, Mr. Dixon and Mr. Lokhandwala mentioned that the chapter sale would in the end “strengthen the corporate.”

“We sit up for finishing the sale course of within the subsequent two to a few months and charting a wholesome and profitable subsequent chapter at Vice.”

The chapter is a second of humility for Vice, which a decade in the past appeared destined to promote for an eye-watering sum or make its debut on the general public markets. Within the 2010s, Vice raised piles of cash from conventional media firms, which it had assailed for rising complacent. The corporate offered advertisers and traders on its capacity to succeed in younger millennials who have been hungry for an alternative choice to its company rivals, delivering you-are-there dispatches from North Korea and Liberia with out the decorum of the mainstream information media.

However the harsh realities of digital publishing caught up with Vice, and issues went sideways. In 2017, the corporate raised $400 million from the non-public fairness agency TPG in a deal code-named “Challenge Venus” that valued the corporate at $5.7 billion. However the money infusion saddled Vice with monetary obligations if it didn’t hit aggressive profitability targets, and it will definitely turned an albatross for the corporate. Later that 12 months, The New York Instances and different shops revealed investigations into allegations of sexual harassment on the firm, kicking off a disaster at Vice that shook confidence in its administration.

Mr. Smith changed himself as chief government of the corporate, appointing Nancy Dubuc — a longtime TV government at A&E who shepherded hits like “Duck Dynasty” — to supervise the sprawling Brooklyn-based media empire. Traders hoped Ms. Dubuc would promote the corporate or take it public, and he or she made repeated makes an attempt.

The newest happened this winter, a gross sales course of that drew curiosity from a number of potential suitors. Antenna Group, a Greek media firm that has achieved enterprise with Vice earlier than, expressed curiosity in buying it, however a deal by no means materialized. Ms. Dubuc left in February, with no purchaser in sight and with out attaining her long-stated objective of constantly turning a revenue at Vice.

The state of affairs received worse final month. The corporate laid off staff after Antenna stopped making funds to Vice for a manufacturing deal price lots of of tens of millions of {dollars}. The cuts included staff at Vice World Information, the corporate’s international reporting initiative, after it turned clear these efforts have been now not financially viable.

Alex Detrick, a spokesman for Antenna and the previous chief communications officer for Vice beneath Mr. Smith, declined to remark.

Ms. Kalita of Epicenter-NYC, who additionally co-founded URL Media — a community of media shops owned by Black and brown folks that share content material and promoting — mentioned Vice’s chapter was a reminder to founders to develop many various sorts of companies past simply promoting.

“I believe even these of us working worthwhile media start-ups now,” Ms. Kalita mentioned, “are pondering extra fastidiously about development and ensuring we are able to constantly outline our viewers and the worth we symbolize to them.”