Canadian start-up Indiegraf offers new financial model for local journalism: Reader contribs plus pooled back-end services

A local news startup launched amid the Covid-19 crisis is hoping to build up a network of 25-30 independent North American publishers by the end of 2020.

Indiegraf Media believes it has found a sustainable local news model in which publishers rely primarily upon reader contributions for revenues and save money by pooling marketing and technology resources with peers. It believes that small local publishers can be sustained through annual revenues of $75,000 (Canadian), about £44,000, a year from paying supporters.

The company, based in Vancouver, British Columbia, is currently seeking journalist entrepreneurs across Canada and the US to help build up its network.

Indiegraf currently has seven publishers on its books across Canada and is welcoming applications until 19 June for the second cohort of its Indie News Challenge.

Participants have to pay $500 for the nine-week “accelerator” course – which consists of Zoom seminars, exercises and one-on-one feedback – with other costs covered by grants Indiegraf has obtained from the Facebook Journalism Project and the Google News Initiative. Publishers can then become part of the Indiegraf network, enabling them to share in central resources and therefore devote more money directly to journalists. 

Indiegraf is led by sisters Erin Millar and Caitlin Havlak, who have been working together to build up The Discourse, a community-funded news site that targets underserved communities in British Columbia, western Canada.

The first Indie News Challenge course helped Ontario-based Peterborough Currents grow its email subscriber numbers from 20 to 2,000. The Sun Peaks Independent News was able to save itself from collapse due by Covid-19 through a reader-support campaign. And the course led to the launch in Okanagan Valley of IndigiNews.

Indiegraf calculates that in a community of 85,000 people, publishers need to initially obtain 5,000 email subscribers. If ten per cent, or 500, of these are then converted into paying supporters contributing $12.50 a month, this can lead to necessary annual revenues of $75,000 (Indiegraf model below).

“We’d like to have upwards of 25-30 outlets in the network by the end of the year,” Millar told Press Gazette. “Our ambitions are big with this. We think really that [will be] just the start that will allow us to really hone the model. And then hopefully we’ll be in a position where we can grow it really aggressively from there.”

Millar said Indiegraf’s approach has been informed by the work of her other venture, The Discourse, in Cowichan Valley, a rural community on Vancouver Island, where the publisher has been able to generate more than $100,000 a year from reader support.

“All of this grew out of our own efforts to launch new media outlets at The Discourse,” she said. “We now have, after lots of ups and downs, developed what is a sustainable model for local journalism that supports two journalists and some freelance in this rural community… the Cowichan Valley on Vancouver Island.

“One of the insights that came from that was we could absolutely build something that was sustainable. There was enough money in this small community to make this work, but it required having pretty sophisticated technology and marketing strategies. So the economics just don’t make sense for an outlet of that scale to support a full-time marketing person.

“So that’s really the unique part of what we’re doing. We’re not just giving you the technology – like Patreon would, or Indiegogo or Kickstarter – we’re actually doing the marketing work for you.”

She said that the focus for Indiegraf publications is reader support but added that in the future advertising revenues will be welcome.

According to J Source research, as of 13 May, 52 news outlets in Canada – including 50 community newspapers – had closed temporarily or permanently as a result of the Covid-19 crisis.

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