Ken Doctor: Six months after launching a
local news company (in an Alden market), here’s what I’ve learned
We don’t wake
up each morning to compete with a print daily, but rather to run our own
local news and community model. That’s the key.
June 17, 2021, 11:02 a.m.
It was our first epiphany. Just a few weeks
after our pre-Thanksgiving launch, we summoned the audacity to announce a
public forum. “Join us for ‘Covid 2021: The Experts Answer Your Questions’
event in English and Spanish.” We had only small thousands of readers, a
largely unknown brand and no track record of credibility in the community.
Yet, Lookout Santa Cruz brought the county’s
public health leaders and other experts together (via Zoom, of course), at a
particularly dire and fearsome time. We got the word out through Lookout,
through our nascent partner network, and on flyers distributed with Second
Harvest Food Bank bags.
How many might sign on? Would anyone actually
More than 500 people signed up for the free
evening event, and more than half stayed the full 90 minutes, listening in
either English and Spanish. More than 100 questions were submitted by
That’s when we first knew we were on to
something. We’d seen the first coalescence of what’s becoming a profound,
interconnected 3 C’s of Lookout’s strategy — content, community, and
We’re counting additional epiphanies as we
gain market experience. We’ve identified “ad deserts” — proving so far that
marketing partner branded content can produce ample early revenue. We’ve
seen that the strong link between timely content and the convening of public
forums can quickly build brand and awareness. We’ve seen that the web of
civic betterment/local business community connection is bedrock to the
revival of community-supported local news. We know that relatively high, but
fair, value-based membership pricing can speed the business-rebuilding of
Overall, we now believe that the digital local
nexus of content, community, and commerce, powered by appropriately scaled
smart tech and bright minds, forms the foundation of Lookout’s early
success, and our planned expansion. What that nexus looks like evolves each
week, but it all derives from our mission statement, an unusual one in the
news business: “Lookout aims to make Santa Cruz County a better place for
all who live here.”
Lookout’s been a wild ride since our
pre-Thanksgiving, into-the-teeth-of-pandemic launch of what we believe will
be only the first site as Lookout Local proves out our model over time.
Seemingly an eon ago, Josh Benton and I talked about
our pre-launch plans last August. While it’s still very early on, we’re now
glad to share first learnings and some key metrics that tell us we’re on the
The early signs all point to what we believed:
If we built a modern product built for quick swipe mobile reading and filled
with ever-deeper, lively content, the wider citizen, civic, and business
communities would respond. Still a half year of even good metrics is only
that; it’s too early to declare success.
We’re now looking for
a new top editor, ready to build the next stage of Lookout Santa Cruz and
then Lookout Local more widely with our great overall team of 14. We’ve just
opened a new position for a community voices/opinion editor, aiming to bring
in the widest set of spirited, solutions-oriented, text and video
commentary. In addition, we’re recruiting for correspondent positions,
storytellers who are enthused to work deeply in this community and with
Launching into Covid — and against Alden
Soon after we formally announced a late fall
launch for Lookout Santa Cruz, Alden Global Capital — the operator of the
Santa Cruz Sentinel — did something it’s rarely done: It added newsroom
staff. Reports told us that its non-sports contingent of three was being
doubled. Alden, here, was responding to competition, maybe “investing,” more
likely moving full-time employees from less-competitive markets. I’d made a
big deal about the Lookout model being a replacement for failing, or
suicidal, dailies. We announced a newsroom of 10, intending to become, as
quickly as we could, the primary news source for the 276,000 people in Santa
Are we competing with the Sentinel? That’s a
curious question. On the ground, it seems like we’re two trains passing in
broad daylight, one headed into a frontier future, the other Dopplering into
history. Print vs. digital isn’t really a fair fight, as long as digital’s
got the time and money to see it through.
Yes, we aim to replace the community glue
function of financially leveraged dailies, but we’re building a new modern
There are the metaphors, and there are the
While still in our infancy, our weekday
newsletter list of more than 10,000, with a good open rate, already exceeds
the Sentinel’s daily print circulation by more than 3,000, with the gulf
growing each week as we gain and they lose. Yes, the newsletters are free —
a mid-funnel product patiently building a durable reader habit, acting as
our biggest converter of readers to paying members — and the paper is
“paid,” but the trendlines are stark.
Consider our pricing: $17 per month or $187 a
year, what we like to call fair value pricing. With a limited free access
system in place for fewer than four months, we’re approaching 1,000 members
paying that price. Of those, 76% have opted for annual membership.
The tiny number we love the most: six. That’s
the total of members who have quit us since November.
The Sentinel just made its Memorial Day offer:
$2 for six months. Do the math — and dailies are back, literally, to the penny
press days of the 1830s.
$17 a month compared to a penny a day? We’ll
communicate the value of our product/service, then back it up, in both the
journalism and the community betterment work.
It’s brick by digital brick.
We launched Lookout in Santa Cruz knowing
Alden had decimated a paper that had once been a community leader, owned by
a local family, then a quality chain (Ottaway), until it fell into the hands
of financial engineers. What we didn’t know is that in our first year, we
would be competing — using a polar-opposite model — with what is now
becoming the second-largest newspaper company in the country.
Does that make us an anti-Alden? We now all
know the Alden playbook, but the makeup of those who stand for polar
opposite values — big city and little city independents, family-directed
smaller chains and the nonprofit startup movement — is so diverse, and hard
to see as of a piece.
As we look at the Alden strategy and
Lookout’s, it’s like a funhouse mirror:
— Short-term profiteering vs. our
built-to-last intention to invest in deep, long-term community connections
— Getting by with as few journalists as possible, vs. us spending 70% of our
budget on the newsroom, a long-term investment given our public be.
— A shrinking of the public face of the paper vs. us flooding the zone with
our staff engaging every way we can with the public in forums, Lookout
Listens sessions, Zoom intros, member events, and, soon, street fairs. Two
key positions we’ve invested in early on: A director of community
partnerships and a head of events.
— A social media strategy that has made us the most actively engaged social
medium among local news providers, one that interacts with communities and
their members wherever they are.
— A print-centric business vs. us being digital first and always, able to
harness the full power and potential of a modern platform.
We don’t wake up each morning to compete with
a print daily, but rather to run our own local news and community model.
That’s the key.
Still, there is a kind of harmonic convergence
in now “competing” with Alden, given my own role in exposing its
outsized profits four years ago. When I first noticed the aggressiveness of
Alden a decade ago, and wrote
about it here, it had bought the small and woebegone Journal Register
company and had already accumulated stakes in a half-dozen newspaper
companies. Now, despite all the citizen protest, politician harrumphing, and
journalist pleading, Alden’s gobbling of Tribune Publishing leaves no doubt
that Alden and other financial buyers will consume more of the shriveling
daily press, as long as the money is right, until there’s little left.
As early as January 2020, I’d focused attention on
Alden’s impossible-to-refuse embrace of Tribune. As I’ve been consumed with
building Lookout, I was left to watch the inevitable unfold — yet again, as
short-term financially driven “newspaper companies” approach ownership of
50% of the country’s daily circulation.
We know how that story is ending.
The new story
A new story is being written.
Nieman Lab has chronicled many sprouts of
local news revival, growing unevenly. As we return to in-person conferences,
the big topic won’t change much: What can really make up for the end times
of the daily print local press?
It is good news that low thousands of
non-daily paper journalists are out there plowing new ground, but we need
many thousands more journalists hired, trained, and deployed across America
(and far wider in all the democracies, all of which suffer the same issues,
to varying trajectories).
I’ve differed, philosophically and
strategically, with some of my peers in the revival movement, in my writing
at the Lab, in conferences and talks. Lookout is a mission-oriented,
for-profit, public benefit company driven to prove that local news can still
be a market good. We love philanthropy, and see it as great for seed and
supplement. However, we believe that the combination of earned revenue from
well-paying readers, community-centric businesses, and events will likely be
the only way that thousands of journalists are able to be paid fair
salaries, fully repopulating the news deserts. That makes us a bit
contrarian these days.
Still, what unites us all — the American
Journalism Project, LION, INN, Report for America, the National Trust for
Local News (which just made its first investment, helping the Colorado Sun
boldly snatch a group of weeklies from the grasp of Alden), and many more —
is far more important than those differences. We must find robust ways
forward, or we risk the further diminution and defiling of our democracy.
The recent attention given to new local aggregation plays is at best a
surface-level attempt to solve for a deeper, more acute problem — the need
for much more well-reported, original local news. It’s a kind of faux local,
when what America needs is simply well-reported, original local news.
A few early metrics
If our goal is earned revenue, how are we
doing? With our big goal of earned revenue, we have paid rigorous attention
to our metrics, building new processes to achieve them.
We love data. And after six months we now have
enough of it to fully make use of a Lookout tech stack built for expansion
through integrated partnerships with the Los Angeles Times, BlueLena,
ActiveCampaign, Parse.ly, Pico, Second Street, and Subtext. These numbers
are very early, but they’re moving in the right direction.
As I mentioned above, 76% of our members have
opted for an annual subscription, and just six people canceled. Our net
revenue per member is $164 per year, after our community giveback program
costs. With that program, every new member picks one of five community
nonprofits, and Lookout donates 10% of the membership fee to that group. The
goal: community betterment is a universal Lookout membership benefit.
When it comes to advertising, we have 17
market partners, with an advertising renewal rate of 100%. Average revenue
per advertiser is $2,000-plus per month. We ask for a three-month minimum
contract, with the average range between three to six months and increasing.
promoter score is 51 among members, and 22 among people who’ve
registered for the site.
And half a year in, we’re more than 30% of the
way there in matching our earned revenue to our monthly expenses. That’s
ahead of where we’d hoped to be.
The three C’s
Let’s return briefly to Lookout’s 3 C’s:
Content, Community, and Commerce.
For us, innovation is often about applying the
best ideas of others, rebundling them in new ways. It’s more alchemic or
recombinant than inventive.
In this exhilarating and exhausting adventure,
we have borrowed from myriad models — from The New York Times and Financial
Times to the Daily Memphian, Charlotte Agenda (now Axios Charlotte),
Colorado Sun, Block Club Chicago, and the Long Beach Post, and from Morning
Brew to Skift, Spirited Media, and Community Impact — we’ve tried to
incorporate the best ideas that so many have built and generously shared,
and put what we consider the best of them together in new ways.
the great, outsized success of The New York Times and scale it way, way down
to our relatively small market of 276,000 in Santa Cruz County. In reporting
on The Times’ transformation over the last decade, I’ve emphasized that it’s
the thinking — not just the level of resources applied — that’s made the
difference. An intense reader-first focus. Product thinking. A tech-driven
funnel that drives both revenue and quality. Branded content, smartly
created and deployed. Making the major investment in journalists the core of
All of that requires an appropriate level of
resources, whether you are trying to serve a market of 331 million (plus the
globe) or a county of 276,000.
We’ve added a new input to the Times’ formula:
We’re putting money and labor into community engagement and community
betterment. The Times represents the gold standard of a national and global
news company, but it can’t serve, rally, and challenge the people of Santa
Cruz County. We can, and we will. In one sense, that’s a special sauce,
waiting to be applied across the country, I think.
Our stated mission — “Lookout aims to make
Santa Cruz County a better place for all who live here” — drives us
philosophically and strategically. How we do that is two-fold: the
ever-better local news report and the deployment of a range of community
betterment initiatives — solution-oriented (and other) events (in-person and
Zoom), those community give-back programs associated with membership, the
creation of more than 60 “civic group pages” and regular listening sessions
with all segments of our communities. We’re now putting the finishing
touches on a broad access program for the county’s students.
Such a mission doesn’t diminish us as a news
company; it multiplies our ability to do more and better solutions-oriented
journalism. Healthier communities nurture healthier journalism, and vice
You have to like the spirit, and the naming,
of startup The Oaklandside. We can — and should — be on the side of our
communities. Properly done, that’s not boosterism, but quite the opposite,
exposing what needs to be exposed and exhorting what needs to be exhorted to
make local democracy and local civic life newly vibrant in this confusing
and challenging national environment. That’s a key reason we embraced
Lookout as our brand.
We are not anonymous in the community,
operating out of a distant, faceless distribution center.
What we’re doing is real modern “newspapering.”
We’re in the fray, as a part of the community. We’ve presented to most of
the Rotary Clubs and Chambers of Commerce in the county. In a town without a
real publisher, I’ve become one.
Our team will soon move into a real office
— built for collaboration — downtown, with a sign. I hope that people will
drive or walk by and say, “That’s our news company,” throwing any epithet
they want our way. We’ve done Zooms with innumerable civic groups, local
boards and schools. We take every opportunity to connect. And in email and
now (!) in-person conversations, people tell us in many ways, “Lookout feels
like Santa Cruz.”
Just one: “I love it. The newsletters are
fantastic. The best way I can describe Lookout is that every time I read it
I feel like my soul took a shower and then I get mad because I realize my
soul wasn’t getting the shower it needed beforehand. We’ve needed this
outlet for years. I can’t believe we limped along without it.”
we believed from the beginning, must be part of any comprehensive news,
information, and entertainment site. Imagine a city landscape with only
housing and no stores. I visited Prague and East Berlin soon after communism
crumbled in Eastern Europe, and still recall the oddness of seeing main
street upon main street without a store.
Shopping, buying, interacting with other
humans is part of what we do in cities, and so we believe commerce must be
part of a revived local news model.
Lookout had no intention of competing with
Google and Facebook, or focusing on Amazon-beaten-down and Covid-hammered
retail, so we aimed to test thoughtfully written, clearly labeled, branded
content on a very local level, clearly delineating promoted content from
In early pitches, we said, “Thanks for
considering Lookout. We know we’re brand-new and that you have a lot of
places you can spend your marketing dollars.” We often heard the reply,
“Actually, we’re glad you are here. We really don’t have the right places or
the right ways to reach our audiences.”
So, slowly, we’re surveying a kind of ad
desert. Sure, there is plenty of competition for ad dollars — but a real
hunger for meaningful ways, on the phone and on the desktop, to engage with
Today we count 17 marketing partners — among
them, the leading financial, education and health players in the county. Not
one that has signed up has failed to renew. These multi-month partners, with
our help, both tout their wares and highlight their own community
connections and social responsibility causes.
Businesses have bought (figuratively and
literally) into our community-forward mission. They love the dynamic,
multimedia storytelling, which has spurred robust reader engagement. Just as
our deepening community involvement has deepened our coverage, so has our
relationship-based selling — a get-to-know-you-and-strategize-with-you
process to form business partnerships that should last — furthered our
you had told us a year ago that six months in, Lookout’s business model
might be more advanced than its editorial model, we would have been
surprised. The challenge we’d set out, of course, is proving out that
communities would financially support revived local news.
It seemed as if creating the news product,
given my own and our staff’s experience, would be the easier work.
Curiously, though, it’s been a challenge. Maybe that isn’t surprising
considering that we were born into the sea of Covid and are just now aiming
to find our land legs as terra becomes firmer. For the first time, as we
enter summer, we can approach normal coverage of a community that’s active,
engaged and physically connected.
We approach what I call our post-launch period
having published almost 2,000 stories, and have now showcased the
best of them. These have been mostly local, with some assists from our
valued content partners, including the LA Times, CalMatters and Kaiser
Health News. These are almost all stories that this community would not have
Readers scan through our stories with our
homepage, highly visual, rotating Instacards, and, of course, through every
manner of side door, familiarized one-by-one by our varied outreaches, with
uniquely voiced and diversifying newsletters, text alerts, budding
Spanish-language content, forums and events, and more. As we do all of this,
more readers begin to make Lookout their go-to destination. We set out to
create a local news product that didn’t look like a newspaper, and we have
succeeded with that foundation.
I think we excelled from day one with our
Covid coverage. All 2020, as a reader, as a citizen, I decried how little we
knew about the local hospitals, the local nursing homes, the local toll.
“Knit masks for the nurses at Dominican Hospital,” we were exhorted in the
spring, but we had no idea what it was like inside Dominican, our largest
We took the challenge and through the depth of
winter and uncertain spring, we told the story well, and then dove headlong
into the early confusion of all things vaccine as Covid fears turned to
joyous tears at mass vaccination centers. We got correspondence that made us
— all remote half of the time, of course — cry: “I never would have gotten
the vaccine without your help,” read one of the many thankful notes.
Now, we’re embarking more fully on our
original editorial mission. That’s to tell the full range of stories about
this place and its people that I like to call “paradise with problems.” We
get to stretch our full accountability muscles, having proven some early
mettle in our coverage
of school district sexual misconduct. We get to expand widely into
culture, arts, and entertainment. We get to cover — in person — all of the
communities in our increasingly diverse county.
For me, Lookout has been my sixth career in
journalism, after alt-weeklies, city magazines, daily newspapers, corporate
digital transformation and my Newsonomics analyst work. And it’s been the
We have set ourselves a sometimes-daunting
mission, but within the bounds of one market and a couple of million dollars
in startup capital — assembled from mission-aligned backers, not financial
players — we are doing our best to deploy it. Humbled by the pains of this
startup, we remind ourselves that the Times, like Rome, wasn’t built in a
day, or six months.