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Unfrozen caveman journalist
In 2019, local journalism was changing quickly, and not for the better. I wanted to help reverse that trend.
On Thursdays in March, The Ledger is marking its 4th birthday by taking readers behind the scenes of our operation. Today, we are examining the business side of running our subscription newsletter — how we built it and where it’s headed.
How The Charlotte Ledger evolved from an idea into a legit and growing small business
by Tony Mecia
In the 1990s, “Saturday Night Live” had a recurring sketch called “Unfrozen Caveman Lawyer.” The premise was that a caveman from 100,000 years ago gets unfrozen, goes to law school and sways juries by saying his primitive mind doesn’t understand the modern world — but it understands enough to know that the jury should side with his client.
The caveman, played by comedian Phil Hartman, would say things like: “I’m just a caveman. Your world frightens and confuses me.” He would then pivot and say, “But there is one thing I do know …” and make his case that his client deserved a huge judgment.
It wasn’t high comedy. But it describes in a small way how I felt when I started The Ledger in 2019: OK, I hadn’t been frozen for 100,000 years, sure. But I had been out of local media for a decade — and in that time, the journalism landscape had changed dramatically.
In those 10 years, social media gave a platform to anyone who wanted it. Longtime well-known media companies were struggling. New digital publications with different business models were emerging. Some parts of the new world of journalism were genuinely puzzling, and troubling.
Would it be possible for someone like me — who had been a reporter and editor for more than 20 years, with no experience in starting or running a business — to create a viable venture in such a fast-changing and seemingly shrinking industry?
This month in The Ledger, we are celebrating our 4th birthday by highlighting our story and taking readers behind the scenes of our operation. We’re also pushing to get to 2,500 paying members by the end of this month — and letting people know how they can help in our mission to deliver smart information to Charlotte.
Today, we’re going to examine The Charlotte Ledger as a business, including some key choices we made and why. We think that will help our readers better understand who we are and what we stand for.
Our small team is proud of what we have accomplished, although I would point out that our experience is no more significant than that of any other entrepreneur. People with ideas start companies every day in Charlotte and elsewhere. We’re telling our story because, well, it’s our story, and we know it best.
‘I’m toying with the idea of starting an email newsletter’
In early 2019, at age 47, I was looking for the next stage in my career. The national magazine I had been covering business for (from Charlotte) had just shut down. Its parent company laid off the two dozen or so of us who had worked there.
As I considered what to do next in my career, I realized that local journalism in Charlotte had gotten weaker. A lot weaker. There were dozens of fewer reporters covering Charlotte than there were when I left the Charlotte Observer in 2009 as deputy business editor. At the same time, the city was growing. There was a lot going on that I knew about that I didn’t see reflected in local media.
The problem: Entrepreneurs often find it helpful to frame the role of their new companies as solving a problem. As I saw it, in Charlotte, the problem was that people didn’t have enough high-quality information about their city. Rather than look for a job or freelance for a national publication, I wondered if it might be possible to address that problem by using my expertise.
Start-ups often like to refer to what’s called their “unfair advantage” — the attributes that they have that make them distinct from competitors. As I saw it, my advantage was experience and perspective, as Charlotte’s shrunken newsrooms were filling with younger reporters who might be talented and hard-charging but lacked the connections and local knowledge that could provide critical context.
Around the same time, I came across an article about a company called Substack, one of several new tech companies that the piece said were “providing the publishing and paid subscription infrastructure to writers who want to start a paid newsletter without the hassle of chaining together several platforms to get the job done.” That sounded promising.
While a more traditional approach would mean starting a website, I had noticed how national publications had found growing audiences with newsletters, especially those that covered business — companies like Morning Brew and The Hustle and Axios. I also observed that there were media companies that were having some success selling digital subscriptions, like sports publication The Athletic. That showed that people were willing to pay for high-quality, in-depth information. I wondered if I could merge those trends into a newsletter about Charlotte business news.
On Feb. 26, 2019, I wrote an email to a friend outlining the concept:
I’m toying with the idea of starting an email newsletter focused on Charlotte business news. Basically, curate and link to the best stuff that’s out there in other media, add a little bit of original content, and make it not boring. … Just seems like the media is such a Wild West right now, and it’s so hard to find what you want because there are so many sources. … But maybe I’m wrong.
He replied: “I would love a product like that. My intuition is that it’s a tough business model. I’ll sign up for it though!”
‘Minimum viable product’: The next day, over the course of a few hours, I created a draft issue on Substack. It makes me cringe to read it now, but it contained a write-up of bank shareholder votes and takes on Lowe’s earnings, construction of a South End apartment building, a list of highly rated local movies that were playing and a round-up of cheap flights from Charlotte’s airport. I circulated it to a few friends who offered constructive and mostly positive feedback.
It was essentially a test — was I creating something that people wanted? Entrepreneurs often refer to this as creating a “minimum viable product” — something that shows it has value and can be adapted over time. In this case, I didn’t create any detailed business plan or make these first newsletters perfect. I just started reporting and writing.
As I sought to see first if there was an audience, I kept everything free. A model that many tech companies have followed is to build the potential customer base, then figure out the business side later.
I sent the first newsletter out on March 11, 2019, and hyped it on my (meager) social media accounts:
The first issue of The Ledger came out March 11, 2019. I shared it on social media.
It went to friends, who spread it, and the newsletter distribution list kept growing, as I sent three newsletters a week. In some of those initial issues in March 2019, The Ledger examined state liquor distribution and the effect of tax reform on banks and airport construction. Thanks to a tip from a real estate source, The Ledger broke the news on the sale of Ballantyne’s Hall Family Farm to Novant Health. By the end of March, The Ledger was up to 250 readers. By the end of May, nearly 500. It hit 1,000 in mid-July.
I don’t know about you, but I don’t have 1,000 friends — so this was more than people reading as a favor to me. I was producing information that people wanted. That was a critical first step. But how do you turn that into a business?
At times, running a business like this one has felt like one of those old “Choose Your Own Adventure” books: Do you raise money and expand quickly, or grow gradually (known as “bootstrapping”)? Do you incorporate as a nonprofit business or a for-profit business? Where do you turn for revenue, and how much do you charge? My friend Tim Whitmire and I held a lot of conversations in those early days with others in an attempt to find the best path forward. I talked with counterparts who were taking similar approaches in Albuquerque and Toronto and Manchester, England. We talked with entrepreneurs in Memphis, businesspeople and marketing pros here in Charlotte and even held a Zoom meeting with the CEO of Axios. (Two months later, Axios announced it was buying Charlotte Agenda — and no, they didn’t offer to buy us!)
As Tim put it in the most recent episode of The Charlotte Ledger Podcast looking back on that time: “There was no clear, obvious direction for how to take this or build a business model around it.”
Settling on a business model
Media businesses are kind of weird. There’s an expectation among many consumers that information should be free — even information that costs money to produce. There are legitimate reasons for that expectation, but there are few other industries in which customers expect companies to provide them with a good or service at no charge.
It would be like if you hired a plumber to unclog your sink, but instead of receiving an invoice for the time and materials, you expected the plumber to charge you nothing.
In media, people who assume they are customers — the readers or viewers — often aren’t really the customers. They’re the product. In many cases, advertisers are the customers, and you receive information for “free” because advertisers are paying to sell to you. It would be like if the plumber in the example above got paid not by homeowners for unclogging the sink, but by home furnishings companies, based on the number of new couches the plumber sells you while walking through your house with those little net things on his shoes.
Weird, right? Wouldn’t it be more straightforward just to pay the plumber for unclogging your sink?
In media businesses, advertising is one of two main sources of revenue. The other is subscriptions (or sometimes “memberships,” or more generally “reader revenue”). Additional revenue sources, especially for local media companies, can include events and, for nonprofit media, raising money from foundations.
Most media businesses rely on a mixture of ads and subscriptions. For instance, here’s a chart with the estimated splits between advertising and subscriptions at major national media companies (red is subscription, blue is advertising):
Most major consumer media companies have a mix of subscription and advertising revenue. Some, like Axios, Buzzfeed and YouTube, are heavily weighted toward ads, while companies such as HBO Max, Sirius XM and Netflix get revenue almost entirely from subscriptions. (Source: newsletter; notes and more details here)
With subscriptions, the interests of readers/viewers and the producers of that information are aligned, because those consumers are paying for the information provided. If you serve the readers and produce something they value, you grow. If not, you don’t. I consider it a more straightforward approach, and one that better encourages media companies to do work their readers value.
In thinking about turning The Ledger into a business, I favored a subscription model over an advertising model. Our platform, Substack, favors it, too, and makes it easy. And frankly, the idea of selling advertising sounded daunting for a one-person business — I had never done that before. My background is in journalism, not selling ads, though eventually newsletter sponsorships would become a small part of our mix, too.
One downside to a subscription business is it tends to grow steadily but slowly. (In contrast, one of the best examples of a successful and fast-growing local media business built around advertising is Charlotte Agenda.) The vast majority of people do not and will not pay for news. A 2021 survey found that just 21% of U.S. consumers said they pay to receive news online.
Still, in looking at the numbers, I thought it should be possible to build a subscription local media business. There are more than 850,000 adults in Mecklenburg County. It didn’t seem that far-fetched to think that The Ledger could find a few thousand to subscribe, which, at $99 a year, would be enough to hire a few reporters.
By the time I made paid subscriptions available in February 2020, The Ledger had about 3,500 free subscribers. Substack said to expect between 5% and 10% to convert to paid subscribers. We do a lot better than that — more like 15%-20%. Today, we’re approaching 2,500 paying subscriber accounts — and hoping to get there by the end of this month.
Steady growth and hiring
As The Ledger has grown, we have put more money back into the operation. As our revenue increases, we are able to do more and improve. If you compare those early Ledgers from March 2019 with today’s, it’s a world of difference: Instead of hot takes on news from elsewhere and links to other articles, we’re producing original articles, breaking news and delivering in-depth pieces — and not just on business, but on education and other local topics.
We can do that because we have expanded and upgraded our team, on the theory that the better we get, the more subscribers will join us. I hired my longtime former Observer colleague Cristina Bolling as managing editor in April 2020. We hired Lindsey Banks as our first full-time reporter last year. They’re both talented reporters and writers who embrace our mission with optimism, hard work and flexibility.
We’ve started newsletters on obituaries, transportation and pro soccer in an effort to find new potential customers and offer more value to our existing customers, and we enlist experienced writers to deliver top-quality articles. We’ve experimented with different ways to market ourselves, including Facebook and LinkedIn ads and ads in school playbills and neighborhood e-newsletters. We have part-time employees who help with customer service and our growing list of projects and administrative tasks.
Ledger editor Tony Mecia (right) at last year’s 1980s-themed 40 Over 40 Awards, Presented by U.S. Bank. The Ledger has continued expanding as the business grows steadily.
The Charlotte media market is competitive. I tell our team we are “running our own race” — that we’re going to model the kind of journalism and business practices we’d like to see in Charlotte. It’s like that famous saying, “Be the change you want to see in the world.” We prioritize satisfying our customers — our readers — and we serve them honestly and ethically. We have found that to be a successful approach.
Not obsessed with clicks: The Ledger doesn’t focus on clicks. Although other media relentlessly track pageviews and related measures of internet popularity, that is not a meaningful piece of data for a subscription newsletter business. Instead, our goal is new subscribers (both free and paid) — and we have found no marketing trick that is superior to producing quality journalism. Some of our best days for new subscribers were days where we published excellent original work. Not all media experience that kind of harmony between their journalism and their business.
Our growth has been steady. We added on average 50 net new subscribers a month in 2022. Our subscription revenue rose 37% over 2021. Subscriptions accounted for 73% of our revenue, and sponsorships accounted for 9% (the rest was events and miscellaneous projects). We’re fine with that. With more resources, we could do more.
We’re a lean operation. We have no need for an office. We’re productive: We send seven originally reported newsletters a week, plus a weekly podcast, with a full-time staff of three and lot of skilled freelancers. If one of us gets sick or is on vacation, things can get a little dicey.
I’ve learned a lot these last four years. By now, we have data and intuition that tell us what strategies are most effective. We still continue to experiment and fine-tune pieces of our operation.
It has been a lot of work. When you run your own business, there is always more work you can do. That’s small business life. And there are more meetings now: more managing and strategizing than in the early days.
But it has also been a lot of fun. We have a great team that I love working with. We have gotten to get to know so many enthusiastic and positive people in Charlotte. Because there are so many thoughtful and engaged people here, I’m optimistic about Charlotte’s future, and The Ledger’s, too.
And I think I’ve put my caveman days behind me.
Tony Mecia is executive editor of The Charlotte Ledger. Reach him at firstname.lastname@example.org.
🎧 Ledger origin story podcast: Listen to Tony and Cristina discuss building The Charlotte Ledger in the latest episode of The Charlotte Ledger Podcast, available on Apple Podcasts, Spotify and other major podcast platforms.
Related Ledger articles:
“Why I started The Ledger” (by Tony, March 10, 2020)
“Why I joined The Ledger” (by Cristina, April 19, 2020)
“The future of Charlotte media is digital and niche” (Nov. 15, 2019)