Jeremy Galvan was on the verge of stopping after continuing to buy up newspapers in small towns where Wall Street companies were milking the local papers.
But when Alden Global Capital shut down a group of six Minnesota newspapers in late April, he couldn't resist the opportunity.
Galvan's Cherry Road Media plans to launch two new newspapers within the next week to serve communities abandoned by Alden.
Perhaps he is reckless. But America needs more entrepreneurs like Galvan to aggressively challenge the Fixer Upper newspapers that thousands of communities and millions of voters still rely on for information.
The 49-year-old technology executive from New Jersey started buying newspapers four years ago, believing his management and software skills could turn things around.
Since then, Gurban has acquired or started 85 newspapers in what appears to be a news desert in 18 states. Most are weekly, but three publish five days a week and about a dozen publish two or three days a week.
“I think overall it was rewarding,” he said. “But it was really hard work to figure this out, it was really hard. I think we are coming up with a model that will make small market newspapers sustainable…real local people, local It's about focusing on what you're producing content for and figuring out how to do it.'' Everything else is done as efficiently as possible. ”
CherryRoad Media also acquired printing presses in Minnesota, Kansas, and Ohio to print surviving newspapers in nearby areas. The company has about 500 employees, and Gurban expects sales to be about $30 million this year.
The company also offers “newspaper-as-a-service” software, including a cloud-based storage and distribution system, which was part of Gulban's original vision.
Galvan acquired Minnesota's first masthead, the Cook County News-Herald, in late 2020. It has proven to be a good market for newspapers, and Cherry Road will soon have 12 newspaper offices in the state.
With encouragement from community leaders, CherryRoad announced on April 26 that it will be a weekly replacement for the Hutchinson Leader and Litchfield Independent Review, two of the eight Minnesota newspapers that Alden just closed. announced plans to launch a magazine.
“It was a very easy decision. We were already there,” he said.
Key Alden newspaper staff were employed at Cherry Road. Galvan believes the two papers will be able to retain “the majority” of the roughly 2,000 subscribers they each had before going out of print.
I'm rooting for Mr. Galvan to find the right formula. I hope this not only helps his company, but also encourages other potential publishers.
If he succeeds, it will help prove that there is still opportunity in the business, that there is still demand for local newspapers, and that an infusion of resources and technology can sustain the mission of public service.
“It's a lot of work, it's hard, and there's a lot of setbacks,” he said. “But at the end of the day, I just really enjoy what I do, so I want to encourage others to do it too, and gather community resources to publish a local newspaper.” ”
I interviewed Galvan in 2021 and spoke to him again last week. Below are edited excerpts from our conversation.
question: Is CherryRoad Media already profitable?
answer: Until now, that hasn't been the case, but I believe we'll finally turn that corner next month, so that's a good thing.
question: Did it take longer than you expected?
answer: completely. I was naive about this as to how quickly things could turn around. We have some very strong properties, but we also have properties that are performing very poorly financially. Our approach is “We don't want to give up on the market, we want to make this happen.'' Other people in the industry have advised us that we should be more prepared to walk away from bad markets, but we've really tried not to do that.
question: Unloading some documents?
answer: We merged some small newspapers into neighborhood newspapers and closed down some free weekly magazines that were only a few years old and didn't really serve a purpose. We sold four pieces each to local staff in each region. But we haven't given up on any of our core markets that are suffering economically. But we're trying to get this done and trying to keep papers in these communities.
question: I worry that some small, economically unsound communities may not be able to support their newspapers.
answer: In my opinion, the problem with news deserts is market size and market revenue. Many of our counties are very small, with populations of 10,000 or less, and incomes are lower in different parts of the country than in the Northeast and Northwest. All of that comes into play, but there's nothing that's being discussed that actually solves the problem. Many philanthropic movements ignore these communities. Because people with means don't live in such communities. That means there aren't enough wealthy people to fund something like that, there's not enough income to drive a subscriber base, and there aren't enough companies on Main Street to be advertisers. there is no. All of this, to me, is the root of many of the problems with news deserts.
question: Will Wall Street chains remove more paperwork in the coming years, creating more opportunities for locals and small chains?
answer: probably. There are several factors. Print revenues are clearly in decline and efforts are needed to transition to a digital future. We have a long-term view on this, and we're working on it for the long term, whether it's 10 years or 20 years. But if that's not the case, and you're a financial institution, you'll get a much better return by publishing a newspaper in St. Paul than by publishing a newspaper in Hutchinson or Litchfield, so you can invest your energy into a St. Paul newspaper. You will have to concentrate on It's not a small market, it's the world, so you'll know more.
question: How big is your newsroom?
answer: Most have one or two full-time equivalents. Some smaller markets have half that amount, while others have larger markets with more people. But we pretty much figured out how to get her one or her two people into the market, out on the streets, getting information, getting stories. And that's where you spend your money.
question: What is your sweet spot?
answer: A suitable county population is approximately 20,000 to 25,000 people. We feel that if we can get her 15% of households in that market to become paying subscribers and introduce a fair share of advertising, we have a viable economic model.
question: What options do I have for smaller locations?
answer: Local ownership is probably one of the best models for this going forward. It was rolled out in his four markets that I talked about earlier. We've been able to run the newspaper much better there than we've ever done before because (the employees) are there every day and have sweat equity.
