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[upbeat music] Welcome to the Rebooting show. I am Brian Morrissey. This week's episode is brought to you by our partners at Piano.

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I'm about to leave for Paris, where I'll be speaking at the Piano Academy next week.

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I'm gonna be talking about what won't change with AI, because I think there's so much up in the air that it makes even more sense than ever to stick to the famous Jeff Bezos dictum that it's better to focus on what won't change, rather than try to divine what will change.

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Piano Academy runs October first and second, and I'll leave a link in the show notes for anyone in the area and interested in attending.

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If you don't know already, Piano's digital revenue optimization solution helps digital services grow revenue by better understanding and influencing their customers' behavior.

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Piano unifies analytics, segmentation, and commercial personalization in one AI-driven application that enables sites and apps to officially maximize the value of every user visit.

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Piano works with a global client base, including BBC, Deutsche Telekom, BK, AXA, and The Wall Street Journal. For more, more information, visit piano.io.

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On this week's episode, I spoke to Keith Pepper, the publisher of Rough Draft Atlanta. I have known Keith for a long while, but not as the publisher of a local news company.

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I got to know Keith when, and we talk about this in the episode, when he was an executive at different tech companies, such as like Hitwise and Outbrain.

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In twenty-twenty, Keith decided to dive into local news by acquiring a cluster of Atlanta community papers that were almost entirely print.

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Since then, he's rebranded the company, he's made it digital first with daily newsletters, and he's also kept a profitable print product, believe it or not, that lands in mailboxes.

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I f- found this really fascinating because print is still profitable, particularly on a local level.

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We talk about the lane that Rough Draft has picked between, you know, city council accountability and also the where to eat this weekend. But also, I really liked getting into the economics of a direct mail model.

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I think direct mail in some ways is underrated.

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We talk about this in this episode because, you know, the inboxes, I know as, as someone who sends a lot of email, the e-e-email inboxes are very crowded, and the actual mailbox is somewhat less crowded these days.

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Bit of a turnabout, everything comes back in style. We also discuss why real estate and healthcare are the right advertisers for these kind of local models.

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And the broader lesson here, which is that local can work, you know, if you build for utility and stay, as Keith says, "Meaningful, not massive," that is, I think, something that every single publisher these days should probably take to heart because that is the direction that a lot of this industry is going, and I think that can be actually a good thing.

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I really enjoyed this discussion with Keith about how to make local news a sustainable business proposition and having a diverse business model to back it up. As always, I love to hear your feedback.

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My email is brian@therebooting.com. Now here's my conversation with Keith. [upbeat music] Keith, so glad to be doing this. We go way back. I say this to a lot of guests, but we do truly go way back.

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I was going back- We-... creeping on your LinkedIn to, to, to try to piece it together, and I think it was Hitwise. I don't think... I think our ti- our paths might have crossed for, for a minute at, uh, Jupiter.

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I think they crossed at Jupiter. I think- Did they on J- at Jupiter? Yeah, I think, I think I was... It was the time when, when Alan Meckler owned Jupiter, or had- Yeah...

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had acquired Jupiter, and we were in sort of different pieces of the company, but I'm- Yeah... pretty sure it was that office on Park Avenue South. Absolutely. Weirdest office in the world. Yeah. Yeah. Yeah.

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It was like being John Malkovich- Yeah... where like he got off at like the eleventh floor and then walked up a s- a set of stairs and was working in a windowless office, which I don't think is legal.

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I mean, if Al- [laughs]... Alan, if you're listening, like I don't think that was legal. And so I used to go at lunch and walk around Bryant Park to, to get a little fresh air [chuckles] D. Yeah.

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And a great guy in Gillard's coffee shop in the lobby. Yeah, that's true. Yeah. It's true. I like that, I like the super- Yeah, so I think it goes back to that, which was like two thousand and two- Oh, yeah. Ish.

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That was after, after the dotcom. Like I was just- Yeah... I was just staying quiet. I'd already lost a job. I'd lost basically my first job, like- Yeah... and so I was like, "Okay, I know how to do it. Just keep quiet.

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Keep in your cubicle." Yeah. "Don't, don't bother anyone," type. Yeah. So anyway, you have, you know, y- you were i- on like the analytics side, I remember then with, with, with Hitwise.

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You were at the Atlanta Journal Constitution for a little bit, but you were, you were on the tech side.

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You were at Outbrain for, for many years, and then Hitwise had been acquired by, I guess, was it CheetahMail and then Experian? Hitwise was acquired by Che- by, uh, Experian. Experian.

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So CheetahMail was part of that group. Okay. And then somehow, some way, you found yourself into local news. Well, how did this, how did this come about? [chuckles] Yeah.

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Well, even before I knew you, when I was a kid, I talked my way into a job at WSB Radio, which is the sort of the flagship AM station of Cox back in the day. And I grew up in a house where we...

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It was a media-obsessed house, so I get it naturally. But we used to get three newspapers every morning delivered, so the Atlanta Constitution, USA Today, when that started- Hey, yeah... and The Wall Street Journal.

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And, and then- Was USA Today, their big thing was they had color photos. Color photos, and none of the stories jumped. Yeah. So they were the...

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I mean, they were the original social- That was, that was innovation in news back then. [chuckles] Yeah. And the one page with every state with the- And infographics. They were good at infographics. Yeah. Yeah.

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They were, they were the first BuzzFeed before it was a thing. Yeah. And, and I was so cool in high school that I personally subscribed...

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Atlanta had two papers back then, so I personally subscribed to the afternoon paperSo we, every day, got four newspapers- Oh, nice... delivered to our house. What was the afternoon paper in Atlanta?

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That was The Atlanta Journal. So they were both owned by Cox. Same name. Oh, okay. Just two different two- Okay. That was, Philly had something similar. It was the Philadelphia Inquirer. Yeah. Yeah.

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There was the Daily News that was the evening. Right. There was the, for the r- for the real old school people out there, there was the Bulletin, but that like went away in like- Yeah... 1981 or something.

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I was a kid, obviously. [chuckles] Yeah. So at some point in the '80s, they merged. They retired the afternoon paper. So yeah, so I worked all...

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And I got this job at WSB just producing, teaching myself, hanging around, and ended up working there through, you know, my junior and senior year of high school, and then, and then, and then through college.

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I went to Georgia to the Grady Journalism School at Georgia and worked. I'm holding a, a pen 'cause I just joined the advisory board there. And, and, and worked through high school

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and college, and then after college, worked for a year producing the morning show of the AM news station. So, you know, for New Yorkers, it was like 1010 WINS or WCBS.

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And, and I did that, and I basically burned myself out of news. I was working, you know, waking up at 3:00 in the morning, working the morning show, and so

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left that whole career, ended up in New York in right around the, right around, right before Y2K, so for...

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And, and got a job at Jupiter Communications at the time, and it was pre-merger with Media Metrix and NetRatings.

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And, and, and wa- 'cause I wanted to get into sales, but I was always seen as like a, a production guy when I was at, at the radio station. Yeah. So they wouldn't even look at me for sales.

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So ended up getting into sales there and, and had a great time doing, working at Jupiter, and then at Hitwise, and then Experian, and then ended up at Outbrain in 2015, and really didn't know anything about ad tech.

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Like, my background was in, was in research and data, and worked at Outbrain, had a, a great experience, but I was...

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Ad tech just wasn't for me, and I was burnt out, and for family reasons, wanted to get back to Atlanta.

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And came back here in, in 2019 and started looking for something to do locally, and really just kind of like slow down with a local focus. Georgia was getting much more interesting politically.

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There was so much more going on in Atlanta, and ended up looking at a, a bunch of small businesses, and one of them was a group of local newspapers that was for sale.

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And the, the guy that had started them was turning 70, and he didn't have a succession plan. Okay.

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And, and right now, in that, that point, we're in the pandemic, and people weren't exactly lining up to buy newspaper companies. And, and the company was 98-plus percent print revenue. Yeah. Really no digital strategy.

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So long story short, I went to a bunch of friends and I said, "Please talk me out of this. I've got this crazy idea," and nobody would.

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Everyone, people that had known me for four months, people that had known me for 40 years, they said, "This sounds great. Perfect for you," and I did it.

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And so in, in, in 2020, we reached an agreement, and in December of 2020, I woke up one day and I owned a newspaper company. Wow. I mean, look, I made a lot of weird decisions during the pandemic.

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I, I, I, you know, I bought an NFT and stuff, [laughs] so I... [laughs] So hopefully this was a, this was a better one. Right. I made some good decisions, but, uh- Well, I mean people, you know...

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I think all those people that talked me into it were like, "Wait, you did what?" Yeah. And I think I remember reaching out to you not long after, and, and you were very [chuckles]... Yeah. You were very polite.

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My board, my board ape. I was like, "You kidding, Keefe?" Yes. [chuckles] Like, I've got a board ape that's been up. No, but what did you end up seeing? I mean, was this like kind of like a gut thing?

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Or like, was it like... You know, 'cause it does sound like, yeah, it's a little romantic, right?

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Like the idea, okay, you know, you'd been in New York and you're, you're working for tech companies and everything like this. You move back to Atlanta. It's not like it's like some small town or something like this.

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But then you're like, "Okay, I grew up getting the papers and all of that, and I'm now going to be, you know, reviving this, this like local paper." But what was the like... What did you see business-wise?

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[chuckles] Because like, you know, I know you- Oh.... and I know you like, y- you like, you know, you, you, you do business. Yeah.

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Well, one was it was, you know, the company was profitable, but it was going in the wrong direction, and I w- I was able to get a pretty good deal.

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So, you know, I think Warren Buffett said, "It's not when you sell a business, it's when you buy a business." Yeah. So I was able to get a good deal, I think, at the time. I saw that there was no...

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I really, from the, you know, laying out the plan at the very beginning, I knew that we, there were a lot of savings to come up with.

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Like, the, at the time, there were three different CMS, three different websites, three different CMSs. They were doing almost no dig- they were giving away digital ads. There's almost no digital revenue.

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So I knew, you know, they were paying a lot of money each month for an office with fax machines and, you know, a, a lot, like, a lot of tech expenses that we, you know, we immediately got rid of.

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So I saw a bunch of savings there, and they ha- and the company had a great reputation in the communities that we serve. So I saw that, and I was able to strike...

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I mean, at the time, interest rates were zero when, when we were going through the process, and so I was able to, to, you know, put together a really, you know, good deal.

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I had really expert advice from a friend whose family owned community newspapers around the southeast, so he helped me put a valuation on it that, you, you know, was aggressive on, for me, but fair for the buyer.

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So yeah, and I, and I wanted something that I could dive into. And so that's, you know, that part has really borne out. It's been, you know, for me, it was a, it was as much of getting a lifestyle business as anything.

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So I, I, I wanted something that I felt passionate about, and all that passion about, about media and, and this passion about Atlanta came together to make it, you know, a- an analytical decision, but there was a lot of gut involved for sure.

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I mean, the second month that I owned the paper, the revenue was down like 20%.And I was freaking out. Okay. I was- And- And every article I read from, from people like you was about the- Right...

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industry, and I read a lot, where it's all just, you know, doom and gloom. So I remember sitting on the, in this office behind me, like, in the fetal position, like, "What did I do?"

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And I, you know, got, got it together I knew that we could freshen up the brand. I knew that we could launch a newsletter, which has been very successful.

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So just got to work doing the basics, and we've turned it around ever since, ever since then. So te- tell me about the, the asset. Like, the, tell everyone about, like, what, what Rough Draft is. Yeah.

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So we're a group- we're a hyperlocal media organization in Metro Atlanta, so we serve communities in the s- kind of the inner suburbs of Atlanta, certainly some of the more affluent zip codes.

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We have monthly print publications that are direct mailed into homes, so it's a different model than, you know, than throwing it on the driveway or just distributing for free, so we direct mail.

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We've flipped the company to become digital first, so everything is, you know, goes on the web- website first and then social media simultaneously, and then we send daily newsletters to 50,000 subscribers, and that includes a morning newsletter, which is kind of a general interest newsletter, and then an afternoon, a series of afternoon newsletters that are more vertical.

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So one day we do seniors, one day we do art, we do food twice a week, and so we're, you know, we're touching people through print, through the website, and through newsletters. Okay. And you're doing news?

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We're doing news, but we're, we're not doing deep investigative news. Okay.

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You know, I think of, you know, if you think of the continuum between, you know, on the one side, local government, development board stuff, school board stuff, and then on the other side, like art, food, real estate, culture, we're kind of, we try to be in the middle of those things.

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So s- we certainly are covering city council meetings in, in, in some of the towns around Atlanta, but we're also doing, you know, we, we, our food editor, for example, used to be the editor of Eater Atlanta.

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So she left Eater to come work for us. We've got, you know, we've got people that have been writing for us for over 20, 20 years, covering arts, culture, real estate in, in Atlanta. Yeah.

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So tell me about that balance, right?

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Because I think when a lot of people talk about the challenges of local news and local news deserts, and particularly in the journalism industry, and rightly so, they, they think about the sort of accountability journalism.

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You always hear who's gonna go to the community board meetings or whatnot, and look, there are some people, like my friends at 6:00 AM, like they're saying, "Hey, we're gonna skip news altogether.

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We're just gonna go to, you know, what do I gotta... What, what is there to do this weekend? You know, what are the festivals? What are, you know, the new restaurants?"

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And, and that kind of coverage is more commercially viable. I mean, back when local news was, you know, a bigger business, it was, you know, it's all part of a bundle, right? But that sort of subsidized the...

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You know, look, uh, ferreting out corruption on the like, you know, town council or whatever is not, like, the most lucrative, uh, endeavors. Like, I don't think.

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[chuckles] You know, the, the cost of rewards just isn't there. How do you end up thinking about that? Well, I think of it just like that.

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I mean, it's a, that side, unfortunately, that side of the, of the continuum, which is critical for democracy, and we're seeing that every day in the current...

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And, you know, we're recording this in, in s- middle of September. We're, we're, we're seeing that every day now. Yeah. It's, it's a, it's kind of a terrible business.

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And, you know, I need to, you know, w- we need to be profitable. We need to be sustainable, you know? So I, I see it as, as trying to aim to be in the middle of that.

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You know, we're doing, we're covering those, those events. We're covering those, those city council meetings in particular in, in some communities.

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But A- Atlanta's not a news desert like you're seeing around, you know, that's the crisis that's going on around the country. There's, you know, Atlanta's got four TV news operations here.

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You know, we've got two NPR newsrooms here. We've got a ton of nonprofit, you know, news sites that have popped up. Yeah.

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So I think we've picked a lane which is, uh, it's kind of a balance between those two sides, between the, the hard news and the, and the food. I mean, the...

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Yeah, so we, so we don't, we don't try to play in a lane that we're not, that we're not e- experts in. Okay. So there's three different, I guess, like, publications, right?

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Like, 'cause I was talking with, a, a local news entrepreneur the other day, and he was, he was saying you need a, you need a bunch of publications to make these work.

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He goes, "Doing, doing it with, like, one is like..." He, in his view, it was, like, i-impossible. He's like, "You have to have, like, many of them." I know, what are you, what are you seeing on the ground?

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Does that resonate at all? Yeah.

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I mean, we, we took, so I took what at the time was three different publications, and we still print, in print, we still print, I have to actually count 'cause I'm looking [chuckles] I'm looking at the screen, but, you know, one, two, three, four, five, six, seven, eight covers a month that we're printing.

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But w- we, we took those, the, at the time when I bought the three papers, we combined the digital footprint into one. So, so we, we consolidated there.

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At the end of last year, we acquired The Georgia Voice, which is the local, the regional LGBTQ paper. Mm-hmm.

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So I think that maybe what you're, you're pointing out is, is sort of finding other publications, you know, that serve verticals or geogra- or geographies that are, that make sense for us and putting them into one umbrella.

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So I like that. I mean, I think that, that that's right. I mean, I think that- Yeah...

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you know, we need to be able to, to look at those two, you know, to look at growing through th- you know, through geography, and that really means, like, contiguous to where we are because it's, it's harder, it's, it's easy for me to have a salesperson that's covering a neighborhood that can then be in the, you know, be in another city or community- Right...

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you know, an hour later.For a meeting, and same with journalism. Yeah. This is very different than the six AM.

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You're not gonna stamp out, like, do a playbook and stamp out rough draft Charlotte, rough draft, you know, Knoxville. I don't see that happening, no. Right.

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So what I'm, I'm sure, you know, coming from the digital side when you went in y-you were like, "Okay, we're gonna make the..."

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You said digital first, and but I assume you found out that print was like really, was really profitable, actually profitable with [chuckles] this too. Yeah, the print...

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I mean, the print is, is, the print is still profitable. I mean, I told you when I bought the company, it was ninety-eight plus percent of the revenue. Yeah.

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And, and even today, it's, it's seventy-five percent of our revenue. And so it's still critical to, you know, to what we do. And- Well, yeah, critical if it's seventy-five percent of revenue. Yeah. It's like- Yeah.

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I mean, it, it gives us a, it gives me- Was, was that surprising to you that, that print was still... And what did you chalk it up to?

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Is it just that's what advertisers were used to buying, or is it that actually in this market print is a better delivery vehicle for, for, you know, for this product?

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Well, I think for local advertisers, print is a, for certain local advertisers, certain types, it's a great product.

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And because, you know, if you think about our delivery mechanism, because we're do-doing it through direct mail, it, it's, it's really like the...

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If you walk into an ad agency today, especially with younger media planners, and you say, "Hey, guys, what's your newspaper budget?" You're gonna get a bunch of blank stares.

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But if you talk about, you know, that we're delivering a high quality newsprint product that looks really nice, tabloid format into mailboxes in Atlanta's most, you know, some of the most affluent zip codes, that resonates with, with advertisers.

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And, you know, if you look at our advertising base, it's... The, the, the ideal for us are advertisers that have low transaction volume but high transaction value. So real estate,

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financial planning, you know, specialty healthcare, those are, those are the types of... Especially medical, those are the types of advertisers that get a ton of value. So very top of funnel advertising. Yeah.

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We almost have no restaurant bar advertising that you used to see in the free, you know, community papers of, you know, of, of years ago. We almost don't, we don't even really prospect much to restaurants or, or bars.

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So we, we've got a, we've got a great product for, for, you know, for real estate. We get a lot of support from the arts, secondary schools, private schools in the area are, are a good advertising base.

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So I think that the, the, you know, for, for... The digital, you know, advertising world is, is confusing for small businesses- Mm-hmm...

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and, you know, in a, in region, and it's hard to target in, in this area, and we're giving people a product, a high quality product that's getting into the mailbox, and so I think that's the big differentiator. Yeah.

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The direct mail sort of angle to it is interesting, right? Because it's not... E-explain, explain why that is valuable in the model.

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Well, I mean, it's valuable because, because it's, you know, people don't pick up print like they used to. Yeah. So it's, you know, if... But if it shows up in your mailbox, if it's a surprise and delight- Yeah...

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and it's a good product, it's high quality newsprint, it's got, you know, engaging photos on the front, you're gonna, you're gonna be more likely to flip through it. And we're seeing that happen where...

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I mean, we also distribute, you know, about ninety percent of our distribution is through direct mail, and the other ten percent goes to coffee shops and dry cleaners and community centers and libraries.

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But we're just seeing that, that, that side of the business, you know, is n- is falling off.

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And so we're trying to increase, you know, where we can, where we can mail because that, that part is, is just a differentiator for us. So explain to me how this works.

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So do people subscribe and get it, or do you buy like lists and send it to them? We, we...

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What we use, we use what's called Every Door Direct, so it's a US Postal Service product, and you, and it, you, you buy mail routes, so essentially every single family home on the mail routes that we pick.

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So we're not buying a list necessarily, but we're, we're, we're delivering, we're delivering papers in bulk to the post office, to, like, the, the regional postal center. I forget, forget the name.

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Our printer handles all this, so it's all outsourced. Yeah. And then the mail carrier takes it, and it just goes in every mailbox on their routes. Yeah.

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And what's interesting, 'cause this came up, actually, I did this dinner earlier this week here in New York, and direct mail came up, uh, honestly, as people were trying to build direct audience connections.

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You know, one of these digital, a digital first publisher, I won't name th- which one, was talking about looking, looking hard at direct mail because- Yeah... weirdly, the inbox is really, really, really crowded.

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The, the, the mailbox- Yeah... is less crowded. Yeah, exactly. [laughs] Exactly. Yeah. Okay, so it's still very print centric, right? What about... I mean, we see a lot of people...

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Give me the revenue breakdown 'cause I, I don't think you're doing a ton on the sort of events and gathering side. I see a lot of, like, local betting on, on that. I mean, there's, there's ups and downs to, to, to that.

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It's, it's more difficult to pull off, I think, than, uh, people think. Yeah.

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I mean, our revenue mix is, is ninety-nine percent advertising, and of that ninety-nine percent, seventy-f-four percent is, is print right now.

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The rest is digital, and for us, digital means display ads, email newsletters, and sponsored content. And then the other one percent is reader revenue, so the membership program.

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So we have, you know, the other two buckets of revenue for, for publishers these days are, like you said, events and in merchandise, and we haven't, we haven't gone into that, those spaces yet. I mean, I, I...

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We did, we dabbled in events. Last year, we did two small events. One we did with a partner-A food festival where we had a, a branded dinner, and then one was a small author event that we did.

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Both were successful, but I just think we don't have the people power right now to make that, you know, a meaningful revenue stream. There are publishers in, in our market that are doing great with events.

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Mostly the, you know, the, the business Chronicle, the Bizjournals Group does a great job with events, multiple events a month where they're, you know, getting great crowds in the room.

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But we haven't, we haven't been able to, to really at- attack that yet. Yeah. How about like, you know, do you have like tentpole franchises or get into the accolades business?

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I think one of the, one of the good things about community and local is, yeah, it's like literally a lot of people are trying to be the hometown paper- Mm-hmm... of different like, you know, industries, if you will.

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Mm-hmm. Like, and it allows you to, you know, celebrate the local entrepreneurs and various other things that, you know, maybe on a national level, you think about like a Forbes or something and that kind of business.

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So it's, it's why they're, you know, a really important business line to them. Uh, do you guys get into that? 'Cause, I mean, a lot of people in, in, in this field do. No.

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I, I mean, we've looked at the best of, is, is that I think what you're saying? Yeah. Yeah. Best of. Yeah. We've got the, we've got the, the platform to do it, but we haven't, we haven't jumped in there yet.

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There's a, there's a handful of best ofs in the market, so it's not something that we've got the- we've, we've attacked yet. But the- but it's, if we wanted to turn it on, we've got the technology to do it. Okay.

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So talk to me about the, the transition to digital, because, like, there's a little bit of a gap because you're saying that, and I'm not even saying that like, you know, maybe a couple of years ago, I'd be like, "Oh, you've got it, like, the future is just digital."

156
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I'm like, I'm actually more intrigued by analog [chuckles] every day now for different reasons.

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But talk to me about that, because, I mean, you're talking about being a digital-first company, but, you know, you've got about seventy-five percent of your revenue in print.

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This is almost, you know, it's completely, completely opposite. Yeah. Well, I say digital first for our c- our content delivery. So we reach a much bigger audience on digital than we do in print.

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And digital has allowed us to expand geographically. So when I bought the company, it was, it had a different name that was much more tied to a, to a geography.

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And so by rebranding it as Rough Draft, we're able to become geographically agnostic, and by expanding our coverage digitally, we're able to grow our audience.

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Otherwise, as a print publication, you're, you're very, you know, tied, you're, like, landlocked to where you're distributing that paper.

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Because we're not, you know, because we're doing the direct mail, we can't direct mail beyond... I mean, we're, right now we're doing ninety thousand.

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You know, our circulation is ninety thousand for our direct mail product, and then we have with the Georgia Voice, that's a different distribution model, but we can't, you know, we're-- it's very hard to expand to other geographies with print.

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So being digital first, meaning our newsletter, you know, goes every morning to almost fifty thousand subscribers, that's, you know, we're getting more readership on a daily basis than, than we ever got with, with print.

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And because the cadence of print is only monthly, w- then we're, we didn't have any opportunity to engage with advertisers in between those, you know, those monthly print editions.

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And so now by having the website, you know, being digital first means our website has twenty posts a day, sometimes more, and then our newsletter, it, you know, is going out

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in the morning, and then another n- newsletter, at least one, is going out in the afternoon.

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So we've got much more inventory to, you know, to sell to advertisers and much more, and many more touch points with, with- Yeah... readers. But there, it's still only twenty-five percent.

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What I'm saying is, like, your, the print product that, uh, still goes out just, like, once a month is seventy-five percent of revenue. What gets...

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And is that just, do you think that's, like, the, the norm of the mix, or is that just you're in an in-between period where digital for, uh, uh, through a bunch of different ways will catch up and it will match its reach and engagement if, if people are engaging with it way more...

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I assume you're, you basically have eighty percent of your engagement. I remember this at Adweek we had this. It was like eighty percent of our engagement we're, we're in digital- Uh-huh... you know, products. Yeah.

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Blogs, newsletters, sites and stuff, and eighty percent of our revenue is in a print product, and that was just a in-between period. I mean, this is back in- Mm-hmm... like, the financial crisis years. Yeah.

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I'm just wondering how you see that, i- if that normalizes or if this is just a different type of market. No, I think it, I don't think it, I don't think it...

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I mean, one, it's the, the percentages are staying that way because the overall revenue is growing. Right. So print revenue's up.

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Digital revenue, I mean, since, since I bought the company, digital revenue's up three, three X. The f- So it's growing faster than print? Oh, yeah. Okay. So the digital revenue looks like a hockey stick.

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It's growing way faster than print. Okay. So is, is the end goal, like, fifty-fifty, or do you see that, like, inevitably, like, you know, or is that unimportant? I don't, I don't think I have a goal for that.

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I mean, if print keeps, if print keeps growing and, and we can keep the margins like we do, because, you know, with, with our print model, we're able to...

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You know, this past month, we had our best month since, like, twenty eighteen in print, and we, you know, we printed fifty-six pages in our paper this month.

179
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But if we have a slower sales month, we just print fewer pages. So we're always keeping that margin, you know, the ratio of e- of, of, of ads to editorial where, where we need it to be for, you know, for our business.

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But with, with digital, I mean, as you know, we can't... I mean, our page view just being the size we are, being in the market that we're in- Mm-hmm...

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you know, be- having news only for the region, it can only get so big. And so we, you know, our... So we're, we're growing, our newsletters are growing, so that's a good source of digital revenue.

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Our, our sponsored content. So our sales team has done a great job of selling sponsored, learning how to sell sponsored content, and those are, you know, those are huge for, for us. And so-So I don't see...

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I don't really have a, a goal in mind, and maybe I should, of what that ratio should be. As long as we can keep the print.

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I mean, print costs keep going up, so you know, it's, it's the per page cost since 2020- Is that literally, literally the ink and the paper or- Yeah, yeah... the delivery Exactly. The raw materials- Yeah...

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of like the... Yeah. I mean, a lot of that was driven, you know, during COVID. A lot of... Because, you know, because of the state of newspapers, a lot of, you know, mills that used to- Yeah...

186
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produce newsprint are out of business, and so now they're making, you know, cardboard boxes for e-commerce. And so the newsprint and the printing costs have gone up 72%.

187
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So, and the mailing costs have gone up, you know, just in the last year have gone up 15%. So we've gotta keep that, you know...

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I don't know, I don't know what that ratio shakes out at, and, I mean, I probably, I probably should know.

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But I think that the, there's a model for us in print being monthly, being direct mail, and being a tabloid format, which just means that we can go up or down in pages very easily. Yeah.

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What's been the biggest challenge so far, you know, owning and operating this? I should've been prepared for that question. [laughs] That's an obvious one, come on, Keith. I mean, the, the, uh, [laughs]

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You're in local news. I mean, the biggest challenge- Come on. I'm gonna have to ask that. Yeah. I mean, the biggest challenge, other than the macroeconomic challenges, for me- Yeah...

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is this is my first time owning a business. And- Yeah... you know, I'm kind of the accidental entrepreneur, so I didn't, you, you know, just like- That's how that feels... everyone raised their...

193
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[laughs] Just like people raise their eyebrow at me are like, "You're doing what?" Like it, it wasn't something that I, that I saw myself doing. You know, that said, I've created the, the perfect job for me.

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I love, you know... It's put me in, in conversations and rooms that I never thought I would be in and, and, you know, at really exciting- Yeah... times.

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You were telling me, you're like, you're like, like, you know, because you're like, you're the operator of, like, newspapers. So then you're like, you know, you're meeting the sheriff or whatever.

196
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[laughs] Oh, yeah, yeah. I mean, I, you know, meeting mayors, I was, senators. I was, you know, I was the, I, I was the chair of the Atlanta Press Club for two years. You know, I'm still a board member there.

197
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I've gotten to be on, you know, boards I never thought I would. So, so it's incredible, I mean.

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But the, the challenge for me, I mean, one is, is when I came into the business, the, you know, w- it was a print-focused organization, so I got a lot of, "That's not how we do it, that's not how we do it," a lot of pushback, you know, early on to some, to some changes of making that shift.

199
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Okay. You know, so I learned a lot early on in that process. But just the, you know, the macro trends of the industry are, you know, are, are very stressful.

200
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The m- the what we're doing on a small level is very encouraging. Mm. We're having our, you know, we're having, we're, we're, we're growing this year.

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We just had an, you know, we're up 30% this quarter for Q, you know, Q3 over last year. So we're, we're, we're, our brand is getting recognized.

202
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Like we're, you know, we're hearing, you know, just more and more feedback from people.

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So, so I'm really optimistic about, about it, and I think that, you know, the model that we've got of the monthly cadence of print, the high quality of the newsprint, the, the direct mail piece, and the mix of coverage that we've got.

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The fact that, you know, the fact that Beth McKibben, who was editor of Eater Atlanta for many years, left a national, you know, digi- l- one of the top national media companies to come work for us i- was a huge, you know, it was a, a lot of wind in our, in our sail.

205
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Yeah. It's interesting how, like, print is, it is still not just valuable, but like, you know, a, a, a real, like, margin driver for you.

206
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I mean, it, you know, look, the Atlanta Journal Constitution just stopped printing, right? Like- Yeah. Well, they announced they're gonna stop at the end of the year. Yeah. But the- Okay...

207
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but the, I think that they'll come back with some kind of weekly or, or biweekly product. But the, but the dynamics, I mean, the economics for what they were doing.

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I mean, I interviewed Andrew for a piece I wrote after- This is Andrew Morrison... they made the announcement Former CNN- Andrew Morrison... executive. Yeah. Right. He was the president of the HAC, and he- Yeah...

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and a friend and, and he, you know, he gave the example of election night last year.

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They had 400-something thousand, you know, visitors to their website, and the next morning, the morning paper, which went to bed at, like, 3:00 the election day afternoon [laughs] had 40,000 copies. Yeah. Yeah.

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So, you know, and you think about the, the, just the geography of Atlanta, how spread out it is, and getting those papers to people and, you know, in the morning, you know, it's not that, the m- the example that I gave of, you know, me growing up with three morning newspapers at the end of the driveway, it just doesn't, it just doesn't make any sense anymore so...

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Yeah, the infrastructure is not there. I mean, it's, it's- Right... you know, I mean, it's not appropriate of- The distribution of... Yeah. People don't think-...

213
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analogy, but, like, we, we can't just bring back manufacturing all of a sudden because, like, that- [laughs]... that infrastructure is gone. Like and- Correct. Right...

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we, the same is happening with print, and I think, you know, I hear all the time from people running, you know, local and, and regional publications about, you know, it doesn't get a lot of attention now, but the fact is, like, the market has shrunk, and so the costs have gone, have, have really gone up for printing.

215
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Mm-hmm. And that hurts. And for distribution and getting people to, to read it.

216
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I mean, it, it's, it's, you know, you, you talk a lot about the, these niche magazines, you know, that, that, you know, that have come back to print. I mean, The Onion coming back to print. Yeah.

217
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But it's, you know, it's like, it's like vinyl.

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I mean, if you walk in my place, like, the first thing you see is my turntable and, and whatever vinyl I want you to see that day to s- to signal to you that I have vinyl, but, but I'm not walking in after a busy day or waking up, you know, to get my news from vinyl every day.

219
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It's just- Right... it doesn't, it just doesn't work. So, so I think of- Yeah... it, think of it kind of like that. But, uh, that's why I like our, our cadence.

220
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That's why I like our, our cadence, our distribution, and the saturation piece.

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But, you know, we've only launched one new neighborhood in printIn five years, we did acquire the Georgia Voice, so there could be, there could be more opportunities to, you know, to bring, you know, people that are in nearby markets under our,

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you know, into our, our platform or whatever, whatever we wanna call it. Because, you know, we've got the operation in place. We know what to do. You know, we've got the printing relationships.

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I mean, one of the hardest parts about printing is, is turning on the printing press. Like, that's the biggest expense, is getting that time, 'cause there are fewer and fewer- Yeah... you know, printers around.

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So, so that's... These are all things that we're doing, and I think we, you know, we have an opportunity to, to grow in that way, but we'll have to, we just have to be deliberate about it. Yeah.

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So where do you s- s- with the model as it is, right? It seems like you, the expansion you see is adding other communities. Or maybe not expand. I don't know. It's up to you.

226
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You can go deeper, you can add different, like, services for the existing communities. But do you, do you see, like, having... Seems like you're getting, like, a playbook down that, like, is...

227
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And you don't wanna sort of replicate it in, in Charlotte and all these other different cities.

228
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So is, is the opportunity to keep, use the digital to understand where the opportunities are and just ga- run the playbook in, in other counties? Yeah, I think so.

229
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I mean, uh, other count- other, you know, counties or cities, but also, you know, other verticals. So I think there's still verticals that we can explore, and we start those as newsletters, right? We have...

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You know, it was started as an intern project, but we have a monthly newsletter about books. There's no other newsletter in Atlanta, you know, for, for authors or for the literary scene.

231
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So that gives us, you know, the ability... We know how to launch newsletters locally, and I think that, you know, those are ways that we can test certain products.

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We've done a pop-up sports newsletter over the summer, which if we, you know, which, which, you know, turned out to be, to be great, but it's not, you know, we don't have the staffing to do that on a regular basis.

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But, you know, if we see opportunities like that, I think that we can grow, you know, both geographically and vertically into other areas. Right. Yeah. What's the kind of ceiling do you think for, for a model like this?

234
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That's a good question. [chuckles] 'Cause I guess I just- Yeah... I end up, like, wondering. Look, I mean, the, the chains have, have, have not exactly been great stewards, I think, [chuckles]

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of the, of the local news ecosystem. And I think everyone is, is tackling it in, in a different way, you know? And I think the question for a lot of these models is, you know, how...

236
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You know, you, you have pockets of success out there, right? And I just wonder whether there is, like, the opportunity for a larger sort of local news play.

237
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There's a sticker on my la- um, a Post-It note on my monitor that says, "Meaningful, not massive." And I think having, you know, worked at different startups along the way, like I, I have a...

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And this is also being a first-time business owner, like, I just think every day the world, [chuckles] the world's gonna end, and so, you know, I'm still in the phase five years later where the first thing I do every morning is check the bank, check the bank account.

239
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Oh, good. I'm gl- I'm glad I'm not alone. [laughs] You're not the only one. [laughs] So, so I, I don't...

240
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I just, uh, it is to a fault, and, and, and this may be too much information, but I wor- talk about this with my therapist, like I, I- [chuckles]...

241
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tend to downplay where, [chuckles] you know, successes and so I- Yeah, I get that... I just worry a l- a lot. But I think that, you know, I think that we can build... You know, I look at, you know, people like what...

242
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It's not, it's not an exact analogy, but, like, the, you know, I would like to be the Puck of At- of Atlanta, of the region. Right. Right?

243
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But that, you know, but instead of it being verticals like they have, it would be, it would be geographies and then, you know, build a, a g- a great platform. And, but, you know, we're still a small business.

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It's hard for me to find, you know, it's hard for... We can't afford y- you know, things like a COO. We can't afford, you know, CROs.

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So there's a lot of small business stuff that, that I think has really torpedoed a lot of small independent publishers and news operations.

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I've seen that happen here with some pop-ups, or startups that have, you know, they just haven't been able, the weight of doing, of doing business. So if I can get that part right, and then we can offer, you know, our,

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our wrapper to, you know, some, some great independent journalists, there could be an interesting model there.

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I, I had lunch yesterday with a, a corporate media, I wo- I won't say their, I won't expose who it was, but someone that was running a, a division of a, of a big corporate media and, and like, they were, we were talking about, you know, di- different tech tools that we're using or whatnot and, and, you know, I was telling about some of them and he's like, "Oh, we can never get that through, I could never get that through corporate," or, "I could never get, you know- Yeah...

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we'd have to have a, we'd have to have 10 cross-functional meetings." We don't have that. I mean, if we decide to launch a sports newsletter, I, we just do it.

250
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I, you know, I, you know, I, I probably do too much of, [chuckles] of that, which is a challenge, like, but the, you know, the, the, the, our ability to test and try things is, is good.

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And I'm, you know, I also have the benefit of, you know, we don't have investors. We're almost, w- you know, it's almost paid off, so I can start reinvesting even more into it. So it gives me a lot of, of flexibility.

252
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But I say all that, and we're still small. You know, if you guys were talking about this on, on your podcast, you would, y- you know, AB, who I've grown to like- [chuckles]...

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would, would, I mean, he wouldn't even [chuckles] you know, give us the time of day.

254
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So I, I had someone, you know, that came to me, it's been a couple years, they might think differently or I might think differently now, but they were like, "I wanna invest in your company," and I just started laughing.

255
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I was like, "Y- you know, you kinda, you know, you need to look at the, look at the, at the, at the numbers first." But, but it's, it's improving. We're having a great year, like it's gonna be, uh- Yeah...

256
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the better- But- It's a much better story. I guess, like, from my point of...

257
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It's like, from what you have experienced the last, I guess, four plus years, does, does it make you more optimistic or less optimistic about, you know, the, the doom and gloom aspect of local news, which apparently I traffic in?

258
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It's fine. Oh, way, I'm way more optimistic about it.

259
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Okay.So just run through the optimism, not just in your, your business, but why you think, you know, in your experience for it, that this is a solvable, quote unquote, problem.

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Well, it's- You have a lot of advantages 'cause you're, you're operating in, in, in rich suburbs of a rich metropolitan area.

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But I'm not gonna like s- b- look, there's a lot of issues to solve, and I'm like, look, if we can, if we can make local news work in some, like, rich areas, we'll get to some little bit less rich areas.

262
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But like what John's doing at Community Impact in Texas- Sure... like, they're doing it across all of Texas. Very similar- John Garrett.

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John, yeah, very similar model, but, you know, at, at much bigger scale than, you know, than we are. You know, obviously there's the, there's the, the, you know, the, um, Lookout,

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you know, the, the stuff that Ken Doctor is doing. Yep. Santa Cruz. Lookout Santa Cruz, and now Lookout Eugene. So I think that the, the models are p- are popping up. I think it just, it has to be...

265
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And there's a lot of nonprofits here in Atlanta, and some of them are doing okay.

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I think it's a really tough time for, for nonprofit journalism, especially with all this stuff going on with, with public broadcasting, 'cause now you've got, you know, you've got so many people that are asking for, for reader revenue.

267
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So I think that that's making it very hard for, for nonprofits. So, but, but I think you just have to sort of keep a small...

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I mean, we're, we're, we're, that meaningful not massive thing just sticks with me because we're just trying to, we're not trying to, to be too big. And, and- Yeah...

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by taking small steps and not looking at, like, any sort of exit or any sort of acquisition, like, just doing what's in front of us, it's allowing us to be, to be successful.

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Well, that's a good mantra I think now, more than ever, for, for most of media, right? Because obviously, you know, the scale era, so to s- so to speak, is, is clearly behind us.

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And, you know, a lot of, there's a lot of really great media businesses that are being built or still are to be built that I think can be very meaningful, but likely not massive. Yeah.

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We're also not chasing, we're also not chasing shiny objects, right? So we don't do video right now. We don't do- You haven't pivoted to TikTok... podcasts. No, we, we don't, we don't even have a TikTok.

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But we're growing our, you know, we're using, we're, we're, we're using the, the basics, but we're not chasing things that don't have direct revenue- Yeah... tied to them.

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Although I still think, I mean, we talked about this before.

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I, I, I see some, like, local Instagram, I don't go near TikTok, but I see some, like, Instagram accounts, like, in, like, Miami, and, like, they're locally based. They have massive amounts of engagement.

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Usually, they're around food or different, like, quote unquote, "cultural parts" of, of- Yeah... Miami.

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But, um- Right, but you don't see any adverti- I mean, you don't see brand ad- you know, what we would call brand advertisers here. Like, if you, you know, you don't see the, you know, the Sotheby's- Right...

278
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Christie's real estate folks that are advertising with us. So I still, I still think there's, there's room for both. I mean, we've got those, we've got a handful of those. I don't know.

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I mean, you could do, like, real estate porn in, like, you know, the Atlanta, like, exurbs and, like, have it supported by Sotheby's real estate. Like, it's possible.

280
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Well, it's, I mean, our real estate ads are some of our best content.

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I mean, if you flip through our, if you th- flip through our papers, the, the, you know, n- the, the only thing that's acceptable in this country to be voyeuristic about is, is real estate. [laughs] Yeah.

282
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So, you know, I'm not likely to ask you what you make, but it's not awkward for me to ask you what you paid for your- Yeah... for your house.

283
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And, and so people lo- I mean, our, our pages are filled with great real estate ads, and people tell me all the time, "Oh, you're the real estate paper." Oh, yeah. And I love it.

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I mean, it's like FT Weekend, where, like, the how to spend it.

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Like, I mean, I'm not in the market for, like, you know, this place in Algarve, but I'm absolutely, like, you know, checking out what I can get for, like, you know, th- Oh, yeah... 30, 30 million euros.

286
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[laughs] Yeah, we just launched a weekly feature, which is guess how much this house costs in a, in our newsletter, and it's a picture of a house with a few descriptors and then three prices. Yeah.

287
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And, and, and people, people love it. It's been huge engagement so far.

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So final thing is, for, for me, 'cause I wanna do more, like, on local, who, who are some, who are some people that you look to and you're saying, "Yeah, they're doing s- they're doing some interesting stuff in these other markets"?

289
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And... Well, the, the, I, I mean, first of all, the idea I should give even more credit was, was Ted in Charlotte. So before- Okay, yeah... before he was bought by- Ted Williams.

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Yeah, before Ted was bought by Axios, I lo- I was following the Charlotte Agenda. I like Ted. Yeah. Um, so- I don't know if I've ever talked to him directly, but if Ted's listening- Yeah, yeah...

291
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we should talk- So he's-... 'cause I like, I like his energy in that publi- 'cause that, that's an interesting publication. You wanna explain it? The Charlotte Agenda or Tiny Money? Tiny Money. [laughs] Yeah.

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Well, the Charlotte Agenda, if people don't know, was the precursor- Yeah... to Axios Local.

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It was a local newsletter just in Charlotte that was the morning brew for Charlotte, basically, that he sold to Axios, and now he's started Tiny Money, which is...

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I don't even really know how to describe it other than it's just Ted's, you know, Ted's sort of personal newsletter with him curating interesting things around Charlotte. Yeah.

295
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I think it's, it's interesting 'cause it's, it's, it's business-focused, right? And I don't know. I think there's something there that i- is beyond, like, his, his, like, interest.

296
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But I'll- But is it, is it the, is it the eat me? Is it the Emily Sundberg for Charlotte? [laughs] May- maybe we're gonna have the feed me of Charlotte. I don't know. Yeah. It's possible. Yeah.

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I mean, so Ted would be someone that I, that I think you should definitely talk to. John Garrett in Texas- Yeah. I, I know John. Yeah... is another, is another person that's doing really good stuff.

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And then obviously, you know, the, the Lookout folks, you know, they're, they're doing awesome stuff.

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And the other per- the other person to tap into, and we're, I'm huge fans of news, we're on the Newspack platform, which for us- Mm-hmm...

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has been, has been just very, very, you know, it's been a, a big win for us because I have no tech people on the team, so- Right...

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that was part of the cost I was able to cut at the very beginning, is we use Newspack and, you know, it's, it's just been incredible support.

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And so what, what, you know, Kenzie, someone else, Kenzie Wilson is someone else to talk to because he's seeing every type of model across the, across the world in local news. And so that's someone else I would talk to.

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Okay, great. Thanks a lot, Keith. This was fun to catch up and get deep into the model. Yeah. Thanks for inviting me, and thanks for doing what you do to keep us informed and entertained. Okay.

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Well, I hope to, like, ease up on the doom and gloom. I'm not, I'm not really that gloomy of a person. [upbeat music]