UPDATE 14 July 2022: The New European last night closed its fundraising scheme having raised £1m from 2,000 new co-owners.
New European editor Matt Kelly told Press Gazette the paper’s readers “now own 16.7% of the business”.
Original story, 22 June 2022: The New European has raised £510,000 in two days by offering readers the chance to buy shares in the newspaper.
The pro-Europe publisher says it wants to use the proceeds to raise its profile.
The publication opened its funding round at 9am on Monday. By Wednesday morning, it had raised over £513,000, surpassing its £500,000 target.
The company, The New European Limited, originally planned to sell approximately 167,000 shares equivalent to 8.84% of the company’s value of £5.15m as based on current revenues.
Demand proved high, however: 48 hours after sales opened the company had brought in more than 600 new investors. Proprietor and editor-in-chief Matt Kelly told Press Gazette the company would continue to sell shares past its target: “I expect the equity we’ll have amongst readers will be in double digits.”
Who owns the New European newspaper?
The New European launched in 2016 as a property of Archant under the editorship of Kelly. Kelly left the paper in October 2019, before returning in early 2021 to buy it alongside a consortium of investors including former FT editor Lionel Barber, former BBC and New York Times boss Mark Thompson and former Blair director of communications Alastair Campbell, who also serves as the paper’s editor-at-large.
Purchasing a single £3 share in this funding round will bag a prospective investor approximately 0.00005% ownership of The New European Limited. Thompson owns approximately 3.4% of the business, according to filings with Companies House; Barber owns just over 1%.
Kelly is by far the biggest shareholder, owning just under 40% of the equity. He told Press Gazette the business lost £150,000 in 2021 because of platform, paywall and editorial investments, but the current run rate is “more or less break-even”.
Kelly said he planned to use the capital to make the paper better-known.
“The idea really is that The New European is much loved by people who know it. But awareness is its biggest problem, still – you know, the media’s best kept secret.
“People don’t really know about it. Even Remainers who I speak to, living in Central London, living near me, right in Remain-central in Islington, and they haven’t heard of The New European after all this time.
“So, we need the money to pay for a marketing campaign to raise awareness, which will then push the whole business into comfortable profitability, and we can go from strength to strength from there.”
Profitability is a key word: The New European will not be a new Guardian or Il Post, asking readers to donate purely out of the goodness of their hearts.
“It’s very much for-profit,” Kelly said. “I really believe that media should be profitable, but on the basis that I don’t think that it’s sustainable just to ask people for donations, as others have done – and that seems to work for them, and that’s fine.
“But I prefer a much more traditional model where we produce great journalism and people are happy to pay for it. We don’t take advertising either, which is a pointed difference. We are beholden to nobody apart from our subscribers, and I think that’s the perfect, ideal model for media.”
Kelly said opportunities for investors to profit might come “if we’re ever acquired or there’s an event or we have another fundraiser…
What next for the New European?
Longer-term, Kelly said he was looking at taking the Remainer paper to Europe.
“We’ve had conversations already with some of our German investors that there is potential for The New European to have a mainland European presence in a meaningful way.
“So we’re currently looking at Germany as a next step for The New European as an expansion and we’ll do it. We’ll do it in a very targeted way.
“But I do think that Europe has got this view now of Great Britain as being quite insular, navel-gazing Europhobes. And that’s not the case. So we’re quite happy to present a more accurate picture of how many Britons feel about mainland Europe.”
The New European was conceived in the wake of the Brexit referendum as a “pop up” newspaper to be published for four weeks in July 2016, but went permanent after exceeding its targets.
After Britain’s exit from the European Union formally took place in January 2020, Kelly told Press Gazette the post-EU future for The New European might be “being the platform for the radical centre”, which he identified as somewhere between The New Statesman and Spectator.
Press Gazette is hosting the Future of Media Technology Conference. For more information, visit NSMG.live
Picture: The New European