Joshi Herrmann, the founder of The Mill — a network of local journalism newsletters based on Substack — has taken a “seed round” of investment funding from a star-studded list of individual investors.
The amount raised is a relatively modest £350,000, but the list of individual investors behind the funding is more impressive. Mill Media Co’s cap table now includes:
- Sir Mark Thompson, former CEO of Channel 4, former director general of the BBC, ex-CEO of The New York Times, and rumoured to be a candidate in the running to lead CNN.
- Nicholas Johnston, the publisher of Axios, which has a network of 30 local news sites in the US.
- David Rosenberg, the global director of strategy at Snap Inc.
- Diane Coyle, the University of Cambridge economist.
- Turi Munthe of Demotix, the photojournalism network.
Thompson said: “Britain’s cities need great commercially-sustainable journalism to inform the public and hold powerful institutions to account. That’s what The Mill and its sister publications were founded to do, and what they are consistently achieving.”
Johnston said: “The global decline of local news is one of journalism’s greatest challenges and it’s not going to be solved by a single idea, but by many entrepreneurial visions. The Mill is one of the most promising.”
Herrmann said he found his new benefactors because they had subscribed to one of his newsletters. “Almost everyone on there, I got in touch with them because they were reading The Mill.
“I don’t think it’s the biggest deal in the world, but I think raising private capital in local journalism at the moment is probably a bit unusual,” Herrmann, 34, told Press Gazette.
Mill Media hits 5,000 paying subscribers
Mill Media Co has 5,000 paying subscribers for newsletters covering Manchester, Liverpool and Sheffield. The company is on course to book £400,000 in annual revenues this year, with nine people on the payroll. Most of that revenue is from Substack subscriptions, which are around £7 per month. About 10% of it comes from advertising and sponsorship, but Herrmann believes there is room for growth.
The Mill was launched during the Covid-19 lockdown in June 2020 by Herrmann, working on his own using savings. He received a grant from Substack in June 2021 which helped him open The Post in Liverpool and The Tribune in Sheffield.
The Mill usually delivers just one story per day, and that story might be 3,000 words long. By contrast, most local news sites publish dozens of stories per day (with a story count of five per reporter per day not unusual).
“I think for the past couple of decades, there’s been a recognition among people who care about these things that local journalism has been in very, very serious decline,” Herrmann said.
“The internet has created an expectation on media companies to produce vastly more content than they are capable of producing at high quality. And, once you have to do that … then what you are able to do per story is sometimes very, very low in terms of actual journalistic output and work,” he said.
“I came along and said, will people pay even if we publish one story a day? And we make that story, really, highly researched and thoughtful? We tell people how we went about it, and we write it in an interesting and engaging way, we edit it properly, we don’t just whack it online.”
Paid subscribers are the only metric Mill Media looks at
Mill Media Co’s stories are judged in part on whether they generate new subscriptions or not. “Did it add two paying subscribers or 20?” Herrmann says. “I think we do see people paying as a good proxy for whether we’re delivering something that’s really interesting, really differentiated, and really something that they care about.”
Traffic — an obsession in most newsrooms, whose editors are addicted to tidal-wave audiences on their Chartbeat measurement dashboards — is irrelevant at Mill Media Co. “I never look at traffic,” Herrmann says. “I don’t look at page views so that metric has just completely disappeared from my life. We all look at one number, which is paid subscribers. How many new paid subscribers do we have?”
“A lot of the success actually doesn’t come from mechanical aspects to do with content delivery. It comes from the fact that people have a real yearning for high-quality, local information, people really like, well-written stories, and if you can give them those things on a consistent basis, they will be willing to pay for them.”
Mill Media Co will expand to Leeds and Birmingham next, Herrmann said. He favours cities with a big professional class, and multiple universities. “My model, which is based around paid subscriptions and quite broadsheet-y vibe journalism, I think it’s 100% possible in the ten biggest cities in the country.”
London is unlikely to be one of them, because the national media already covers the capital so thoroughly.
While Mill Media Co remains a small operation, the mere fact that it is growing and has a commercially viable business model makes it a standout in a market beset by layoffs elsewhere. Local news publishers Reach and National World have both had rounds of redundancies this year.
Herrmann said he intends to recruit by picking up disaffected reporters from these companies. “We get contacted by people who work for companies like Reach, Newsquest and National World on a fairly regular basis who are interested in doing this in other places,” he said. He is also currently hiring two more positions in Manchester and one in Liverpool.
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