How Block Club Chicago reached 20,000 paying subscribers

A $183,000 Kickstarter campaign provided the seed capital to get it off the ground.

Layoffs in the local news sector are, sadly, a regular occurrence, but three Chicago journalists decided they weren’t going down without a fight.

In November 2017, the news startup DNA Info laid off its entire staff, and it was only a few months later that three of its editors launched a Kickstarter that raised over $183,000; they used that capital to launch Block Club Chicago, a nonprofit that seeks to put a journalist in each of the city’s neighborhoods.

Flash forward six years, and Block Club has a robust news gathering operation that’s funded by 20,000 paying subscribers, foundation support, and a growing advertising business. In a recent interview, co-founder Stephanie Lulay walked me through the site’s launch strategy, its unique approach to neighborhood-based reporting, and why she thinks Block Club’s model can be replicated all across the US.

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Transcript

Hey, Stephanie. Thanks for joining us.

Hi, Simon. How are you?

I'm doing great. So you co-founded a really successful local news outlet. It's called Block Club Chicago. What was your background in local news prior to that?

Yeah, Simon, my background is I was a local reporter and then became an editor. I was laid off like many journalists. The newsroom that I worked for, DNA Info at the time, here in Chicago.

Was that the first local newsroom you worked for?

No. Yeah, we can back up all the way. Sorry. Yeah, I always knew that I wanted to be a journalist. For me, it kind of started at age three. I would ask why about everything. Why? Why? Why? Why? And my grandfather would always remark, does she ever shut up?

And I'm not sure that I have ever shut up and stopped wondering why. And that's really driven my passion for journalism. It's such a gift to be able to learn about the world and what's going on in politics and our communities and all of that. After graduating from the University of Illinois, I did my undergrad and my master's there. My first job in local news was working for the Aurora Beacon News. Here in Illinois, that's our second largest city. I did a little bit of everything there from covering schools and small towns to eventually covering politics in the city.

Then I left to join DNA Info, which at the time was a startup looking to cover Chicago by neighborhood. It kind of flipped the beat system on its head. Instead of having a daily newsroom where you're focused on cops and courts and education, traditional beats, the reporters at DNA Info were focused on covering communities, like covering these neighborhood stories from the ground up. So I was very inspired by that mission and eager to join them. And I joined first as a reporter and a neighborhood reporter, and I eventually became a senior editor.

And DNA Info, it wasn't just in Chicago. There was also one in New York, correct?

There was also one in New York and the billionaire Joe Ricketts that founded DNA Info also ended up buying the Gothamist network.

Yeah. I actually met the guy. I did like a presentation at the New York office about headlines or something like that. And he just happened to be there that day. And so yeah, like you said, it was really innovative in that it changed up the beat system where, rather than, like you said, traditional local newspapers – if you have enough staffers, there will be a board of supervisors person, here will be an education reporter, a crime reporter, and stuff like that – but instead, DNA Info kind of broke up those beats in a different way by saying here, these are the neighborhoods and you need to be hyper specific on this neighborhood.

How did that manifest itself? It's like they just had that neighborhood specific stuff on the website? Or were there ways where if I live in a specific neighborhood, I could access just that information? Like, were there newsletters or social media accounts that were dedicated on the individual neighborhood level?

Yeah, at DNA Info, that's exactly how it worked. We had newsletters that were dedicated just to certain neighborhoods, and Facebook pages. Facebook was big back then. Facebook pages dedicated just to certain neighborhoods and serving those neighbors. And our goal there was just really to be writing about what the neighbors cared about. In a city as large as Chicago, when you are the one cops reporter, let's say in a newsroom, there's a lot going on on a crime beat every day. Right? Or if you're the one education reporter, same thing. There's a lot going on citywide education wise. And it was our goal just to always be writing about what the neighbors cared about from the ground up and get to those stories first by continuously serving those neighbors and building connections with them.

Yeah. But at the same time, cities are centralized. How did it handle that centralization? Cause like, obviously there are edicts that are going out at the school wide level, and so how did you balance that? You want to obviously cover the local school in that neighborhood, but obviously there are things coming up from up high that are going to affect that one school. And then obviously you don't want to write the same story five times about five different schools. I don't know. How did you approach that kind of more centralized beat reporting?

Yeah, I think the key to tackling those central beats is we did have some central beats. Like we had a city hall reporter at DNA Info. A lot of how we tackled that at DNA Info, though, was cross-newsroom collaboration. If there are two reporters noticing that this is an issue popping up that's going to affect the whole city, they would team up to show different perspectives of how it's affecting the neighborhoods, but across the city.

And was the plan for it to be an advertising-supported organization?

Yes. Yes, it was a free site. And the bet was that we could get people to support this neighborhood news mission with advertising, but specifically like neighborhood focused advertising. So there was a whole sales team that mimicked the neighborhood reporter footprint. So like for instance, I covered Pilsen and the West loop for a while. There was also a West loop and Pilsen focused ad manager.

So obviously you can say the experiment didn't work out, the other thing is you could say maybe Joe pulled out prematurely, but I think like the the series of events were that somebody, maybe it was the whole DNA Info newsroom or maybe it was just in New York newsroom, they announced that they were going to unionize and he very quickly decided that he was just going to shut down the entire DNA Info network and I think the Gothamist network completely at the same time. Is that kind of the gist of what happened?

That's exactly what happened. I was on Fox, our local Fox channel earlier that day, talking about DNA Info stories. I got back to my desk and we all were told that our website had gone blank and that it would be replaced with a letter from Joe Ricketts.

And that letter from Joe Ricketts was public facing, just said that, you know, he... given the New York office's decision to unionize, that he was shuttering DNA Info and its affiliates.

Yeah, and that was a very weird move for him to, like, on the same day he was closing it down just to shut down the website. Like, what was the strategic advantage of that, you know? Or do you think that was just out of spite or, like...

There's not much value in speculating. I don't know if it was spite or not. I think it's entirely probable that he didn't understand – again, he’s not a journalist, that he didn't understand what this would mean to the staff. In fact, they did put the archives back up and made plans for that. I do think it's a possibility that they just didn't understand to journalists what an archive of our work means.

So he did that. I forget how much time went by, but this was after all the staff had been laid off, but like a bunch of public radio stations banded together and bought the Gothamist network. Did they buy DNA Info too, or did they get the assets of DNA Info or what was it?

Yeah, so this actually happens after... After Block Club Chicago has already started. One thing that we were fortunate is we did get severance. So we had a little bit of runway. to start talking about what's next, right? Whether we're going to go get jobs in other newsrooms or quit journalism. And something interesting that happened in the meantime is we started hearing from readers all across the city, just encouraging us not to give up and just saying how much they needed this neighborhood coverage and they couldn't get it anywhere else. And we looked around in the meantime to see in the city, like, was a newsroom going to pick up this mantle, like do this kind of neighborhood focused reporting. And it really, Simon, it really didn't happen. And that really led to us, you know, thinking seriously about starting something and It was pretty fast. DNA Info shuttered in November 2017. By February 2018, we had announced that we were forming a new newsroom called Block Club Chicago that would be focused on Chicago's neighborhoods. And that day we launched a Kickstarter too, so people could support us right away.

And when you say we, what does that mean? Was it just all the former staffers, DNA Info? Was it a small number of staffers? Who else was it?

Yeah, DNA was big. So like we knew that there was no possible way that we could get enough public support day one for us all to have full time jobs like we did at DNA Info. So what we did is our three co-founders, me, myself, Jen Sabella and Shamus Toomey, who are all editors at DNA Info, got together with five reporters. And we decided to launch it small and to see if we could build it sustainably from a small newsroom that we could support to, you know, to build it back slowly and sustainably, especially considering the current and former and, you know, environment and media then and now.

Yeah. And so did you decide prior to it launching that it was going to be a nonprofit?

Yeah, we did a lot of, we're journalists. That's like one thing that was, you know, different. We understand journalism. And so we did a lot of research just on for-profit models, nonprofit models, talked to a lot of leaders in the nonprofit news movement about the advantages and yes, decided to go nonprofit.

We actually ended up, at the time we were also, talking to another newsroom about potentially housing this operation within that newsroom. We had talked to a venture capitalist who was very interested in this model. So we really did explore a lot of different avenues before settling on forming this as a nonprofit.

And then also you partnered with, I think I could be wrong about this, but an organization called Civil. Am I getting this right?

Yeah, no, you're getting this right. Um, yeah. Shout out Civil. Civil was trying to launch journalism on the blockchain. It was a very ambitious plan, but one thing that they were doing at the time is they needed newsrooms to test out this journalism on the blockchain – kind of to be partners in what they were doing. And it was like perfect timing for us. It also was perfect timing for some other newsrooms that have flourished since then. 

Civil didn't work out, it failed but all of these newsrooms because of the pretty much no strings attached investment they made in us they didn't care if we were for-profit or non-profit they just wanted us to do good journalism with their investment. Because of that, it really gave us the seed funding to start up, coupled with the money that we raised from the Kickstarter campaign. We actually broke a record for most funded local newsroom at the time on Kickstarter. And yeah, so those two coupled together really gave us the seed funding to do this. It wasn't from one foundation. We see that a lot with newsrooms starting up with $10 million already in the bank. This was not that, it was very scrappy.