Capital Stacks of Journalism

There are few pragmatic reasons to start a news media company in Europe. Print collapsed and platforms took over most of the advertising. Across half the continent, owners with political agendas bought up what was left; across the other half, governments themselves did. Professional investors drew the obvious conclusion and mostly stayed away.

And yet, between roughly 2008 and 2021, from Bratislava to Madrid and Zurich to Kyiv, quite a few new ventures launched anyway. This study follows twenty-one of them: digital-first, independent, public-interest news outlets that reached financial viability and, in several cases, profitability at scales their founders never dared include in a business plan.

Our goal was simple: to show that investing in journalism, media and information is not necessarily the same as setting your money on fire. Media is difficult and rarely as lucrative as other sectors, but it is not a bottomless pit either: across Europe, people have repeatedly taken modest amounts of capital (or pulled themselves up by their bootstraps) and built viable, sustainable and sometimes highly profitable businesses. This report is written primarily for the people who control resources and might invest them, and secondarily for founders and operators who can use these companies as a benchmark for their own.

Doing the unreasonable thing

Journalists or editors were involved in founding nineteen of the twenty-one ventures. Almost nobody founded alone; several outlets began with whole newsrooms walking out the door together.

Most founding groups carried decades of experience with them, and that proved critical. Trust rarely accumulates on a startup schedule; ventures that launched with known and proven editors and journalists (and, at times, a powerful founding story) got audiences to pay attention earlier and gave people with resources more confidence to take a risk on them.

Raising the money

Launching a sustainable independent outlet in Europe took somewhere between zero and €8 million, which narrows things down only slightly.

A bootstrap wing—roughly a third of the sample—launched with less than €100,000, often with literally no money beyond the few thousand euros legally required to incorporate a company. The capitalized wing launched with around €400,000 and often much more, all the way up to €8 million.

We defined founding capital loosely enough to include grants and pre-sold subscriptions, and identified three broad fundraising routes: investor-capitalized starts; revenue-as-capital launches, where crowdfunding campaigns sold a product that did not yet exist; and sweat-and-trickle launches, where the “runway” was pieced together from small loans, unpaid labor and modest grants.

Well-capitalized outlets often went back to their initial investors multiple times. The bootstrappers, with one exception, never raised again. Not because they could not, but because their models did not require outside money and independence from external influence was often the most important point. Even where outside investors played a large role, dilution was limited.

No risk capital, but a lot of capital at risk

Venture capital is essentially absent: across twenty-one cap tables, we found one named institutional VC, and it arrived as part of a rescue.

The money came instead from people who had made their wealth in software and invested personally; media insiders backing a business they already understood; old industrial and family fortunes; mission-locked institutional investors, which almost always arrived a year or more after launch, once somebody else had absorbed the founding risk; the crowd; and skills-and-services investors contributing design, technology or commercial capability instead of cash.

They said yes for reasons that were rarely purely financial: dissatisfaction with the existing market, belief in a particular founder, or a desire to protect something they believed should exist.

Outside investors also provided validation, discipline, cover in a crisis and, sometimes, a credible commitment not to interfere. Their involvement could also cost them more than money: owning a stake in a news media company can attract political attention that not every investor was prepared for.

Four-million-euro businesses

In their latest closed financial years, the outlets generated revenues ranging from around €700,000 to €28.1 million. The median sits at around €4.6 million; the typical outlet in our sample is a €2–8 million business, and the numbers are still growing.

Most of that money is spent on people, who absorb between 50 and 75 percent of everything. Net margins are often close to the waterline. Some of these are million-euro businesses intent on making almost nothing, year after year, and on purpose. Still, several ventures in the cohort are nicely profitable, most with margins in the high single digits to mid-teens, and a couple well beyond that.

Six outlets broke even within their first year and often that was the goal. The median took three years, while the tail stretches to seven and ten.

Audiences still pay for good journalism

Audience revenue is the dominant revenue stream across the cohort; for some outlets, it constitutes 99 percent of all income.

Nine newsrooms sell access behind relatively strict paywalls, eight operate mixed models and four rely on voluntary payments. But every documented change in the sample points in the same direction: toward a paywall.

Keeping everything open may be a principled choice, but in revenue terms, it also often means leaving money on the table.

Advertising divides the cohort with something close to religious intensity, but it still finances a great deal of public-interest journalism. Beyond these core streams, books are the most persistent recurring source of additional revenue.

Grants for now, not forever

We expected grants to be marginal in a group of commercially viable information ventures, but we found them throughout the cohort, often doing the job that launch equity did elsewhere: million-euro, non-repayable grants at or soon after startup that gave newsrooms crucial early runway.

At least ten outlets received platform development grants, mostly from Google’s DNI or GNI, almost always earmarked for subscription and audience infrastructure. In several cases, those grants helped build the systems that later enabled audience-revenue growth and ultimately made the ventures sustainable. Then the grants receded for most as audience revenue grew.

The biggest unrealized opportunity

Successful as they are, quite a few of these publishers cannot tell you what it costs them to acquire a customer.

Wherever we could calculate the ratio, lifetime value covered acquisition cost three times over or better. Marketing spend across most of the cohort remains in the low single digits as a percentage of revenue.

And explosive growth often arrives alongside some dramatic external event: a SLAPP suit, an invasion, a pandemic; and disproportionately rewards whoever already has the funnel ready.

Financial sustainability is everyone’s job

Relative to its importance, HR is probably the least professionalized function across most of our publishers. Nearly every outlet launched essentially as a newsroom and gradually diluted toward 50–75 percent editorial staff as it matured.

Most ventures made financial sustainability everyone’s responsibility, using mechanisms that sometimes contradict one another.

Technology follows a similar arc. Seventeen of twenty-one outlets say their infrastructure directly affected their ability to grow revenue, and the clearest movement over time is away from self-built systems and toward specialist vendors.

East and West, two different threat models

Draw the line at the Leitha—the river between Austria and Hungary, often treated as a symbolic demarcation between Western and Eastern Europe—and some distinct patterns begin to emerge.

The six eastern outlets look remarkably similar to their fifteen western peers in almost every business respect, but they operate under a different threat model.

In the West, cash is for investing and a second legal entity is often for tax. In the East, every outlet holds six months or more of reserves; national public money is treated as contamination while EU funding is considered the only clean public source; and backing journalism can cost an investor political exposure rather than merely money.

The line is moving, though. Mediapart now keeps 12–24 months of cash in reserve, preparing, in its general manager’s words, for hard times if the far right comes to government. The eastern threat model may simply be the European one, arriving in the West with a little lag.

Below promise, above expectation

Eighteen of the twenty-one outlets have never paid a dividend. Where money did leave the company, it often went to the people producing the journalism.

Shareholder exits happened surprisingly often: at sixteen of the twenty-one outlets. But the buyer was almost always the company itself, the remaining founders or incoming employees. There has been only one conventional trade sale: Zetland’s sale of a majority stake to Bonnier News.

Pull the known multiples together and the picture is remarkably consistent: one 1× return, a couple at 1.1–1.5×, a cluster at 3–5× and two above 5×. Nobody got venture returns, but nobody was promised them either.