Iașul Nostru was the only European publication to win the Substack Local grant. How is it doing after the first year?

In 2021, Substack announced its Local grant, giving selected publications that applied up to $100,000 in cash.

Romanian journalist Alexandru Enășescu was among the winners and the only one based in Europe. The grant allowed him to start Iașul Nostru, a local news outlet for readers in Iași – the second largest city in Romania – and run primarily as a newsletter on Substack.

Substack described Iașul Nostru as a local newsletter that would focus on four main topics: 1) civic issues from an apolitical stance; 2) locals who improve their corner of the world; 3) arts and culture; and 4) food and drink.

I reached out to Alexandru exactly a year ago when I saw the list of winners. My first question to him was whether the fact that Substack is in English isn’t going to limit its audience. 

He was confident it shouldn’t be a problem. Romania has an overall good English proficiency and ranks 15th in the world’s largest ranking of countries and regions by English skills.

A year later, when I read Simon Owens’s media newsletter about local newsletters and looked in the comment section, I found Alexandru replying to a thread saying he learned he has to focus on business as much as on content.

I was curious about how he is doing and reached out to him. The following is the result of the interview we conducted over Twitter.

Could you introduce Iașul Nostru to the wider audience who might have never heard of it? Also, could you just hint at the current Romanian media market? How widespread is the notion of reader revenue among audiences? Which other local/national publications are building the same model as you?

Iașul nostru is a newsletter-first publication, launched through the Substack Local program. 

Our purpose is to help readers in Iași – the second largest city in Romania – navigate our city and highlight the people and places that make it better. We believe local news is overly focused on politics and crime, so we take a different approach, based on constructive journalism and an uplifting point of view.

The media landscape in Romania is quite different from Western Europe and the US, in the sense that there are hardly any paywalls here. The leading independent media outlets (Recorder, DoR, PressOne, Scena9, Rise Project) all rely on either donation or membership models, mixed with advertising. 

That’s why it made sense for us to experiment with a similar model on Substack – paid subscriptions without a paywall or any extra benefits for paid subscribers – in order to make our longform content available to as many locals as possible.

You received an undisclosed sum of up to $100,000 in cash from Substack a year ago as the only European publication/journalist. It was supposed to give you a one-year runway to make your publication Iașul Nostru sustainable. How are you doing so far? Can you break down your business and how many subscribers you have now?

In summer 2021, we received a grant from Substack, which wanted to test whether the subscription model works on a local level across the globe.

We have over 1.400 free subscribers and over 80 paid ones. We’re growing steadily, organically, but at the current growth rate we would need a couple more years to be sustainable, by reaching around 5.000 subscribers.

Would you be able to build your publication to its current status in a year without the funding? 

The short answer is no. Even before the Substack Local program, I had been thinking about starting a local newsletter as a side project but there was just no bandwidth or resources to get it going while working full-time as a newsletter editor and local reporter. 

Do you think all local media is destined to get that boost in funding in order to turn things around?

I think the local media business model is broken and the basic dynamic of supply and demand will not work in every community.  If we truly believe that local news is a public good, then we need different ways to support it, whether that means government subsidies, grants from local philanthropists or big platforms.

Under a recent interview with Tony Mecia, who launched the Charlotte Observer, another Substack-based publication, you agreed in the comment section with a fellow grantee that publications that “put the greatest focus on the business side as well as the editorial side” did better than the other ones. What does it mean for you, your business? Were you able to hire staff, and invest in projects that you wouldn’t try otherwise?

For us, focusing on the business side meant building our publication just as you would any other startup, working from a “jobs to be done” framework and applying the user needs model to the local audience.

I’ve also had the chance to develop my media business skills through the Entrepreneurial Journalism Creators Program at CUNY (through a Substack scholarship), which opened my eyes to the importance of product thinking in news. 

We’re on a constant feedback loop with our subscribers, relentlessly focused on helping them explore and know what’s going on around the city. 

I’ve been part of newsrooms which functioned more on an „if you build it they will come” model but there is always the risk of being self-serving and not actually solving people’s problems.

Recently, Substack told me they are not planning anytime soon to add language mutations, the platform will remain in English. How much does this affect how you grow your publication?

Our audience skews younger, higher education, higher income, which means the language barrier is lower but having the buttons and menu in Romanian would definitely help with reaching more people over 50, who might not be fluent in English. 

What is your current publishing model (weekly, daily, a few times a week)?

We publish a weekly briefing on Friday morning and an in-depth feature story or interview every other Tuesday. 

Is there anything you thought would take longer and took shorter, and other things you thought might take shorter and took longer?

The biggest revelation for me was how difficult it is to recruit talent even in a mid-sized university city with a [journalism school]. Local journalism is no longer a viable career option even for most J-school graduates I’ve talked to, who move on to communication jobs in IT multinationals or completely switch industries. 

On a brighter note, I’ve been humbled by the fact that over 5% of our audience pays us just to support our mission of doing high-quality local journalism. We were also thrilled to be nominated in the local media category of the biggest awards ceremony for independent journalism in Romania.

Do you do any advertising? Have you thought about native advertising?

Our contract with Substack does not allow advertising of any kind in the first year but we always felt we’re leaving money on the table by not monetising the 94% of our audience which does not pay a subscription.

So going into the second year, as we’re no longer bound to the subscription-only model, establishing partnerships with local businesses is vital for the sustainability of our publication.

What about a podcast? I haven’t seen one on your website.

Even in my city in eastern Romania we have quite a few interview-style podcasts. So I think the way to serve our community would be through a narrative nonfiction podcast. But that requires particular skills and resources. As we’re working on a tight budget, we’re always wary of spreading ourselves too thin. 

What would it take for you to switch to another platform than Substack in the future?

I’d stick with Substack because the benefits of their ecosystem (saved email addresses/credit cards, recommendations) offset the lack of multiple language support.

But my biggest frustration with Substack is the lack of a referral program.

The recommendations are actually less effective for a local newsletter. We send more subscribers to national Substacks in Romania 10x our size than we receive from them.

After the grant money runs out and as you don’t have yet enough paid subscribers, how are you going to sustain the publication?

Well, this is what keeps me up at night. The plan is to introduce native advertising in autumn and partner with local businesses who understand the value of a loyal, albeit smaller, audience. But we’re fighting to keep the lights on in 2023, definitely. Sure, [we are considering applying for] grants as well.

Have you had any offers from national publications for acquisition? Would you go for it?

No offers since we’re not really on the market. It’s not my preferred scenario, but I am not dismissing it if that is what it would take for us to keep serving the local community.

Photo by Oleg Laptev on Unsplash

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