OMG: Canada's Solution to the Local News Crisis

The Challenges Facing Local News

Over the last twenty years, local news organizations have faced significant difficulties. The emergence of the internet disrupted the traditional dominance of newspapers and local television in both news dissemination and classified advertising. Simultaneously, platforms such as Facebook, Nextdoor, and Citizen have captured a growing share of public attention for local updates.

Consequently, numerous newspapers have ceased publication, and the number of journalists has drastically declined. This has led to the proliferation of “news deserts”—areas with virtually no local news coverage.

A New Era for Online Media

However, a significant shift is currently occurring within the online media landscape. The convergence of audience development, community engagement, and subscription models presents a potentially opportune moment for the revitalization of local journalism.

The question remains: will these innovative tools and strategies ultimately enable the reconstruction of local journalism following a period of decline?

Overstory Media Group's Approach

Overstory Media Group (OMG) firmly believes that advancements in software and business models can fundamentally alter the landscape for local news.

Co-founded and spearheaded by Farhan Mohamed, formerly the editor-in-chief of the Canadian news website Daily Hive, the company currently operates ten local news brands and employs thirty full-time staff members.

Their aim is to establish a sustainable, and potentially profitable, model for local media.

The Genesis of the Idea

“I started my own email newsletter as a child,” Mohamed recalls. “I recognized a void: no one was informing me about events in my immediate surroundings.”

Initially, he distributed the newsletter via Hotmail, eventually transitioning to more contemporary tools for local journalism. His observations were concerning; he found that the “user experience was poor, and the quality of stories was lacking… I struggled to understand how the average person could navigate this,” he stated.

Focusing on Community

Mohamed identified an opportunity to rebuild from the ground up, prioritizing the fundamental role of local news within its community.

“My background is in community building, not solely news and journalism,” he explained. He envisioned a model leveraging modern internet technologies to empower readers to become stakeholders in these news operations.

Collaboration and Growth

He eventually connected with Andrew Wilkinson, the founder of Tiny Capital, a fund specializing in acquiring and scaling small internet businesses while facilitating exits for their original founders.

Wilkinson had previously launched Capital Daily, a newsletter-based publication covering developments in Victoria, British Columbia. The publication rapidly amassed tens of thousands of subscribers, despite serving a region with a population of only a few hundred thousand.

Scaling the Capital Daily Model

Mohamed and Wilkinson joined forces to establish OMG and begin scaling the Capital Daily model to additional publications.

They developed a technology infrastructure centered around Pico, which recently secured a $6.5 million seed funding round, and also created growth and branding strategies for launching new brands.

Achieving Sustainability

The objective with each new brand is to reach profitability as quickly as possible.

“We have projections outlining the timeframe for achieving sustainability for each brand, and we continually refine this model with each new launch,” Mohamed said. “Our goal is to achieve sustainability within ten months, or even nine.”

His ambition extends to expanding to 50 brands and employing 250 journalists by 2023, with a potential for reaching 100 brands.

Adaptability and Flexibility

While the company utilizes established “playbooks,” it acknowledges that each brand will have unique characteristics.

There is a foundational structure for building each brand and determining the frequency of new content, but the company remains adaptable to the specific needs of each new audience.

Supporting Journalists

For journalists, the company emphasizes stability and a focus on growth.

“You maintain editorial control and focus on what’s necessary,” he said. “We can provide assistance… we understand what strategies will be effective” in building community and implementing growth marketing initiatives.

A particularly valuable aspect for journalists is the network of other reporters facing similar challenges as they expand their communities and subscriber bases.

Expanding Beyond Canada

Although the company has focused exclusively on Canadian brands thus far, covering cities like Vancouver, Victoria, Fraser Valley, and Calgary, it also envisions opportunities to replicate its model internationally.

“We’ve engaged in discussions with individuals in the United States, Southeast Asia, and Europe,” Mohamed stated.

A Potential Turning Point

Given the history of unsuccessful ventures and optimistic forecasts in local news, a degree of skepticism is understandable.

However, OMG possesses a certain dynamism that suggests this time might be different.

Update

Updated May 20, 2021: The Daily Hive now covers Canadian national news, not solely Vancouver-specific news.