We show you the money!

The Agenda celebrates its second anniversary by bringing the receipts

Since we first launched the Arizona Agenda almost two(!) years ago, we’ve been radically transparent about our finances.

We do that for a few reasons. First and foremost, we believe it’s the right way to run this business. We demand transparency from politicians, government and even private companies working for the public. And since we’re all up in everyone else’s business, it’s only fair that everyone else has a chance to be all up in our business (to a reasonable degree). It hasn’t always been comfortable sharing. 

But also, we’re among the first class of local newspaper reporters who made the jump to Substack, and we believe that detailing our experience can help other writers and reporters decide whether going independent is right for them.

And finally, it’s simply good business. We get an amazing response every time we show you our numbers. Some people are so impressed with how much we’ve grown the Agenda that they want to be a part of it by becoming paid subscribers. Other people are so dismayed by how little we’re earning that they decide to help us out by becoming paid subscribers. 

Whatever gets you there is cool with us! 

So today, we’re once again detailing exactly how much we’ve earned, and how we’ve done it, as we approach our second anniversary. 

But first, it’s almost our birthday! We’re having a big bash in Tucson on Sunday, August 27, to celebrate two years of fun and the successful launch of the Tucson Agenda. More details are below or click the banner.

IN CASE YOU MISSED IT

A quick refresher if you’re new here: Hank Stephenson and Rachel Leingang started the Arizona Agenda two years ago after being selected among a dozen proposals worldwide for an advance from Substack as part of its experiment in local news. The advance meant Substack took 85% of our revenue for the first year, but we had a guaranteed $100,000 and a few other perks, like healthcare stipends, that expired after the first year. Now we operate under Substack’s standard terms, which means we pay 10% of gross subscription revenue to use the platform. 

We left our jobs at local corporate newspapers to try something fun and different — to build a political publication we’d actually want to read ourselves. But we didn’t really expect the Agenda to succeed, or at least we didn’t expect it to succeed financially quickly enough to support us both. 

But here we are. It has been a lot of work, but we’re staring down our third year with a budget large enough for two humble reporters and a cast of freelancers, editors and other helpers who make this business possible. 

We’re sustainable. And we’re growing.

We’ve branched out into southern Arizona, where two of the best reporters in town — Caitlin Schmidt and Curt Prendergast — are crafting their own Agenda, the Tucson Agenda. The Tucson Agenda is a separate, employee-owned sister company of the Arizona Agenda that launched last month and has already earned support from about a quarter of the readers it would need to be sustainable long term.  

We’ve spent the last six months planning big moves for 2024 and beyond. We have a lot of exciting updates scheduled this month as Hank takes some vacation time and Rachel finishes maternity leave and figures out what comes next. Stay tuned!

For today, we want to focus on our subscription revenue numbers and our expenses, and how we’re growing new revenue streams to ensure the Agenda can become bigger and better than ever. 

SUBSCRIPTION REVENUE 

Projecting revenue on Substack is harder than you’d imagine, but luckily Reid DeRamus was kind enough to help us figure it out. Reid used to be a subscription guru for Hulu and Crunchyroll, then became a newsletter consultant, and then he got hired by Substack. If you’re a Substacker or have any subscription-based business, his newsletter, Growth Croissant, is a must-read. 

The takeaway from his subscription forecasting model is he expected us to earn about $135,000 from subscription revenue in our second year of business. But we’re happy to say his projections were a little low. Here is an overview of our real numbers in the last year. 

In nearly every single month, we've beat the projections. And in most months, we've beat our growth goals¹, sometimes wildly. 

And those numbers never really go down — at least not yet. March, for example, was a terrible month for us (we were both sick), but we didn't lose money over the previous March. We just didn't grow much.

So far, the growth has been incredibly consistent. It won't last forever. But given that we’re heading into a presidential election cycle where all eyes will be on Arizona, we’re pretty confident we can keep up this trajectory through 2024. 

Even assuming we keep the exact number of subscribers that we have today, the Agenda would bring in about $175,000 in subscription revenue in the next 12 months.

Not bad for a tiny newsroom that started two years ago with a small advance and a dream to make politics and government understandable (and dare we say entertaining?) in this weird state. 

OTHER INDICATORS 

Our rate of free/paid subscribers is still above 20%, which is amazing, especially considering we don’t employ a paywall. 

You may remember our brief experiment in paywalls. While in theory locking down our content makes a lot of sense, it actually hurts our growth. We noticed a significant drop in new free subscribers when we put up a paywall. We get very few subscribers who sign up as paid on day one. Instead, we see people sign up for free, then upgrade to paid a few weeks or months later.

The real trick to making this work, at least as far as we’ve discovered, is getting readers hooked for free, then convincing them that the Agenda is worth their hard-earned dollars.

The best way we’ve found is setting realistic goals and communicating them. 

For the last four months, we’ve picked monthly goals, like 40 new paid subscribers, and kept you updated on how it’s going. Sometimes it’s slow for a few weeks, but as the deadline approaches, people really want to help us hit that goal. People are cool like that. We’ve hit our goal every month we’ve done that. The emoji counter seems to help.

And our strong free/paid ratio tells us two other important things: People find immense value for the price, and we haven’t yet saturated our potential market. Our growth trajectory could probably even be pointed up by a few degrees by spending more than the $0 we’ve spent so far on marketing the Agenda.  

So, how much room for growth do we have? We believe that there are at least 100,000 Arizonans who would read the Agenda if they knew about it. Unfortunately, we don’t have millions to pump into an advertising and marketing budget, so we probably won’t cross that six-figure subscriber number anytime soon. But even if we could double our overall readership, we could hire two new reporters to expand our coverage.

We count on organic growth through word-of-mouth from our readers. We know there are a lot of people out there who want a sharp morning read to keep them up to date on Arizona politics and government. We just have to find them.

You might even know a few…  

On that note, if you can help us find subscribers, we’ll send you cool Agenda merch, like mugs, tote bags and shirts. It’s easy — just click the button and send the link to your friends!

When we dropped down to three days per week this summer after Rachel went on maternity leave, we were worried it would hinder our growth and current readers would cancel. But paid subscribers are incredibly understanding when we slow down or take time off. Thank you! And we’ve still been finding new readers at a steady clip through the slow season. 

Our churn rate — the rate at which people unsubscribe — is below average for our peer groups. We have to reach a certain level of growth just to outrun unsubscriptions, but it’s not very high. Once you sign up, most of you stick around. So thanks for that, too! 

We understand you have to make tough decisions about where to spend your money, and we appreciate your support, even if it’s for a limited time. 

That said, the top reason we lose subscribers is because credit cards expire.

So please double-check that you have your current card on file with Substack before your subscription renews!

EXPENSES

Our major expenses are our people. 

Besides our own salaries, which we kept at about $50,000 each last year, we have hired a few people to help out. 

BC Creative is a virtual assistant and project management firm that somehow does more in an hour than we can do in a day. They’ve carved out something of a niche with Substacks, so their knowledge is incredibly useful. And without their organizational skills, the Tucson Agenda would still be in the “coming soon” phase, rather than ahead of our expectations on the path to sustainability. If you need help managing your business, your project or just your inbox, we highly suggest you hit them up. 

We also struck up a contract with our former colleague Tracy Townsend to put her keen eyes on our emails before we send them to you. She’s been an incredible help while Rachel has been gone and has saved Hank from at least one embarrassing mistake per edition. If you’re spotting fewer typos these days, that’s all Tracy’s doing. 

And we’ve hired a bunch of great freelance reporters, contributors and photographers in the last year to help us tell the stories that matter to you. We pay them above-average rates because that’s the kind of company we want to be. 

The minor expenses like gas, subscriptions, web hosting, the Capitol office, etc., come out to less than $500 per month. We have a few larger annual or emergency expenses. Buying a new computer is a huge expense for a small company! But mostly, your subscription goes directly into essential workers: reporters, freelancers, copy editors, and business administrators. 

That means your subscription pays for journalism, not for some stockholder’s quarterly dividends or some CEO’s golden parachute. Isn’t that refreshing?

PRICE INCREASE

This is where we tell you the bad news: We're raising our prices on some existing customers. Not yet, but soon. 

When we started the Agenda two years ago, we charged just $70 per year or $7 per month. We lowballed the price in part because we didn’t know our value or how much people would pay. But journalism costs money! We need to charge a rate that reflects our value and keeps us sustainable.

Since 2021, we’ve increased our price on new subscribers a few times, first to $80, then $100 annually. Then finally, after surveying readers to see how much you think the Agenda is worth, we set our price at $120 or $12 per month. We don't expect it to go up anytime soon.

But now we’ve got people paying anywhere between $70 per year and $144 per year, depending on when they subscribed during that first year. If all of our paid subscribers paid full fare, it would nearly pay another reporter’s salary. 

But we know that going from $7 or $8 to $12 per month is a big jump. Unfortunately, Substack doesn’t allow us to simply raise each tier by a small amount, as we originally hoped. If we want to raise prices on existing customers, we have to go to the full, current price of $120 annually or $12 per month. We’re still trying to find a workaround. 

We’ll send you several notices before we do anything. We don’t want to surprise you. And we’ll do what we can to limit the price increase to $2 per month or $20 per year, no matter what you’re paying now. We’re working with Substack to try to figure something out that doesn’t require such a drastic jump.

But if you’d like to opt in on our current price of $12 or $120 when your subscription renews to help us gear up for 2024, click the button below. We’ll send you some Arizona Agenda and Tucson Agenda stickers as a thank-you to all of you who volunteer. 

We agonized over this price increase for months. Hank has at least four different spreadsheets attempting to game out how much additional revenue it’ll bring in versus how much we’ll lose because people don’t want to pay more.

But we don’t want to lose anyone because they can’t afford the Agenda. If you truly can’t afford a subscription, just send us an email. We appreciate your support immensely, and we’ll work with your budget.

NEW REVENUE STREAMS

So far, we’ve only focused on one revenue source: subscriptions. Now that subscriptions are at a healthy level, we're developing other revenue streams so we can continue to grow and better serve our readers. 

For starters, the Agenda recently secured a $20,000 grant from Lion and the Google News Initiative.² The grant also included the opportunity for a "sustainability audit," which reviewed a bunch of our documents and interviewed us and will deliver a report on how we could do better. So that's cool!

There aren’t many grants available to for-profit newsrooms, so we’re working on developing a nonprofit wing, which will allow us to take advantage of many of the opportunities available to nonprofit newsrooms without giving up the freedom and ownership that we enjoy now. 

The Agenda is a worker-owned newsroom and we intend to keep it that way. As we grow, new reporters will share in the benefits of ownership, and the profits, of this company.

We don’t want to pay ourselves outrageous salaries. We want to build something sustainable for a better Arizona and a better journalism industry.

In order to grow and bring in more people, we need to diversify our revenue sources. 

So we’re going to start offering advertising opportunities to local organizations, businesses and nonprofits. 

We’re only going to offer ads on the version of the email sent to free subscribers. Those of you who pay for your subscription won’t see them.

If you don’t want to see them, there’s a simple solution.

We’ll limit them to classy banners with a short message, like Politico’s Playbook and many other great newsletters. We’re also setting up guardrails so that we don’t have to be involved in soliciting advertisers directly or selling ads. Aside from the fact that we’re not good at sales, newspapers have a wall between editorial and advertising for a good reason. We will reserve the right to refuse to sell ads if we don’t feel good about who’s buying them.

Honestly, we don’t love the idea of selling ads. (However, we do love our future sponsors. Thanks for your support!) But ads will pay for more journalism. 

Simply put, we’re building the Agenda into something bigger than a newsletter — an employee-owned statewide newsroom that serves its readers first and keeps great reporters from leaving journalism, as too many of our friends have, by giving them a chance to control their own fate. 

To do that, we need to invest in our people and our business. Ads will help us get there.

If you’re interested in partnering with us to build awareness for your business, nonprofit, organization or event, click the button. Or reach out to info@arizonaagenda.com. Our friends at BC Creative will get you on the schedule. 

Finally, we're going to start doing more live and online events — beginning with our 2nd Birthday Party!

Our ads will look like this, with your organization’s logo and message, plus a caption and a link embedded in the banner. Click the image to buy your tickets!

This year, we’re celebrating in Tucson, where we rented out The Loft Cinema, the iconic local theater from 3-5 p.m. on Sunday, August 27. We talked legendary cartoonist (and Substacker) David Fitzsimmons into emceeing. We’re gonna swap stories and Fitz is going to do some live cartooning of a few lucky guests.

We’re in the smaller, more intimate, theater, so buy your ticket early before they run out! It’ll be a blast for a good cause: Celebrating the Arizona Agenda’s birthday and the successful launch of the Tucson Agenda. 

We’re also working on a cool webinar series for 2024 that will offer deep dives on topics that concerned citizens need to understand. We’ll fill you in more on that and all our other big plans for 2024 soon. 

We’ve said it so many times that it probably sounds trite, but it’s the truth: You all are the best bosses we’ve ever had.

Your input, support, patience and accountability have made the Agenda a success. We wouldn’t be here without you, and we hope you’ll stick around to see what’s coming next!

1. Admittedly, we just kind of made up those goals before seeing the projections.

2. Don’t jinx us. The check hasn’t arrived yet.