Seven Ways the Industry Is Trying to Close the Local News Gap
More than 300 digital news startups have opened in the past five years. The problem is where all of it is landing.
This newsletter is free and will stay free. If it’s useful to you, a paid subscription is the best way to keep it going. —Luis G.
The Chesterton Tribune covered a small Indiana city since 1884 — more than 140 years of town council votes, school board decisions, and community accountability that no other outlet in Porter County was providing. Then, the newspaper published its final edition in January 2025.
What replaced it under the Tribune’s name was a community-run online platform, described by its administrator as “a free community-powered news hub where residents can share updates, stay informed, and connect locally” — a resident-sourced aggregator with no reporters, no editorial staff, and no capacity to cover local government.
Chesterton still has something called the Chesterton Tribune, without the reporter who used to sit in the back of the school board meeting. But what happened in Chesterton is happening everywhere, and the industry-wide collapse of local news is something this newsletter has covered from various angles.
By the end of 2025, 136 newspapers had closed in the previous year alone, bringing total losses since 2005 to nearly 3,500 papers and more than 270,000 newspaper jobs. It is no coincidence that some 50 million Americans now live in places with limited or no reliable access to local news.
What’s shifted is who is closing. For years the story was about large chains gutting properties. But between 2024 and 2025, the majority of closures came from smaller, independently owned papers that were family-run operations with deep community roots and no corporate owner to absorb the losses.
And while this might signal an existential crisis for local news, something has emerged to fill the gap. Medill counted more than 300 digital news startups that opened in the past five years — genuine momentum, backed by philanthropic coalitions committing hundreds of millions of dollars, reporter placement programs, newsletter franchises, university partnerships, and state legislation. The problem is where all of it is landing.
Nearly all of those startups are in cities and suburbs, where capital and audiences already exist. Rural and lower-income communities — where closures are hitting hardest — are getting little of it.
Map out any model the industry is employing and you’ll find that they cluster where the conditions for those models already exist; it’s happening where foundations already operate, where wealthy donors already live, or where an anchor newsroom already exists. The communities most hollowed out by the local news collapse are, with striking consistency, the ones least served by what’s supposed to replace it.
None of that changes what’s happening on the ground. Journalists and organizations who couldn’t wait for someone else to fix it are building anyway — through franchises, nonprofits, solo newsletters, community newsrooms, and funding approaches the industry hadn’t tried before. What follows is an account of those models, evaluated not just on what they’re doing but where they’re doing it, and whether any of it can be sustained and replicated elsewhere.
The corporate newsletter franchise on stilts
Axios Local is the most watched experiment in for-profit local news right now because it now operates in 35 cities with more than two million free subscribers and more than 100 reporters, with plans to reach 43 cities by the end of the year (with a caveat). It’s free to readers, ad-supported, with an optional paid membership tier that has more than doubled to 15,000 paying members since late 2025. And while those are real numbers, they haven’t yet added up to a profit since its 2021 launch.
But for all that Axios Local is doing to fill news coverage gaps left behind by shuttered newspapers, the profitability question is not a small footnote. Axios hasn’t opened its financials to outside scrutiny — the company is privately held and hasn’t disclosed whether Axios Local turns a profit overall or market by market. What has been reported is that the business missed its own revenue targets in 2022, generating $8.6 million against a $10 million forecast, something that caused Axios Local to pause expansion in 2023. And as recently as this month, it still hasn’t hit profitability. Axios Local’s own general manager described expansion as the path to profitability, not proof of it.
The caveat to Axios Local’s expansion is that the current push to 43 cities is being partially underwritten from the outside. A three-year partnership with OpenAI, announced in January 2025, funded entry into four new markets: Pittsburgh, Kansas City, Boulder, and Huntsville, Alabama. It was the first time OpenAI directly funded a newsroom as part of a publisher deal. CEO Jim VandeHei has said it takes roughly three years for a new market to approach profitability — which means the OpenAI money isn’t a windfall, but rather a runway.
That partnership, however, is about more than funding.
The AI layer is central to where Axios believes the economics eventually close. As Axios COO Allison Murphy explained in a January 2025 conversation with OpenAI, the company uses AI across the entire workflow — from curation to distribution — with a custom internal tool called the “Axiomizer” that helps reporters sharpen headlines and key newsletter components.
A recent Media Copilot podcast episode goes further, with Murphy detailing how Axios has compressed social publishing from a 45-minute production task to a two-minute automated process. Two minutes: 120 seconds! The theory is that AI efficiency can eventually make a single reporter in a smaller market viable where a full editorial team isn’t.
Axios Local is still a hypothesis. It’s a well-funded, seriously staffed hypothesis — not a vanity project — but the unit economics in underserved markets have not been independently verified.
BackStory & Strategy (by Yoni Greenbaum, a subscriber of this newsletter!) drew a direct line between Axios Local’s current structure and Patch’s collapse: venture-scale corporate overhead sitting on top of local newsletter economics. The counterargument Axios is making is that AI compression will change that math. That argument is reasonable, but we have yet to see measurable results.
The philanthropy coalition with a ticking clock
Press Forward is the largest coordinated philanthropic commitment to local news in U.S. history — a coalition of 130-plus funders, including Knight, MacArthur, and dozens of community foundations, pooled behind a five-year, $500 million initiative. Its July 2025 infrastructure open call distributed $22.7 million to 22 organizations. That funding ranges from a disaster reporting playbook built on lessons from Hurricane Helene to a low-interest loan program for newsrooms that traditional lenders won’t touch. A separate $20 million coverage gap fund has reached 205 newsrooms — at least one in every state, which is a milestone worth naming directly.
The recipients show what the gaps actually look like on the ground: Hola Carolina, serving Spanish-speaking communities in Western North Carolina after Hurricane Helene; Black Iowa News, which launched during COVID to reach Black Iowans; and the Ouray County Plaindealer in Colorado, a husband-and-wife operation covering 5,000 people whose accountability reporting on the local sheriff led to a 93% recall vote.
The structural limitation of the model is built into its name. A five-year initiative is a grant cycle, not a business model. Press Forward Director Dale Anglin has said publicly that no outlet can survive on a single revenue source. That’s right; but it doesn’t resolve the question of what individual newsrooms funded through this initiative do when the initiative concludes.
As Inside Philanthropy reported, rural chapters of the coalition are forming but remain underfunded relative to urban chapters — the same geographic mismatch that appears across every model in this section.
To get a better sense of what Press Forward’s coordination infrastructure for supporting small newsrooms, I will turn your attention to BackStory & Strategy for additional context:
The newsroom superblooming in civic wealth
Nonprofit newsrooms structured as 501(c)(3)s — funded through major donors, memberships, events, and institutional grants — have become the dominant growth form in U.S. local journalism. Signal Ohio now covers Cleveland, Akron, Columbus, and Cincinnati. The Marshall Project has opened local newsrooms in Cleveland, Jackson, Mississippi, and St. Louis.
Scott Woolley, the cofounder and editor-in-chief of the Substack newsroom L.A. Reported, says that Los Angeles has experienced something he describes as a “superbloom” of newsrooms in late 2025 to early 2026 — five new local ventures launched in five months, several founded by Los Angeles Times alumni and backed by the American Journalism Project with a multi-year runway.
And while the LA superbloom is great, one cannot overlook the fact that it is also happening in one of the most media-rich, philanthropy-rich, population-dense metros in the world. The nonprofit newsroom model runs on major-donor relationships — and major donors cluster where civic wealth clusters.
Reproducing a Signal Ohio or an LA Reported in Sullivan County, New Hampshire (where the Claremont Eagle Times closed and created one of the few news deserts in New England) requires something the model currently doesn’t offer.
What the shuttered Chesterton Tribune once provided wasn't investigative reporting on state policy only. It was a reporter at a school board meeting, or one at a city council meeting, or one checking the books at the local sheriff station. That kind of coverage doesn't require a Signal Ohio — it requires someone showing up consistently, week after week, in a community small enough that no major donor has ever heard of it.
The nonprofit model has proven it can fund the long investigations, the policy beats, the accountability journalism that commercial papers abandoned first. What it hasn't proven is that it can fill the gap left by the paper that simply covered the town.
The newsrooms shared-services apparatus
One of the more quietly effective developments in local news support right now is the shared services model — one that exists with “fractional executives,” pooled legal services, shared audience development staff, and editorial partnerships between newsrooms that can’t afford full-time specialists individually.
The Local Media Association’s 2025 Impact Report documents something less visible than grant totals but more useful to a newsroom with a $400,000 budget and no HR department. Through its Knight x LMA BloomLab, LMA shifted in 2025 from training Black-owned newsrooms to providing them “fractional executive” services in technology, revenue, and fundraising. In the first few months, those shared services generated $250,000 in annual tech savings across 11 clients, delivered nearly $250,000 in incremental revenue to six others, and helped five newsrooms submit grant applications totaling more than $5.37 million.
The Family and Independent Media Sustainability (FIMS) Lab ran a parallel version of this for independent and family-owned papers — 19 companies working through strategic planning, sales training, and AI experiments, with $10,000 stipends to fund the experiments. One participant overhauled its app and generated more than $100,000 in new revenue from that work alone.
The same logic shows up in how other programs are attacking the problem. Press Forward Chicago awarded $1.5 million to 26 organizations in its second grant round — 18 receiving capacity-building grants totaling $883,059, and 11 receiving immigration journalism grants totaling $686,500. (Editorial note: Two organizations appear in both pools — Block Club Chicago and Coalition for a Better Chinese American Community/Lumpen Radio — which is why the total recipient count is 26 rather than 29.)
The award included a grant to Chicago Public Media to build an immigration reporting hub connecting WBEZ, the Chicago Sun-Times, La Voz Chicago, and other newsrooms — giving smaller outlets access to editorial and distribution infrastructure they couldn’t build independently.
The AP Fund for Journalism, backed by more than $30 million including a $25 million Knight Foundation commitment, takes a different approach. It puts AP content, photos, and video into under-resourced newsrooms that couldn’t afford a subscription on their own; and it has 100 additional newsrooms targeted for 2026 and 300 by 2028, building on a pilot that has already reached nearly 50 organizations.
What ties these together is a belief that shared infrastructure — shared executives, shared wire access, shared reporting capacity — can make small newsrooms function at a scale their budgets wouldn’t otherwise allow. Whether it holds outside of cities with established philanthropic ecosystems is the question none of these programs has fully answered yet.
The ceiling of this model is visible in its design — shared services help newsrooms that already exist. They do not create coverage in communities with no newsroom at all. In metro markets with multiple outlets, the efficiency gains from collaboration are real. In true news deserts, where the last outlet closed and nothing replaced it, there is no anchor organization to share services with. The model assumes a baseline that doesn’t exist in the hardest geographies.
Report for America and the scale-versus-need gap
Report for America is the most geographically intentional model in this section.
The program places emerging journalists in local newsrooms across the country, prioritizing underserved markets, with costs shared between the host newsroom, the community, and RFA’s national fund. The 2026 cohort will bring the total active corps to more than 200 journalists in newsrooms by July. By that point, the program will have placed more than 850 journalists in 465 newsrooms across all 50 states, Puerto Rico, Washington D.C., and Guam, and helped newsroom partners raise more than $60 million in local donations.
The 2026 cohort leans toward the places where coverage is thinnest — more than half (54%) of corps members will cover rural communities, local government, or the environment. Nearly half (49%) of incoming host newsrooms are small outlets with nine or fewer editorial staff, where a single reporter can change the volume and depth of what a community knows about itself. RFA is also expanding investigative capacity, supporting 48 local investigations at partner newsrooms over three years, backed by Arnold Ventures and the Jonathan Logan Family Foundation.
The arithmetic is the problem. Two hundred reporters nationally, set against 136 newspaper closures per year and a map of news deserts spanning several thousand communities, falls well short of the need. And the model has a hard floor — RFA requires a host newsroom. It cannot place a reporter where no outlet exists.
The program has widened its definition of eligible hosts, and a pilot accelerator is helping some newsrooms build sustainable business models through local philanthropy, but the dependency on an existing partner organization remains. That condition is absent in many of the communities that need coverage most.
El Tímpano’s civic partnership model and the question of replication
The most financially innovative development in local news right now didn’t come from a corporate newsletter franchise or a national philanthropy initiative. It came from El Tímpano, a Bay Area civic media organization serving Latino and Mayan immigrants.
And this month, it released its Civic Partnerships Playbook — a free guide for newsrooms looking to generate revenue through contracts with government agencies and nonprofits that need to reach communities they’ve historically been unable to.
And it has the proof that it works. El Tímpano generated $350,000 through civic partnerships in 2025, working with public health departments, school districts, transit agencies, and nonprofits across the Bay Area. It’s now the organization’s second-largest revenue stream. Made possible by a Knight Foundation grant, the playbook walks newsroom leaders through building a civic partnerships program from scratch — how to price it, vet partners, protect editorial independence, and build the audience trust that makes the model work.
El Tímpano founder Madeleine Bair made the case that this path is replicable for community newsrooms serving low-income populations, and challenges journalism funders to invest in outlets they’ve historically overlooked.
The revenue logic here runs opposite to advertising where advertisers pay to reach consumers with money to spend. El Tímpano’s partners — the Oakland Unified School District, the Alameda County Public Health Department, transit agencies, local nonprofits — pay for something different. They need to reach communities that have historically been unreachable through conventional channels. Language barriers, distrust of institutions, and the absence of culturally relevant media mean those communities don’t respond to standard outreach.
El Tímpano spent years building the relationships and language capacity that changed that equation. As Bair wrote, advertisers paid for reach and affluence; civic partners pay for depth of trust. The organization went from $12,000 in civic partnership revenue in 2020 to $350,000 in 2025, growing from one full-time employee to a staff of 15 over that same period.
What makes the Playbook’s release notable is that El Tímpano is giving it away. The guide is free. The organization is running webinars and working with a cohort of other newsrooms, starting with the Immigrant News Coalition — a peer network of four outlets including Documented, Conecta Arizona, Sahan Journal, and El Tímpano — to help other newsrooms adopt the model. The model addresses a gap that advertising and membership strategies were never equipped to fill for outlets serving low-income and immigrant communities.
The civic partnerships model is the most transferable funding approach to come out of local news in years — but Bair does not oversell it. In her own words: “El Tímpano’s model required years of relationship-building and — critically — runway. We would not exist today without a small number of early funders who took a risk on us because we were meeting a community need.” That’s an important distinction. A newsroom in a rural market with no existing community trust, no early-stage capital, and no institutional relationships cannot execute this playbook on day one.
The urgency behind releasing it now is grounded in the numbers. More than 150 ethnic media outlets have closed since 2020, according to the Immigrant News Coalition — the outlets already serving communities no other model reaches. The INC received a three-year, $1.5 million grant from Press Forward to test and share revenue strategies, plus a separate $350,000 two-year grant from Democracy Fund. Both are real investments in a problem that, by the coalition’s own count, has already cost 150 newsrooms and counting.
Patch, AI and the difference between reach and journalism
Patch’s AI newsletter product — PatchAM — has been running in 14,000 communities with nearly a million subscribers. The newsletters pull headlines from local news sites, social media groups, and town websites, then use language models to draft summaries and select relevant stories.
Patch CEO Warren St. John said the company seeks to solve for “some component of the riddle of how to make this sustainable” — which explains why PatchAM exists but doesn’t resolve the question of what communities get when the outlets it aggregates from disappear.
The geography of PatchAM’s reach is worth examining. Of the more than 11,000 Patch sites that Medill tracked, only 535 offer original local reporting — the rest are PatchAM aggregation newsletters. And while PatchAM does run in some genuinely underserved places — Mountain Home, Arkansas; Chatsworth, Georgia; small Illinois suburbs that lost their papers years ago — the same Medill data shows that less than 10% of digital-only news outlets nationally are in counties the USDA classifies as rural, and that the counties where digital news has taken hold tend to be more affluent and more educated than the counties classified as news deserts. PatchAM operates at the edges of that pattern; it’s present in some of those communities, but pulling from a shrinking pool of source outlets whose own survival it does nothing to address.
Aggregating existing coverage is a useful service. It is not the same as producing original reporting. A Patch newsletter does not put a reporter at a school board meeting. It does not surface a water authority’s billing discrepancy. It does not build the source relationships that produce the story no one else was going to find.
In markets where original reporting is already gone, what Patch delivers is a digest built largely on journalism produced by someone else — often by the same outlets that are themselves shrinking. The reach is real. The question is what fills it when those source outlets disappear too.
Taxpayer subsidies for journalism enters the fray
State-level legislation to support local newsrooms has gone from a fringe idea to a policy category in the span of a few years. According to Rebuild Local News’s inaugural annual report, policies already on the books are on track to deliver approximately $74 million to local newsrooms in 2026 — more than double what state governments delivered in 2025 — with more than 15 states working on new proposals. Six states have passed laws since 2020 channeling more than $129 million in public support to local reporters.
Illinois launched the country’s first refundable journalist employment tax credit and in its first year awarded more than $4 million to support 260 journalist jobs across 120 local outlets. The majority of funds went to newsrooms outside Chicago, roughly a third to nonprofit outlets, and two-thirds of recipients were news organizations with six or fewer journalists. California added $15 million for its Local News Fellowship at UC Berkeley, extending the program through 2028 and supporting 35 to 40 two-year reporting fellows and 10 one-year editing fellows.
Its 2026 State Policy Playbook identifies four approaches gaining ground nationally: employment subsidies, small-business advertising incentives, state journalism fellowships, and government advertising set-asides. Rebuild Local News president Steven Waldman estimates that state policy will deliver more to newsrooms in 2026 than in any prior year — which matters more now given that federal support for public media has been effectively eliminated.
The California picture complicates the optimism, however. A partnership with Google, initially framed as a nearly $250 million, five-year commitment, had produced just $20 million in new money by early 2026 — and as Poynter reported, not a single newsroom had seen a dollar of it yet, with no guarantee the funding would continue.
Illinois is working. That’s one state. Getting to 50 requires winning legislative fights in places where the politics run the other direction. State funding is a real and growing contribution to local news. It is not, on its own, a solution to a problem that exists in every state.
My two cents on what has potential
The seven models in this edition have something in common beyond intent. They work better where conditions already favor them.
Axios Local works in cities with advertising markets. Press Forward works where foundations already operate. Nonprofit newsrooms work where major donors live. Report for America works where a host newsroom still exists. Shared services work where multiple outlets can pool resources. State legislation works where legislatures are willing. Even El Tímpano’s civic partnership model works where years of community relationships have already been built.
That’s not a criticism of any of them. I’d say it’s a description of what they leave unaddressed.
The communities most likely to benefit from what’s being built are, with few exceptions, not the ones that need it most. Don’t get me wrong — the Ouray County Plaindealer and Hola Carolina receiving Press Forward grants are real progress. Funding a husband-and-wife newsroom in rural Colorado also matters. But 136 papers closed last year. One in every state isn’t the same thing as one in every county that lost its paper.
Of the models I highlighted in this edition, I think El Tímpano’s civic partnership approach has the most realistic path to broader adoption because it addresses something the other models mostly gloss over. Government agencies and nonprofits in every state need to reach communities they currently can’t. That gap exists in rural markets, in tribal communities, in immigrant neighborhoods far outside the Bay Area. And El Tímpano’s playbook lowers the cost of testing whether the model actually works. Someone has to try.
State legislation is the second candidate with real national potential. The 13-to-1 return Rebuild Local News cites from philanthropic investment in policy advocacy is the most capital-efficient figure in this entire edition. A refundable employment tax credit doesn’t require a new outlet to exist — it keeps the ones barely surviving in the field. Illinois worked. New Mexico is moving. If that becomes a pattern, it’s the closest thing this edition documents to a fix that could actually make a difference.
Everything else is filling the gap on fertile ground where the conditions allow. That’s worth doing. It’s not the same thing as solving the problem that started in Chesterton.