With an expansion on the way, Ken Doctor’s Lookout thinks it has some answers to the local news crisis
It’s been a big year for Lookout, the local news company founded by longtime Nieman Lab columnist and news industry analyst Ken Doctor. In May, its first newsroom, Lookout Santa Cruz on the California coast, won an obscure little bauble called the Pulitzer Prize in Breaking News Reporting. (“For its detailed and nimble community-focused coverage, over a holiday weekend, of catastrophic flooding and mudslides that displaced thousands of residents and destroyed more than 1,000 homes and businesses.”) And last week, Lookout announced it was ready to launch a second newsroom, Lookout Eugene-Springfield, on the banks of the Willamette River in Oregon. Editorial excellence and financial growth — not the most common combination in 2024 local news!
Unless you live in Santa Cruz (or root for the Banana Slugs from a distance), you likely haven’t paid too much attention to what Ken and his colleagues have built — a digital-only news organization whose editorial resources outgun the local newspaper. The Lookout model isn’t to supplement to the hometown daily, to be a second read for the most engaged — it’s to supplant it as the biggest news source in town. And by some measures, Lookout Santa Cruz has done just that. (It has 10 full-time newsroom staffers; the Santa Cruz Sentinel, owned by the vulturous hedge fund Alden Global Capital, lists 7.)
Yes, there are a few other digital news companies that can claim to be the news leader in their communities. But what’s exciting about Lookout is its ambition to repeat its Santa Cruz success in other markets. There are so many American cities whose once-respectable daily newspapers have been hollowed out by plundering chains. If Lookout succeeds, it’ll have created a model that can help fill those voids at scale.
For Eugene-Springfield, Lookout is hiring a 20-person staff, 15 in the newsroom. (Are you, Nieman Lab reader, the perfect candidate to be executive editor or publisher? Ken wants to hear from you.) That’s the sort of journalistic heft you don’t see often for a digital news site in a smallish (pop. 380,000) metro area. And the company has committed to launching at least three more Lookout cities by the end of 2026.
Four years ago, I spoke with Ken shortly before the Santa Cruz launch, and this expansion seemed like a good occasion to check back in. We talked about the lessons he’s learned, the new revenue streams he’s aiming for, and who he sees as Lookout’s peers around the country. Our conversation, lightly edited, is below; I started by asking Ken about his long-ago connection to Oregon, where he edited and published the alt-weekly Willamette Valley Observer in the 1970s.
We do have other revenue streams — from platforms, especially with the California settlement going through now, and Google Showcase. We have a Lookout in the Classroom program we’ve gotten philanthropic support for. We’re about to launch an individual donation program through the Local Media Association. And then Oregon has digital public notices, which we’re interested in. We’re going to try to break a code on obits somehow, to get a significant revenue stream from obits. So there are a lot of other possibilities out there, but the basic blocking-and-tackling is still advertising and reader revenue.
I think philosophically, we’re very similar — but we’re rigorously digital to make the economics work. Our technology costs are 10% or less of everything we do. 75% of our costs are salaries, and a majority of that goes to journalists. I remember when I wrote for the Lab [back in 2013] that the average daily was only spending about 12.5 percent of its total expenses on the newsroom, much less than it spent on paper and ink. Our model flips that. So we’re a digital disruptor.
We’re not going in and competing with anybody who is mission-oriented. But there are plenty of communities, like Eugene, that have these tired, fatigued dailies that have been bled dry — and with our model, on a relatively small amount of capital, you can go there and succeed, because it’s not really expensive to do.