Republik set crowdfunding records. Then reality hit.

Republik, a Swiss news startup, raised $2.4 million in less than two weeks in 2017, when a crowdfunding campaign that promised a new kind of journalism took off and set records.

A year after its launch, its de facto publisher, Christof Moser, looks slightly more gaunt and tired than he once did when the digital magazine first went online. He sits on the edge of his chair when talking about the project he has lived, slept, and dreamt about since he and nine other founders hacked the Swiss journalism world with their start-up.

“There were some fuck-ups of course, but on the whole, we are on a good course,” he says, with what might be described as Swiss understatement. In the past year, the digital magazine ramped up from 10 to 50 employees. Spending, by its own admission, got a bit out of control. Even with an additional $3.5 million contribution from investors, the magazine was over-budget. It has spent more than $6.5 million since its inception.  

And this month marked a key moment for Republik, one of a number of sites around the world  aiming to find new ways to fund and run journalism: its initial backers will have to renew their subscriptions, and pay again.

Republik aims to attain something of a holy grail for subscription-based publications—to retain two-thirds of original funders. “We know from experience abroad that retention rates are around 50 percent,” Moser says. “We want more than that.”

Republik staff felt it was keeping its promise to deliver hard-hitting journalism. It had provided an insider-view of a mosque that allegedly groomed extremists; it broke a story of national importance about corruption in the construction industry.  And it uncovered the potential scandal of a politician who lent his car—twice—to a driver with no license, but faced no consequences.

“One of the hardest things to do as a journalist is to not rush in and write about the latest trend,” Moser says. “When we step back and research, that’s our best work.”

It also attempted to reformulate the relationship between readers and publications. When editors asked readers for feedback they complained of a lack of cultural reporting, so Republik added a new section, as well as weekly updates from Bern, the capital, and world events presented in bullet-pointed snippets. (The editors also noted that its Swiss readers yearned for more local reporting and less Trump news.) 

Then reality hit. A week before its self-imposed January 15 deadline, Republik was about 400 renewals away from retaining even the industry average of 50 percent. So it added transparency to its fundraising efforts. It has an interactive site where subscribers can view the totals and play with a tool that shows how editors must adjust for lower budgets. The point of the exercise, Moser says, is to demonstrate how tenuous the business is. “It’s crazy to think how little is needed to fail.”

It seems to be working. By January 23, a week before its new January 30 deadline, renewal rates had jumped to 59 percent. Richard Hoechner, a co-founder who heads up marketing, hopes there will be another spike at the end of the month when Republik plans to remove all delinquent accounts from its strong paywall. Once they can no longer read the site, the thinking goes, more will pay up.

Republik was designed to be ad-free but to keep it that way, Hoechner acknowledges it has to increase the number of revenue streams. The most important part of its business strategy is staying engaged with readers, which it calls “shareholders.”

Following the lead of other crowdfunded sites like Zetland of Denmark and De Correspondent of The Netherlands, Republik keeps its subscribers informed of all major business decisions. It is working on improving the comments section, turning it into a “dialog” with reporters and editors; and on using reader expertise.

“We want readers to have a voice in the running of the site and that remains a very decisive part of our membership,” Moser says. But despite the increased renewals, he says, “we’re fighting still for the survival of this enterprise.”

The site has only one reliable revenue stream: subscribers. It averages 430 new members per month, he says, but it needs about 675. Republik will need around 26,000 paying members to break even. It currently has about 22,000. To stay afloat, Moser says, it will cut its spending by 10 percent this year.

“For the first time after a year we now understand what works and what doesn’t,” he says. “We’ve gotten unbelievably good at getting new subscribers every month.”

He says that subscriptions jump when the site publishes important investigations—most notably a three-part series on possible illegal cartel and business dealings between politicians and the construction industry in the Canton of Graubünden, an area in the east of the country that borders Italy and Austria. For that story, Republik printed a “extra edition” on paper.

The site is now searching for a one-time, $1 million cash injection. And it is determined to increase word-of-mouth recommendations—which it hopes to do through shared stories and social media, paid events, and more interaction with readers.

It plans, as an experiment, to invite a small group of paying subscribers to join Republik’s court reporter to sit in on a trial. The group, and its views on its country’s justice system in action, will then form part of the reporting.

Some of Republik’s new ideas, launched with great fanfare, simply did not work. In the spirit of teamwork, the magazine had planned to rotate the editorship every three months. The idea was quickly dropped because there was no continuity, no planning and no one in charge. Editors now serve for a year.

The startup also neglected to develop a mobile app. “We thought it wasn’t important, but the world said, ‘yes, that’s important. We really underestimated that,” Clara Vuillemin, an engineer and product developer who was another co-founder, says. “It made a huge difference to people that they get an icon on their phone and push notifications.” Who would have thought a digital magazine that publishes no more than three stories a day needed push notifications?

Republik also has had to explain its concept to people who keep pushing the unabashedly longform journalism site to publish more often. In essence, the team has come to feel they are trying to change the habits of people on the internet.

“Creating something new is hard,” Moser says. “The temptation is to follow what’s already there, but if we do that there’s no reason for us to exist.”

While text will always remain core, the site is also adding interactive stories, videos and podcasts like Klang, which explains classical music and opera. 

But the heart of Republik’s aspirations remains investigative journalism. One journalist, Sylke Gruhnwald, had to delay her turn as co-editor until she finished a cross-border investigation with 18 other European media outlets last October that revealed how corporations and the super rich exploited tax laws to get “refunds” on taxes they never actually paid. Republik has also been working with ProPublica on tracking dark ads on social media. And, as a national election in Switzerland approaches in the fall, she says the magazine will be filing FOIA requests to look into political party financing.

The investigations have given Republik a burgeoning reputation in Switzerland—a fact paradoxically confirmed in a congratulatory column in the newspaper Tages-Anzeiger, which has been publishing for more than 100 years. With a nod toward the Republik’s slogan, “Without journalism, no democracy,” the Tages-Anzeiger column joked: “So this congratulation comes with a commitment: If democracy goes down, it’s your fault.”