The Hyper-Local Media Magnate Journalism Can’t Ignore

Six years ago, at a high school event in suburban New Jersey, Michael Shapiro was covering the story for a hyper-local news site he had founded two years earlier when he spotted a journalist from an established local print newspaper from the same town.

“I extended my hand to shake hers,” he recalls, “and she turned around and walked away. People who saw it, their eyes opened wide. They couldn’t believe it.”

Those were the early days of Shapiro’s foray into hyper-local news. He was a former lawyer who was building a network of websites covering towns in New Jersey, and some of the state’s old-guard journalists didn’t like it. Getting the cold shoulder from them, he says, was not unusual.

“They saw us as a threat,” says Shapiro. “It was also a matter of, ‘ Who are you to come into my town,’ as if it’s their town.”

But things have changed considerably since then. Now, Shapiro presides over a rapidly expanding network of 51 hyper-local franchises dotted throughout New Jersey and, more recently, New York state. (Two more just signed on and will launch this spring. A brief expansion into Pennsylvania failed.)

TAPinto, as Shapiro’s chain is called, has outlasted AOL’s Patch, a behemoth with deep pockets that moved into the hyper-local business just as Shapiro was expanding and began targeting some of the same towns – before virtually fizzling in 2013 after extensive layoffs.

He’s signing new sites at a steady pace – a year ago he had 30 sites in his network. Now he claims a combined reach of 4.2 million unique users in the last year and has set a goal of 75 sites and a new state by year’s end.

But perhaps most importantly, as he grows, Shapiro and his network have found growing acceptance with journalism insiders who once derided the boxy diner menu look of the old TAPinto website template, the lackluster quality of the reporting from some of the franchise sites, and the inexperience of the many non-journalists who were buying his franchises.

“We are getting more and more professional journalists who are applying to be journalists or who are interested in working with a franchise,” he said. “As we keep growing, the caliber of the people on the journalism side is getting higher.”

He notes that the managing editor of the Hunterdon County Democrat, Curtis Leeds, is now doing the site for TAPinto Flemington/Rariton, and Rod Hirsch, the former managing editor of the Somerville News, is now doing TAPinto Somerville. A handful of journalists from the Independent Press, which folded last year, now work for him.

“It starts to send a message that we’re not to be looked down on anymore,” he says, adding that half of the sites in his chain have someone involved who is either a reporter or has journalism training.

Building a Franchise

Recently, two other developments have further burnished Shapiro’s journalistic credentials: he was approached by Halston Media, a chain of four newspapers in New York state, and asked by their publisher to provide the website complements to their newspapers. And he also signed on with the journalism program of St. Bonaventure University in upstate New York to provide the website for the news organization run by undergraduate students in a journalism workshop class.

“In the early days people didn’t take him seriously because I think they saw it as a featurey thing,” says Dr. Richard Lee, who’s watched Shapiro’s expansion and was responsible for bringing TAPinto to St. Bonaventure. “Now that’s changed.”

Lee teaches the workshop class with his wife, Anne, and both have decades of experience as working journalists. They say they  like the user-friendly back end of the TAPinto site much better than the WordPress they used to use.

Anne says by being part of the TAPinto network, her students are connecting with other journalists beyond the program. There’s a Monday morning conference call that the students sometimes join, she says, and a Facebook group for franchisees to share tips and information.

Being part of the network, the couple says, allows them to use stories from other sites in a pinch, such as on St. Patrick’s Day when there was no appropriate student work to post. And most importantly, it raises the chances of students getting exposure – and clips. For example, a student piece about a Bruce Springsteen concert and a connection to a Bonaventure alum was picked up by 14 sites in the TAP network.

This is how Shaprio’s franchise model works: the franchisee pays between $4,250 and $6,750 a year, depending on the population of their territory, and 10 percent of their overall revenue. Franchisees who want to start a second site pay $1,000 a year for subsequent sites. Shapiro says there are about 35 paying an average of $5,000 a year and 15 sites that are bringing in $1,000. So the rough math on revenue from franchise fees is $190,000 a year.

What the franchisees get is a content management system, back office support, reduced cost liability insurance and editorial feedback. They also get access to Shapiro’s team of trained reporters who help with journalism fundamentals, such as how to write a lead and the nuances of AP Style, and also assist with social media and story promotion on the web. The franchisees also get media kits, contracts and the paperwork they need to run their business, so they can focus on news and ad sales.

Shapiro says the two highest performing sites made close to six figures last year and are on track to exceed that this year. But most of the sites are earning less than $50,000. Apart from the TAPinto fee, expenses for these hyper-local business are often low, as they are usually run from kitchen tables with only the occasional freelancer or publicity event to finance.

Hyper-Local Kindred Spirits

Brett Freeman, the publisher of Halston Media, a small chain of hyper-local newspapers centered around four school districts in upstate New York, says he too bought into Shapiro’s network this past Fall in part because his staff had struggled with the complexities of the WordPress template they were using. Some complained of the cumbersome multi-set process for uploading images. Others were not proficient with social media or search engine optimization or getting good rankings on Google.

“I learned about TAPinto and met with Mike and really fell in love with his company,” says Freeman, adding that his company easily cleared the franchise fee within a month. “This is the first site where I could get compliance from my staff. Now they are enthusiastically posting because it’s easy to use.”

Freeman says he admires Shapiro’s ability to expand while still giving each community website the hyper-local focus that readers want. He sees in Shapiro a kind of hyper-local kindred spirit.

“Our mission and what’s very important to me is being hyper-local,” Freeman said. “That’s what I like about Mike Shapiro’s business model. By having franchisees, he is always going to have resources devoted to being hyper-local.

In the early years, Shapiro had to dip into his savings to fund the business. Then in 2012 he raised $150,000 from investors who still hold a small equity stake. Now he’s out of the woods and making enough to pay four full-time staff and two part-time. Most of the profits get plowed back into developing the business, he says.

So far there have been no journalism awards for any of Shapiro’s sites. But this year he’s found time to submit entries to the New Jersey Society of Professional Journalists awards, and is waiting for the results.

Winning would be the icing on the cake for a man who is not shy about making the bold assertion that he’s the only one who has found the model for making hyper-local journalism sustainable and scalable.

“Until us, there has been no successful local news network that has scaled successfully,” says Shapiro, who sees himself as a kind of hyper-local David who once faced down the AOL Goliath. “The road is littered with good intentions.”

Tara George is Associate Professor of Journalism at Montclair State University’s School of Communication and Media. She has spent more than a decade teaching journalism to undergraduates. A former New York Daily News reporter, she now specializes in issues in local journalism. Tweet her @journoprof.