National Observer $1M equity round

Offering Description

As traditional revenue streams for media companies are shrinking, National Observer is building a scalable business model to bring progressive, daily news to Canadians. 

The media industry is in a state of constant disruption. Traditional revenue sources have dwindled for news companies as advertising spending predominantly aimed at four Internet giants makes up nearly 80% of total online ad spending. For news media, the advertising model that sustained it for generations, from the classifieds to local and corporate advertising, is all but dead. This is why producing high quality content that convinces readers to pay for the news by subscribing is both urgent and profitable. 
 
The political and social environment has created a massive demand for true reporting. From the desire to combat the fake news coming from Macedonia and Russia, with more expected to come to Canada in the 2018 federal election, to the #MeToo movement becoming a global movement, the public thirst for facts and intolerance for clandestine meetings and archaic norms is growing. Despite a 7% drop in print circulation in 2015, digital circulation increased by 7%. That was before Trump was elected and readers have only become more aware of the need for fact checking and reliable sources. Established news organizations like The New York Times, Washington Post, and Chicago Tribune have seen explosive growth in online subscriptions in the last 12 months. Observer Media Group is considered by many Canadians to be like these publications; in other words: a reliable source of facts and news that readers will pay for. It is already leveraging this momentum and will continue to expand its high value, loyal, paying-subscriber and reader base in Canada, U.S. and internationally this year.
 
Observer Media Group Inc. (OMG) is an online media company founded in 2009 that includes the award-winning publications: National Observer and Vancouver Observer (VO). VO was an early innovator in digital media in the 'deep local' space. OMG leverages a team with both deep business and journalistic experience. With no political or corporate affiliations, Observer Media Group is one of the few national media companies in Canada ready to become profitable through reporting that is independent of political or corporate influence, exceptionally well-written, meticulously researched, and addictive to readers. 

See an example of our work below.

Year of the Animal from National Observer on Vimeo.

Capital raised figures include amounts raised both on and off platform

Investment Highlights

Investment - $1 million (Minimum investment $100,000)

Use of Proceeds
1.    Hire subscription acquisition firm to drive user growth and conversion
2.    Improve technology: platform and user experience
3.    Launch app to triple mobile audience
4.    Increase sales, editorial and operations team

Investment Structure

Observer Media Group offering is structured as common shares.

Investment Opportunity

This security is structured as common shares in Observer Media Group which will represent a fully diluted 16.6% ownership in the corporation post-investment.

Service Description

National Observer is a mobile-first, daily national news outlet that publishes tough investigative reporting, in-depth analysis and solutions journalism.

With newsrooms in Ottawa and Vancouver, National Observer works with reporters across Canada on in-depth analysis, features, and investigative reporting. Readers pay $139.99 annually, or, $12.99/monthly to gain access to stories they simply can't get anywhere else. Subscribers also donate to fund specific coverage, such as the upcoming Ontario election campaign. With more than 750,000 pages read on National Observer stories in Feb-March 2018, 70% of them by Canadians, National Observer also sends out daily and weekly newsletters to a rapidly growing list of 20,000 people while engaging with more than 100,000 through its vibrant social media platforms.

Stories often focus on issues to do with human rights, democracy and justice, and the company policy is to seek out voices that represent a diversity of communities; a keen focus is placed on gender balance in sources. Leading Canadian reporters investigate problems in society while prominent columnists provide analysis and insight that reach in the hundreds of thousands of readers. The investigative reporting team focuses on highlighting how governments and industry make decisions as well as the factors that influence their policies. Leading special reports include: First Nations Forward, The Race Against Climate Change, Canada's Clean Economy, Homesick: Quebec Inuit Between Two Worlds, Edge Dwellers and Visionaries, and House of Irving.

National Observer is unique in Canada as the only publication that keeps climate change prominently on the national agenda, with daily coverage, while also featuring clean energy solutions that provide a hopeful path to the future. These features give innovators and companies vital recognition and visibility with the public. Meanwhile, as Trump and U.S. politics inundate Canadian news, National Observer ensures that, every day, Canada's unique story continues to be told.

Competitive Advantage

National Observer is an award winning, innovative, national digital publisher

Before launching National Observer, Observer Media Group produced the Vancouver Observer, an early innovator in digital media. In the course of nearly a decade, the company has gained valuable business expertise that has allowed it to rapidly position National Observer (founded in 2015) at the forefront of national digital news publications. National Observer was one of the first digital-only publications to successfully use a paywall and the first ever to receive a Michener Foundation citation for public benefit journalism from Canada's Governor General. As the first digital-only recipient of the National Newspaper Award for business reporting, National Observer leads Canadian reporting on energy and the environment. In total, the company has garnered 10 honours/awards on business and public benefit journalism. 

Traction

National Observer has successfully rolled out a pay wall, and continues to earn revenue through crowdfunding while growing their subscriber base.

During the first year with a paywall/subscription model National Observer secured 250,000 subscribers through a group subscription with the Government of Canada, universities, and foundations. Individual active subscriptions have surpassed 2,000 with over 17% of newsletter members converting to paid accounts. Over 27 Million pages have been viewed with an average time on National Observer per article at 6 minutes (Feb-March 2018), significantly higher than the industry average. Additional fee for service and direct funding has come from foundations, charities, and not-for-profits that has driven some of Canada's best reporting. Observer Media Group's CEO has raised around $350k through crowdfunding to support specific coverage over the years. Most recently, paying subscribers donated more than $25,000 over only 19 days to fund Ontario election coverage at National Observer.

Impact Narrative

Public benefit journalism is a critical piece of democracy.

Without truth-hunting journalists uncovering corruption and political agendas, Canada is at risk of being manipulated by large corporations. Observer Media Group's stories have forced companies to accept responsibility for their social and environmental failures and driven policy changes in the Canadian government on immigration and energy infrastructure oversight. Media is like a mirror that reflects society back to itself and the company's focus on women as sources is vital to the health of Canadian society, as currently only 30% of sources quoted in stories across North America are women. This must change, and we are dedicated to changing it.

Impact Metric

Impact is core to Observer Media Group's mission.

OMG is now a registered BCorp and will measure impact based on the Alexa reputation score (a measure of how trusted a media source is) and subscriptions from public policy organizations and universities. In addition, National Observer actively monitors policy changes and outcomes created after investigations and special reports are published on the site. For additional details on National Observers impact please see their site: https://www.nationalobserver.com/impact. Below are some examples: 

Indigenous rights

Observer Media's editor-in-chief, Linda Solomon, has made it a strong policy to interview Indigenous people in news stories  and focus on full, in-depth interviews that allowed them to tell their story, rather than just obtain soundbites. The importance of representing Indigenous voices in news about such projects has been a strong focus of both Vancouver Observer and National Observer and has led to the First Nations Forward series which focuses on successes in Indigenous communities in British Columbia in the area of land and water management.

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Trudeau government to turn over new leaf in 'transformative' rights recognition framework

First Nations Forward

By Elizabeth McSheffrey, February 14th, 2018

 


Irvings series

The House of Irving by Bruce Livesey received considerable feedback from academics and readers in New Brunswick due to the lack of scrutiny of Canada's fourth richest family over the past few decades. In August 2016, the Maine Sun journal requested permission to republish the Irvings Invasion of Maine story. University of New Brunswick subscribed in order to use the series in a course in the business school.

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What have the Irvings done to New Brunswick?

House of Irvings

By Bruce Livesy, June 6th, 2016

 


Kinder Morgan pipeline

Observer Media was early, again, to cover the Kinder Morgan pipeline expansion, even when the project was almost free of controversy in 2011. When the protests by a handful of university professors and activists on Burnaby Mountain against the project turned into one of the largest civil protests in recent history in 2014, with over 120 individuals arrested, our reporters were covering the events almost daily, with powerful videos and photos showing the arrest of professors, youth, business owners, seniors, First Nation leaders and family members of environmentalist David Suzuki. Again, we were providing detailed coverage at a time when Postmedia (which owns the only two major newspapers in Greater Vancouver) editorials were denouncing the protests for standing in the way of Canada's economic interests.

The Energy East pipeline proposal was abandoned last fall. The project would have crossed almost 3,000 waterways (828 in Quebec alone) endangering the drinking water of 5 million Canadians. The project was abandoned following extensive coverage by National Observer, most notably the explosive revelations that led to the suspension of project hearings, recusal of the chair and members of the National Energy Board and the restaffing of the NEB by the Trudeau government. A full modernization of the agency is now underway.

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Thousands rally against Kinder Morgan after court injunction

Kinder Morgan

By Dylan Waisman, March 10th, 2018

 


Grizzly bears

Grizzly bears are now safe from trophy hunting in British Columbia.For many years, Vancouver and National Observer kept a drumbeat of coverage going on this issue.

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B.C. Government Announces End to Grizzly Hunt

Trophy Hunt

By Jenny Uechi, December 18th, 2017

 


Price of Oil

National Observer's groundbreaking 'Price of Oil' collaboration has resulted in action by Ontario government. 
Price of Oil' is the largest partnership of its kind ever undertaken in Canada — a project of National Observer along with Global TV, the Toronto Star, the Corporate Mapping project, The Michener Foundation and journalism schools at the universities of Concordia, Ryerson, Regina and British Columbia.

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How the reporters in an historic Canadian journalism collaboration cornered a silent killer

The Price of Oil

By Elizabeth McSheffrey, October 2nd, 2017

Management Team

Linda Solomon Wood

Linda Solomon Wood

CEO, Editor-In-Chief

Linda Solomon Wood is CEO of Observer Media Group and the founder and Editor-In-Chief of the National Observer. She is a co-founder of the Canadian Centre for Investigative Journalism in Vancouver as well as the Canadian Centre for Solutions Journalism in Ottawa. She has served on The Future of News Committee at the Public Policy Forum and sits on the Board of Governors at the National Newspaper Awards representing digital media. Under her leadership, the National Observer made history as the first digital-only publication to win a National Newspaper Award in May 2017. It made history again that June as the first digital-only publication to receive a Michener Award citation at Rideau Hall for reporting in the public interest.

Mike De Souza

Mike De Souza

Managing Editor

Mike De Souza is National Observer's Managing Editor. He has covered politics for more than a decade, focusing in recent years on energy and environment policies in government and industry. In 2017, Mike won a Canadian Association of Journalists award for his investigation that exposed a conflict of interest in the federal review of the Energy East pipeline project, which was subequently terminated. A Montreal native, Mike has worked as a broadcast and print journalist in his home town, as well as the National Assembly in Quebec City, Parliament Hill in Ottawa and Calgary. He has worked for Reuters, Postmedia and The Montreal Gazette. He now leads National Observer's news coverage out of its Ottawa office on Parliament Hill. A specialist in filing targeted access to information requests, Mike is constantly pursuing multiple lines of questioning and investigations and he always has an eye open for his next scoop.

Chris Hatch

Chris Hatch

Chief Strategy Officer

Chris has a background in strategic communications on clean energy, climate change, forest issues and Indigenous rights. He has experience in organizational development and international environmental issues having worked previously as Executive Director of Rainforest Action Network and Senior Counsel with Hoggan & Associates. He has worked with First Nations, foundations, public, private and non-profit clients.

Jenny Uechi

Jenny Uechi

Chief Values Officer

Jenny Uechi works on Special Reports for National Observer. After serving as Managing Editor of Vancouver Observer for five years, Uechi became Managing Director of Observer Media Group. Following a successful first year as a manager, Uechi will be leading a year-long reporting project to be announced soon.

She was formerly an editor at Adbusters magazine, where she coordinated stories with journalists like Matt Taibbi, and later worked as a freelance writer for The Japan Times in Tokyo and as a news director for NHK Newsline, part of the television division of Japan’s national public broadcaster.

Iana Sidorik

Iana Sidorik

Chief Financial Officer

Iana (CPA, CGA) is Observer Media Group’s part-time CFO. She is the founder and principal of I.Sidorik & Company in Vancouver. Her personal
area of interest is in Forensic Accounting, which makes heran invaluable part-time CFO for a mid-sized organization.

 

$630,000.00

Raised Of $1,000,000.00 Goal*

Days Remaining 44
Hours 12
Mins 05
$630,000.00
 
Common Shares Offer. Structure
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*Capital raised figures include amounts raised both on and off platform. Amounts raised off platform or committed have not been independently verified by SVX.