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With around $1.5 million in revenue, 2026 is on track to be a break-even year for the worker-owned local news site Hell Gate.
“We’ve spent a lot of money growing this year,” Hell Gate co-founder Nick Pinto told me, “so the fact we’re ending the year in the same place with regards to our bank account, it’s basically good. But it would be better if we were ending with more money than we started with.”
The New York City-based local news org has about 11,000 paid subscriptions — and exceeded $1 million in annual recurring revenue for the first time. That subscriber support is critical, the report notes, because “philanthropy is fickle” and “advertising just doesn’t pay the bills in 2026.” (Hell Gate made more than $20,000 in advertising so far this year, primarily on newsletter ads, compared to $660,000 in subscription revenue in the first three quarters.)
“We have said for many years that subscriptions are also more stable than other revenue sources, because, barring a national economic crisis, subscribers are unlikely to desert us all at once. That qualifier feels a bit less hypothetical and remote these days,” the report goes on, linking to a headline about how an AI crash would cause a recession and global economic stagnation, “but our philosophy is unchanged.”
Hell Gate expects a revenue boost thanks to a new tax credit from New York State. To collect the $157,000, its worker-owners have to jump through a series of hoops, including refiling their personal taxes for 2025.
Like its fellow worker-owned outlet Defector, Hell Gate offers an unusually candid look at its own finances in its annual report. Hell Gate’s openness about its business is a gift to anyone else trying to build (or grow) a news outlet. Many in the news industry, for example, are also trying to solve one of the major problems Hell Gate lays out in its annual report: turning free readers into paying subscribers.
Subscriber growth at Hell Gate slowed from 69% to 22% in the last year. Nearly 64,000 people currently get at least one of Hell Gate’s three newsletters. One conversion move that worked? Randomly withholding the free Morning Spew newsletter.
“The fact that the free subscribers have grown faster than our paying subscribers suggests to me that we need to be more aggressive about figuring out how to work them in,” Pinto said. “Gentle encouragement and inducing guilt is definitely one powerful tool. The other one is turning off the free stuff every once in a while in a stochastic, destabilizing way, so that they’re like, ‘Oh, I actually really did want to read that newsletter today.'”
Here’s the top of one newsletter that successfully nudged some “Hell-Gate-curious freeloaders” to become paying subscribers:
Hell Gate, founded by five journalists in 2022, now has 10 employees, including a couple of part-timers. Currently, only full-time editorial employees can become worker-owners, and only after a vesting period. Shares can only be owned by workers so when co-founder Esther Wang departed this summer, the rest of the owners got the shares back under a buyback policy.
“When we organized Hell Gate, in our fevered idealism, we wrote it into our operating agreement that there’s no way for anybody to make any money selling Hell Gate,” Pinto said.
“To the extent that we contemplated the possibility that we’d even still exist [four years later], I don’t think any of us thought we’d ever want to leave,” Pinto added. “The arrangement makes ownership stakes about control of the direction of the company rather than about, you know, accruing value on an investment. That means our ownership is a thing that keeps us pulling together rather than having us fight over money.”
But, even in worker-owned news organizations, money can be a source of tension. “Compensation and how to structure it has reliably been the single most difficult conversation for Hell Gate owners,” the report notes.
Hell Gate once paid journalists the same salary. Last year, it paid reporters $75,000/year and its two editors $85,000/year. Now, in 2026, Hell Gate salaries range between $83,000 and $100,000, “according to a slightly complicated formula intended to reflect both longevity with the company and the extra work and responsibility carried by editors.” The news org expects to keep tinkering with the pay structure.
“The wise words of one of Hell Gate’s advisory board members continue to be borne out: In setting compensation, the best you can hope for is to minimize the inevitable dissatisfaction,” the report reads.
You can read the full report here.
