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MADRID – The legendary Spanish newspaper editor is flush with 18 million euros ($20 million) from crowdfunding, well-heeled investors and the payoff he received for leaving Spain's No. 2 newspaper. With that haul, Pedro J. Ramirez is about to launch a startup digital publication aimed at shaking up Spanish journalism and scooping traditional and new media competition.
"El Espanol" — led by the fired co-founder of Spain's El Mundo newspaper — will be seen starting Wednesday by more than 10,000 subscribers who have agreed to shell out 7 euros per month, without even seeing the product.
Customers will get full access to a news website, a morning electronic newsletter and a nightly magazine-style mobile report. They are betting that Ramirez' reputation for relentless reporting justifies paying for the privilege. Those choosing not to pay won't see El Espanol until Oct. 14, and will be allowed to see 25 articles per month from the website.
"There will be scoops every day," promises Ramirez, who hired 72 journalists at an average annual salary of 50,000 euros each, bucking a trend in which digital publications in Spain and elsewhere frequently rely on a business model of hiring less seasoned reporters for a pittance.
They sit elbow to elbow around high round tables on one floor of a nondescript office building in the city's outskirts, heading out of the newsroom to do telephone interviews because the space is so cramped.
Their job: deliver a visually appealing product with news Spaniards aren't getting elsewhere.
"Some of them could probably make more money elsewhere, but they were attracted to the project," Ramirez said, adding that he wants his journalists to report news that exposes the seamy underbelly of Spanish politics and seemingly non-stop corruption.
Ramirez scored his first big journalistic coup in the 1980s while he was editor-in-chief of Madrid's now defunct Diario 16 newspaper, when he broke news about links between the Socialist Party government of Prime Minister Felipe Gonzalez and death squads targeting members of the armed Basque separatist group ETA.
He was forced out of that job reportedly amid heavy political pressure, and went on to launch El Mundo in 1989. Despite warnings it would never succeed in a crowded Spanish media landscape, the newspaper quickly grew to become the country's second largest after El Pais.
One of its biggest scoops came in 2013, when the newspaper revealed text messages sent by Prime Minister Mariano Rajoy to the former finance chief of Rajoy's Popular Party, after the party treasurer was accused of hiding tens of millions of euros in Swiss bank accounts and making slush fund payoffs.
El Mundo also raised eyebrows for a seemingly endless stream of reports over the years challenging the Spanish government's investigation into the 2004 Madrid train bombings that killed 191 people. Ramirez believes pressure put on El Mundo by the government after the Rajoy text messages scoop, plus the newspaper's financial problems, triggered his ouster last year.
His fame and notoriety account for why he managed to raise 3.6 million euros in crowdfunding for El Espanol. He put up his entire after tax windfall of 5.6 million euros from the El Mundo settlement, and the rest of his 18 million euros in start-up funds comes from friends, family and other investors.
Ramirez "has played one of the leading roles in Spanish newspaper journalism and he's been quite controversial due to the kind of journalism he's done," said Ramon Salaverria, a journalism professor at the University of Navarra. "Sometimes you felt when reading El Mundo that it was guided by hidden interests and you didn't know who was behind it."
Ramirez says no single investor except him has been allowed to invest more than 1 million euros, meaning "there isn't one investor that has enough of a position to affect the editorial line El Espanol takes."
The publication's business plan doesn't call for El Espanol to make a profit until its third year of operations, but Ramirez says it could "lose money for two or three more years without any problems."
Advertising is expected to account for 80 percent of revenue following the launch with subscriptions providing 20 percent revenue, Ramirez said. The company's business plan envisions that balance hitting 50-50 between advertising and subscriptions within four to five years.
In a country where most print and broadcast media have a clear political stance to the right or the left, Ramirez says El Espanol's reporters will tell both sides of the story — but he doesn't believe objectivity is possible.
"Everything deserves interpretation," he said. "I believe in honest subjectivity."
Salaverria says El Espanol has already shown via a blog introduced ahead of the publication's launch that it can effectively harness data to generate stories, something he sees as rare in Spanish journalism.
With Spain's economy finally growing after years of severe financial pain, "there is room for new journalism projects and in that sense El Espanol arrives in the market at a good moment," Salaverria said. "I don't know if it will be first or second in penetration in digital media, but it will easily reach a position in the top 10."
Journalism experts say much of El Espanol's success before it has started is due to the showmanship and sales expertise of Ramirez, who plugs the publication constantly on his Twitter account, which has 368,000 followers.
"It remains to be seen whether it will be viable or not because they can't burn money forever," said Arturo Gomez Quijano, a journalism professor at the Complutense University of Madrid. "He's got a certain level of notoriety, and if his people can put out great work, that will create an audience."