Jeremy Klaszus was one of many Calgary residents who wished aloud that somebody would create what became The Sprawl, a hyper-local digital news outlet aimed at the city’s younger residents. But it was Klaszus, a former alt-weekly reporter, who managed to swiftly put the platform together—and then, just as quickly, take it down.

Calgary, Alberta, is a prairie city in Canada’s heartland with 1.2 million residents and a familiar North American problem: Its legacy news media is a shadow of its former…