Sculpture

“It’s really important to break the cycle of getting addicted to the continuous now, which is, ‘We’ve got this thing up, we’re feeding the beast, I can’t do anything else.’… So there’s moments that what you have to do is be ruthlessly relentless about thinking, ‘What am I doing, what can I stop, where can I get space…?’”

—Michael Maness, John S. and James L. Knight Foundation

Last Friday, the John S. and James L. Knight Foundation and the Pew Research Center gathered nonprofit-based news sites from around the country to discuss their plans for long-term sustainability and for the engagement of their readers. There were no hard and fast conclusions, but it was evident that this was a dynamic field of organizations trying to discern a way forward, not just for their sites but for journalism more generally.

One of the more interesting changes to the nonprofit/philanthropic landscape over the last fifteen years has been the gradual movement of journalism from the for-profit to the nonprofit sector. Of course, the nonprofit sector has traditionally been a solid home to some journalism, in public radio and television and in periodicals like Mother Jones and The Nation. Additionally, many human rights groups and other nonprofits, like think tanks and advocacy groups, have played a role in journalism. In short, there has always been connective tissue conceptually between the civil sector and the fourth estate—both being so core to democracy that, historically, government subsidized them.

But, as market failure began to increasingly seriously threaten the integrity of sound journalism, it has been rational and natural to look for a sectoral home less focused on profit-making and with a greater focus on sustainability in the context of the mission of providing the public and the public’s representatives with the depth of information they need to make decisions and take action. Thus, small journalism sites have been steadily cropping up in the last fifteen or so years. The influx is nowhere near enough to replace the number of serious reporters who have lost their jobs at large media shops, but points to a search for new and innovative ways to keep journalism alive, robust, and credible.

These sites exist in an environment that could not be more of a moving target. The public’s habits vis-à-vis reading, venues for accessing, and expectations in paying for media have changed, and continue changing, radically. There are new expectations having to do with engagement, and the relationships among various media sites and between the sites and their publics are morphing. In this environment, a number of foundations and individual donors have made significant investments, possibly expecting to discern a replicable business model in a relatively short time. In both the for-profit and nonprofit sectors, people have played with combinations of revenue generators: paywalls, memberships, advertising, underwriting, donations from individual readers, syndication of content, events, and more. Still, an excellent recent Pew study, “Nonprofit Journalism: A Growing but Fragile Part of the U.S. News System,” looked at 172 nonprofit news sites and found that many of these organizations still relied to a fairly significant extent on only a few sources, including grant funding from a foundation or major donor.

Now, the Knight Foundation is preparing to publish another study, titled “Finding a Foothold: How Nonprofit News Ventures Seek Sustainability.” This report, scheduled for release in October, has made a bit of a breakthrough in that it shows patterns of revenue by type of operation, along with other comparative data. As one participant in the roundtable said, this type of information is like gold to those struggling to make sense of an emerging enterprise model.

The journalism groups that attended and were under discussion had annual budgets that were as small as $165,000 (Oakland Local) and as large as $10 million (ProPublica and Center for Investigative Reporting). They were divided generally into three categories—national, statewide, and local—with a few outliers, like NPQ, that addressed particular communities of interest, and more established groups, like NPR. But most were fairly new, and primarily online, publishers. Some engaged heavily in investigative work, but these seemed to be organizations with larger capital investments from individuals or foundations. A number of foundations were also represented, including the Bill and Melinda Gates Foundation, the Knight Foundation, and the MacArthur Foundation.

The conversation moved fluidly between the design of content and the design of revenue and public engagement models. As an example, Tom Glaisyer, an investment principal at the Media Democracy Fund, talked about the use of events:

I may go back a little bit to the question of theatrical journalism or event-based stuff. For me, if we abstract it back, journalism used to adhere to the page, the printed page. Now can we make it adhere to something else, to events…. That sort of brings me to…where the journalistic institution sits within its greater ecosystem and what it is capable of doing. Just one example: the Zócalo Public Square folks, who sort of lead with the event-based journalism. The site is somewhat of a secondary thing to that, and we’ve just got used to the printed page as the starting point. I just wonder if we can’t just think a lot more broadly about where it goes to maximize how we present the value proposition of the hard work that goes into creating this public…good.

This reflects the sense that the field is looking for whole enterprise models, rather than revenue models awkwardly patched onto a mission. These enterprise models are likely to look different from one type of endeavor to another. For instance, Richard Tofel from ProPublica, which is overwhelmingly funded by private grants and contributions, said that he felt that everything should flow from the business model, in that the group needs to decide what is important to its work—what impact it wishes to have—and that this should be reflected in the way the business model is structured. He said that ProPublica, which was started with money from the Sandler Foundation, was originally approximately 95% dependent on those funds, but expects that reliance to be down to 30% next year. (Tofel, by the way, is the author of an enormously interesting paper, “Nonprofit Journalism: Issues Around Impact,” commissioned by the Bill and Melinda Gates Foundation.)

There was a good deal of conversation about the important role of philanthropy vis-à-vis these sites, and there were a number of organizations in the room that had received a nice dose of it as ongoing operating support or capital investment. Two issues arise in relation to this: overdependence on one or a few sources, and the potential for editorial influence. There has been a longstanding discussion about the potential for content to be affected by a donor’s beliefs or interests, and this concern becomes particularly acute when the underwriter is backing a particular line of reporting in which the underwriter is an active player.

At the same time, most of the people in the room were very much still searching for the right revenue model, and since many of the organizations were started by “legacy journalists,” there was a lot of discussion in the third person about their capacity to attend to the business of producing renewable, reliable income.

But many indicated that they had come to terms with the challenge. For instance, one participant confessed,

We have a lot of employees now, and one of them is a non-journalist. It’s our Development Director. I thought, “Oh, great, I’ve hired the one person who’s going to go out and raise all my money. I’m done with that. I’m going to go take care of the journalism.” [Laughter] Through some programs and some tough love and Kevin Davis and some partners at INN [Investigative Nonprofit News], I’ve realized my journalism days are over. I’ve got to be a businessperson. It’s been tough, but it’s absolutely critical, and I’ve recently hired a half-time person to do some more outreach and marketing events and steal plenty of ideas.…

It was interesting to listen to the conversation around engagement and impact, which was also very much in formation. It was generally agreed that the whole field needed humility around what it does not yet understand about participation by readership communities, and that experiments abound, but this flowed into a conversation about what people were attempting in order to grab the attention of the public. A number of people talked about the usefulness of rolling investigations that break stories up into digestible pieces over time, about understanding the life cycles of stories, and how journalism can look at moving people from intelligently learning to taking action.

Mark Horvit of Investigative Reporters and Editors said this “rolling story line” method could invade public consciousness differently:

So, the traditional method of doing an investigative project is to work, work, work, work, work, gestate, gestate, gestate, give birth to this big thing when it comes out, and then go take a nap, right? That’s fine, but what you’re seeing more and more of, and partly out of the same necessity, is the rolling investigation kind of thing. The work is not less important, and you don’t do less. The impact isn’t different in the end. But you’re breaking this into pieces as you go along, and there’s a sustained constant hit.

Anybody can withstand one hit if you’ve done something wrong. If there’s one big hit and it disappears, the odds of having any impact are very slim. But if you beat that drum continually, and if it comes out in pieces and you keep it going for a while, you see all sorts of impact happen that might not have happened otherwise. That can also play into the way you bring traffic to your site, into the way people respond to it, and the kind of audience that you build. So I just think that the way you think about doing your content has to factor into this whole discussion, not simply how you get word out about it once you’ve done it.

But one of the most noteworthy discussions was of the level of investment currently being made in journalism by philanthropy. While it was acknowledged that the Knight Foundation has been actively advocating for local philanthropy’s support of new local journalism, it was also generally agreed that the investments currently being made were a drop in the bucket. John Thornton, a venture capitalist and cofounder of the new Texas Tribune, said that he saw the need for the education of potential equity investors in journalism sites.

I think one of the things that knits a bunch of the really smart things that have been said here together is this coming back to the notion of equity investors versus revenue…to the notion that Dick [Tofel] was talking about in terms of the difference between building a for-profit and nonprofit enterprise and the willingness and forethought required on behalf of—and I’m going to call them investors not donors…to fund for our losses, and that to me is the difference between equity and revenue. So all of these things are incredibly important at a tactical level. Some of them, at a strategic level. In my mind, the most important thing that needs to be done is the consciousness-raising of a new generation of equity investors in these things.

Overall, it seemed to be generally agreed that building this field within the chaos of changing markets and technologies will take time, and that much more working capital is needed with the understanding that experimentation will be the order of the day for some time to come. Michael Maness, Knight’s VP of Journalism and Media Innovation, concluded the session by saying that “we charged into this with our hearts, not our heads.” He suggested that we should not become “addicted to the continuous now” of the near future or try to mimic legacy journalism (at least in presentation), but instead embrace the need to change versions of what we do quickly, acting always in an iterative and experimental manner.—Ruth McCambridge