October 3, 2013

What’s Next for Nonprofit Journalism?

Elizabeth Green of Education News Colorado speaks at the Future of Nonprofit Journalism event.
Elizabeth Green of Education News Network speaks at the Future of Nonprofit Journalism event, held at the Pew Research Center.

On Friday, September 20, 2013, the Pew Research Center and the John S. and James L. Knight Foundation co-hosted a roundtable on the future of nonprofit journalism. The event brought together representatives of the philanthropic and journalistic communities, as well as thought leaders and experts in the field. Framing the conversation were data from a June Pew Research report on the financial sustainability of nonprofit news, and a forthcoming report from the Knight Foundation assessing the health of a group of nonprofit news organizations. Full video footage and an edited transcript are now available, as is the Knight Foundation’s recap of the event. Here are four key points that emerged out of the afternoon.

Philanthropy may continue to be a significant part of the future of nonprofit journalism.

Pew Research Center data show that in spite of calls to diversify revenue streams, foundation revenue has continued to be vital to the existence of many nonprofit news organizations. About three-quarters of the 93 outlets surveyed in late 2012 receive foundation funding, which in most cases accounts for more than half of an outlet’s total revenue. And new Knight Foundation data on a smaller cohort of outlets suggest that while reliance on foundations is shrinking for some outlets, it is still the most important revenue stream.

While participants in the roundtable conversation emphasized the continued need to diversify revenue streams, institutions such as the John D. and Catherine T. MacArthur Foundation are not planning on ending their commitments tomorrow, and some funders and news providers said a level of philanthropic support will be necessary over a long period of time. They also indicated, however, that philanthropic giving would be tied to the nonprofit outlets’ ability to innovate.

Some foundations are willing to make long-term commitments

Some representatives of the philanthropic community clearly indicated that they are willing to consider long-term funding of nonprofit news organizations. Elspeth Revere, vice president of media, culture and special initiatives at the MacArthur Foundation, noted that her institution has supported some news organizations for 20-25 years. Daniel Green, deputy director of strategic partnerships for the Bill & Melinda Gates Foundation, said it is conceivable his foundation would do the same.

ProPublica President Richard Tofel shared a distinction he sees in the willingness of different types of foundations to commit funds over a long period of time. “Institutional foundations…are quick to remind you they cannot fund you for 20 years in a row,” but that “high net worth individuals…often support the same cause for a long, long time.”

Venture capitalist John Thornton, on the other hand, is done with his substantial financial investment in The Texas Tribune, which he considered to be strictly start-up equity. But he says that was the plan all along, and the organization now relies on major philanthropy for only about a third of its revenue. “In my mind, the most important thing that needs to be done is the consciousness-raising of a new generation of equity investors,” Thornton said.

However, long-term support comes with conditions

Some members of the philanthropic community noted that funders are more likely to open their wallets under certain circumstances. The Gates Foundation, said Green, is more likely to provide long-term support if the grantee is engaging an audience around a specific issue that the foundation considers a top priority.

And in his closing remarks, the Knight Foundation’s vice president for journalism and media innovation Michael Maness directly addressed the practitioners in the room, saying they need to do a better job of innovating: “I think there are differences between us, but one thing that I think is rock-solid…is that those things being iterative and experimental are key structures that we’re just not seeing, and that we need to see.” And to that end, Maness announced a funding proposal in the works that will reward innovation.

Some news outlets may be more permanently reliant on philanthropy than others

The Texas Tribune, with its aggressively diverse revenue model, may be an exceptional case, even as some other outlets are working toward that end. Joel Kramer, CEO and editor of MinnPost, noted that the Tribune’s ambitious goals for earned revenue (non-donor revenue streams such as events, sponsorships and syndication) would be considered high even by the standards of other cultural nonprofits—such as orchestras and museums—and may be unrealistic for smaller news operations.

And not just unrealistic, but perhaps foreign to their DNA: Kevin Davis, CEO and executive director of the Investigative News Network (INN), distinguished between mission-driven and revenue-driven organizations, arguing that nonprofit news organizations, often focused on investigative reporting, are mission-driven. “The expectation,” for these types of organizations, “is that philanthropy remains a very big part of the mix.”

Kramer summed up the tension over the role of philanthropy in nonprofit journalism: “I think bringing donors into this ecosystem is more important today, not less important, even though we’re pedaling like hell trying not to be dependent upon them.”

Developing greater business-side capacity is critical, but remains a daunting challenge for some nonprofits.

A majority (54%) of the outlets surveyed by the Pew Research Center identified business, marketing and fundraising as the areas of greatest staffing need. And nearly two-thirds (62%) reported that finding time for those activities constitutes a “major challenge.” Data from the Knight Foundation suggest that the vast majority of nonprofit news resources are going to the editorial side to produce the journalism, to the neglect of the technical and business operational side.

A natural blind spot

Nobody in the room disputed the notion that business skills and capacity are critical to the future of nonprofit journalism. But some participants were quick to highlight what they saw as an inherent blind spot among some who entered the profession.

Houstoun: "They just don't have the entrepreneurial bone in their body."
Houstoun: “They just don’t have the entrepreneurial bone in their body.”

“I’ve been up close and personal with about five of these [nonprofit news organizations],” said Feather Houstoun, senior adviser to the Wyncote Foundation. “They just don’t have the entrepreneurial bone in their body.”

“Feather’s absolutely right,” said Jeff Jarvis, director of the Tow-Knight Center for Entrepreneurial Journalism at CUNY Graduate School of Journalism. “Journalists do not think like entrepreneurs.”

Richard Tofel noted that those who enter nonprofit journalism with a background in commercial media can miss a key distinction between the for-profit and nonprofit sectors: A for-profit company’s ability to sustain losses over time while building “enterprise” value does not really apply to the nonprofit sector, which is focused heavily on preserving the bottom line and managing expenses.

And instinctively, editors and directors running these operations tend to prioritize the journalistic work, said INN’s Kevin Davis, adding that while these outlets are devoting more time to business than in the past, those activities are often being tackled after hours.

Susan Mernit of Oakland Local concurred, citing her small staff of two and limited capacity. “The place where we don’t have the resources to really do everything we’d like to is [spending time cultivating] individual philanthropy and family foundations.”

Prioritizing business: A set of practices, and a mindset

Observers of the nonprofit sector voice a common complaint that organizations—including those focused on news—feel pressure from foundations and watchdog organizations to focus the overwhelming majority of their budget on program areas. “Organizations starve themselves” in this way, Kate Barr of the Nonprofits Assistance Fund, told the Pew Research Center in an interview. “There’s an obsession with being able to say [to funders] that 80 to 90 cents of every dollar you gave us is going to programs.”

But at least one philanthropic voice in the room challenged that portrayal. “To me, the organizational side and what we call the technical assistance side,” said Chris Daggett, President & CEO of the Geraldine R. Dodge Foundation, “is as or more important than the other things that they’re doing.”

Some suggested that philanthropic support could come in the form of training or business consultancy, which elicited approval from both journalists and philanthropists alike. Elizabeth Green, executive editor of EdNews Network, is already getting that kind of help. Her advice is to look outside the nonprofit news realm for inspiration, in her case, to technology startups and the education sector.

And at least some nonprofit news leaders are making a full transition from identifying as journalists to business managers. Steve Beatty, editor of The Lens, said, “I’m one of the legacy guys that Feather talked about, that was not put on this planet to manage money.” However, he added, “Through some programs and some tough love and Kevin Davis and some partners at INN, I’ve realized my journalism days are over. I’ve got to be a business person.”

Beatty’s remarks seemed to reflect a sentiment shared among journalists in the room—that of a willingness to more fully engage the business side of a news operation, while at the same time acknowledging a real need for help. The concept of shared services, such as technology platforms or business consultancy, through networks of nonprofit news outlets, seemed to resonate as well, both as an answer to the staffing and resource issues many outlets face, but also to help close the knowledge gap.

The nonprofit sector faces unique technological challenges in reaching and measuring audiences

All news media today are wrestling with the question of how to build and engage audiences in the digital space. The nonprofit sector is no exception, but it does face some unique challenges. One is the issue of staff size. With more than three-quarters (78%) of the outlets surveyed reporting five or fewer full-time, paid staff, there is little capacity to add in-house expertise and innovation in audience metrics. Second, the nonprofit field is mission-driven, which means it is necessary to measure not just the size of one’s audience, but also the impact the journalism is having because of its reach.

Reaching the audience

“Give me some programmers,” said Brian Wheeler, who manages a small handful of staff at the nonprofit outlet Charlottesville Tomorrow where he is executive director, and wants to build a better digital experience for his audience. It was a plea that resonated around the room, and resulted in the suggestion that networks of news outlets—such as INN or LION (Local Independent Online News Publishers)—could share programming support.

Others offered suggestions for getting around the resource problem. Susan Mernit offered a practical solution for small outlets—if you can’t afford a mobile application, at least use a content management system that offers an attractive mobile experience. She said her site’s mobile traffic spiked upward once they migrated to WordPress.

And simply having a strong social media presence can not only help an outlet broaden its reach, but break into an untapped audience. Joel Kramer told the story of MinnPost’s outreach strategy, which began six years before with an e-mail list. But 30,000 Twitter followers and 10,000 Facebook likes later, the median age of the outlet’s readers dropped from 50 to the low 40’s.

For his part, Beatty said that weekend web traffic rose “remarkably” for The Lens when the outlet’s staff began sharing content on Twitter during that part of the week.

Content-sharing and syndication agreements are other practices that many in room said they use to help build audience—though most also agreed such arrangements carry little direct monetary value. Charlottesville Tomorrow places its stories in local media outlets, which helps reach a wider audience and introduce new audiences to their brand. Wheeler noted that the outlet does not charge for the service, but instead arranges for in-kind support, such as marketing or printing services.

Kevin Davis also stressed that content-sharing is not a major revenue stream. “The amount of effort it takes to collect the pennies that you get back may not be worth it anymore, and so people who used to charge for syndication content are now going with Creative Commons licenses” that facilitate more seamless content-sharing among news providers.

MinnPost has content-sharing agreements, but again, not as major revenue-drivers. “The big [media outlets] don’t really seem to want to invest in using other people’s content.”

Although ProPublica publishes many of its stories with outside partners, Richard Tofel acknowledged that the nonprofit makes little money off of syndication, and he characterized certain types of syndication as “a new lousy business model.”

Measuring the audience

Regardless of the method of reaching audiences, participants shared the view that the digital nonprofit news sector has reached the point where it needs a clearly defined and widely accepted set of audience metrics. But the uncertainty over what those metrics are triggered one of the most animated segments of the conversation.

Eric Newton, senior adviser to the president of the Knight Foundation, noted that “we really don’t have the kind of measurements that the legacy media have been developing, in some cases for a century, and so we can’t even say how many people consume your stuff.”

Emily Bell, director of the Tow Center for Digital Journalism at Columbia University, also nodded to the history of audience measurement in legacy media. “The reason the television industry can charge the highest premiums for the least accountable metric system is because there is a consistent and agreed dialogue around what those things mean.”

For Davis, the concern was to avoid reinventing the wheel. “If people would start to agree on some standards, we wouldn’t have to redo them every single time.”

For Kramer, referring to the widely used measurement platform Google Analytics, it was all about consistency across the sector. “[Google Analytics are] terribly misused and they’re used differently by everybody and it would be of great value if we could agree on which metrics in the world…actually matter.”

Ruth McCambridge, editor-in-chief of Nonprofit Quarterly, noted that “all numbers aren’t equal”—suggesting that deep contact with a small audience might be just as valuable as surface contact with a wider audience. And that is what the Texas Tribune is doing by launching a newsletter for the “insider” crowd.

But according to Steve Waldman, a media entrepreneur with deep experience in the commercial sector, nonprofit news organizations need to figure out their business model before they are able to identify how to best reach—and engage—their audience.

Measuring impact

Several participants in the roundtable, including Charles Lewis (executive director of the Investigative Reporting Workshop), Richard Tofel and Davis, have recently written about the importance of impact and engagement in assessing the success of these outlets. Dig a little below the surface, and the challenges of measuring impact emerge. Lewis and co-author Hilary Niles, in a report for the Investigative Reporting Workshop, wrote that while finding a way to measure impact is important to the future of nonprofits, “When it comes to specific methodologies for assessing that impact, divergent perspectives and priorities start to surface. Journalism’s shifting landscape renders impact harder to pin down.”

Beatty of The Lens picked up on that thread, suggesting that the results of investigative journalism are not easily translated into typical empirical metrics. “Did that city council member wave our story in front of a city official at the next meeting and say ‘what are you doing about this?’”

Mark Horvit, executive director of Investigative Reporters and Editors, added that “ a key way you have to measure a lot of this… isn’t just about who looks at your site but what happens because of what you do, right?”

Still, the ‘how’ of measuring impact remains unsolved, though institutional muscle is now being put behind efforts to crack the code, including the Media Impact Project at the Norman Lear Center at USC Annenberg, funded by both the Gates and Knight foundations.

Better together? The tension of finding common ground within a diverse field

Kramer: Nonprofit news outlets "don't have the same models and they don't have the same needs."
Kramer: Nonprofit news outlets “don’t have the same models and they don’t have the same needs.”

A central challenge that emerged in the conversation was how to overcome the vast differences in these nonprofit outlets and their business models in order to create networks that will reinforce sustainability.

Joel Kramer articulated it this way: “You bring all these people together and they are not in the same business and they don’t have the same models and they don’t have the same needs.” Kramer suggested a solution: divide the nonprofit news field into subgroups based on shared needs and identity, and solve problems that way.

“I get so tired of the idea that we need to scale things,” said Dylan Smith, editor of the Tucson Sentinel, hinting at what he saw as the failure of the Patch.com model of local news.

One subject that illustrated the wide range of capacity and unique challenges faced by different types of organizations was that of event-hosting. Texas Tribune can generate $1 million from events, but as editor Emily Ramshaw noted, “There are a lot of bodies involved in putting on production of this nature and to make a sizeable revenue dent.” Ramshaw added that the Tribune spent nearly $200,000 in 2012 on hosting events.

Susan Mernit of Oakland Local says she can put on events, but given the nature of her community, cannot generate significant revenue. “I think part of it is about knowing your market and your audience,” she said. For Rose Hoban of North Carolina Health Care News, the prospect of hosting an event is “impossible” for a one-person shop such as hers.

Steve Waldman observed, “There’s a certain amount of work that is done by a local that is inherently local.  There’s just no way around…. but then there are other functions that could be shared.”

The conversation turned to examples: development of membership models, fundraising strategies, software and other technological needs. Molly de Aguiar, director of media & communication for the Dodge Foundation, pointed to an effort to implement this strategy with their support of the Center for Cooperative Media at Montclair State University. Kevin Davis shared how INN developed a WordPress stack used by more than 45 organizations.

“Many of the nonprofits in this room are highly networked to each other,” noted Brian Wheeler, who pointed to the growth of support networks for outlets like his.

Despite all their differences, the nonprofit journalism field is coalescing—identifying common practices and organizing into groups such as INN and LION. The fragility of the sector remains real, but at least among the members in the room, there were signs that digital nonprofit journalism is entering a new phase somewhere between start-up and maturation.