Nonprofit newsrooms struggle with long-term funding, Pew study finds

By Andrew Lapin

Finding long-term, sustainable funding remains a top concern among the country’s nonprofit news outlets, according to the results of a study published Monday by the Pew Research Center’s Project for Excellence in Journalism.

Pew’s study found that 61 percent of nonprofit news outlets founded since 1987 were assisted in their early stages by large, one-time foundation grants, but only 28 percent of those newsrooms have received additional funding from the same foundation.

The study, which surveyed 93 digital nonprofit news outlets in late 2012, excluded PBS, NPR and other “longstanding noncommercial organizations” because they had launched prior to 1987. However, the study also omitted local pubcasting stations founded since 1987 because they entered the journalism world with greater institutional support than digital nonprofit newsrooms have, according to Mark Jurkowitz, associate director of Pew’s Project for Excellence in Journalism. Pew chose the cutoff date because it saw the quarter-century timeframe as a useful framework for the study, Jurkowitz told Current.

One-third of the newsrooms surveyed were independent, with the remainder sponsored by universities or other larger organizations. Pew did not separate partisan and nonpartisan sites. All but nine states house at least one nonprofit news outlet, and most of the operations cover niches such as government or public-affairs issues instead of trying to compete with news organizations that cover a range of subjects.

Though the majority of outlets had cash on hand in 2011, the year of the most recent financial data available at the time of the survey, the organizations rely heavily on single-source funding, according to Pew. While 58 percent of outlets draw from at least three separate revenue streams, half of those organizations rely on one stream for more than 75 percent of their income.

“Many of them did not feel like they had the business-side skills or resources to build a successful business model going forward, at least as it currently exists,” Jurkowitz told Current. “They need business help.”

Jurkowitz also noted that many respondents said they were hampered by the culture of nonprofits, which places a much greater emphasis on fulfilling a mission than business skills and financial acumen. “In many cases these guys are getting mixed messages going forward,” he said.

Still, 81 percent of respondents are either “very” or “somewhat” confident that their organizations will become financially solvent within the next five years. Psychology may explain the high level of confidence, Jurkowitz said.

“If you’re engaged in this kind of an endeavor and in a difficult situation where you’re really working to invent something or reinvent something, I think psychologically there just has to be a tremendous amount of buy-in,” he said.

Many digital nonprofit newsrooms are working from small staff pools: Seventy-eight percent of those surveyed employ five or fewer full-time paid staffers, and a little more than one-fourth of all respondents have no paid full-time staff. As to which staffing area they’d like to improve upon, 54 percent said they had the greatest need for business, marketing and fundraising staff, while 39 percent named editorial employees as their top need.

The largest share of respondents, 21 percent, focused on investigative journalism. Geographically, their areas of concentration varied, with 38 percent of respondents geared at a statewide level and 29 percent metro-focused.

Questions, comments, tips? lapin@current.org

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