Tow Center

‘When money is offered, we listen’: foundation funding and nonprofit journalism

January 10, 2020
A money faucet. | Photo: Adobe Stock

The economic outlook for journalism remains dark. The news industry’s once-dependable revenue model, based on selling advertising and subscriptions, increasingly seems like an artifact from a different era. Against this backdrop, many journalism stakeholders have looked to foundation funding for rescue. Between 2009 and mid-2016, foundations gave $1.1 billion to journalism projects within the US.

Such support raises important questions: As foundations grow more powerful within the world of journalism, how might they influence journalistic practice? Will journalists treat foundations like advertisers—an important source of revenue that must be kept away from editorial decisions? Or will the differences between the motivations and approaches of advertisers and foundations produce a different dynamic? 

Many of the foundations within the US that fund journalism hope to help solve the problems facing the profession as a whole: they want to help figure out what works, and what doesn’t. And while the journalists they fund are similarly interested in overcoming the industry’s most pressing problems, they have a lot more to lose. If a foundation funds an initiative that fails, then that foundation can learn from the experience and move on to another innovative approach to journalism. The same cannot necessarily be said for the journalists who receive the funding.

If I wanted to make sure I kept [foundation funding], I would have to reinvent this place every year or so.”

We explored this issue and others in a study recently published in the academic journal Media and Communication. We drew on 40 interviews with journalists at digital-native nonprofit news organizations and employees from foundations that fund nonprofit journalism within the US to understand how each side perceives the influence of foundation finances on journalistic practice. We found that the impact of foundations on journalism parallels that of advertisers throughout the 20th century, with one important distinction: funding from foundations is often premised on editorial influence, complicating efforts by journalists to maintain the firewall between news revenue and production.

We focused on news nonprofits because the number of this type of news organization has skyrocketed over the past two decades. As recently as 2004, the number of nonprofit news organizations that were members of the Institute for Nonprofit News was fewer than 10; today, there are more than 200, including established newsrooms such as The Intercept, The Texas Tribune, and ProPublica. News nonprofits are often lean operations, both in staffing and focus. Some, like The Marshall Project, focus exclusively on one subject (e.g., the US criminal justice system). For the most part, these outlets reject legacy media’s reliance on advertising. Instead, they rely on donations, subscriptions, and development. 

Our study builds on prior research that has concluded that the influence foundations have on the newsrooms they fund presents itself in less obvious ways than many may have initially suspected. We found that foundation funding did not push journalists to pursue or avoid specific topics with their reporting—perhaps the most obvious form of editorial influence. Instead, foundation funding was tied with the methods that journalists utilized for their reporting. The journalists and foundation employees we spoke with described how foundation funding often went to news nonprofits pursuing three types of initiatives: specific, technology-driven projects; audience-engagement projects; and projects intended to push journalists to expand their daily work beyond traditional routines. 

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Donor-driven projects

The most common theme to emerge from our data concerned foundation funding that came with an expectation that journalists use specific new technologies. All but one of the journalists we interviewed mentioned this type of funding, and all the participants from foundations did as well. “For a while,” said one journalist, “it was all about virtual reality. Some biggies like The Guardian made some cool stories using VR and now these places would give anyone money if they promised to use it.” 

The problem, interviewees told us, is that these new technologies are only new for a short period of time. Journalists described feeling compelled to continuously chase the latest tech trends to remain competitive for foundation funding. They felt that these circumstances left their newsrooms with a growing stack of technology that journalists needed to spend time mastering and incorporating into their reporting—even after funding for the adoption and use of that technology had disappeared. As one journalist put it, “All [foundations] care about is how cool something sounds right then… If I wanted to make sure I kept [foundation funding], I would have to reinvent this place every year or so.”

I’m a journalist. This type of stuff basically makes me [the foundation’s] PR man. First, I’m not good at it, and second, I could be doing the work [the foundation] is funding me to do.”

A majority of the journalists interviewed, and all of the foundation employees, also said that foundations currently prioritize “audience engagement” when it comes to the initiatives they fund. Though this is an inconsistently defined term, our interviews suggest it was used to describe efforts by newsrooms to more actively work with and solicit feedback from their readers so that audience members had more agenda-setting power when it came to news story selection. Many of the journalists we spoke with were skeptical about the value of these initiatives. As with the technology-driven initiatives, journalists appeared to consider audience engagement a trend, the pursuit of which came at the expense of resources for actual reporting. As one journalist said:

What people… call engagement isn’t very different than others said 30 years ago. Jay Rosen, for example, is still Jay Rosen. And back then, some places jumped on the bandwagon but most stayed off. The difference is now we have these [foundations] waving money at us, money we need, if we just do this thing or that thing that will engage our public. When money is offered, we listen.

Finally, journalists said they often acquired extra responsibilities when their organization accepted foundation funds. One said that a foundation grant to their newsroom came with a directive to explicitly describe to the public how the organization spent the funds—in news articles, testimonials published on the foundation’s website, or, most commonly, in presentations at industry conferences and events. Journalists described irritation at these directives, again pointing to what they saw as opportunity costs. “I’m a journalist,” one said. “This type of stuff basically makes me [the foundation’s] PR man. First, I’m not good at it, and second, I could be doing the work [the foundation] is funding me to do.”

The foundation employees, unsurprisingly, saw these efforts differently: as a necessary part of their mission to help solve journalism’s most pressing problems. As one foundation employee said, “Everyone wants to find the thing that saves journalism. We want others to know how we’re running it.” 


Evaluating perceptions, not outcomes

To be clear, our study was not an evaluation of the actual initiatives encouraged by foundations or pursued by the newsrooms they fund. Instead, our study demonstrates how perceptions of these pursuits vary throughout the newsrooms that receive foundation funding to pursue them. In doing so, it shows that there appears to be cases where those who receive foundation funding and those who provide it have very different ideas of what journalism should look like and how it should be produced. Indeed, considering how critical some of the journalists we interviewed were about these foundation-funded initiatives, it seems possible newsroom managers who apply for and accept foundation grants feel more passionately about the directives associated with those grants than the reporters and editors ultimately tasked with implementing them.

Many in journalism have undertaken serious and commendable efforts to understand the outcomes of audience engagement and technological innovation within the news industry. But our findings suggest that collaborative efforts between journalism funders and publishers face challenges posed by a skewed power dynamic between those in dire need of institutional assistance and those who hope to use such assistance to find industrial solutions.

Jacob Nelson and Patrick Ferrucci research issues in news production and consumption. Jacob Nelson is an assistant professor at Arizona State University's Walter Cronkite School of Journalism and Mass Communication, and a fellow at the Tow Center for Digital Journalism. Patrick Ferrucci is an assistant professor in the Department of Journalism in the College of Media, Communication and Information at University of Colorado Boulder.