Giving Compass' Take:

• There are huge disparities in funding between more prominent nonprofit media outlets, and smaller, localized journalism outlets. 

• How can donors address these disparities? What are alternative funding sources for local journalists?

• The American Journalism Project is taking a new approach to funding nonprofit journalism. 

As I explain in my book on U.S. nonprofit investigative journalism, wealthy individual donors over the past decade have provided the venture-like capital to create the most successful nonprofit news organizations, which foundations have subsequently backed with grants.

But while the overall funding for nonprofit news sites presents a “robust picture” according to a recent Institute for Nonprofit News survey of 88 of the network’s media members, large donations by rich philanthropists and foundations generally have benefited only a handful of new startups and nationally focused nonprofit media.

While researching the financial health of U.S. nonprofit news media, I’ve found a huge disparity between the most successful nonprofit news organizations and the smaller outfits, with some operating on the “sweat equity, heart and hope” of journalists who struggle to raise funds.

This situation should concern those who are looking to nonprofit news organizations to provide serious journalism in areas that have been diminished, neglected or abandoned by newspapers, such as statehouse coverage, specialist reporting on topics such as the environment and health, and reporting for minority communities.

The nonprofit media leaders at smaller news organizations that I interviewed expressed existential fears about their funding. Because of the uncertainty of foundation funding, many nonprofit news sites are attempting to ramp up their incomes through membership programs and boost the donations they get from individual donors.

While the number of nonprofit news organizations has increased over the past decade and the sector’s funding has grown overall, many city and state-based news organizations that are filling gaps in local reporting have not yet persuaded enough foundations without a tradition of funding media, wealthy philanthropists and smaller donors to back them.

Read the full article about smaller nonprofit journalism by Bill Birnbauer at The Conversation