Knight Blog

The blog of the John S. and James L. Knight Foundation

How the Challenge Fund for Journalism helped nonprofits develop better business practices

June 5, 2012, 9:08 a.m., Posted by Eric Newton

journalists

Photo Credit Flickr User Steve Bowbrick 

A few weeks ago, I wrote about how journalism funders this past decade were working together more often. Here’s an example of that. During the past seven years, we teamed up to help journalism nonprofits develop better business practices in a project called the Challenge Fund for Journalism.

A recent study of the Challenge Fund for Journalism showed how the project helped 53 journalism nonprofits, both professional organizations and media outlets.  The fund’s partners were Ford, which created the project, as well as Knight, McCormick, and Ethics and Excellence in Journalism. The management consulting firm TCC Group coordinated the project.

Some organizations, usually the smaller ones, got fundraising and administrative training only. Others got training as well as a grant that they could collect only if they could raise twice as much themselves. That’s like giving away a fish if someone can catch at least two more on their own. Hence, the name of the report on the project: Learning To Fish.  As we’ve said before, the largest amount of philanthropic money given away each year in the United States is donated not by foundations but by individuals. The challenge fund helped nonprofit journalism groups learn to fish where the most of the fish really live.

The foundations put in $3.6 million in grants, and the grantees found nearly $9.5 million in matches.  Nine in 10 made their matching goal.  In addition, 85 percent reported that they experienced positive organizational change as a result of the project. The organizations that did the best realized that “business as usual” was not an option. They appealed to individual donors and broadened their foundation requests to include grant-makers who care about the issues journalists cover, such as civil society or public health. They built new firewalls so certain types of no-strings corporate grants would be allowable.

The International Center for Journalists, for example, doubled revenue from planned gifts and bequests between 2009 and 2012. The Center for Public Integrity ramped up efforts and revenues from individual donors. Investigative Reporters and Editors diversified its revenue streams.

Obviously, the better a group is at delivering the goods, the better its fundraising position. TCC’s coaching, peer meetings and other efforts helped the organizations during a time of “drastic upheaval,” as Ford’s Calvin Sims put it, causing their regular sources to dry up. Said Andy Hall, Executive Director of the Wisconsin Center for Investigative Journalism: “The greatest value of the initiative was that it enabled us to try out new strategies for growth, which ultimately helped change our business model.” The center added board members who knew how to raise money, expanded its corporate sponsorships and introduced new fundraising events.

Too often we take for granted the important role nonprofits play in training and professionalism, or, as Bob Ross of Ethics and Excellence puts it, “maintaining a vibrant journalism sector.” That’s why I think Clark Bell of the McCormick Foundation is right on when he reminds us that, these days, even “healthy organizations have to be willing to revisit and overhaul their business models.” 

By Eric Newton, senior adviser to the President at Knight Foundation