You have probably heard the saying of not putting all the eggs in a single basket. It is especially significant for newspapers. For decades, they depended largely on advertising income.
That system stopped working about 20 years ago, when the public moved to the Internet and advertisers followed their example. The media also moved to the Internet, but found themselves in a battle lost by advertising investment against new digital competitors such as Craigslist, Facebook and Google.
A third of American newspapers have closed in the last two decades, most local.
As their advertising income and subscriptions have decreased, some news organizations that used to depend mainly on advertising income, such as The Salt Lake Tribune and Philadelphia Inquirer, have become non -profit organizations, opening the door to other sources of income.
In addition, the interest in creating news organizations as non -profit organizations has been increasing. Meanwhile, some profit media have begun to obtain philanthropic support and request donations from readers and subscribers.
The journalistic and experimentist studies researcher Katherine Fink, investigated how journalistic leaders conceived their future a constantly evolving panorama and fundraising strategies of the non -profit local media in the US.
In an interview with 23 local media leaders about their fundraising strategies and their perspectives on the best way to balance their long -term financing sources, the researcher discovered that the non -profit media are in need of looking for multiple sources of income, including those of foundations, in the search for sustainable business models.
However, the ideal combination of income can vary for each organization.
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The foundations pay half of the bill
The foundations, especially the Knight Foundation, have become important sponsors of the non -profit media in recent years. According to the non -profit news Institute, the foundations contributed approximately half of the total income of the non -profit media in 2023.
Another 29% came from individual donations. And 17% came from ads and other sources of own income, instead of donations.
The money raised through foundations subsidies can reach major quantities and be more predictable than advertising income. However, it often carries conditions. For example, in exchange for a subsidy, a means of communication could be pressed to adjust your editorial priorities or adopt specific technologies.
The non -profit news leaders said that the foundations tend to be more interested in starting new organizations than in holding media that are already in operation.
Some foundations are making it clearer than ever by asking non -profit news organizations that have supported that they no longer depend too much on them. The Knight Foundation and other financiers have informed the possible applicants who must demonstrate that they seek the diversity of income as a condition to obtain a subsidy.
In other words, the non -profit media should not put all their eggs in the basket of the foundations.
Brancing
Local news leaders said they did not consider having various sources of income necessarily a way towards sustainability. In addition, adding new sources of income entails costs, such as the hiring of membership directors or advertising vendors.
In addition, they commented that it is difficult to know if those investments will be profitable.
Even so, under the pressure of relying less on the foundations and more than other types of income, they have diversified in recent years. According to the non -profit news Institute, the foundations contributed 57% of the income of the non -profit news in 2018; In 2024, that proportion had been reduced to 51%.
But it is not clear how many additional income could come from other sources. Donations of readers are usually small, so the media need many. In addition, people donate to the media for various reasons, so they need to hire funds collectors capable of creating various messages.
However, getting a large number of Done readers is difficult, since local media audiences are usually small.
Non -profit news organizations can also accept advertising. However, advertising is an income subject to taxes, unlike donations. The IRS has also warned organizations that may lose their tax exemption if they accept too many income not related to their non -profit missions, including advertising.
Sharement of donor funds
In short, the interviewees claim that all types of income have their inconveniences. And the more complex its combination of income becomes, the more complex it should be its approach to collection of funds.
Local news organizations that already operate with limited budgets do not have the ability to complicate their fundraising, even if they say they agree with the general principle of income diversity.
The news leaders of non -profit organizations commented on encouraging things about a new fundraising trend: the joint funds. With these funds, several donors contribute to a single beneficial organization that acts as an intermediary and disburses the money donated to a specific type of non -profit organization.
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For example, NewsMatch, of the Institute for Nonprofit News, and Press Forward, a coalition of 20 foundations.
Common donor funds can be considered a form of income diversification, since they combine contributions from multiple sources and are used to persuade individual readers to equal to donations from common funds with their own contributions.
This can protect the news organizations from important changes as the subsidies of individual foundations come and go.
Investigating the role of ‘income earned’
The non -profit news Institute has called it “perhaps the source of income less used by non -profit news.”
But non -profit news leaders had opinions found on the income obtained. This was, in part, to the ambiguity of the guidelines on how much news organizations could accept without compromising their tax exemption.
Given the recent threats of President Donald Trump against other non -profit organizations, including universities and hospitals, news organizations can be even more reluctant to test those limits.
*Katherine Fink is an associate professor of media, communications and visual arts at Pace University.
This article was originally published in The Conversation
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