Elizabeth Green knew there was a failure in the local news model. She says — for lots of reasons — it was broken.

And that’s why the American Journalism Project came about.

The co-founder of the AJP and CEO of Chalkbeat, along with co-founder John Thorton, who founded the Texas Tribune, found each other through a common interest in searching for an innovative media model of the future.

“We both cared about journalism and realized we had a market failure,” Green said. “We realized we needed an intervention.”

She saw a broken model

Green

It was fairly obvious to Green that the current advertising-reliant model was not viable. But maybe even just as big of an issue was the lack of connection between the large media conglomerates and the communities they were supposed to be serving.

“Even in the heyday, when newspapers were taking in billions of dollars in profit, there was a lack of community connection in so many parts of the country,” Green said. “That’s when you serve advertisers first and readers second.”

When you step away from the commercial model is when you truly serve readers, Green believes.

“The right models will look different in different places around the country,” Green said. “In some places, it will involve the reader and in other places, there will be innovative funding through grants and philanthropy — and there will eventually be public dollars that will be important to sustain this important part of our democracy.”

Working on finding a niche

The leaders of AJP describe it as a new venture philanthropy organization that is dedicated to local news. They are working with select news organizations that have unique — or are aspiring to develop —innovative models that do more than just focus on advertising as their primary source of revenue.

“Every good nonprofit has a diversified revenue stream,” Green said. “Being overly dependent on one source is a big vulnerability.”

That’s why AJP is trying to ensure the companies they work with approach their business a bit differently.

Providing niche content is one way, Green said, offering Chalkbeat as an example. Green is the company’s CEO and its mission is to cover improving schools for children, “especially those who have historically lacked access to a quality education.”

“At Chalkbeat we wanted to be able to compete against Facebook and Google, and one way to do that is to give a targeted audience to advertisers by focusing on education,” she said. “We can target this niche in a way for advertisers that the social media companies can’t. It’s a new kind of advertising.” 

Reader revenue, obviously

AJP sees reader revenue as an important lever for media companies. But it’s anything but a one-size-fits-all approach.

“Reader revenue will be a solid leg of the stool,” Green said.

Green explained that reader donations for non-profit news organizations fit quite nicely with their mission.

“Reader donations are not subscriptions,” she said. “Nonprofit news organizations believe we have a public mission to not put up barriers if someone can’t afford to pay to read the news. Donations and membership are a way to appeal to a reader’s civic duty and connection to the brand and mission as a gratitude of the work.”

Berman

Sarabeth Berman, CEO of the AJP, said throughout the coronavirus pandemic readers have swarmed to news sites, many ready to help financially.

“Readers do want to support good work,” Berman said. “A grantee of ours in Puerto Rico did reporting that was instrumental in the governor stepping down. That happened in the same year that they experienced their highest revenue. Readers may make donations off a single story, one that they see made a difference.”

How does philanthropy work for news?

AJP believes in creating investments and venture support that helps uphold civic news organizations. They say they are creating a new public service media that is “governed by, sustained by, and looks like the public it serves.”

Green strongly believes that just like in other sectors, venture philanthropy can help create stable news organizations that are filling holes in the market. In this case, the holes are news deserts or communities that news organizations are no longer covering like they could or should be.

But what exactly is venture philanthropy? In essence, it provides funding for nonprofits that are rallied around a mutually impactful cause, both to funder(s) and to the nonprofit. It’s similar to capital that for-profit companies might get, but has more of a purpose-driven approach built-in.

“At Chalkbeat we work with philanthropists who care about improving education,” Green said. “They provide grants where they don’t necessarily dictate what stories to write, but they just want to see good journalism around a topic.”

While philanthropy is a core part of AJP’s model, they are also eventually hoping for public dollars. 

“We can’t rely on advertising alone to subsidize news coverage,” Green said. “We love the idea at some point of having public dollars supporting the work journalists are doing. We’re not there yet, but believe we will be at some point.”

Many organizations like dance companies and health organizations run off a philanthropy model, Green said. And to begin with, philanthropists can play a huge financial role in helping nonprofit news organizations thrive and provide the runway they need to be successful longterm.

So, how do news organizations work with AJP?

Berman said as AJP geared up, more than 100 civic news organizations sought to work with them. They whittled a list down to organizations that fit with their mission.

Of those hundreds, they selected 11 grantees. This is who they are working with right now:

AJP’s goal is to double or triple each news group’s current revenue through new and better approaches and products. 

In addition, AJP is a funder and philanthropic partner to the Racial Equity in Journalism Fund, with a goal to “strengthen the capacity and sustainability of news organizations led by people of color and to increase civic engagement for communities of color.”

They are working on the fund with Craig Newmark Philanthropies, Democracy Fund, the Ford Foundation, the Google News Initiative, and the News Integrity Initiative at the Craig Newmark Graduate School of Journalism at CUNY.

Addressing the news desert

The number of news deserts seems to grow by the day, and AJP is focused on filling those gaps as quickly as they can.

“The need and opportunity is great,” Berman said. “We are really looking at the news desert map closely, and our intention is to stand up a news ecosystem and reach as many communities as possible, and work to get philanthropists to work with us in these communities.”

Berkleyside is an interesting example of how a news organization can grow and evolve through AJP’s involvement. This year, the founders of Berkleyside created Cityside, a nonprofit, civic journalism organization that publishes both Berkeleyside and Oaklandside. It’s a model that could allow for more sites under a Citywide brand.

“Berkleyside secured a matching fund from Google and they transitioned to a nonprofit news organization,” Breman said. “We think Cityside has the potential to launch new community sites off the back of what has been created.”

A new Start-Up Lab that AJP is working on has great promise to do just what Cityside is doing, and hopefully at a significant scale.

“We are now doing a lot of deep research to identify news organizations that have the ambition and capabilities to scale into new communities. Our Start-Up Lab’s aim is to launch new communities where there are information needs that are underserved,” Green said.

How fast and how quick this can happen is yet to be determined, but Green truly believes that her organization can help fund new launches that are building more diversified revenue streams and scale all at the same time.

“That’s the goal,” Green said. “And I believe we can do both.”