Do you pay for your news? I’ve been doing some work recently on how online news media stay in business, I mean, cough, finance themselves. What I’m finding is surprising, worrying and at the same time uplifting, and while I would love to go on about it for hours, I’m sure you have to go and prepare dinner or go running or take the dog out for a walk. And if you don’t, well, I do, so I’m going to limit my post today to a form of media financing that I would not have expected to work, but it seems that it does: crowdfunding.
And I want to talk about this aspect of media financing first because, when pondering how journalism will cover its costs in the future, and what role citizen journalism has in the big picture (it’ll be more than we expect), this option is the most surprising. You pay for something before it’s created, without knowing what it is. The return is intangible. There are a lot of free alternatives out there. And yet, it works. On Kickstarter alone, over $10 million has been pledged to independent journalistic ideas. And even mainstream media are starting to explore the concept.
Kickstarter is currently the main crowdfunding platform, with over $1bn raised for over 73,000 projects since it started in 2009. Earlier this year it created a separate category for its journalistic projects (which had been previously filed in Publishing, along with children’s books, novels, comics and calendars…). Almost 400 journalism projects have been funded on Kickstarter alone, each raising between $1,000 and $170,000. Indiegogo doesn’t disclose figures, but also has a significant and growing number of journalism projects looking for pre-funding from their potential readers.
While things are starting to happen, it is still a young and untested field, with a patchy success record. On Kickstarter, so far only about 35% of the projects get funded, slightly below the site average of 43% (on Kickstarter, if the target is not met, the platform returns the pledge money to the investors). Personally, I think that 35% is surprisingly high, given the niche value (and, let’s face it, strangeness) of some of the ideas. Take a look at the category and you’ll see what I mean. Several platforms created exclusively for journalism crowdfunding such as Newspryng and Spot.us seem to have stopped activity. The Dish was one of the first big-name blogs to ask readers to financially support its work, through annual pledge drives (the Founding Editor might well disagree, but pledge drives are another form of crowdfunding), although it has since switched to a subscription model (UPDATE: closing down, but for health reasons, not financial).
But, as with any young tech-related sector, it only takes one or two successful businesses to open up the way for others to follow. Beacon is a Y-Combinator-backed platform in which journalists pitch their projects on the platform (for example: “Back me, and I’ll explore how innovations in health technology are changing the way we live.”, from Jenna Owsianik’s “Health Technology and the Future” report, or “To really understand New York, you need to understand the people first. Through words and pictures, I aim to tell their stories as a way to reveal this vibrant city.”, from “Extraordinary Everyday New Yorkers” by Sion Fullana). Readers choose one writer or project to fund with a $5/month subscription, and in exchange they get access to every article by every writer.
The Dutch online platform DeCorrespondent raised over €1 million via crowdfunding, asking interested readers to pledge €60 for an annual subscription to a magazine that didn’t even exist yet. After just 8 days, 15,000 people had signed up, many even adding additional donations on top of the subscription fee. Its current subscriber base is over 30,000. Its manifesto, published on its web, includes: “Journalism over revenues… From readers to participants… No advertisers, but partners.”
There are many, many other worthy success stories. Long-form journalism magazine Matter reached their target on Kickstarter in two days in 2012, eventually raising more than twice what they were hoping for, only to be bought by Medium a year later. Design podcast 99% Invisible (one of the few I listen to regularly) raised $170,000, over 4x their initial target. (UPDATE: for their fourth season, they raised $375,000, more than double their initial goal of $150,000). I love how on their funding page they clearly spelt out how the extra money would be spent (including promising to research cloning the creator of the program if the funding passed $200,000!). If it wasn’t worth backing for the content, it might well be just for the T-shirt:
The large news organizations are getting in on the act. The Guardian works with Kickstarter to curate projects it thinks are interesting, giving them added visibility which will help their crowdfunding campaign. Beacon has joined up with Newsweek and the Huffington Post to fund reporting. Why would established news sites need to crowdfund news? They see it less as a form of financing and more of a way to test market demand.
One huge advantage of the no-ad, no-paywall model of crowdfunded journalism is that it is shareable and indexable, which boosts readership. Another is that crowdfunding allows journalists to see what the public is interested in, before investing the time and money. It is a way to find out, not what readers want, but what we find valuable enough to pay for. True, many worthwhile and important stories could never get written because they did not get the public reaching for their digital wallets – but the failure on one crowdsourcing campaign does not mean that subsequent ones for the same project but with a slightly different approach won’t have more success. Journalism becomes entrepreneurial.
Giving money before production is not the only crowdfunding option available to journalists. There’s the “if you like it, please pay me” option. This financing model, the “tips greatly appreciated” model, was the subject of a much-viewed TED talk by musician and artist Amanda Palmer. “People have been obsessed with the wrong question: how do we make people pay for music?,” she said. ”What if we started asking: how do we let them pay for music?”. Where she says “music”, we could say “journalism”.
I donate to two sites that I read often: Wikipedia, and BrainPickings.org (note to self: must do more). And I have to tell you, it does feel really good. I’m not rich, but giving money to projects that I like when I don’t have to, makes me feel as if I am. And we’re not talking large amounts (see the part about me not being rich), but $25 here and there is the cost of a mediocre meal out.
Backing a journalist or news source, rather than buying a subscription or access to an article, in the end is much the same thing, except for the emotional impact. If I’m backing, I’m investing, and if I’m investing, I feel that I have a connection, a responsibility almost, to follow the work, to hope for their success, to feel pleased when they grow. I’m not buying, I’m giving, and getting in return.
Funding the development of news sources because we feel it’s the right thing to do, with no economic return on our investment in sight, is counter-intuitive to an exinvestment anaylst like myself. Funding something because you believe in their purpose? Projects getting off the ground just because people want to hear what you have to say? That’s not only surprising, it’s exciting and uplifting. Are we really looking beyond what’s ours and what we’re owed, to what’s right and what should be given a chance? In funding a creative effort before it’s even produced, I’d say yes, we are.
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If you’d like more on crowdfunding, check out my Flipboard: