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June 18 2013

02:15

[Net2 Portland] Getting People to Click DONATE on Your Nonprofit Website

Portland’s PDXtech4good recently invited Mazarine Treyz, founder of Wild Woman Fundraising to share her fundraising secrets.

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May 25 2013

19:19

Invitacion a ser parte de RedLATIC - Red de NetSquared a nivel de Latino America

Por iniciativa de algunas instituciones miembros de NetSquared ( http://www.netsquared.org) y con el apoyo de TechSoup Global (http://www.techsoupglobal.org/) estamos armando una red de organizaciones e individuos que tiene por objetivo el uso de la tecnologia para bien social ("technology for social good") en la región de Latino América llamada RedlaTic

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August 08 2012

19:58

Creating a Mobile Marketing Strategy for Your Nonprofit Organization

The Pew Internet & American Life Project reports that, as of early 2012, 88% of American adults had a cell phone. Three out of five of those were smartphones. Yes, that’s right. The majority of cell phone users now own smartphones, and by 2013, experts predict mobile phones will replace PCs as the tool most used to access the web.

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March 15 2011

15:14

Say "No" to Money (to Raise More Money)

Say “no” to money. We dare you. 

Believe it or not, sometimes saying ‘no’ to money, helps the money pour in.  Counter-intuitive? Yes.  But does it work? Yes! 

Based on 10+ years of game-theoretic research and live lab experiments, conducted by two of the company's US founders, NYU and UC Berkeley economics professors, give2gether has built an online fundraising platform, that also introduces some brand new line of thought on crowd and donor sourcing  

Consider ALL or NOTHING when it comes to setting your fundraising goals.

Set an ambitious but not unachievable target, and vow to your donors that unless you hit that target in the allotted time, you will return all the money raised so far. Every single cent.

For example – a hospital looking to raise $50,000 for a new CT machine creates a ‘conditional giving’ campaign.  Either they raise the $50k needed to buy the new machine, or they return any money raised by the time the campaign ends.  They can’t buy half a CT machine, and they won’t redirect the money raised into another cause.  It’s the machine or nothing.

Sounds crazy, eh?  What sort of fundraiser worth their salt would promise to give back money that has been donated by generous, supportive donors?? 

Here’s the thing.  By opting into the ‘conditional giving’ or ‘in it to win it’ strategy, it has been proven in Berkeley XLab (Economic experimental lab) that your donors are more likely to rally, rise up, step up to the plate and come through for you. They know exactly what is at stake, and they won’t let you down. 

Knowing that the balance of the money raised so far rests on their shoulders, gives incentive to civil philanthropists to make the final push, give more than they normally might, and enlist the support of their own networks to help meet your goal before time runs out and the money is snatched back.

And here’s something else interesting.  Try setting a maximum donation amount for your donors.  No, we didn’t say minimum, though that too.  We said maximum.  Donating money is scary. How much to give? How often? Help your donors make those decisions by removing the guilt and uncertainty.  Set an upper limit and time after time, they will donate amounts closer to their top limit, based on your suggested amount.

Now. We don’t just want money from donors.  Your donors are more valuable to your campaigns and causes than just their credit cards, cash and cheques. What you really want are for them to inspire their friends. You want each donor to share and spread, post and get excited, introducing your project to their entire social network and community.  One person with their $50 quickly turns into 100 friends who reach out to their friends each with their $20-50 donation, and see an average social activist bring in x20-x30 of his original individual donation! Awesome!

Our research demonstrates that:

(1) by increasing transparency, fundraisers can enlist trust, donor engagement and commitment  

(2) conditional giving, i.e., the ‘in it, to win it’ principle encourages donors to rise to the occasion to help campaigns succeed and meet their target  

(3) money is not enough, but that people’s vocal support and advocacy are ultimately more important for exponential growth 

 

Shachar Kariv Bio

Educated at Tel Aviv University & New York University; Ph.D. in Economics. In 2003 joined the Department of Economics at University of California, Berkeley as Professor & Faculty Director of UC Berkeley Experimental Social Science Laboratory (Xlab), a laboratory for conducting experiment-based investigations of issues of interest to social sciences. His fields of interest include game theory, decision theory, and experimental and behavioral economics. His research includes social learning, social networks, social and moral preferences, and risk preferences and are published in a variety of academic journals including, The American Economic Review, Games and Economic Behavior, Journal of Economic Theory, and others,

 

 

December 15 2010

12:15

November 19 2010

16:00

The Washington Independent is folding, the CEO goes over the books and outlines the lessons he’s learned

On Wednesday, the nonprofit news and politics site The Washington Independent announced that, after just under three years of publishing, it’s closing shop. Its state-based sister site The New Mexico Independent said it would reduce its staff to just one part-time blogger.

News organizations open and close all the time, but this one hit home for me. I joined The Washington Independent in late 2007 as its managing editor and went on to be its top editor before joining the Lab. Several of my former colleagues have already lamented the loss of a valuable news organization; I could do the same, but in the spirit of the Lab, I’d like instead to look at what went wrong financially and what lessons could be learned by other nonprofit publishers from its experiences.

To get a sense of what happened, I spoke with my old boss, David Bennahum, the CEO of the American Independent News Network, which publishes the Washington and New Mexico sites plus a network of six other sites. Back in January, Bennahum told me that in the first five years the organization existed, he’d raised $11.5 million. With that kind of impressive fundraising, what went wrong? And what kind of outlook do other nonprofit news sites have? Here are three contributing factors to the closing:

The economic crisis

Nonprofit organizations are no less susceptible to the pain of an economic downturn. In the past two years, foundations and other donors regularly cited shirnking endowments as a reason for not renewing gifts or initiating new giving. That forced the network to spend less and still dip into reserves to cover costs. “It’s actually quite difficult to get these [nonprofit news sites] funded and get them to run,” he said, no matter the editorial success of the site. “It just never gets easier.”

In an email Bennahum sent to his staff, which he forwarded to me and is published in full at the end of this post, he broke down the numbers like this:

  • In 2006, 2007, and 2008 we raised $8.3 million and spent $6.5 million.
  • We ended 2008 with a surplus of $1.6 million.
  • In 2009 we raised $2.7 million and spent $3.1 million, eating into our reserves by $400,000.
  • In 2010 we will raise $1.9 million and spend $2.7 million; we expect this to leave us around $400,000 in reserves.

Going forward, each site in the network will need to generate enough fundraising to support its operations — successful fundraising for one site will no longer support other nodes in the network. The Washington and New Mexico sites were the two not pulling in enough to cover their costs independently. They also both launched in 2008 with a similar structural problem. In Washington’s case, a single $600,000 donation largely got the project off the ground. New Mexico launched with the backing of a small pool of donors. Those early donors didn’t renew another year.

Not enough multi-year commitments

Bennahum says in hindsight, he should not have launched without multi-year commitments from big donors, even if it meant starting off smaller. For example, had he negotiated the $600,000 donation as three $200,000 grants over three years, The Washington Independent would have been smaller, but more stable. “We would have been half the size — which means today, instead of this position, I might have had several hundred thousand more dollars left,” he said. “We probably wouldn’t be closing The Washington Independent.”

The Washington Independent launched with two full-time editors, about ten reporters (a mix of full and part time) and a substantial freelance budget. By the closing announcement, the staff was down to one editor and four reporters. “You have to have your own diet. If someone puts out a big buffet in front of you, you have to think twice,” he said. “That’s a lesson I’ve learned that we’ll just never repeat again.”

Not growing gradually

Bennahum says the next year will focus on what he described as “a more diversified mix of journalism projects that work in recessionary times.” Earlier this year he launched a site called The American Independent that aggregates stories from around the network and runs original content from states without standalone sites. The idea is to produce new content without the commitment of launching a new state-based site. Currently, reporters file stories from North Carolina and Texas. The funding for those reporters ends in January 2011, which they understood when hired on contract. The site, though, will continue to operate.

“The incremental cost to adding reporters [to The American Independent] is potentially a much lower price than you could operate a newsroom,” he said. “It creates a much more organic and gentle growth path.”

The network will continue operating sites with small staffs of one to three reporters in Iowa, Colorado, Michigan and Minnesota. The Florida Independent received a grant from the Knight Foundation this year for $175,000 (the network’s largest donation) and will continue to operate with a staff of five.

Bennahum says he wants to experiment more with syndicating content across his sites to see if even a site with one reporter can serve a community. “It’s just a great thought experiment,” he said.

So what does The Washington Independent’s demise say about the growing nonprofit sector of journalism? Bennahum said that, for now at least, journalism still isn’t in the same category as the sort of nonprofit entities that get long-term foundation support, like hospitals or schools. Philanthropists are still watching where the news industry is headed.

“‘Let the market sort it out,’ is a lucid response, and not necessarily wrong,” he said. “For the foreseeable future, success [in nonprofit journalism] is going to be the exception to the rule.”

David Bennahum’s staff email:

Dear Team Members:

In four years, we have built an extraordinary news organization. We can proudly track 600,000 monthly readers, and cite dozens of stories that have had a demonstrable impact in the communities we serve. Along the way, we’ve also received over 40 awards for excellence in journalism. We have pioneered a model that melds the benefits of the Internet (speed, voice, dialogue) with the discipline of serious investigative journalism.

I am proud of all we have accomplished together.

It is all the more remarkable for how we’ve done this in the worst economic climate since the Great Depression.

So I want to be transparent with you in regards to our financial position, as it will have consequences for 2011. Here’s the arithmetic:

  • In 2006, 2007, and 2008 we raised $8.3 million and spent $6.5 million.
  • We ended 2008 with a surplus of $1.6 million.
  • In 2009 we raised $2.7 million and spent $3.1 million, eating into our reserves by $400,000.
  • In 2010 we will raise $1.9 million and spend $2.7 million; we expect this to leave us around $400,000 in reserves.

Thus we have, for two years, been self-financing from reserves accrued during better economic times. I am grateful for these reserves, and that we could use them judiciously over 24 months. However, it is no longer possible to self-finance the gap between income and expenditures, for the simple reason that our cash reserves are too limited to do so.

Much of the shortfall in our income has to do with the larger economic climate. But not all. Here are some other factors that I, frankly, underestimated: We agreed, in the past, to open programs without multi-year commitments from supporters. In some cases, these supporters have not renewed their commitments, yet we have kept operating the programs at close to scale. In particular, this is the case both for The New Mexico Independent and The Washington Independent.

We are approaching our fifth year of operations; some of our founding supporters have, understandably, felt that the time has arrived to shift their support elsewhere. This is a relatively predictable pattern in philanthropy: 3-5 years of support from any given source is a safe assumption. Replacing this support with new support requires a 9-18 month development cycle. In this economic climate, it is closer to 18 months. The net result is that we see, in addition to a shortfall, our most conservative estimates actually coming true. For instance, in the summer of 2009 we did a worst case scenario for 2010, with regards to income, and projected $1.9 million in revenues. This is precisely what happened.

So going forward, we must adopt a new set of rules, to ensure our overall viability through an economic crisis that persists, and may persist for several more years:

Institute “pay go” budgets: programs must be supported. When they are not, they have to be either closed or operated at the level being supported. In the case of new programs, require multi-year commitments as a precondition for operations. This is what we have successfully done in Florida, where the program has two year commitments.

Be more innovative in terms of leveraging the “network effect” to help smaller programs operate with limited budgets. We pioneered this in Minnesota, where we’ve learned to operate a robust site with one full time reporter. The site is successful thanks, in part, to the way we can syndicate content throughout the network from our sister sites.

Using this framework, there are two programs that, unfortunately, are no longer sustainable at their current levels: The New Mexico Independent and The Washington Independent.

In the case of New Mexico, we are going to institute the Minnesota model, with the aim of working to rebuild support over time. In the case of The Washington Independent, we are going to merge the site with The American Independent, and now have one national place (instead of two) for all our reporting. Over time, we aim to build up our reporting capacity in Washington as support develops.

And going forward, we will be looking to a different architecture with regards to how we create new sites: more of our programs will live as “state pages” on AmericanIndependent.com rather than as stand alone websites. This will provide us with more flexibility and leave us less vulnerable to sudden changes in support levels.

More details in terms of how these changes will affect you will be forthcoming shortly from the editorial team.

I know that this news is hard, and the decisions that led to this did not come easily. We have learned to work with less, and done so admirably, but I am taking the prudent course that will ensure our network and its mission can thrive. And if things improve faster than anticipated, I look forward to having that good problem on our hands.

Please know that you can come to me with any questions about this situation.

Thank you.

Best,
David

November 15 2010

14:06

The Pros and Cons of Using Kickstarter to Fundraise

We recently ended our first big fundraising drive for the LocalWiki project and wanted to take a moment to step back and reflect.

In particular, we'd like to talk about the funding platform we used, Kickstarter, and its advantages and disadvantages. While we already had a grant from the Knight Foundation to develop the LocalWiki software, we need to raise more money to go beyond just the software and help us do community outreach, coordination and education to ensure our project's success.

What is Kickstarter?

Kickstarter describes itself as "a new way to fund creative ideas and ambitious endeavors." It works like this:
  1. You post a project description on Kickstarter. You make a pitch video. The video isn't a strict requirement, but almost all funded projects have a video. You come up with a set of "rewards" for different pledge levels on the site. You set a funding goal and a time frame for your project.
  2. Kickstarter staff look at your proposed project and provide feedback. Then they (hopefully) approve your project and it's posted on the site.
  3. Your project goes live.
  4. If you don't hit your funding goal in the specified time frame, no one's cards get charged and you don't receive any of the funds.

Sounds simple enough, right?

An almost remarkable percentage of Kickstarter projects reach their funding goal. How's this possible? There are a few reasons why Kickstarter appears to be such a successful fundraising platform.

1. Staff Filtering

As mentioned before, the Kickstarter staff review postings before they appear on the site. In our case, it took a few days of back-and-forth with Kickstarter staff for our project to get a green light.

In our case, Kickstarter staff were concerned with our initial reward selections. Kickstarter wants you to have a rich selection of rewards that provide a lot of value to pledgers. For instance, something that seems like it ought to be worth $50 should be priced as close to market value as possible in the reward selection. We almost gave up on using Kickstarter because the approval process appeared to be pushing us toward a reward selection that would really cut into our real, post-reward funds.

That raises another important point: Kickstarter staff wants your project to succeed. Their filtering process helps Kickstarter ensure high quality (lots of successful projects!) and also lets them push project creators to maximize their chances of success (well priced rewards!). The main reason Kickstarter staff wants your project to succeed, though, is because Kickstarter takes a 5 percent cut of your funds.

So, in our case, we ended up paying Kickstarter $1,316. That's fairly significant, but it may be worth it.

2. The Kickstarter "Mold"

Launching a Kickstarter project means you're going to have to do certain things if you want to meet your funding goal:
  • Produce a video about why you want to raise money. This helps you focus your message into a couple minutes. This helps you fundraise.
  • Write about, and provide updates, why you want to raise money. Again, this forces you to focus your message.
  • Widely publicize your project. This is magnified by the next point ("All-or-nothing").
Your project will also be sitting alongside lots of other interesting projects, so just "hanging out" on Kickstarter may help your fundraising effort seem more legitimate. However, you may not get many pledges from traffic originating from Kickstarter.com -- this really depends on what type of project you have. In our case, probably 90 percent of our pledges came directly from folks browsing Davis Wiki.

Having to fit into this mold means you're going to have to do the kinds of things that organizations that fundraise successfully do. Which is great, because you might not have done all these things otherwise.

3. User Interface

When we decided to launch our outreach/education fundraiser we didn't have a lot of time to prepare a fancy fundraising site. We knew the Knight Foundation grant announcement would generate a fair amount of press and we wanted to capitalize on that excitement and energy. We had a couple days before we had to be in Boston for the announcement and most of our time was spent making our fundraising video. So having a pre-built, well designed fundraising site like Kickstarter really helped us.

Here's what you see when you click the usual Paypal "Donate" button on our site:


and here's what you see when you click "Pledge" on Kickstarter:


While we could have crafted our own pledge drive interface on top of a payment gateway, using Kickstarter saved us a lot of time.

4. All Or Nothing

Kickstarter pledge drives are "all or nothing," meaning that if the goal isn't met by the specified time then no one's credit cards are charged and the project doesn't get any of the pledged funds.
 

Surprisingly, the all-or-nothing nature of Kickstarter is its greatest asset in ensuring projects hit their funding goal. Once a project has reached a certain threshold of funding, the project creators (and pledgers!) feel an intense desire to "unlock" the money. In fact, word has it that something around 90 percent of projects that reach 25 percent of their funding goal are eventually fully unded.

Having projects be all-or-nothing was probably a decision made by Kickstarter to support projects that need to meet a concrete goal, such as printing the first major run of a new book. These are, by and large, the sort of projects Kickstarter excels at funding -- projects where, if a certain amount of money isn't raised, the project simply isn't possible, or isn't worth it.

But what about projects that deviate from this format? Projects that need to fundraise money but aren't goal-or-doesn't-matter? For more general fundraising projects, the all-or-nothing property has an interesting effect: It functions as a sort of "matching donation" multipler. In traditional fundraising, matching donations -- where an individual or organization pledges to donation $X but only if $X is raised independently -- are a common and successful way to drum up contributions. With Kickstarter, a donation of $50 with a $10K goal can be thought of as being "matched" by 199 other $50 contributions!

The all-or-nothing characteristic is a way to create a big "matching donation" pool and helps drive pledges even for projects that could make do with less than their goal amount.

Drawbacks

It's not all milk and honey, though. There are some hidden drawbacks and costs to using Kickstarter.
 

Fees

Kickstarter takes a 5 percent cut of your pledges and Amazon will take an additional amount (around 2 percent) on top of that. If your margins are slim, this could be significant.

You should think about it like this: I'm paying Kickstarter 5 percent of my pledge goal if we make it. Is the Kickstarter service worth the 5 percent? In particular, you should think about 1) The pre-built platform you get with Kickstarter; 2) the publicity of being on Kickstarter; 3) the "mold" that Kickstarter forces you into and the value of that.

#1 is worth it if you don't have a lot of time or resources to build something yourself. We certainly didn't.

In some cases, #2 is really valuable. Obscure, quirky projects can get amazing press just by being a part of Kickstarter. But if you're doing something more like a traditional community-based fundraiser you probably won't get much from #2. For us, the publicity of being on Kickstarter didn't drive a lot of pledges, but it did give us some valuable exposure.

I think everyone can benefit from #3 unless you're a large organization with a track record of successful fundraisers. In that case you've already got methodology, fundraising materials, and probably a big existing donor base.

It's hard to take Kickstarter fundraising offline

We held a couple of offline events during our pledge drive (a bar night and a silent auction). Unfortunately, it's pretty difficult to move offline funds back onto Kickstarter. You're not permitted to "pledge" toward your own project, which means you need to find a trustworthy third party to agree to pledge any offline funds. This also means the offline donors won't be noted on Kickstarter.

For local community-based fundraising efforts this can be problematic.

The all-or-nothing system is a bit confusing

Unfortunately, the all-or-nothing pledge system can be a bit confusing. Many folks we talked to thought they had already given us money before we hit our funding deadline.

Our fundraising period was 90 days -- the longest allowed by Kickstarter -- and so there were lots of people who'd simply forgotten they'd pledged by the time their cards were charged. Thankfully, Kickstarter is astonishingly good at collecting funds (they pester pledgers with an email every day for a week if their card is declined), and we only saw a few pledges that never came through.

Many successful projects are basically product sales

Despite the perception of Kickstarter as a fundraising site, a large number of high profile Kickstarter projects are, at their core, product sales. What do I mean by product sales?

Well, all Kickstarter projects have rewards. And unless you get remarkably lucky, you're going to have some cost associated with acquiring, shipping, and dealing with that reward. For folks in the non-profit world, we're all very familiar with the standard tax-deductability formula that's on donation receipts:

(Amount contributed) - (Value of goods or services given to donor) = Deductible amount

This isn't just some tax mumbo-jumbo -- it tells that the donor intended to give at least the deductible amount to the organization or project itself. But this formula doesn't tell us everything. After all, oftentimes we get goods or services donated to us and then, in turn, give them away. We're still bringing in money, either way. So the important missing part here is the cost to us of those goods or services, right?

(Amount contributed) - (Cost to us of goods or services given to donor) = Our profit

The first formula is still useful for differentiating these "I'm basically selling something" Kickstarter projects from "I'm doing something amazing, help us!" projects. So let's call the first formula the "Donation amount" and the second formula the "Profit amount."

How do projects measure up?

Methodology: I calculated Profit and Donation amount by using my best guess of production cost and resell value of the rewards (to an interested party). For instance, a T-shirt is counted as having little or no value (unless the project is all about T-shirts). This is roughly how the IRS counts things.

I also subtracted estimated Kickstarter and Amazon fees from total profit. I also factored in over-pledging and "no reward" choices.

The following are projects I've heard about recently, either because they got widespread press or because they touched my social circle in some way:

  • Vuvuzelas for BP: Raised $6,846 with a pledge goal of $2,000. Estimated Profit: $5,437. Estimated Donations: $6,846. Profit percentage: 79%. Donation percentage: 100%.
  • NIMBY - Industrial Art and DIY Space: Raised $17,897 with a pledge goal of $17,255. Estimated Profit: $16,161. Estimated Donation: $17,823. Profit percentage: 90%. Donation percentage: 100%.
  • Hollaback!: Raised $13,560 with a pledge goal of $12,500. Estimated Profit: $12,241. Estimated Donation: $13,466. Profit percentage: 90%. Donation percentage: 99%.
  • Decentralize the web with Diaspora: Raised $200,641 with a pledge goal of $10,000. Estimated Profit: $135,905. Estimated Donation: $180,051. Profit percentage: 67%. Donation percentage: 90%.
  • Embodiment: A Portrait of Queer Life in America: Raised $12,568 with a pledge goal of $10,000. Estimated Profit: $11,397. Estimated Donation: $10,848. Profit percentage: 90%. Donation percentage: 86%.
  • Punk Mathematics: Raised $28,701 with a pledge goal of $2,400. Estimated Profit: $20,224. Estimated Donation: $17,225. Profit percentage: 70%. Donation percentage: 60%.
  • Power Laces: Raised $25,024 with a pledge goal of $25,000. Estimated Profit: $12,429. Estimated Donation: $12,904. Profit percentage: 50%. Donation percentage: 51%.
  • Designing Obama: Raised $84,613 with a pledge goal of $65,000. Estimated Profit: $24,717. Estimated Donation: $30,010. Profit percentage: 29%. Donation percentage: 35%.
  • Coming and Crying: Real stories about sex from the other side of the bed: Raised $17,242 with a pledge goal of $3,000. Estimated Profit: $10,773. Estimated Donation: $6,144. Profit percentage: 62%. Donation percentage: 35%.
  • Glif - iPhone 4 Tripod Mount & Stand: Raised $137,417 with a pledge goal of $10,000. Estimated Profit: $98,950. Estimated Donation: $15,467. Profit ratio: 72%. Donation ratio: 11%.
  • Lockpicks by Open Locksport: Raised $87,407 with a pledge goal of $6,000. Estimated Profit: $64,043. Estimated Donation: $4,922. Profit percentage: 73%. Donation percentage: 6%.

This is hardly a proper random sample, and all of these projects were successfully funded. Many projects on Kickstarter never reach their funding goal. Unfortunately, it's difficult to search Kickstarter for unsuccessful projects for more data points.

Additionally, there are other costs associated with shipping rewards and time spent drumming up pledges, processing shipments, etc. Theses costs weren't included, but some costs (like time) are very real.

Conclusion

So, is Kickstarter good for running fundraising drives? Well, let's take a look at this graph:

That big spike is the Diaspora project, which had a few extraordinary factors working in its favor -- perfect timing, massive public backlash against Facebook, and a huge NYT piece. Ignoring that spike, it's clear that the projects which have the highest Kickstarter totals are those that are actually getting the least amount in donation-like pledges.

So while Kickstarter has many high-profile, successful pledge drives under their belt, the campaigns that raise the most cash tend to not look much like traditional donation drives.

All-in-all, we're happy we used Kickstarter. It helped us raise significantly more than we would have otherwise. It has drawbacks, though, particularly for non-profit organizations wanting to run somewhat traditional fundraising drives.

September 27 2010

14:00

Jeff Israely: Juggling on a tightrope, aiming for a news startup’s launch

[Jeff Israely, a Time magazine foreign correspondent in Europe, is in the planning stages of a news startup — a "new global news website." He details his experience as a new news entrepreneur at his site, but he'll occasionally be describing the startup process here at the Lab. Read his first, second, third, fourth, and fifth installments. —Josh]

For any startup dude or dudette, impatience is a virtue…and delays a necessary evil. You must insist, insist, insist and then keep insisting: with gurus, colleagues, developers, designers, potential partners and funders, and that eternal beast of institutional inertia. But you must also remember that all those people essential to your success can never share the same degree of urgency you have in getting your project off the ground.

So we must always guard against our own over-eagerness, that hunger to start actually producing what we have spent months preparing to produce, to finally have something to show for yourself. The journobeast is a creature used to having his work out there to see and touch, and so we must adjust to the longer rhythms and anonymity that go with planning, lining up ducks, laying groundwork. Succumb to your own anxiety and vanity, attempt to stick to timetables linked more to your (tunnel) vision and psychology than to the facts on the ground, and you can start to make mistakes: You frighten away people who might otherwise (in due time) be on board; you overlook key details; you oversell the proximity of your target launch date.

Even in this space, for example, I’d desperately wanted my first after-the-summer post to include a sign-up page — and perhaps the announcement of our name — to add some grist to these musings. That ain’t happening here and now, though it does feel as though we are close enough for me to say (ever impatiently!) that over the next two posts the who and what we are will begin to come into focus, as we head toward the alpha launch of our website.

Still, as always, I hope there may be something from the startup experience itself that may be worth sharing with others wading through the wreckage and sawdust and buzz of heavy machinery of this global information retrofitting. In the final countdown phase of my little piece of it, five distinct areas are staring me in the face: product, partnerships, team, fundraising, the company. Like a watch, all are interconnected, and must be properly calibrated to keep the thing moving forward. But things move forward (or backward) at unpredictable paces. Progress on one of the five components can spur on the others, and the whole project suddenly lurches forward; conversely, one aspect getting sidetracked can send the whole thing unraveling. It’s a confidence game. A juggler on a tightrope. Last week, I taught our French lawyer Serge Vatine the expression Catch-22. The road of a startup is filled with countless such binds and potential binds. They are what keeps me up at night…and alas, what sometimes slows things down.

Smarter, more seasoned people who have already crossed the threshold and beyond can tell you from experience what worked and didn’t work in the weeks before launch. Instead, here I can tell you what it looks and feels like now: facing the unknown of all those moving parts. Scared. Hopeful. Too dumb to know any better.

PRODUCT: One could break down the building of a news website into two component parts: the journalism/information and the how-to-get-it-delivered/consumed/interfaced-with. Content and functionalities. In an ideal world, they should serve each other. But the reality of this early stage, when you’re not quite sure what you have, when your time and resources (that’s what polite folk call cash money) are limited, extra attention on one can sacrifice the other.

We have the good fortune to have found Lili Rodic, who began her career as a journalist, to project manage the development of the site. Though she may not be able to provide us with everything on our wish list, within the constraints of time and money, it’s never because she doesn’t understand what we are after. She knows perhaps better than us — too often entranced by some cool feature or design — that the functionality is not an end in itself, but a tool to bring out the best in the journalism. That is, in fact, our product.

PARTNERSHIPS: In the networked future-of-news, doing it alone is not an option. Gotta partner up, link out, look for love. Partnerships are fundamental to the content we will be offering, and we are perhaps farther along on this aspect of our project than any other — and pleasantly surprised by the relative lack of institutional inertia. But the Internet’s immediacy and accessibility is a double-edged sword: It makes it much easier to actually get a product up and visible. And that means some people will want to wait to see you in operation before committing. That’s been particularly true on the distribution side, where the good feedback from would-be partners has stopped short of actually talking turkey on sales, syndication, links, etc. Instead it’s been some variation on “Let us know when you have something live.” (See above overeagerness to launch!)

TEAM: I have had conversations, in one form or another, with some 20 journalists — of all ages, locations, levels of experience and ranges of interests — who could potentially take part at launch. My network from my years as a foreign correspondent is key to all of this. Still, others have found me via my more recent blogging and tweeting. It’s obviously a buyer’s market — lots of talented people trying to figure out how to continue (or begin) making a living in this line of work. But it’s also a moment of great uncertainty. Talk is plenty, ideas abound, and many by now have had brushes with startups, some of which have never gotten off the ground. Or gotten people paid. So the conversations, on some level, must remain just that until…

FUNDRAISING: It was a full 13 months after the first draft of my business plan that I actually asked anyone for money. Sure, I’d been thinking about it, talking about it, reading about it from people on both sides of the proverbial table. Once I have more perspective on the process, I plan to write a separate post on what it’s like for a longtime staff journalist (read: employee), who is used to asking just about anything from complete strangers except money, to find himself seeking out serious people who might be willing to bet their hard-earned cash money on him.

I am lucky to have a business partner, Irene Toporkoff, who has plenty of experience dealing with money, contracts, and the like…though for her too, this is the first pure fundraising startup experience. We are still gathering advice, getting reactions to our project. But I am now no longer shy about telling just about everyone I speak to that investment is at the very top of our to-do list. Though we still have a scenario for launching first in pure bootstrap mode in order to show what we have to potential investors, we are convinced that we can show much more clearly what we we can do at launch if we have the proper, er, resources.

THE COMPANY: We have decided after some initial wavering to incorporate the company in France, though we know that we can always expand our operations and company to the U.S. Our choice to launch here is in part because that is where we are based. We also like the idea of a new English-language global news source that was born here in the rest of the world. A global perspective is key to the product we will be offering.

But we have also found that France has quite a lively Internet business environment, with smart, forward-looking people and new laws to encourage entrepreneurship. That doesn’t mean there isn’t paperwork to take care of, documents to fill out, a bank account to open. That, it turns out, is high on our to-do list this week. And by October 1, this would-be world news startup will be a living, breathing company. A champagne toast will be in order, then right back to work…and plenty more impatience on the way.

September 20 2010

16:00

A warning to nonprofit news organizations: Government funding may not boost the bottom line much

At a time when some Americans are talking about increasing government support for journalism, here’s an interesting new study that adds a useful data point to the discussion: When governments provide financial support to nonprofit organizations, 73 percent of the extra money is counterbalanced by a decline in support from private donors. In other words, the value of government money received is decreased by a reduction in funds from elsewhere.

The paper is by Jim Andreoni of UC San Diego and A. Abigail Payne of Canada’s McMaster University, and it examines over 8,000 nonprofit organizations. The idea that government funding reduces private giving is not new, but this paper attempts to figure out why — and how — the trade-off occurs. Is it because private donors think that government grants eliminate their own need to give — the idea that they “already gave at the office” through their tax dollars? Or is it because getting government money causes nonprofits to relax, to reduce how aggressively they pursue outside money through fundraising?

Andreoni and Payne come down squarely on the side of the latter — it’s primarily nonprofits’ own reduction of their own fundraising efforts that lead to less outside support, not any change of heart by donors. When the government gives, nonprofits take that as an opportunity to cut back on fundraising, even though fundraising is highly cost-effective; the paper finds an average $5 return in gifts for every $1 spent on raising money. Reducing fundraising may save some cash in the short term, but it doesn’t appear to be a smart strategy.

If charity managers find fund-raising a “necessary evil,” or fear it may hurt their evaluation from charity watchdog groups, then a government grant will allow them to redirect efforts from fund-raising to providing charitable services. This means that after getting a grant, charities may simply cut back fund-raising.

The paper finds that for every $1,000 given through a government grant, nonprofits reduce their spending on fundraising by an average of $137. But that decrease leads to a drop of $772 in donor gifts. (The paper found that, contrary to the fears of some, government grants encourage outside donors to give instead of discouraging them — but the impact is small, only about $45 per $1,000 in government grants.)

In other words, adding it all together, $1,000 in government money only nets out to $410 in the end, on average.

The study didn’t look specifically at nonprofits engaged in journalism, and it’s difficult to apply its findings directly to the ongoing debate over government support for news. Check out the full paper for much more detail. But if I were in charge of a nonprofit news organization, here’s what I’d take away from Andreoni and Payne:

Government help is not a cure-all. Even setting aside the very legitimate arguments over the wisdom or ethics of government support for news, it doesn’t appear to be quite the financial boon some are foreseeing, at least for nonprofit organizations more broadly.

Fundraising is worth investing in. Andreoni and Payne say it’s surprising to economists that $1 spent on fundraising could lead to $5 in revenue, but it’s a robust finding that lines up with what the industry reports internally. They also point out that not every nonprofit approaches fundraising with the same sort of enthusiasm (the “necessarily evil”); those who find the task distasteful will pay for it in the pocketbook.

Success in one source of revenue can’t lead to the abandonment of others. The smartest nonprofit news organizations are busy trying to build a multi-pronged model for financial sustainability — often blending advertising, sponsorship, small individual donors, money from big foundations, content-sharing alliances, and more. Over-reliance on any one source is dangerous; just ask the publisher of a major metro newspaper about classified advertising circa 1995.

Photo by Thomas Hawk used under a Creative Commons license.

September 15 2010

17:00

Government-free* nonprofit journalism, asterisk included

Here’s a test for nonprofit journalism and its stakeholders.

The following sentence comes from the “Contribute” page of a nonprofit journalism organization. What’s wrong with it?

The [organization] neither accepts nor receives any government or taxpayer-financed grants and relies solely on the generous support of our donors.

The answer is…nothing is wrong.

Ha! It was a trick question. The website belongs to a news organization that says it helps produce independent journalism and doesn’t like the idea of government supporting its work. No problem.

But in the same breath, the organization informs its potential donors: “Your donation…is tax deductible to the fullest extent of the law under Internal Revenue Service Code Section 501(c)(3).”

Now we have a problem.

The organization I am zinging here, the Franklin Center for Government and Public Integrity, believes that tax deductions for donors aren’t the same thing as government support. “Our generous contributors are not funding government support of journalism when they donate to the Franklin Center,” Jason Stverak, the group’s president wrote in an email. (Complete response below.)

Economists disagree. Charitable deductions are known within the realm of economics as “tax expenditures,” and according to Stanley Surrey, the former assistant Treasury secretary who coined the term, they’re no different than direct government spending.

“Whatever their form, these departures from the normative tax structure represent government spending for favored activities or groups, effected through the tax system rather than through direct grants, loans, or other forms of government assistance,” Surrey wrote with coauthor Paul McDaniel (emphasis mine).

The Heritage Foundation offers a similar definition. It says in part: “The word ‘expenditure’ is used to highlight the similarity between the use of the tax code to provide advantages to a select group and the more traditional method of giving the group a slice of the federal budget.”

Last month, I took WikiLeaks to task for promoting itself as a cutting-edge proponent of transparency in government while failing to disclose much of anything about its own funding and expenditures. My gripe, in a nutshell, was that WikiLeaks’ adherence to a double standard undercuts not only its own credibility, but also that of the entire nonprofit sector in journalism.

Like WikiLeaks, the Franklin Center seeks to “advance the cause of transparency in government” while it also withholds information about its own finances. But it slides further down the slippery slope when it condemns the idea of government support for journalism and then makes that condemnation a central selling point in its case for philanthropy — tax-deductible philanthropy, no less.

The Franklin Center isn’t alone. In Idaho, the Idaho Freedom Foundation, publisher of the nonprofit Idaho Reporter says this on its “Donate” page:

The Idaho Freedom Foundation relies solely on the generosity of individuals, foundations, and corporations that share its commitment to freedom. IFF does not accept any government funding. IFF is a tax-exempt organization under section 501c3 of the Internal Revenue Code. U.S. citizens will find their contributions to be tax-deductible to the extent allowable by law.

Some of the biggest names in the world of Washington think-tankdom commit the same offense. They include the Progress and Freedom Foundation and the Heritage Foundation, both of which oppose the idea of government policy changes to support journalism.

I’m not here to flog the Franklin Center or any of these other organizations for their ideology. I know from a decade of reporting on Capitol Hill that it’s darned hard to maintain one’s purity when money is involved. But those who count themselves among the nonprofit sector in journalism should walk their own talk: Tax deductions for donors are government support. Any nonprofit organization that says it “relies solely on the generous support of our donors” while also promoting the charitable tax deduction available to its donors is issuing, at best, what the late Ron Ziegler might have called an inoperative statement.

The fact is, government subsidies for journalism are everywhere. In addition to the charitable tax deduction, they include mechanisms such as favorable postal rates and revenue-producing legal-notice requirements. Geoffrey Cowan and David Westphal of USC identified these government subsidies to journalism in a report earlier this year and argued that they were intended by our founding fathers to help support a vigorous press.

If you don’t buy their argument, another proponent of the view that tax deductions constitute government support is view is Sen. Chuck Grassley. The Iowa Republican has been a tireless watchdog over the nonprofit sector, and the charitable tax deduction has been his entry point to investigations of hospitals, athletic booster clubs and other 501(c)(3)s.

So what to do in a world of ambiguity?

One solution would be for journalism nonprofits that oppose government support to refund the value of donors’ tax deductions to the U.S. Treasury. The Franklin Center recently named an advisory council that includes well-known journalists such as Tucker Carlson, and maybe that body could take up the idea at their next meeting. But I’m not holding my breath for that to happen.

Here’s another scenario: What if Grassley slipped in a legislative rider ending the charitable tax deduction for organizations involved in journalism? I bet the nonprofits mentioned above would howl like holy heck.

Perhaps the best thing would be for these organizations to acknowledge the reality of their dependence on government support and focus instead on journalism. They have a lot to contribute from their point of view, and that should be reason enough for readers to support them. Until then, a little more transparency might be in order. If journalism nonprofits want to denounce government support while promoting tax deductions for donors, they should add an asterisk and a disclaimer to their solicitations for support. It’s the transparent thing to do.

I asked representatives of several journalism nonprofits whether they thought tax deductions constituted government support. Here is the full response I got from Jason Stverak of the Franklin Center.

Our generous contributors are not funding government support of journalism when they donate to the Franklin Center. In fact, the Franklin Center strongly believes that government intervention in media will create greater problems than the struggling newspaper business is currently enduring. If government intervenes in the news industry, journalists will no longer be able to report credibly on stories that matter to the people, but ultimately only on what matters to officials. Journalists may ignore scandal and corruption for fear of losing government funds. They could become political flacks and write to appease government instead of investigating it.

Drawing the conclusion that every donation to a non-profit 501 c3 is supporting the government in some way is incorrect. Tax deductions for gifts to houses of worship are not funding government support of religion and tax deductable donations to health care associations are not supporting government healthcare.

Photo by Jacob Kearns used under a Creative Commons license.

July 28 2010

07:52

TechSoup Webinar: Tour GrantStation - Your Fast Track to Fundraising

Join Cynthia M. Adams for a free webinar that offers a short tour of the GrantStation website. Learn how to use the tools that GrantStation provides to help you identify the right grantmaker for any program or project.

If you're interested in learning more about GrantStation before the TechSoup special offer on August 17 and 18, this tour will help you understand whether it's the right tool for your organization and how to get started.

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July 09 2010

14:00

This Week in Review: Time’s non-pay paywall, free vs. pay in Britain and what to do with content farms

[Every Friday, Mark Coddington sums up the week’s top stories about the future of news and the debates that grew up around them. —Josh]

A Time quasi-paywall discovered: Thanks to some collaborative online sleuthing — OK, basically just wandering around on a website and asking some simple questions — we found out that Time magazine is planning an online paywall. Reuters’ Felix Salmon ran into the wall first a few weeks ago, but saw that it had disappeared by the next day. Then on Tuesday, the Lab’s Joshua Benton noticed it again, pointing out that this was an odd kind of paywall — one without any sort of way to pay online (“a paywall without a door,” in his words).

All Things Digital’s Peter Kafka got word the next day that the paywall is part of a company-wide strategy at Time Inc. to separate its print and iPad content from its online material. The Lab found out that Time does indeed have a plan to give that paywall a door and provide a way to purchase articles online, and The New York Times reported that this paywall sans pay is part of a gradual effort to retrain readers to pay for content online and noted that not everything from the magazine is gone from the website.

PaidContent’s Staci Kramer called the move not a paywall, but “the magazine equivalent of a condom” — a way to separate online readers from its print content. She noted that the move limits non-print access to Time to a very select group of people — namely, iPad owners. Essentially, it’s a hardware requirement to read Time magazine, something Publish2’s Scott Karp asked whether we’re going to start to seeing more of.

All Things Digital’s Kafka wondered why Time wouldn’t just offer its print articles for free if the magazine’s print and online audiences were as separate as they’re typically said to be. New York’s Chris Rovsar posited that the new wall is about protecting its $4.99 iPad app: If all your print stuff is available through the iPad browser for free, why buy the app? DailyFinance media critic Jeff Bercovici made the same point and argued that while Time may appear forward-thinking here, this move is really a regression. Newsweek’s Mark Coatney, a former Time staffer, was ruthless in his assessment of the strategy, saying that it all comes back to value, and Time hasn’t articulated why its print content is worth paying for, but its online stuff isn’t.

A paid-content contrast in Britain: Time was far from the only paywall news this past week: Three relatively small Gannett papers put up a $9.95-a-month paywall last Thursday, and the most important new paywall may have been at The Times of London and The Sunday Times, two of Britain’s oldest and most respected publications, which began charging for everything on their site last Friday. That development is particularly important because it’s the first move in the paid-content crusade that Rupert Murdoch has been gearing up for since last summer.

Steve Outing and Poynter’s Bill Mitchell noted that the Times’ paywall is among the most impenetrable we’ve seen yet in newspapers: All non-subscribers can see is the homepage, and even the headlines are blocked from online news aggregators. New York’s Chris Rovsar took stock of what The New York Times (planning its own paid-content system next year) could learn from how the Times rolled out its paywall, and basically, it boils down to, “Whatever they did, just don’t do it.” He and the Press Gazette’s Dominic Ponsford ripped the Times’ paid-content strategy, criticizing it for not being RSS-compatible, not linking, and giving away desperate-looking freebies. (Rovsar and Ponsford do acknowledge that the site is cheap and pretty, respectively.) British journalist Kevin Anderson used the Times’ paywall as an opportunity to light into the thinking that leads newspapers to charge for content online in the first place.

Meanwhile, the Guardian, another prominent British paper that is staunchly in favor of free online content, released a Wordpress plugin that allows blogs and websites to embed the full text of Guardian stories for free. (Steve Outing demonstrated with a post on the iPad.) It’s an unprecedented move, and one that made for a pretty easy contrast with the Times’ protectionist strategy online. Outing did it most explicitly in two posts, arguing that the Guardian’s strategy taps into a worldwide revenue potential, while the Times relies on its brand-loyal British readers. Murdoch “apparently still doesn’t understand that this whole pay-for-news-online thing is not about the needs of publishers like him. It’s about what the audience for news is willing to do and willing to pay for,” he wrote.

Learning from (and fighting with) content farms: Since acquiring the online content provider Associated Content in May, Yahoo has become the latest online media company to begin producing articles based on a calculation of search terms, including for its new news blog, The Upshot. The Wrap’s Dylan Stableford took a look at these “content farms,” focusing on why journalists hate them and what news organizations might be able to learn from them. (On the latter point, Stableford’s sources said content farms’ acute attentiveness to what people are interested in reading could be particularly instructive.)

One of the people Stableford quotes, NYU professor Jay Rosen, gets some extended time on the subject, and another, Jason Fry, posted some additional thoughts, too. Fry, who is quoted in the article as saying, “If you want to know how our profession ends, look at Demand Media,” clarified his stance a bit, saying that what bugs him is not the low pay, but the lack of quality. Still, he acknowledged that because of cost-cutting, many small- and medium-sized newspapers’ content is just as mediocre. Peter Berger, a CEO of Suite101.com, one of those content generators, said the concern from news organizations is a red herring, and his industry really presents the biggest threat to non-fiction books.

Canadian writer Liz Metcalfe voiced some similar thoughts, arguing that the problem with the “demand content” model isn’t the model itself, but the poor quality of what gets produced. Newspapers should find a way to incorporate the model while producing high-quality material, and beat the content farms at their own game, she said. On the other hand, Harvard prof Ethan Zuckerman said dictating content based on search would be a bad way to run a newspaper: “You’d give up the critical ability to push topics and parts of the world that readers might not be interested in, but need to know about to be an engaged, informed citizen.”

A private group called the Internet Content Syndication Council wants to do something about these dastardly villains, and they’re exploring a few options, including drafting a set of content-quality guidelines, licensing content syndicators and asking Google to tweak its search formula. CNET’s Caroline McCarthy wondered what a guideline or licensing system would do with bloggers.

Chronicling an accelerating shift to mobile: The Pew Internet & American Life Project released a couple of fascinating studies in the past week, the first on the future of social relations online and the second a survey of Americans’ mobile use. The latter study in particular turned up a raft of interesting statistics, led by the finding that 59 percent of adults go online wirelessly, including 47 percent of Americans with their laptops and 40 percent with their cell phones.

Poynter’s Mobile Media focused on the rise in “non-voice” uses for cell phones over the past year (Silicon Alley Insider has it in graphical form). The New York Times and Washington Post centered on the survey’s finding that African-Americans, Hispanics, young people and poorer Americans are among the heaviest mobile media users, with the Times stating that “the image of the affluent and white cellphone owner as the prototypical mobile Web user seems to be a mistaken one.”

Here at the Lab, Laura McGann seized on another tidbit from the study indicating that about a fifth of young adults have made a donation via their cell phone. She tied that finding to the public radio station WBUR’s attempt to find a way to allow users to donate via an iPhone app, something Apple doesn’t allow, asking how nonprofit news orgs might be able to find a way to tap into that willingness to give through their cell phones.

Reading roundup: Lots of really thoughtful stuff this week that’s well worth your time (I assume it is, anyway — maybe your time’s much more valuable than mine):

— The debate over objectivity and journalism raged on this week, fueled by the firing of CNN’s Octavia Nasr over a remark she made on Twitter. Many of the arguments circled around to the same ground we’ve covered with the Gen. McChrystal and Dave Weigel flare-ups, but I wanted to highlight three takes that stand out: Salon’s Dan Gillmor on America’s “technically good subservient press,” Jay Rosen on “objectivity as a form of persuasion,” and Mediaite’s Philip Bump on a journalism of individuals.

— Many new media folks have been following the fate of the nonprofit Texas Tribune, and the Columbia Journalism Review has a pretty definitive account of where they stand.

— ReadWriteWeb has a handy resource for zooming out and taking a look at the big picture — a summary of five key web trends so far at 2010’s halfway point.

— Spot.Us’ David Cohn takes a look at the short-lived journalism startup NewsTilt and comes away with some helpful lessons.

— Finally, Google researcher Paul Adams has a presentation on the problems with the way social media is designed that’s been making its way around the web. It’s a whopping 216 slides, but it’s a simple yet insightful glance at what feels just a little bit wrong about our social interactions online and why.

July 07 2010

20:30

Attention nonprofits: Young adults love texting donations

This afternoon the Pew Internet and American Life Project released a study on Americans’ mobile device and wireless habits. The full report has many interesting figures, but I’m going to zoom in on just one portion that signals an important trend for nonprofit journalism.

Pew asked survey participants whether they had ever made a charitable contribution via text message. A surprising 10 percent of all cell phone users have. When you look at young people, it gets even more interesting: 19 percent of 18 to 29 year olds have made a charitable donation via text. Other age groups text donations considerably less: 10 percent of 30 to 49 year olds, 8 percent of 50 to 64 year olds, and 4 percent of 65 and up.

I emailed with Peter Panepento, the web editor at The Chronicle of Philanthropy, to put the 19-percent figure in perspective. Surprisingly, he says 26 percent of people in their twenties have mailed in a donation in the last two years. (Who knew 20-somethings were so generous! And so likely to use the mail!) “What’s startling about that number [the 19 percent] is the fact that it is catching up with other forms of giving so quickly,” Panepento wrote. “Giving through mobile phones is still in its infancy and only a small percentage of charities even have the ability to set up mobile-giving programs. These programs are still too expensive for most groups, whereas direct mail and checkout-counter-style giving is a huge part of how most nonprofit groups raise money.”

The survey also showed differences among demographic groups in donation texting. Of cell phone users of all ages, 23 percent of English-speaking Latinos have sent a charitable text, 16 percent of African Americans and 7 percent of whites. Pew has previously found similar racial differences among mobile news consumers.

Here’s the question for journalism: Can nonprofit news groups figure out a way to cash in on the potential of mobile fundraising, particularly when the next generation of donors clearly like giving via their cell phones? Earlier today we an item about a new iPhone app for Boston NPR station WBUR, which is inching public radio closer to mobile giving. This growth is the reason Apple’s ban on in-app donations matters: WBUR was forced to come up with a series of workarounds that complicate the process. Those aren’t quite the same as, say, texting the word “HAITI” to give ten bucks to the Red Cross.

Photo by Paul Hart used under a Creative Commons license.

June 16 2010

17:34

Attention nonprofits looking to produce video for social media

If your organization is considering producing video as part of a social media intitiative, check out this video.  The information applies whether producing in-house, or hiring an professional company.  Let me know if you find it helpful and if you have any questions or suggestions for future content on the topic.

15:15

Index of Charitable Giving: Nonprofit Revenue was up 12.1% Earlier this Year!

Blackbaud recently announced their new Index of Charitable Giving, a fundraising index that reports revenue trends of 1400 nonprofit organizations on a monthly basis. The tool is valuable for fundraisers and organizations interested in keep an eye on the global pulse of of monetary giving.

The Haiti Effect

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June 11 2010

15:24

Elizabeth Spiers’ media-entrepreneur summer school

This summer Elizabeth Spiers is teaching summer school, and you can apply for a seat in her class.

The media consultant, founding editor Gawker, and builder of DealBreaker, several Mediabistro blogs, and other sites is looking for a handful of people with smart ideas for a small business — but not experience launching one — to join her two college interns in a 90-day class. By the end of the summer, Spiers expects her students to have learned everything they need to get their media projects off the ground.

Here’s Spiers’ take on why you should apply:

What you get in return: dialogue with other beginning entrepreneurs, some good contacts for your project and what’s essentially free consulting from me (the latter of which would be price-prohibitive for most beginning entrepreneurs if I were charging.)

I spoke with Spiers about the project and why she decided to do it. Turns out she’s a kind-hearted boss: She didn’t want her two interns completing only menial tasks all summer. So she’s requiring them to spend at least 10 hours a week on their business idea and to meet weekly to discuss their progress. Her idea, she notes in her Tumblr post, is ripped off of a similar project Seth Godin ran that he called an alternative MBA.

Spiers, who teaches at The School of Visual Arts Design Criticism program (and is off for the summer), also said she sees a lack of support for entrepreunerialism in journalism schools. Her current interns are writers with the editorial skills you need to run a new media project, but not the business savvy.

“That’s one thing that I think — in journalism programs, they don’t really equip people to start new media products,” Spiers explained. “They equip them to work within the context of an existing publication. I’m just trying to fill in the gap a little bit.”

There are, of course, j-school professors already teaching classes which require entrepreneurial spirit. Among them is our Lab colleague C.W. Anderson at CUNY, whose course Entrepreneurial Journalism requires students to cook up new media ideas. (He’s also working on a white paper on innovation in j-schools. If you know of a school working on something innovative, let him know.)

For j-schools wondering how much time to devote to more business-side coursework, consider Spiers’ 10-hours-a-week-for-90-days argument. “Starting a new company seems more intimidating than it is,” she told me. “I do think it’s the kind of thing you can transform and ramp up in 90 days. As long as you have a process in place, I don’t think it’s as difficult as people think it is.”

(If you need funding, though, then you’re looking at a longer timeframe. Tack on extra months to the process to get your project actually going.)

When I asked Spiers if she would keep readers posted on her students’ progress, she said (earnestly, no Gawker snark) she has high hopes for her students. ”I sort of expect that some people are actually going to go out and launch their projects, and I’d be happy to promote them. And intend to do that anyway,” Spiers said.

Photo by Robert S. Donovan used under a Creative Commons license.

14:00

Bill Buzenberg on Center for Public Integrity’s aim to “catalyze impact,” fundraise in a competitive field

Nonprofit news organizations may be all the rage, but they’re not a new animal. Last week, 20-year-old Center for Public Integrity announced a round of recent hires. Since January, CPI has brought on nine new journalists, including reporters, editors and a database expert. For a team of about 50, it’s a significant expansion.

New hires include John Solomon, long-time investigative reporter and the former executive editor of The Washington Times, as “reporter in residence,” Julie Vorman, former Reuters Washington editor as deputy managing editor, and Peter Stone of National Journal.

CPI is known for its investigative projects that appear in major print and broadcast outlets. A recent year-long project on campus sexual assault was picked up by outlets around the country, reaching what CPI said was an audience of 40 million. Last week CPI partnered with The New York Times in publishing Coast Guard logs suggesting authorities knew about the severity of the BP oil spill much sooner than announced. The logs were also published on the Center’s website and were widely used by newspapers across the country.

I spoke with Bill Buzenberg, CPI’s executive director about his expansion and the organization more broadly. Buzenberg says CPI does not fall on one side of the “impact v. audience” question, but acknowledged that their latest strategic plan emphasizes the organization’s desire to “catalyze impact.” He thinks it’s an exciting time for nonprofit journalism, but sees challenges in an increasingly crowded fundraising field. Here’s a lightly edited version of our conversation.

Is this a new team you’re hiring for a specific project or a general expansion of your editorial capacity?

It’s a general expansion of our editorial capacity. We have a very strong push on: The top major newspapers are all using our content, even online at The Huffington Post. The work is being used more than ever. Lots of places want to partner with us. There is so much watchdog work to be done.

Some nonprofits, like MinnPost, are focused on drawing a regular audience to their website. Others are looking for other outlets to pick up their work and reach an audience that way. Could you talk about where Center for Public Integrity fits?

I think from the beginning the Center has had the same trajectory. In the beginning, actually, it did reports, held news conferences and handed out those reports, and they were reported on by other publications. That is still part of our operation. We very much do reporting work — sometimes it’s a year, sometimes it’s months, sometimes its a few days — and we make it available to other organizations very broadly. And it gets used very, very broadly.

One example: We did a project on campus assault, just recently. We worked on it for a year. We collected the data from 160 universities, we did an investigation, we did a lot of FOIAs, which we increasingly do here, we get the documents and the data. Then we did a number of reports. And we look for a specific partner on each platform: online, print, radio, and television. That’s what we’ve done. ABC did a story on it. NPR did a number of reports on it. Huffington Post carried a number of reports. And we made a specific plan to provide a toolkit for campus newspapers: 65 campus newspapers have used that report. We made it available in an ebook. The sum total of that we can now say that 40 million people have heard, watched, seen, or read some part of our campus assault project. It is on our website. And there’s a community interested in this work, that’s concerned about what’s going on with campus assault. So we have a resource on our website. And it’s in the other publications.

So we’re both. We want people to come read it and get our work here, and we love it when it’s published elsewhere and linked back to us. There is always going to be more on our site — more data, more documents, more photographs. We want traffic to our site, as well as have it used elsewhere.

We also run the International Consortium of Investigative Journalists. The consortium is 100 journalists in 50 countries. We are working on, right now, three major cross-border investigations. We’ve been working on global tobacco for quite a while and issuing reports. Those reports are running in publications all over the world where those reporters work or have connections. For example, in July we have a project coming out with the BBC. The BBC has planned two documentaries and several programs. They’re using all of the work that we’ve started. We’re all doing it at the same time. It’ll come out the third week in July and it’ll run all over the world. Not just the BBC World Service, but in countries where we’ve been working. So we work internationally. We work in Washington, increasingly covering federal agencies. And we work at the state level, where we’re able to do 50-state projects. So that’s our model. It’s unique in how it operates. We’ve spent 20 years building this up. We’re very much pushing to do more, do it better, and do it widely.

You mention audience — is that how you measure success? There’s this debate happening right now: Is it audience, or is it impact? How do you define success at CPI?

Increasingly, the real way we measure success is impact. That is a huge part of our strategic plan: We want to catalyze impact. That means we want hearings to follow. We want laws to change. We want actions to happen. We are not an advocacy organization. We don’t go out and say “here is what you should do” in any way shape or form. We’re an investigative journalism organization. We do the reporting, but we love to see actions happen because of our reporting. A few years ago, when we reported on all the lobbyist-paid travel, where the records were kept in the basement of Capitol that no one had ever looked at — that took a year to do, with students. [Disclosure: I was one of those students.] But we listed every single trip taken by every single member of Congress for five years, and every staff member of every member of Congress. We showed every trip, every expense. The minute that was published, the travel started down. Then the new Congress came in and said, “oh, we have to close this loophole.” It was a loophole because it was public and transparent. We love that that’s an action that comes out of it.

But of course we like audience and we like engagement. So audience is a part of it. Engagement is increasingly a part of it. Are people writing comments, giving us ideas? How is the audience engaged? I was just up in Minnesota — the university there had just done a day-long session on campus assault, which came out of a public-radio interview they did with our reporter there. That’s an engagement in an issue at a local level that is very important.

[Buzenberg said that CPI's site attracts more than 1 million unique visitors per year, but declined to release exact traffic statistics.]

Nonprofit journalism is a hot topic right now, but there have been outlets like yours for a long time. I’m wondering, in terms of fundraising, does that give you a leg up right now, given that you’re established, or is it becoming difficult in a more crowded field?

I was in public radio for 27 years, both at National Public Radio and local. I was the head of news at national for seven years and then went to Minnesota Public Radio, now called American Public Media nationally. We raised a lot of money in both places. That’s nonprofit journalism with an important audience and it does great work.

Right now, I think, many funders have understood that the watchdog work, the investigative work, it’s expensive, it’s difficult, it’s risky. It’s the first thing often that gets cut when newspapers are declining, or magazines, or television, when they don’t have as many people out doing it. I think it’s been a period in which foundations and individuals have seen the importance of the kind of work that we do and we’ve gotten some strong support to continue to do this work. Yes, it’s competitive. It’s difficult.

We’re raising money in three ways. We do have foundation support. We’re talking with something like 86 foundations, many of whom do support us. We also are raising money from individuals — small donations with membership, much like public radio. Larger donations from people with resources. We do have a strong base of individual donors. And the third way is earned revenue, and we’re working on various scenarios of how we can earn that. We just did research for BBC. We sold our map on the global climate lobby to National Geographic. We’re selling ebooks. We do have various small revenue streams we want to grow. Those are three ways we raise the money to do this work. It’s important work and it’s not free. Public radio’s not free either. They get government resources — a small amount really. But at the Center we don’t take government money, direct corporate money, and we don’t take anonymous money. We make transparent, which is a very important thing, who is supporting us. It’s difficult. It’s not easy. With all the new centers popping up, there’s competition. There’s a lot going on, but I think many foundations, locally and nationally — and increasingly internationally, because we’ve gotten some good international support — have understood that this kind of work needs to be supported.

One thing I wanted to circle back to is your expansion. It seems like your recent expansion is into financial coverage. How did you come to that decision to expand in such a focussed way?

It came when the financial crisis hit the fall of 2008. We felt like no one was really saying who had caused the subprime problems — who was behind that? So we did a project. We started with 350 million mortgages. The mortgages are public information. From that, we named the 7.5 million subprime mortgages and we picked the 25 top lenders. Who they were, who supported them, where they did their lending, at what interest rates. We put it into a report. It took us six months. It’s “Who is behind the financial meltdown?” It still gets traffic. We put it out as an ebook. It’s being used by attorneys general. It’s being used by all sorts of people. No one had done the definitive work. That’s a project I’m really proud of. From that we grew a business and finance area. We thought there was so much more.

We’re tracking financial regulation and financial regulation issues in a way other people aren’t doing. That’s what our three-person team is doing. Financial is one area — money and politics is obviously one area we work in at the state and the national level. I might add when we did the global climate lobby before Coppenhagen, we were working globally. The other area is environment. The stories we’re working on with the BBC are environment. We’re doing a big project on the 10 most toxic workplaces and the 10 most toxic communities in America. It’ll take us six months.

How big are you? How many people work at the Center?

Right now, with the additions, we’re about 40. With fellows, we have 5 fellows and 6 interns, so we’re close to 50 people, if you add in fellowships and interns. It’s a major investment, there’s no question about it. That’s how we’re able to focus on these new projects.

This is a little touchy, but it jumped out at me. When I looked at the press release for the expansion I noticed that the eight new editorial hires are all men, I’m just curious about your struggles with diversity and bringing on women?

Well, first of all, the corrected version of the press release we sent out has Julie Vorman. We hired a deputy managing editor whose name should have been on there and it’s not on there. It’s not all the hires at the center — the six interns we hired, for example, are all women. We had 350 applicants for our internship program and we picked six, the best six. There are women at the Center. If I looked at the overall Center numbers, it is diverse, and it does have women. My COO and the head of development are in there, and on and on. There are many women here. It looked more male than it should have in the latest hires. It’s a fair question, but I think if you look at the overall numbers of the Center both with diversity and women reporters.

[After our conversation, Buzenberg looked up a breakdown of all staff at the Center, finding 43 percent are women and 23 percent are minority. Their staff page, showing individual positions, is here.]

June 04 2010

08:49

Prizes for Paperless Fundraising

Have you successfully moved from paper-based direct mail fundraising to digital tools (email, websites, video, social media, widgets, and/or mobile)? Want to gloat about your successes and possibly make some (more) money as well?

The Paperless Choice Challenge is rewarding successful, creative, replicable campaigns that use electronic  fundraising tools by giving away eight prizes totalling over $20,000. Entries can be submitted between June 15 and September 15, 2010. 

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May 20 2010

15:35

Round-up of Recent NPTech Research Findings

pie chartLoads of new research has been released in the last month that can help nonprofits be more strategic in their approach to their work. These studies have findings that have major meta level implications for senior leadership down to nitty gritty details for fundraisers. Here's a round-up:

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May 06 2010

07:07

TechSoup Webinar: Using Second Life to Collaborate and Connect

The virtual world of Second Life is a platform that is a 24/7 always-on online community where the world’s content is entirely user-generated. It’s a 3-D immersive space that is used by a global audience to build experiences, offer trainings, connect with friends and collaborate with colleagues. It’s an exciting medium that is becoming more ubiquitous and TechSoup’s Nonprofit Commons in Second Life is the community to teach Nonprofits and NGOs how to collaborate and get acquainted with working to raise funds, augment your communications and procure volunteers in this cutting-edge environment.

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