Three (or more) Kinds of Money. How Can I Fund my World News Project.

The mywebproject file on my Mac is piling up with new documents every day. But one Word doc that I’ve been dipping in and out of since the early days is simply called “Funding.” Talk about the elephant in the laptop. While I am busy refining the details and description of the project, and figuring out how best to present it, there is the big question of TO WHOM it should be presented. Of course the list will include (and has already included) plenty of folks who have no potential money role to play: colleagues, smart people in the news industry, startup bootstrappers of any ilk. “Friends and family,” by the way, was one category of potential investors that made me shudder the first time I heard it. “Yeah, you know, try to drum up some money from relatives and anyone in your social circle. Your high school friends on Facebook” Yikes! Let’s just say: friends and family (and facebook) are complicated enough without having to throw in the fate of my professional future. With that said, as I joke, only half-jokingly: I’ll be more than happy to ask for money from someone else’s friends and family.

As I’ve cut and pasted relevant information/contacts into said Word document, the question of how the project will be financed has evolved. So too have the actual numbers, ie, the amountof funding I think I’ll need to get going. Indeed, the very idea of “getting going” is what has fundamentally changed. I started out with the idea, and accompanying business plan, that I would be launching an operation at more or less full capacity. In any case, by newspaper standards, it would be a small operation: four inhouse editors, a few webmasters, photo and video folks, some other fixed administrative costs related to the content …and a global network of stringers who would be paid for their work. Overhead would be low, ad sales outsourced. Small, yes, but still north of 2-3 million bucks a year, which meant I wasn’t too far from the circa $8 million that Charles Sennott and Philip Balboni raised to launch Globalpost. I will come back in a later post to Globalpost, and have been in touch with Charlie, who I knew from his days roaming the planet. For now, I’ll just pass along my one-year anniversary kudos. Like the rest of the industry, they still have major challenges to overcome. But from where I sit, perhaps more than most, it all looks pretty damn impressive how quickly/forcefully they have gotten on the map…across the globe.

Though I would hardly turn down the chance to do  the full-fledged launch alla globalpost, I am now working under the assumption that the thing will likely start smaller. And cheaper. That may (or may not) condition my decision about whom to approach, and when. And of course the question of what, ie, for and not-for profit, is essential. I had begun  almost without posing the question, that my news site was a for-profit project, simply because that’s what the news and publishing business is. But as I’ve learned more, and seen how many funding mechanisms there are for startups (and how many are non-profit), I have shed my preconceptions. And it’s not just New Media. I for one only found out recently that The Guardian is run by a trust. Although the way things look in London, that may be motivation to stick with for-profit model!? Here in France, and Europe more generally, there are also certain public chunks of money floating around. An Italian colleague who wants to launch a news site is applying for funding from a city program that aims to “offer value for young people.” Who wouldnt qualify for that!?

Where does this leave me? Confused as ever…though not necessarily pessimistic. In a future post, I will explore more specifically the upsides and downsides of the different potential sources of funding. For now, to help find some clarity, here’s a quick set of would-be “competing” axioms about the broader journalism funding landscape, as seen at ground level…

1. Quality journalism (esp. general news/investigative)  is widely considered a bad financial investment.

1A. There are wealthy people and foundations who believe quality journalism (esp. general news/investigative) is a worthy investment.

2. THE business model does not exist.

2A. THE business model will exist.

3. Media companies are up to their eyes in shit,  running scared.

3A. Media companies know that success will depend on who can best see the future through the shit … and show some, er, balls.

4. Think hard about what the implications would be on the news product itself of the different “kinds” of money, ie, private, media, non-profit, public, friends&family

4A. Follow the path of least resistance.

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1 Comment

Filed under business model, entrepreneurship, funding

One response to “Three (or more) Kinds of Money. How Can I Fund my World News Project.

  1. Hi Jeff,

    I found your blog via the Nieman Lab. Interesting stuff. I’m a journo turned entrepreneur myself.

    Check it out: http://speakertext.com

    So two thoughts…

    1) Have u read Crossing the Chasm by Geoffrey Moore? If not: Run, don’t walk. Buy it!!!!

    2) PLEASE PLEASE PLEASE Don’t become a non-profit.

    3) Why are you in Paris? Not exactly an entrepreneurial hotbed…why not New York or Silicon Valley?

    3) What is the World News Project? How is what you’re trying to do better than what’s already out there?

    Cheers!
    -Matt

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