There’s a common refrain that comes with many commentaries lamenting the decline of newspapers these days: Investigative reporting is an expensive endeavor.

Our experience proves that bit of conventional wisdom dead wrong. For the past four years, we’ve been running, a nonprofit online-only daily publication dedicated to local in-depth and investigative reporting. And, on a budget of less than one million dollars, we’ve been able to produce stories that have an impact on a daily basis by running an efficient organization of full-time, professional journalists free from the burden of printing an actual paper.

Indeed, we’ve learned that it’s not investigative reporting that’s expensive, it’s printing a newspaper.

Sam Zell, owner of the Tribune Company, says that 86 percent of the cost of the newspaper business is print, paper, distribution and promotion. We turn that on its head and spend the vast majority of our budget on the actual journalists—the people out on the street finding the best stories. Web hosting and production represent a sliver of our costs. And though we have a similar financing model to public broadcasting, our costs are also a tiny fraction of what it takes to run a local affiliate of NPR.

New York Times investigations editor Walt Bogdanich recently summed it up concisely in a conversation with readers: “Good investigative reporting depends less on money than on the commitment of editors and the skill of its reporters.”

Nonprofit Online Journalism

Still, the decline of the major daily newspaper in metropolitan areas around the nation means that more and more important stories are going untold, especially in America’s big cities. While it won’t be the only vision for journalism’s future to spring up as newspapers shrink, the nonprofit online-only model is uniquely situated to fill the rapidly growing gaps in the local news landscape for a number of reasons:

Efficiency: The Internet is simply more efficient and cost-effective than any other medium available to a local entity. While print still provides newspapers with a lion’s share of their revenue, that share is continually declining, and we can plan for the future without having to drag a dying paper product with us. Especially in local investigative reporting where there are few travel costs, investigative reporting is more about mission than it is about cost.

Mission: Reporters step into this newsroom with a very clear mission: produce in-depth and investigative reporting. They don’t have to worry about being a paper of record, covering a celebrity trial, rushing to a harmless house fire, or figuring out what direction their general-interest publication is going. They learn how to let the small stuff slide in order to go after the more ambitious stories. They don’t touch anything if it isn’t a clearly local story. This is our best route to making the biggest impact.

Measuring Success: As a nonprofit, our success is measured in one simple metric: the impact of our stories. Dedicated journalists forever have measured their success by the impact of their stories. But their organizations as a whole have always had different measurements. Quality journalism in many of those is important. But so is returning a profit to the owner or shareholders. And in today’s market, when newspaper Web sites are scratching and clawing for every hit in order to raise advertising revenues, those goals of providing meaningful journalism and profits can directly collide. We don’t have to make money for anyone, just make our budget. And when we go to our board of directors every quarter, we have a very simple question to answer: What was the impact of your stories?

More Revenue Streams: Taking the very long view, we have more revenue streams available to us than do most media operations. We have the nonprofit streams long used by public broadcasting: foundation grants, corporate sponsors, and membership drives.

Civically engaged San Diegans are realizing that journalism at its core is a public service institution and, as it is threatened, they’re going to have to fund it like they’ve funded so many other causes they care about, just as they do the museum or soup kitchen. We also accept online advertising. While this is a small pillar of our budget, we see it as a significant potential growth area as we invest more resources into drawing advertisers to our site and the value we offer becomes better defined by the marketplace.

Starting From Scratch: We were fortunate to be original and autonomous—not an offshoot of a daily newspaper or other established news organization. We don’t have legacy habits, costs or debts. We’ve never had to be everything to everyone, nor have we ever tried to be. We don’t need to try to find room in our budget to still do local in-depth government reporting while also have a staff-produced society column or cars section or things that can be handled by national publications such as movie reviews, reviews of personal electronic devices, or coverage of presidential politics.

Deciding What Stories to Cover

We don’t try to be what the newspaper used to be—and is still trying desperately to be—a general-interest collection of things.We don’t try to be what the newspaper used to be—and is still trying desperately to be—a general-interest collection of things. It’s easy to get stretched a mile wide and an inch deep, especially when you’re operating on limited resources. People every day always want to know why we don’t cover this or that.

From our first day our job has been to fill the gaps between what people want from their local media and what they have. So how do we decide what we cover? This is a key question, and the answer is likely different in every community, but the two principles that guide our decision-making are firm.

  1. We cover something only if we can do it better than anyone else or if no one else is doing it (which, by default, would make us the best at it).
  2. We look at what issues aren’t getting sufficient coverage in the local media.
  3. In San Diego, we’ve gradually identified those as the cornerstone quality of life issues. Those aren’t static, though. As local media outlets continue to shrink at an alarming rate, the gaps that we were created to fill keep expanding.

As we decide how to handle this situation, again we find benefit and direction in our mission. Throughout 2007 and 2008, there were many distractions in San Diego, as in any big city, that could have proved devastating to any long-term investigative projects. A less disciplined approach would have had us running around with the media pack from daily press conferences that can bog down a beat to the scandalous trial of the day, only to duplicate what other news outlets were already covering. Despite cuts, there are still plenty of reporters in town doing this kind of coverage.

But time and time again, we reminded ourselves to stay focused—focused on doing something special, on making sure we added something to a community that needed it.

RELATED WEB LINK won a 2008 IRE Award in the Online category for their series, “The Redevelopment Investigations.”
-Will Carless, Rob Davis and Andrew Donohue
It was during that period that we performed arguably the most significant and sustained investigative journalism to emerge from any outlet in the city. We broke open scandals at two local redevelopment agencies that have led to criminal charges, scrapped development projects, and complete overhauls at the agencies. We exposed the police chief’s lengthy history of misrepresenting crime statistics, detailed a school official’s financial misdeeds, and unveiled a group of other investigations that never would have been told without the emergence of a new local publication.

Again, it wasn’t a huge investment that produced this. It wasn’t a legacy newspaper that dedicated dozens of writers and millions of dollars to these stories. It was a simple mission pursued efficiently.

Our goals now are to expand to continue to fill as much of the growing gap as efficiently as possible. And while some, like the police chief, finance guru, or ousted redevelopment agency presidents might not be entirely excited about that, San Diego residents are, judging from the enthusiasm among our donors and readers.

Andrew Donohue, as editor, and CEO Scott Lewis direct, a four-year-old nonprofit online daily dedicated to local in-depth and investigative reporting.

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