Searching for sustainability
Digital-first nonprofit newsrooms are generating only a fraction of the revenue of the newspaper industry from 20 years ago, and their “earned revenue” through things like subscriptions and memberships make up only about a quarter to a third of their total funding.
Those are the findings of a report released on Thursday from the Wyncote Foundation, which concludes that philanthropists likely will need to support these outlets for an extended time to preserve their sustainability. That philanthropy, however, may need to shift from national funders to local ones.
The Philadelphia-based foundation published the report to focus specifically on the role of philanthropy in the sustainability of local news. The study puts in context the financial and organizational challenges in nurturing the continued growth of nonprofit digital newsrooms, which are playing an increasingly critical role as many local legacy newspapers shrink or even close.
The report noted that while 400 digital-first nonprofit newsrooms brought in $650 million to $700 million in revenue in 2024, that’s just 1% of the combined advertising and circulation revenue generated across the newspaper industry 20 years prior.
In 2004, there were far more than 400 newspapers — more like 9,000. As such, there’s still a long way for nonprofit digital newsrooms to go to rebuild all that’s been lost in the local news industry over the last two decades. Since 2005, the nation has lost nearly 40% of its newspapers and 75% of newspaper staffers, according to the Medill Local News Initiative’s State of Local News Report published late last year.
“If you want to have a healthy industry, we are going to need more money to compensate people who can raise families and send their children to college and have benefits,” said Mark Fuerst, a co-author of the report. “I think our point is, it’s going to take a lot to get there. We could see philanthropists and foundations play a leading role, and they’re going to have to stay there in supporting these groups over an extended period of time.”
The report highlights trends that various nonprofit digital newsrooms have followed in their development from brand-new startups to more mature organizations. Among the key findings: that journalist-founders took time before viewing their news outlets as small businesses and as a result, shifted to recognize the need for investments beyond just reporters and editors.
“There’s a flywheel effect within small businesses that you can really get ground down in if the flywheel is moving too slowly because you go for extended periods of time, and some of the groups we looked at did, where they didn’t grow very much over a five-year period,” Fuerst said. “They kind of stayed at the same level. Not that there’s anything really wrong with that, but most people who are running businesses know you have to grow if you want to keep skilled staff because you have to give raises; you have to expand the benefits you are offering to people as you get more experienced. There is a growth factor that many journalists don’t want to talk about.”
The project adds that one of the biggest roadblocks to growth for these news organizations is a lack of staff focused on business development. And, it’s not typically easy for outlets that even want to hire staff for this need to find the money for compensation.
As a result, this leads to a trap: newsrooms need business development staff to grow but can’t secure the funds to hire those staffers and therefore struggle to scale their organizations and put themselves on a path to becoming more sustainable.
Another key focus of Wyncote’s analysis is on the role of philanthropy in local news. As the report notes, it was a relatively insignificant pillar in the business models of traditional news outlets but has grown to be a key cog in digital nonprofit startups over the last 10 to 15 years. In fact, philanthropy is in many cases a primary revenue source for some of these outlets.
According to the report’s analysis of members of the Institute for Nonprofit News (INN) and Local Independent Online News (LION), two journalism support organizations, “grant funding provided about 50% of the total revenue in 2024 reported by INN members,” and “among members of LION, philanthropy was the most common source of revenue in 2025.” But, it adds, these news outlets need to develop robust revenue streams across more than just philanthropy to be successful in the long-term.
And while over time, the report finds that organizations might shift from reliance on national philanthropic organizations to more local philanthropies, they’ve yet to become operational without this level of support.
“For the funders who are thinking about continuing to invest in journalism, you’re not going to be able to walk away and say, ‘We’ve done our job; we don’t have to help you anymore,’” Fuerst said. “Nobody was earning enough money through subscriptions and ad sales or sponsorships.”
In fact, they note that “earned revenue” (subscriptions, ad sales, memberships, etc.) makes up only about a quarter to a third of the funding that these news organizations require to operate on an annual basis.
“[There will be] the almost certain continued reliance on philanthropy, although it’s likely to move away from the national funding to local funding,” Fuerst added. “It’s the importance of local funding on the management/leadership side, it’s getting adequate staffing at the right level of salary in order to bring in people who can execute your revenue plans at the level of volume to keep your newsroom healthy. I think we were able to see, ‘Oh yeah, those are nearly essential.’”