Heck, I’ll Fund That! Can Crowdfunded Journalism Work?

Congragulations to David Cohn for winning a Knight News Foundation award for his Spot Journalism project, now residing at the aptly titled Spot.Us.

However, don’t go popping bottles quite yet. In the shadow of the failure of well-funded, well-executed crowdfunding venture Cambrian House, crowdfunding remains anything but a proven model. It creates a new product for an non-existing market, where there is only an ambiguous pain point. More importantly, the ROI isn’t good - or at the very least, doesn’t appear to be any good.

The first problem is a classic - you need to find a way to give people something they want, in a way that doesn’t suck. And in this case, there is a latent demand for crowdfunded journalism. It’s latent, but it’s there.

My mom, for instance, has been complaining about a problem that she believes is just one example of a much, much larger problem that would be pulitzer-worthy, if only it could get some attention. She’s contacted the Union-Tribune, but they haven’t been responsive. “Why invest in shoeleather reporting when there are puff pieces and wire stories to fill the pages?”

Anyways. So, imagine that Penny (that’s my mom’s name) gets referred to Spot.us by a Union Tribune rep with the message that she needs to raise $x before they’ll put someone on it, or she otherwise discovers Spot.Us.

The first thing she is *not* going to want to do is pull out her credit card, at least if her money will be wasted. That’s where the tipping poing model comes in, a la www.thepoint.com. Andrew and the other guys at The Point have come up with a great crowdfunding system. If I see a cause I want to support, or an art piece I’d like to see made, or anything else that will need funding, I’ll pledge $20 to escrow - to be released on the condition that 5,000 other people pledge as well.

The tipping point model is useful on two counts. Of course, funders only want to pledge if their money will actually amount to something. And perhaps even more importantly, it’s intrinsically viral. After I’m the first person to pledge money for a story, I’m going to want to get as many people as possible involved to reach the needed critical mass. And since it’s a finite number that is always getting more obtainable, we have a more concrete idea of how much is being accomplished with every new referral we make.

So assuming my mom does start gathering funds for an investigative report, reaches her target (and there could be different achievable tiers - such as basic report, video report, data mashups, etc.) A reporter is unleashed, and comes back with interesting findings. And Spot.us helps out with the distribution as well, getting the content on all the big aggregators, and perhaps onto some major news sites.

What then? As an investor, does my mom have ownership over the story? Does she get the byline, or residuals?

That’s not really the important part - but it is important that she is linked to the story. You see, I’m not inclined to think that this is about fame and fortune. In some cases, we’re just talking about an individual with an axe to grind. And in some cases, I can imagine large funders such as businesses funding stories - and that’s perfectly alright.

That brings me to my last point - David may be onto something with crowdfunding, but the real promise of such a platform, in my eyes, is to open up a legitimate way for information to be produced and distributed by vested interests, without resorting to misinformation, sock puppets, and all the other shenanigans that have brought some worthwhile attention to the issue from the likes of Sheldon Rampton.

If it can be very easy for me to pledge money to certain topics of investigation - with tipping point mechanisms, if the end result can be distributed well, and if all the funding information is able to remain intact for the purpose of full transparency, this could be the product that ushers in a new age of Patronage Journalism.

Good luck, David. And congratulations.