Knight Foundation has just released the third installment in a series of reports, which it launched in 2011, that track the progress of nonprofit news sites as they strive for sustainability. The report “Gaining Ground: How Nonprofit News Ventures Seek Sustainability” analyzes trends among 20 local, state and regional nonprofit news organizations. It also incorporates insights from interviews with leaders of a few additional nonprofit news organizations that have a predominantly national scope. Many, though not all, of the organizations included in the study have been funded by Knight Foundation. The report is based on data collected from a cohort of 20 nonprofit news organizations about their mission, Web traffic, revenue and expenditures. Researcher Kate Marshall Dole led the data collection efforts and report development. Community Wealth Partners, a social sector consultancy and evaluation firm, performed the data analysis.

Key findings include:

• The revenue for nonprofit news organizations increased by an average of 7% between 2011 and 2013. In 2012, revenue grew by an average of 3%; however median revenue was only 7% suggesting year-over-year revenue for half the sites was either flat or declining.
• The organizations generated 23% of revenue through earned income in 2013 compared with 18% in 2011. Nonprofits remain very reliant on foundation funding, and few appear to be rapidly approaching a sustainable business model.
• The most growth in earned income has occurred through sponsorships and in-person events. Though advertising is the earned income source utilized by the most nonprofit news organizations, advertising revenue was flat from 2011 to 2013.
• Spending remains highly concentrated in editorial expenses, though as organizations grow in size they appear to invest more in marketing and technology.
• Sites grew Web traffic by an average of 75% from 2011 to 2013, and the share of mobile traffic and referral traffic from social media grew considerably. A few sites are piloting more sophisticated efforts for tracking impact beyond basic website analytics.