The Role and Limits of Grants

News nonprofits around the country, especially the recent startups, have been working to diversify their revenue streams. The INN Index, based on a 2018 survey of members, found 90% of the responding organizations’ total revenue came from philanthropy. Foundation grants accounted for well over half of total revenue, but only 30% of news nonprofits relied on foundations for 75% or more of their funding.

Age and type of organization correlate to different mixes of revenue streams as
organizations refine models that match their missions and their communities.
Older organizations often have a higher share of foundation funding; local and state organizations generate more revenue from individual donations. This pattern may reflect the concentration of foundation funding in a few national news operations, which was one finding of a 2018 report by the Harvard Kennedy School’s Shorenstein Center and Northeastern University professors.

Developing revenue streams from multiple sources is critical to the stability of an organization, so that the loss of one stream is not catastrophic, as it would be if only one or two sources were available.