Who Would Fund America's Largest Nonprofit Newspaper?
San Francisco Chronicle journalists are trying to talk investors into buying the foundering daily newspaper and restructuring it as a nonprofit, writes the SF Appeal. Who are the ink-stained wretches courting?
The editorial workers would invest some of their own money, a Guild representative told the Appeal. But they could hardly acquire the Chronicle on their own, even assuming a heavy markdown from Hearst's 2000 price of $660 million.
Possible buyers fall into a few broad categories:
Old San Francisco money: There's been chatter among Chronicle journalists for years about the possibility of a local investor like private-equity billionaire Warren Hellman or Gap founder Don Fisher buying the paper. It's hard to imagine either of those red-blooded capitalists giving up on the idea of a profitable local newspaper, but then one never puts money into a cash-hemorrhaging hometown paper for purely rational reasons.
New dot-com money: If it's hard to imagine local elders funding a (purposely!) non-profit Chronicle, it's even harder to picture Silicon Valley's many Google million- and billion-aires doing likewise. Newspaper philanthropy would hardly be a hot topic of conversation among young founders on the Web 2.0 cocktail circuit.
Craig Newmark: The San Francisco-based Craigslist founder likes to think of himself as being in a different, entirely more altruistic class of startup founder. In the case of newspapers, he does stand apart, and not just because of his instrumental role in ushering along the decline of print journalism: Newmark has a peculiar (for the tech world) obsession with journalism and politics, leading to investments in content aggregator Daylife and citizen journalism initiative NewAssignment.net and advisory roles at the Center for Citizen Media and Sunlight Foundation.
But even assuming he wanted to buy the Chronicle, it would seem a stretch for Newmark to do so on his own. Craigslist throws off maybe $100 million or $130 million in annual profits, which Newmark must split with other shareholders. The Chronicle is losing $50 million a year just operating, to say nothing of the purchase price.
With enough cash from employees, a fire-sale price from Hearst and maybe one or two more rich investors, it's possible to imagine Newmark picking up the paper, should some sort of expensive guilt complex compel him to do so.
The Chronicle would then be the largest nonprofit paper in the country, ahead of the Poynter Institute's St. Petersburg Times.
More likely, though, would-be newspaper philanthropists will come to the same conclusion as would-be newspaper investors: It makes little sense to invest in fixing the old problems of a dying industry when you can net much more glory or profit starting from scratch.