The rise of single-serving libel insurance: If it’s good enough for bloggers, why not small newsrooms?

By Michael Andersen

Sooner or later — as Diane Sawyer, Jeffrey Wigand or the National Enquirer could tell you — anyone who makes a living telling the truth is going to need a good lawyer. That’s why major metro newspapers carry libel insurance policies the size of Abrams tanks. Their deductibles alone can run into seven figures.

But what if the only insurance policy you can afford is a pith helmet?

Say what you will about the small, nimble news organizations of the future — liability insurance is going to be a problem. I emailed 13 news startups from Atlanta to Seattle to see how they’re handling it; the answer, usually, was that they aren’t.

“We are more or less without a safety net,” wrote David Cohn, of the journalism microfinancing service Spot.us, one of several with similar answers. (He’s gotten lawyers to draw up language that attempts to pass all liability to writers who use Spot.us, but of course that’s no guarantee.)

Insurance companies, of course, would love to sell a safety net to Cohn and other entrepreneurs. But there’s a problem.

Here’s the chicken-and-egg dilemma that any new variety of business faces when it looks for insurance: Keep reading »

Spot.Us, pioneer of crowdfunded journalism, preps for expansion

By Zachary M. Seward

Spot.Us, the non-profit experiment in journalism funded by readers, plans to expand beyond San Francisco by the end of summer, founder David Cohn tells me in the interview above. Seattle and Los Angeles are the most likely candidates for the site’s next iteration, and in the longer term, Spot.Us is looking to the east coast as well.

I caught up with Cohn at the Knight Foundation’s conference earlier this month. He won a $340,000 grant from Knight last year to develop a local news site that relies on small donations from readers for individual projects by freelance reporters. Since November, the site has funded and published 20 stories that you can read here.

Part of the mission at Spot.Us is to test whether and how the broader notion of crowdfunding might apply to local journalism. One persistent criticism of the venture has focused on its structure: How can you raise money for a pitch before conducting sufficient reporting to know if there’s really a story there? In part to address that concern and to test new models, Spot.Us recently began experimenting with beat pitches: The first is for ongoing coverage of San Francisco’s budget crunch by reporters at The Public Press, a non-profit news site in the city.

Cohn’s blog at Spot.Us is a must-read for its consistent introspection. He is the site’s biggest critic, which is fortunate for those of us watching to see how crowdfunding might fit into the future of news. Recently, Cohn laid out a three-month plan that includes finding the right financial model for expansion.

Spot.Us operates on a lean budget: Users who donate $20 to a news pitch are asked to contribute an additional $2 to the organization, and 90 percent oblige. Cohn says that model might be enough to support infrastructure at Spot.Us as he expands to other cities but wouldn’t be able to support a full-time employee like himself to coordinate pitches, publicity, and partnerships with news organizations.

In our interview, I skipped the basics of Spot.Us and focused on what Cohn has learned since launching in the fall. One key lesson, he said, has been that volunteer editors work better than poorly paid ones. Spot.Us had reserved 10 percent of funding for each story to pay an editor, but that rarely amounted to much. “I’ve found so far that volunteer editors who sort of come in, not because of money but because they just want to be involved in journalism, have been doing much more thorough better job of the editorial workflow,” Cohn said.

A full transcript of the video is below. Keep reading »