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Beyond The Fourth Estate

“I think in order to understand what we do and how we do it you have to go back to the beginning. You have to go back to the intent of the donors. We are first and foremost a private foundation that was started with a small handful of dollars from [Knight Newspapers], but primarily all of our wealth comes from Clara Knight, Jack Knight and Jim Knight. In fact, the company, Knight Ridder Inc., never put in a dime. It was all private wealth. …They ran it, obviously, in the cities and towns where they ran newspapers for decades.”
—Alberto Ibargüen, president and CEO of the Knight Foundation

Knight Ridder is perhaps best known for its stock and trade in newspapers. It was once the largest newspaper publisher in the U.S., with properties from coast to coast, including such prestigious publications as the San Jose Mercury News, the Miami Herald and the Detroit Free Press.

The Knight Foundation, a $2.4 billion non-profit institution in Miami, has offered prized journalism fellowship programs, university chairs and grants for 65 years.

But now the foundation is moving beyond the Fourth Estate to the fundamental purpose of journalism itself: community engagement.
“We seek to bestir the people into an awareness of their own condition, provide inspiration for their thoughts and rouse them to pursue their true interests,” said John S. Knight in April 1969.

The Knight Foundation has retained its mission to inform and engage people and communities—but with a twist that reflects the changing times.

Good Disruptions
Tables lined with itchy fingers and eager minds at work in an open-spaced office cooperative. Meetings and whiteboards in windowed conference rooms rented by the hour. The rat, tat, tat of keystrokes on laptop computers. One-on-one discussions at community tables by guys sporting beards and zany shirts and women dressed in all black: potential investors, potential sales, potential revenue, potential markets. Art. Coffee. Social media. Social entrepreneurship. The subject matters roll as easily off people’s tongues as they roll together in a cool if not hipster-like fashion that embroils the zeitgeist of the nextgen—polymathic excitability and exuberance for disruption. The good kind of disruption. The kind that often ignites positive social change.

This is LAB Miami, one of Knight’s investments. “It’s a co-op space for entrepreneurs,” explains Matt Haggman, Knight’s program director for Miami. (Knight operates in 26 cities across the counrty.) LAB Miami is located in the Wynwood section of downtown Miami, an up-and-coming neighborhood that was until very recently down-and-out.

“Interesting things were happening around here, but it needed a space, and at the time there was no community gathering point for entrepreneurs and creatives,” says Haggman. That was 2011, the same year he joined Knight. “Alberto said, ‘Go talk to people for four months and tell me what people are saying,’” Haggman recalls. As a former business reporter for the Miami Herald, Haggman had the right set of skills to sniff out an initaitive around entrepreneurship.  

“The goal was to help make Miami more of a place where ideas are built, and where people can pursue ideas,” he says. There was no physical place to do those things.

LAB Miami was born: a 10,000 square foot warehouse that acts as a campus for social and technology innovation. And there is more to it than mere structure. An entire ecosystem was built. Mentor and funder networks were established. An angel investor organization was founded. A rich calendar of events scheduled. Entrepreneur education classes were underwritten at the University of Miami.

What also became apparent as soon as entrepreneurs gained traction was they needed to staff up—fast, says Andrew Sherry, the foundation’s vice president of communications. So another network of resources was launched: a job placement agency called LaunchCode. This stimulates even more activity: Investment in the ideas entrepreneurs hatch, technologies to assist those business missions, and so on.

This, let’s remember, is just one program in one city in which Knight operates.

Radical thinking. It harks back to the time when Jack Knight displayed that kind of progressive approach in business, as well as philanthropy.
Ibargüen notes that in 1948, a German magazine said that Knight was talking about faxing his newspaper to customers—at a time when the world didn’t know what a fax machine was. There was an early company Internet venture called Viewtron that preceded Netscape (it was all text). And perhaps most tellingly, when Knight became a public company in 1969, Jack Knight flew to Wall Street, informing analysts he’d be too busy running newspapers to ever return. He didn’t.

 

Chutzpah perhaps best describes these happenings. Today, it’s Ibargüen who is trailblazing.

From neither man would you expect such outside-the-box thinking. Jack Knight, whose portrait hangs on the office wall of the Knight Foundation, looks like a partrician member of a foreign affairs council from the Eisenhower era. Ibargüen himself is buttoned down right to his suspenders. But haberdashery belies their philosophies.

Radical Approaches
“When I think about the work of the foundation, I really don’t think about charity. I really do think about social investing. I want to fund opportunity. I think Jack Knight and Jim Knight made a deal with the IRS, and in exchange, the people, the communities where we were, got a really pretty good deal. They got an organization that is supposed to fund things that are going to make that community better,” says Ibargüen.

Don’t expect to read about community centers here or announcements about new wings for museums. Some of the things Knight invests in sound as if they stem from the Williamsburg section of Brooklyn or Mountain View, Calif.

Take Symphony in D. It’s a crowd-sourced symphony the Detroit Symphony Orchestra will perform “by, for and with the people of Detroit.” The project proposes to create a musical portrait of Detroit using notes and noises submitted by the general public. Knight supported the effort to solicit and collect material.

Its St. Paul, Minn., art challenge similarly coaxes the general public’s involvement by giving people a chance at funding their ideas. The main requirement is that the idea has to take place in or benefit the city.

Media contests run the gamut from innovative publishing platforms to social media movements such as Hollaback!, an online anti-bullying tool to fight harassment.

Politics, too, gets its day. Knight funds information technology that adds more transparency to the voting process. A Library Freedom project engenders privacy rights by giving librarians tools to battle surveillance, censorship and free speech. In all, I count more than 100 projects Knight is funding. All different. All disruptive. Importantly, almost all of these programs can be considered an investment, as a distinct return is produced.

The symphony generates ticket sales. Art leads to auctions. And media innovation has its obvious commercial applications.

“When you do charity, the gift is the end of the line. You’ve given and you will get your reward in heaven. That, to me, is charity. Whether it turns into a thing, that’s another story. It is no longer your concern. It’s anonymous. You clothe the poor and feed the hungry. That’s really the end of your obligation as a charitable person. You have given. If you’re a social investor, like any other investor, you require a return,” says Ibargüen.

Knight, like most foundations, has a “real” investment arm that invests in the capital markets. Of late, even that has been upended.

Like many other institutions, the Knight Foundation had a problem to fix when it came to diversity issues.

“If you’re going to talk about diversity, and if you’re going to talk about inclusion, and if you’re going to talk about engaging everybody in the community, and yet you run a $2.4 billion portfolio [without any minority money managers] … well, Houston, we have a problem,” says Ibargüen.

 

That was the case until several years ago. “I asked how much money do we have under management by minority- and women-owned money managers? I knew that we had just made a $7 million investment with a particular fund and the answer back was seven million dollars. I said no, no, no. I don’t mean just in that one. I mean how much altogether? The answer was seven million dollars,” he said.

Knight turned to Cambridge Associates to help itself diversify and now about $300 million is in the hands of minority-owned investment firms.

Knight also runs two in-house funds: the Knight Prototype Fund, which “helps media makers, technologists and tinkerers take ideas from concept to demo,” and the Knight Enterprise Fund, which provides early-stage, venture funding for media innovation.  

Ben Wirz, who runs the Enterprise Fund, says the fund’s investment philosophy is the same as the overarching foundation mission: “What we’re looking for is innovation around ways people traditionally engage, whether that is deepening interaction, or engaging better.” One example is GoPop, a mobile app that allows users to combine any two photos, gifs or short video clips to create a visual conversation. It’s a new and unique form of storytelling. There’s also Seene, which allows you to capture 3D images on your phone, and Change.org, an online petition platform.

Wirz is careful to specify that the fund limits investments to between 10% and 15% of any round, and it does not take board seats. “The market dictates terms,” Wirz adds. Still, over half the deals the fund has invested in come via foundation activities. It focuses on four areas: communications, events, networking and recruiting.

Planting Stakes
Look. Learn. Be inspired. Public space. Public life. Carol Coletta, the foundation’s vice president of community and national initiatives, describes the path to engagement. “Engagement is a tough thing to define,” she admits. Realizing that, Knight put some stakes in the ground. Showing, in other words, what engagement is rather than just talking about it.

The Market Street Prototyping Festival showcased ideas for improving San Francisco’s main thoroughfare. A jury of more than 50 “makers, artists, thought leaders and community stakeholders” reviewed hundreds of idea submissions to make Market Street “a more vibrant public space.” Winners got funding, workspace and mentorship.

“If you don’t have real, robust, authentic engagement of people in communities, the future is poorer for it and cities are poorer for it,” Colletta says.

Back across the country and through downtown Miami, all the way up to the 33rd floor of the glass high-rise building that is the Southeast Financial Center, all this activity is part of a grander plan for Knight and how it’s splintering from supporting journalism alone.

“It really is about funding opportunity,” says Ibargüen. “We began to see the value in working with a media lab [MIT’s], the value of basing a lot of our activity around a place that had 25-, 26-year-old graduate student geniuses who were driven by the media, who were driven by the programming, by the development of programming—not by telling the story, not by informing community.

 

“Over time, our job was to figure out how to meld those two together, how to bring together the people who are driven by media and those that are driven by the need to inform. What it did was to send us on a quest to figure out what people will use, how will they use it, and how will they value the information depending on the platform that they got it on.

“You can never go wrong by following Yogi Berra’s dicta. He said, ‘If the fans don’t want to come to the ballpark, nobody can stop them.’ We noticed that the fans weren’t coming to the ballpark, and we thought, ‘Well, we’re not going to stop them from not coming, so let’s figure out where they are and why they’re there.’”

In short, as legacy media stumbles into a new era of journalism and dissemination, Knight had to chart a new direction of support.

The latest media industry figures from Pew Research Center show newspaper advertising, readership and employment in steady decline; advertising, especially, is suffering, down some 66% over the past decade.

Yet people are still being informed. How?

“How?” is the last question every journalism student learns to ask in the formula of reporting a story: who, what, when, where, why … and how? Knight is now putting it first.

“I think what I want to make sure comes through is that all of our experimentation is in trying to figure out how to inform the community. We are not about the ‘paper’ in newspaper. We’re about news, we’re about informing communities so people can determine their own interests,” Ibargüen says.

Which is why community challenges are such a big part of Knight’s endeavor.

Dennis Scholl, Knight’s former vice president for the arts, observes that news, arts, sports and business are all different ways of serving community interests, and yet all involve different forms of engagement. Still, they do not reveal what is missing, what would foster perhaps more or better experiences.
Which is why it’s important to give communities opportunities to express themselves. He points to Symphony in D as a fine example of that: “We’re getting a community to engage and participate,” he says.

When it comes to businesses or social entrepreneurs, Knight seeds cities’ programs and centers of … curiosity, I guess is the best way to describe it.
The day I am in the Wynwood area of Miami, there is a City Startups event going on. “City Growth Areas for 50+ Years.” “Hardwiring Civic Tech Into Codes.”
“Autonomous Vehicles & Smart Cities.” “Scale, Sale & Energy.” These are just a few of the topics being addressed and discussed by the crowd of 20- and 30-somethings. They buzz about which sessions to attend, chat about speakers, text colleagues about their whereabouts and web search about various people—including me—on the spot. What’s going on is palpable. It’s change.

The shadows of change within the business landscape of Miami are as evident as the cityscape itself.

Communications chief Sherry tells me technology is fueling rapid changes in the tourism and finance sectors. And real tech, too—the kind that drives business and, in turn, the economy, which lifts tides of constituencies, from students to business owners, artists and culture mavens. This is not the kind of boom-and-bust real estate cycle for which Miami is known. It has an air of long-term, sustainable growth. A foundation is being laid for a different Miami.

“We’re adding new events all the time,” Rebekah Monson says. She is one of the entrepreneurs attending the City Startups event. She is discussing TheNewTropic.com, a community website that is filled with curated local news and events. The site helps locals get together and showcases original work. She’s young and energetic—a cool kid looking to change her part of the world by informing and engaging others.

We’re chatting at a communal meeting room in Wynwood. It’s likely you could see this spot from the sleek Knight offices that sit high above the city. The view from Ibargüen’s office is spectacular. The Biscayne Bay glistens against the azure sky. Cruise ships dot the harbor. And towering construction cranes etched by thick, crosshatched patterns of steel are seemingly everywhere. The New World Symphony building designed by Frank Gehry is in the distance. A concert hall by Cesar Pelli. A Richard Meier project. And the art deco district known as South Beach jets out into the ocean. That section, too, is being redeveloped.

But the most striking site I see is the old Miami Herald building. It’s being torn down. A wrecking ball hangs aloft, adjacent to its top floors.

I comment to Ibargüen on the obvious metaphor of change. He smiles and without taking his gaze from the building tells me, pointing at it, that his office was the first to get smashed.  “I sat in Jack Knight’s chair over at the Miami Herald,” Ibargüen says. “That doesn’t exist anymore.” His words underscore the teetering state of journalism, and a new path for the Knight Foundation.

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