How Open Democracy finds funding to investigate dark money in politics

The surge in populism and the dark money behind it are providing rich material for a resurgent Open Democracy. The political upheaval of 2016 has sent Open Democracy on a “two and a half year odyssey,” says editor-in-chief Mary Fitzgerald, “investigating political funding, lobbying and influence across Britain and increasingly across the world”.

The site exposed the Democratic Unionist Party’s role as a channel for funding the pro-Leave campaign in the EU referendum, via a £435,000 donation from an organisation called the Constitutional Research Council. It recently secured a scoop when prominent right-wing commentator Peter Oborne chose the platform to renounce his previous support for the Leave campaign, saying “the economic case for Brexit has collapsed”.

The site’s co-founder Anthony Barnett, a veteran campaigner and former director of electoral reform group Charter 88, has published The Lure of Greatness, described by Irish writer Fintan O’Toole as “the best book about Brexit so far”. The project evolved from a series of chapters posted on Open Democracy under the heading “Blimey, It Could be Brexit!”, which began before the 2016 referendum. Barnett was prescient in identifying the rise of English nationalism and a growing dissatisfaction with the UK’s democratic systems.

Next week’s European elections will be a crucial test for the site’s small editorial team. “Dark money from unknown sources is flowing in and supporting networks that are supporting far-right parties that are seeking to make big gains,” says Fitzgerald. “People talk about Russian influence but we have found there is a lot more money coming from the US. What we have identified is that the US networks that propelled to Trump to power are really ramping up their efforts in Europe and quite literally bringing culture wars to the UK.”

She knows this partly because of work done by Open Democracy’s 50.50 project, which is “tracking the backlash against women’s and LGBT rights across the world”. Led by Claire Provost, a former data journalist at The Guardian, 50.50 has grown into an international network of investigative reporters. It has uncovered ties between far-right Italian politician Matteo Salvini and US fundamentalist Christian organisations opposed to same-sex marriage and abortion.

Tensions between conservative values and minority rights are a “global issue” that interlinks with other critical themes, such as hidden political funding, Fitzgerald says. “It’s not a religious question, it’s a question of the fundamental values that underpin both British and European law and that protect vulnerable groups. They are under threat.”

Managing Open Democracy’s resources is a complex task. 50.50 is just one of 14 ongoing editorial projects, dedicated to subjects ranging from the Eurasia-focused Open Democracy Russia to the Spanish-language Democracia Abierta.

The organisation is based in a small room above the Arcola Theatre in Dalston, east London. “It’s definitely not what I would call a newsroom,” Fitzgerald says. Open Democracy has 13 full-time staff but few come to the office. The head of investigations, Peter Geoghegan is based in Glasgow and the UK editor, Adam Ramsay, is in Edinburgh. Other journalists are in Berlin, Bogotá, Barcelona and upstate New York.

Open Democracy has been dependent on philanthropy, much of it project specific. It has had grants from a plethora of bodies with a track record in supporting journalism: the David & Elaine Potter Foundation, the Bertha Foundation, the Roddick Foundation, the Ford Foundation, the Oak Foundation, eBay founder Pierre Omidyar’s Luminate, and the Open Society Foundation created by George Soros, the billionaire investor.

This has been the model from the outset, when money came in from large organisations who were excited by the potential of a new online media player. “Open Democracy was a really radical idea when it started. An online-only global publication back in 2001 was seen as very bold and very different,” Fitzgerald says. “People were very excited; they had great writers, 9-11 happened and it felt very urgent and vital. Large grant making organisations wrote large cheques because they thought it was a visionary idea.”

There was a widespread assumption that, in time, Open Democracy would develop its own revenue model. For eight years, the site operated from nice offices in London’s historic Clerkenwell. But the money “sort of dried up”, Fitzgerald says, leaving Open Democracy tied to only covering projects for which outside funding had been promised. “It became a federated model of different projects funded through different restricted funding pots from grant-giving organisations. It was precarious and disjointed.”

Fitzgerald, who previously worked for Prospect magazine, arrived at Open Democracy from the global activism organisation Avaaz. Open Democracy’s open submissions platform had enabled it to develop new writers but it was being challenged by Medium, which launched in that space in 2012. “What I inherited was a really fascinating organisation with an interesting history and a collection of interesting voices; academics, activists, policy (wonks), and journalists. It had a global network and reputation but was struggling financially.”

Avaaz showed that there was another way to raise funding, beyond big grant organisations. “I saw how you can raise money from a global community of small donors if you have a very strong, impactful story to tell.”

Today, the site’s resources are growing. Its annual operating budget of £1.6m is around double what it was when Fitzgerald joined in 2014, partly because of increased contributions from readers for its investigative work.

It was Oborne, a regular contributor, who gave the site a crucial exclusive in 2015 on his decision to quit as chief political correspondent of the Daily Telegraph. In the long and detailed piece – headlined “Why I have resigned from the Telegraph” – he blew the whistle on his employer’s alleged failure to critically report on HSBC and other of the paper’s major advertisers. The “great issues” at stake, Oborne wrote, “go to the heart of our democracy, and can no longer be ignored”.

While Open Democracy challenges the rise of the far-right, it’s not itself of the left. “It’s true that a lot of our contributors are on the left or would be described in the US as liberal but we bring in a lot of voices from across the political spectrum,” Fitzgerald says. Open Democracy’s board chairman is David Elstein, the Tory supporting former boss of Channel 5. John Mills, the businessman Brexiteer who was chair of Vote Leave, is also on the board.

Oborne’s piece led to Open Democracy probing the integrity of the media across Europe. More recently it raised questions over the London Evening Standard’s promises to commercial partners including Uber and Google of “money-can’t-buy” positive coverage as part of its London 2020 campaign on the future of the capital.

While The Telegraph and Standard have both protested their innocence, Fitzgerald believes the stories have highlighted a need for tighter regulation. “I think it’s the most fundamental issue affecting press freedom in the UK – far more so than political interference,” she says, calling on the Advertising Standards Authority to up its game. “They have quite vague guidelines and very rarely investigate this but there’s such a clear need for white labelling when it comes to commercial relationships.”

Crucially, Oborne’s revelations convinced Open Democracy of the value of a more investigative approach to its reporting, accompanied by appeals to readers for financial support. “That has given us more unrestricted income which allows us to make important decisions and take risks and be quick in a way you can’t when you have project funding.”

The best example of this has been Open Democracy’s work on hidden funding in politics. The appeal on its website is clear: “Who’s behind the ‘dark money’ bankrolling our politics? We’re on their trail and we’ve got many fresh leads to chase down - please support our work.” Crowdfunding on the back of this dark money investigative work raised £110,000 from over 3,000 readers in under four months. The site is building its base of individual financial supporters. It has applied for a fresh grant from Luminate to upgrade its technology, appoint a head of Audience and to test and iterate a membership model for the site.

“At the beginning of this year we had 300 small donors and we want to increase that to 1,000 by the end of this year, which we are on track to do,” Fitzgerald says. “That will increase our flexibility and independence. Our challenge is to convert people who give one-offs because they are motivated by a story into becoming subscribers.”

Ian Burrell's column, The News Business, is published on The Drum each Thursday. Follow Ian on Twitter @iburrell