• by Tameka Kee , July 30, 2007

NowPublic.com, a citizen journalism Web site with some 100,000 global contributors--many of them unpaid--has secured $10.6 million in Series A financing, and plans to expand its partnership with the Associated Press.

Led by Rho Ventures and its affiliate Rho Canada, as well as seed investments from Brightspark and GrowthWorks Capital, the funding represents a substantial one-shot financial commitment to a citizen-generated news organization.

The news outlet's current business model is a mix of advertising, content sales, software licensing and wire services revenues. The wire service revenues are set to expand through its national partnership with the AP.

Since March, NowPublic has been working with AP bureaus serving Seattle, Los Angeles, Las Vegas and Chicago. As part of the new agreement, (and a nod to the increasing validity of citizen journalism), it will roll out support for many additional AP bureaus over the coming year.

For example, NowPublic's 20,000 members in hurricane-prone areas will be supporting the AP during the upcoming storm season.

Contributing writers are not directly compensated by NowPublic. Instead, the eyewitnesses, bloggers and photography enthusiasts can earn money from third-party sites like the AP that buy their news content.

"Most of the people who contribute do it for a sense of community," said Leonard Brody, NowPublic.com's co-founder and CEO. "It's a chance for them to report firsthand and really be affiliated with the news and where they stand."

The third-party reporter compensation model also staves off any potential conflicts of interest between marketers and NowPublic--as the site does not have to censor, rank or display news articles with regard to brand affinity.

The overall ratio of advertising revenue is slated to increase as NowPublic.com scales out, but "we'll be sensitive in the same way that other ad-supported news organizations are around stories," Brody said (i.e., the ages-old example of airplane ads not running when airplanes crash.) "This is a raw, citizen-generated news wire. Advertisers will understand that, just as they've started to grasp and get a hand on other user-generated content."

NowPublic does plan to use some of the funding to add internal staff and reward consistent, heavy site contributors--but overall, the $10.6 million represents a shift into what Brody calls News 3.0.

"There's a need for an army of people everywhere seeing, hearing, and reporting everything that's going on--like a next-generation Reuters," said Brody. "We realized that the breaking news component would increasingly move away from traditional news organizations, so we've set up the technology and we're fostering the community that allows people to break and interact with the news personally."