Media Development Investment Fund

Media Development Investment Fund (MDIF) is a New York-registered 501(c)(3) non-profit corporation and investment fund that provides low-cost financing to independent news media in countries with a history of media oppression. It works with newspapers, radio stations, and TV companies in Africa, Asia, Latin America, the CIS, and the Balkans.^[1] It was originally founded as the Media Development Loan Fund (MDLF) before changing its name in 2013.^[2]

Through low-cost capital (mainly loans), business training and other advice and support, it aims to help news outlets committed to responsible journalism become commercially sustainable, believing that only financially independent news media can stay editorially independent over the long term.

History

MDIF was founded in 1995 by Saša Vučinić and Stuart Auerbach, the late Washington Post reporter and editor. Previously Vučinić was editor-in-chief and general manager of B92 radio in Belgrade when, in the early 1990s, the station started to experience financial problems caused by government interference.^[3] Witnessing freedom of speech slowly slip away partly due to a lack of economic security, Vučinić had the idea of creating an organization that would provide independent media with access to capital.^[4] The idea was pitched to George Soros, who provided the initial grant for MDIF's start-up.^[4]

Activities

Financing

From 1996 to June 30, 2014, MDIF provided $129.8 million in affordable financing, including:

• $113.5 million in loans and equity investments;
• $15.8 million in technical assistance and other grants;
• Earned over $38.9 million in interest, dividends and capital gains;
• Collected more than $60.5 million in recovered principal invested;
• $0.5 million through Digital Kiosk, the secure payment service for independent media.

MDIF has invested in 100 clients and 303 projects across 31 countries, writing off only 4% of the total loaned and invested.

MDIF has returned more than $29 million to investors. It ended June 30, 2014 with a portfolio of $47.7 million in outstanding loans and investments.

MDIF Impact:

Impact analysis found that more than 55 million people got their news from clients of the Media Development Investment Fund in 2012.

• On average, MDIF traditional media clients increased their audience reach from 2011 to 2012 by 52% while digital media clients increased reach by 82%
• After the first year of working with MDIF, clients increased their reach by an average of 111%
• On average, MDIF clients increased their sales by 6.2% from 2010 to 2011
• After one year of working with MDIF, clients experienced an average growth in sales of 45%, and 240% after 5 years
• MDIF clients employed a total of 3,681 people in 2012^[5]

With its activities growing but the pool of development agency and private foundation funding limited, in 2006 MDIF, Swiss bank Vontobel Group and Zurich-based social investment specialists responsibility launched "Voncert responsibility Media Development". Voncerts are a bond-like investment that also include a loan to MDIF and are available in most countries outside the USA and UK. Voncerts are listed on the Zurich Stock Exchange.^[6][7]

Funders of MDIF's Loan/Investment Pool include: Bank Vontobel, Calvert Social Investment Foundation, DOEN Foundation, Dreilinden gGmbH, Foundation for Democracy and Media, John D. and Catherine T. MacArthur Foundation, Open Society Institute, Oxfam Novib, Swedish International Development Cooperation Agency (Sida), Swiss Agency for Development and Cooperation and Alexej Fulmek.

Other support for MDIF's work has also come from: Council of Europe, Eurasia Foundation, J.M. Kaplan Fund, Charles Stewart Mott Foundation, Netherlands Ministry of Foreign Affairs, United Nations Development Program (UNDP) and U.S. Department of State, Bureau of Democracy, Human Rights and Labor.

CAMP and Sourcefabric

As in the developed world, media businesses in transitional countries must embrace developments in technology and changing customer demands if they are to survive. From interactive news services to broadcasting online, MDIF provides clients with strategic advice on some of the key challenges facing the media business worldwide and helps them to seize local first-mover advantage.

MDIF recognized the importance of technology to media as long ago as 1998 when it founded the Center for Advanced Media-Prague (CAMP). CAMP provided technology support to independent media in developing countries and developed open-source software solutions under the Campware brand. In May 2010, MDIF spun off CAMP as an independent organization, Sourcefabric, which continues to provide valuable support to news outlets in the majority world seeking to get the most out of technology.

All in all, Campsite cost between $100,000 and $250,000 over more than 5 years.^[8]

MDIF's active partners in Campware were Redaktion und Alltag (Berlin) and the Department of Digital Design of the Parsons School of Design in New York.^[9]

Digital News Ventures

Digital News Ventures is an early-stage fund for digital news and information businesses. It is a wholly owned subsidiary of MDIF. It provides early-stage equity finance from $30,000 to $300,000.^[10]

Outernet - free Wifi to any country

MDIF plans to start Outernet project in mid-2015 to allow free access to certain censored sites like Wikipedia, YouTube, Google etc. for any country. China restricts Internet using "Great Internet Firewall of China", but Outernet is going to bypass even this. Thus make all information freely available to anyone - just what the Internet was supposed to provide. Success of the project depends on its funding. Any investor is invited to help start outernet. Outernet uses CubeSat technology - satellites 200 km from Earth.

References