It’s easy to use the word invest a lot when talking about how the Knight Foundation funds journalism and information-needs-of-communities projects. Less than a month ago, we were talking about how Knight invests in media innovation with the recent round of the Knight News Challenge winners.

Turns out Knight now actually is in the business of investing in media companies — specifically with the Knight Enterprise Fund, a $10-million chunk of the foundation’s endowment set aside for early investment in companies that promise media innovation.

In some ways, the Enterprise Fund seems like a spin-off of the News Challenge, but aimed specifically at supporting for-profit companies that are compatible with Knight’s mission. The Enterprise Fund, which was officially approved in December, will be investing $25,000 to $500,000 in individual companies — roughly the same scale as what most News Challenge winners received. And the News Challenge allowed for-profit companies to apply for grants. But the Enterprise Fund comes with the potential benefit of a return on investment — which, if all goes well, could have the cyclical effect of boosting more Knight projects.

By investing in for-profits, Knight hopes to create a pipeline to new kinds of projects.

“God willing, we get a huge winner here and it would expand. If we’re lucky enough for that to occur, we would expand the endowment, which would allow us to make more contributions,” said Juan Martinez, vice president and chief financial officer for the Knight Foundation.

Knight already supports a large stable of projects — not just News Challenge winners but grants to organizations like NPR, the Online News Association, and journalism programs at universities (including, it should be noted, us here at the Nieman Journalism Lab). By investing in for-profit endeavors, they can create a pipeline to new projects and systems that could be of use to people through Knight’s network, Martinez said. The Enterprise Fund also could mean an injection of fresh blood into the sometimes insular media innovation community.

“This allows the program staff to get a view for what new companies are out there and what new innovations are being created,” Martinez said. “I think in the long run this will help us understand those kind of market drivers better.”

It will also allow them to shepherd News Challenge projects into the next stage of their development. The sale of EveryBlock to MSNBC in 2009 is an example of how News Challenge projects sometimes transition from grant-funded to the for-profit world. With the Enterprise Fund, Knight will be able to continue to support these projects and potentially see a return on the foundation’s long-term investment. “Venture capitalist provide networks and expertise needed for those companies to expand,” Martinez said. “So as they transition out of the Knight News Challenge and into a VC space, this is a platform to help expose that process for them.”

An example is BookBrewer, one of the first companies Knight has invested in, which began life as 2008 News Challenge winner Printcasting. (Knight also is investing in Snag Films, a documentary film platform, and OwnLocal, which creates advertising, deals, and shopping systems for news organizations.) The initial idea of Printcasting was to create a platform for low-cost, on-demand publishing. Remade as BookBrewer, their focus has shifted from print and PDFs to ebooks to try and tap into the growing demand for content on tablets and smartphones.

But entering the investment game is not without some risks for Knight, which is why they are not working alone, said Ben Wirz, Knight’s director of business consulting. “We’re not leading these investments ourselves,” he said. “We look for early-stage companies that are mission-aligned, do due diligence, and the business side is done by angels and venture capitalists.”

Martinez said Knight knows they don’t exist in a vacuum, that there is a world of experimentation and entrepreneurship in media and technology that could be beneficial to the people the foundation is trying to help. If they can act as a conduit, hooking up for-profit and nonprofit to help support and sustain journalism, that’s what matters most, he asid. “Ultimately what Knight cares about is impact, that our dollars go towards promoting informed and engaged communities,” he said.