JSTOR began as a project of The Andrew W. Mellon Foundation designed to help libraries address growing and persistent space problems. Couldn't advances in technology help reduce the systemwide costs associated with storing commonly held materials like core academic journals? A decision was made to test a prototype system that would make the backfiles of core journals available in electronic
form. Mellon Foundation staff signed up journal publishers in history and economics and, working through a grant to the University of Michigan, began to create a database with associated controlling software that was made available to several test site libraries. It became evident very soon both that the concept was extremely complicated to implement and that it held great promise.
JSTOR was established as an independent not-for-profit organization with its own board of trustees in August 1995. From the outset, JSTOR was given the charge to develop a financial plan that would allow it to become self-sustaining-the Mellon Foundation was not going to subsidize the concept indefinitely. At the same time, JSTOR is fortunate to have had Mellon's initial support because enormous resources have been invested in getting the entity launched that never have to be paid back. Apart from the direct investments of funds in the development of software, production capacity, and mirror sites through grants to Michigan and Princeton, there were large investments of time and effort by Mellon Foundation staff. JSTOR has received, in effect, venture capital for which it need not produce an economic return. We have tried to translate these initial grants into lower prices for the services that we provide to JSTOR participants.