We set out to be intentionally provocative, because Bill and I have seen too many great ideas for projects and products turn into smoldering wreckage because of miscommunication between journalists and business folks. (OK, and partly because Bill and I just like being provocative.)

So we taught it as if it were a master’s level business-school class. We used case studies about interesting media start-ups. We taught the ABCs of financial statements (yes: We made journalists look at numbers) and the grandular details of different revenue models. And we required every student to pitch a sustainable news-and-information venture.

We heard some terrific ideas. But as Tom O’Malia*, a serial entrepreneur and director emeritus of the Lloyd Grief Center for Entrepreneurial Studies at USC,  reminds anyone who will listen: Ideas are cheap.

Entrepreneurial ideas are only useful if they can be refined into a workable business concept – one that has real, paying customers, and delivers clear value to those customers.

Tricky distinction, especially for reporters.

No, your audience is usually not a paying customer. (We won’t get into the tiresome paid-content discussion here – but even at newspapers and magazines, subscription fees from the audience are a small portion of revenues, and an even tinier portion of the profits. The real paying customers are the advertisers.)

We were gratified at how quickly the group caught on.

Many of the ideas were terrific, and got only better by the final pitch session. We’re going to be intentionally vague about the specifics – several folks are still working on their ideas with an eye towards actually executing them in the real world. Suffice to say our interest was piqued by proposals to:

• Mine rich internal archives of entertainment reviews at a major media company
• Connect reporters and people who have compelling information to, um, share. (“Leak” is such a loaded word, wouldn’t you agree?)
• Attack a classified-advertising niche that has largely – and strangely – been left untouched. So far, anyway.

Great. But you know what was even better?

The weak ideas – the ones that started life as “Hey, kids! Let’s put on a website!” (All credit to Mark Potts for that line.)

Over just two months, those weak ideas got better. From vague beginnings emerged sharp proposals to create:

• A unique alliance around a hyperlocal site to provide modest, yet stable, funding that doesn’t rely on local ad dollars.
• Community and hobby-driven sites that focus on narrow, but attractive, niches. (All I’ll say about one of those niches: The hobbyists scraped together $15 million to construct a building for their pastime?!? That’s a niche I’d like to capture.)
• A clever blending of non-profit status, cheap technology and Internet cafes to support women in West Africa.

The point here is not that all of these ideas will work. Perhaps none will.

The point is that 18 young people – hard-core traditionalists, inexperienced cubs, even some NGO and government types – innovated. They combined creativity, perseverance and some basic business principles to develop concepts that are worth testing in the marketplace.

And therein lies the future of journalism: Smaller, nimbler, more creative.

*(As an aside: Bill and I owe a huge debt to Tom for graciously sharing his curriculum and research.)

Over the past month or so, I’ve been plowing through an extensive stack of resumes to fill some openings on my new team at PBS.

Many of the resumes were sort of sad – those of journalists with impeccable traditional credentials, and no clue what I meant when I asked for work samples that showed creative use of different digital story forms in service of the content.

Call ‘em The Lifeboaters:  “This digital thing is going to be huge, and I’d be proud to learn it from your team!”  Umm, sorry. The ship that you want left 15 years ago. The good news: New ships leave everyday if you’re willing to swim out to the meet them. WordPress.com offers blogs for free. Start there, keep playing, and we’ll talk in a year.

A second pile included people who are incredibly good … at a singular thing. Call ‘em the The One-Skill Wonders: Very adept at slideshows. Or digital video. Or shoveling existing text onto a page. Yes, those are useful skills (and, candidly, they’ve been enough to get very good production jobs at many shops for a long time.) But that’s not what my team is trying to do.

Happily, however, there was a third pile of those resumes: Digital natives (or digital immigrants who work hard to remain conversant) who understand the whiz-bang toys are only useful if they serve the story. They also understand there will be a new whiz-bang tool next year.

My favorite example: One of the candidates is a wizard at a certain vector-graphics program that’s hideously expensive, ridiculously proprietary, notoriously hard to learn – and incredibly useful. Which, of course, leads some to treat it as the Universal Truth to all journalism questions, and to treat themselves as priests.

Not this guy. He wouldn’t bite on my trick question (something about whether this program was the most useful skill he’d ever learned): “The technology is always changing, so I just feel like the ability and willingness to adapt is the best skill someone can have.”

Guess what? He got an interview. So did most of the others in the third pile. They’ll be the ones making up our new team.

It was hard not to notice a few commonalities among them. An awful lot of them passed through Medill at Northwestern, American University in D.C., or Cal-Berkeley. Several also received one of the fabulous summer-long News 21 fellowships.

I’d be horribly remiss if didn’t mention the excellent program at CUNY; as it happens, none of its kids choose to apply. I’d be equally remiss if I didn’t point out that some name-brand journalism schools aren’t on this list – and that’s not an oversight.

The kids in that third stack are solid reporters and great storytellers. When pressed, they talk about technologies as means to an end – tools they can use in service of the story, not as a flashy adornment to it. They also used overly long sentences to offer variations on a motto a longtime colleague used to have on his blog: Semper Gumby – always flexible.)

Of course, one of the people I hired said it far better than I can.

I hope this forms an optimistic riposte to a discerning entry from Wayne MacPhail on PBS’ Media Shift blog. MacPhail makes an impassioned observation that J-schools are failing their students by defaulting to traditional story forms, taught by traditional professors, with barely a mention of the information revolution occurring around us. He’s right.

Too many of my friends – the first-generation digital pioneers now in academe – talk privately about the battles they fight with tenured colleagues who insist that circa-1994 curricula are just fine¸thank you and have served generations of graduates with distinction!

Fortunately for our craft – and for my project – a few schools are taking another path. Some of their grads are going to help us at PBS.

As part of the prep work, I’ve re-read a hefty stack of posts about emerging revenue models for news – advertising-supported for-profits, L3Cs, non-profit structures, even the wishful-thinking paid-content model.

Running through many of the pieces was an irksome thread: A focus on single solutions. Most framed the discussion in terms of “what’s the source of revenue,” as if there were a magic bullet that can solve every operation’s money woes.

There isn’t, of course. What’s more important, though, is there never has been. In times like these, naiveté isn’t charming – and for entrepreneurial journalists, it can be downright dangerous.

No successful news media organization has ever relied solely on a single source of revenue. In fact, the most successful industry segments – newspapers, magazines and broadcast stations – have long had many revenue sources, almost too many to list.

There’s more elaboration – and a rough list of the different sources — in this deck.

Key takeaways:

-  Don’t think too broadly. Even something as seemingly straightforward as “advertising” isn’t a single source of revenue. There are myriad advertising products – each with distinct strengths and weaknesses, sets of customers and sales models.

- As you plan the revenue models for your own proto-business (that’s what start-up journalism sites are, folks), copy the best of traditional organizations. Find multiple streams of revenue.

(Lest this come off as too scolding: I think it’s fantastic to see journalists actually interested in this sort of question. For decades, most of us acted as if the money that powered our organizations was created by magic. Worse, some assumed that it was the result of their brilliant journalism. For a welcome example of incisive, if tardy, analysis, see James Fallows’ terrific Atlantic piece on Google and the news industry.)

This goes against years of training and experience most of us have as traditional journalists: Bigger is better, right? Cover more things, get a bigger audience?

It’s hard sometimes to pull ourselves away from topics we know too well. So to understand why niche sites work so well, let’s look instead at the same issue in another industry – retailing.

Sears' logo, circa 1970

In the middle of 20^th Century, Sears was the dominant store in America. It offered most things to most people, conveniently located at almost every mall in America. Their shirts weren’t the greatest, but they had a plentiful selection. Downstairs, the hardware department had most of the tools you’d need; out in the garage, you could get a new Die-Hard and fresh tires.

Today, Sears is a mere shadow of itself – and it wasn’t dethroned by Montgomery Ward or others who tried to do the same thing, just better.

 Sears was beaten by competitors who seized niches and exploited new technology: Wal-Mart’s legendary information systems and overseas outsourcing allowed it to offer mass-market goods at lower prices. Nordstrom and others catered to some consumers’ desire for premium goods and outstanding service. Home Depot and Lowe’s stripped away the hardware business by combining more selection,  cheaper prices and  a lumber yard.

Today’s mass media – newspapers, tightly formatted radio stations, the Big Four TV networks – are Sears in the mid-1970s.

For the past 50 years, the economics of scarcity meant programming “most things to most people” was a terrific model (especially when you could jack up your ad rates at will because advertisers had few other options). But digital technology has destroyed the scarcity that made those models work.

The general daily newspaper during the Golden Era of the 1960s-1990s was a happy accident of economics. No one could possibly afford to publish just international news, or just sports news, or just the comics. In a world of $75 million printing plants, $600-a-ton rolls of paper and all those delivery trucks, bundling together many niches made the product work.

But none of those costs exist in the digital world. In fact, bundling the traditional newspaper mix together leaves mainstream news sites with a huge problem: Too much good stuff, all competing for attention. The result? Early newspaper.coms had home pages stuffed with hundreds of links, none of which stood out enough to have an impact.

So to entrepreneurial journalists: Don’t be like Sears. Don’t try to be all things to all people. Don’t try to recreate the newspaper model of covering everything, but not particularly well.

That why niche sites are the fastest growing part of the digital world. Here are a couple of my favorite examples. What are some of yours?

I commend them. They’re gamely carrying on in the face of the implosion of their publication, and they’re doing it without getting paid.

But I’m not linking to them here because I don’t want to embarrass them. The new site is, well, a bit of a mess.  has issues.

First, it’s hosted at Blogger.com. Don’t get me wrong – Blogger is fine if all you’re looking for is a free, fast, personal site. But its functionality pales compared to the open source (and equally free!) tools like WordPress, Drupal or Joomla.

Second, the “life boat” magazine site has a dreaded subdomain URL: (site name).blogspot.com. I won’t get geeky here, but there are subtle search-engine drawbacks to a subdomain. And a blogspot URL just. Looks. Rookie.

Third, the site doesn’t have an ad unit. Anywhere. Sustainability, anyone?

In fairness, I suspect the writers believe this site is temporary. There’s a slim chance the magazine will be resurrected. It’s even more likely the Blogger site is simply a placement – a way to keep the writers’ work visible while they put together a more-substantive site.

But the irony is dripping all over the floor (and the damn dog refuses to clean it up the way he takes care of my snack crumbs): Writers who covered the demise of an industry that couldn’t cope with technological change … aren’t using technology very well.

What to do? Well, the inestimable Mark Briggs has a boatload of useful advice at J-Lab’s J-Learning site. (my only quibble: stop calling it “newspaper” in a box! Think “niche site in a box!”)

I’ll be adding some of my own thoughts about free technology tools over at the GrowthSpur blog. (Link coming when I, um, get the post finished. Nothing like a deadline…)

(Big hat-tip to erstwhile competitor @AmyVernon for noting the irony.)

REVISED TO ADD: In a Facebook conversation on this topic, someone fretted about the technology being complex – perhaps even too hard. To which I politely say “nonsense.” I can do this.