Tuesday was the first day of my entrepreneurship class, which I’m taking in case I decide to work at a start-up or create a nonprofit. Although the class has nothing to do with journalism directly, I think about every concept in terms of news.
The professor, Johnathan York, described the four stages of entrepreneurial growth using an airplane metaphor:
Stage 1: Opportunity
Are the circumstances right? Do you have the fuel? Do you have the passengers to board the plane?
In terms of journalism, the circumstances are absolutely right because there is a need for a new model. The old model is failing and that is the fuel. The passengers (readers) are there and will always be there. In fact, there are more passengers now than ever.
On a less theoretical level, you’ll need to get your hands on money and staff to put your non-profit into action.
Stage 2: Launch
You have the materials, now you need to get off the ground. This means coming up with a business model that will work.
In journalism, this is the toughest aspect because current online models aren’t working. You’ll want to look toward new, innovative models like the Voice of San Diego (a non-profit, online-only organization) or Spot.Us (community-funded journalism).
You’ll have to launch a model that doesn’t fall into the same path as traditional newspapers. Print advertisements will not transfer to online, so you’ll have to come up with revenue models beyond advertising.
For example, the San Diego Union-Tribune recently hosted a live chat in its Marketplace web site. Three real estate professionals answered questions from first-time home buyers over the chat. This simple, interactive form of advertising let users connect directly with agencies, which says more about their brands than a banner advertisement ever could.
We need to think beyond static images and into truly innovative forms of advertising that consumers will actually pay attention to.
Stage 3: Growth
You’re off the ground — how do you stay in the air? If you try to stay in the air using the same techniques you used when lauching, you’ll crash.
In other words, get your content out there and give it value. Gain readers. Use social networks to promote yourself and find ways to accumulate more revenue.
Stage 4: Harvest
If you make it to stage four, you’ve done well — but it’s not over. How do you land safely?
In any other business model, “harvesting” would be selling and getting a return on the value of your business. For a news organization, you wouldn’t want to harvest by selling, but by ensuring that your business will continue to bring in long-term revenue.
A news organization doesn’t want to just “land safely.” That’s what put the industry in a tough place to begin with. They got comfortable with what was working and didn’t move beyond it when they needed to. Harvesting the value of your news organization will mean continuing to stay ahead of the curve, and constantly thinking ahead.