Chi-Town Daily News, the Chicago nonprofit news site we profiled way back in the first issue of Miller-McCune magazine is shutting down, with the editorial leadership starting up again as a for-profit with angel funding. In Chicago, a city whose two major newspapers have both filed for bankruptcy, the Daily News has been a welcome source of on-the-ground reporting and community news of late. It's scored great (if not gargantuan) watchdog scoops, including one on how a billing glitch cost the city $1 million and led to the closures of several mental health centers.
Among the recent crop of nonprofit journalism start-ups, the Daily News is the most prominent to bite the dust. Its saga speaks to the difficulty of managing the transition from a grant-funded innovative pilot project into a sustainable business with a real revenue model. It also highlights the limits of citizen journalism: Most of the best work lately was produced not by the citizen journalism project for which the Daily News received a Knight Foundation grant, but from the pack of young, hungry reporters that editor/founder Geoff Dougherty hired in the past year. (It's worth disclosing that since the article was published, I've met with Dougherty for drinks socially a few times.)
Based on what Dougherty wrote today, the new venture will probably rely on skilled reporters, not citizens. The CJ community of volunteers that organizer Frank Edwards worked so hard to build may disappear with the demise of the Daily News.
There is a case to be made that a lean newsroom relying on talented young journalists can turn a small profit from public affairs reporting. The logic for the successor to the Daily News, though, seems a bit off. As one Miller-McCune editor wrote to me, parodying Dougherty's thinking: "I failed at making this fly as a nonprofit — but if I add in 8 or 10 percent on the cost side as profit paid to investors/owners, it'll go like a rocket!" Part of the message of the original story was that management is the limiting factor in the success of any news organization, and the Daily News' downfall doesn't bode well for Dougherty's skills as an executive.
If you want to read up on the situation, the most comprehensive coverage thus far on the situation comes from local Chicago blog Gapers Block.
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