There’s absolutely nothing about the nonprofit model that precludes selling advertising or pursuing other revenue sources, and Dougherty said nothing to that effect in his post on Friday. (The CUNY News Innovation model, in fact, assumes that about half a nonprofit’s revenues could come from advertising by Year 3.) If CTDN couldn’t generate the advertising revenues they needed, then that’s a reflection of their own effort or self-imposed limitation, and it should not be represented as anything else.

When you operate a newsroom or any business as a for-profit, your first duty — your fiduciary duty — is to your investors. You owe it to them to protect their investment. A nonprofit’s first duty is to its mission, whether it’s news, fighting homelessness or curing disease. Those are statements of fact, not “claptrap” or idealism. There are different ways of doing things, and they have different outcomes.

At the same time, to say that a nonprofit has to generate enough money to sustain its operations is a blinding glimpse of the obvious. Any business does. And of course there’s no “magic wand” that comes with the nonprofit model — no one here is claiming that there is. If anything, a nonprofit business needs to be smarter and more innovative than its for-profit counterparts.

The nonprofit model isn’t a cureall; nor is the for-profit model. There is a place for both, especially in a time of such upheaval in the news business. We’d do well to discuss them both in an informed, thoughtful way.

Moreover, the idea that investors will somehow inhibit his coverage is similarly ridiculous. What investors care about is making money (that’s not a bad thing, incidentally). If Dougherty’s new venture successfully gains an audience and advertisers, he’ll have happy investors. He won’t have to “ask permission of his investors” for anything else.

Dougherty’s experience highlights the great limitations of the non-profit model, chief among them that even a non-profit has to generate enough money to sustain its operations. There’s no magic wand that protects any non-profit–even a news operation–from that simple law of economics. For-profit status, in most cases, provides more flexibility.