"@Jared: You said "You can't expect young writers to work for free indefinitely." Well, actually, yes you can. I have been writing and running TransitMiami for six years without any compensation and will happily do so indefinitely. Also, the ten or so other writers I have had over the years never asked for a dime, and always put in 110% (including Craig). The incentive for us is not financial, but ideological. Achieving changes in policy or design are pretty strong motivators.
That being said - would it be nice to get paid - of course! Folks do get paid for blogging, but that is not what it is all about. The blogosphere thrives despite the lack of financial incentive because people give a shit about what they write about. In our case, our writers are urban planners or transportation planners who have expertise in our subject area. They are not professional journalists who rely on the blog for their livelihood. (In other words, they don't need to get paid to blog).
In that respect, you shouldn't apologize for wanting to make a buck. Most writers blog for a hyper-specific purpose (to study the dysfunction in county government, document the latest food trucks, to document the blogosphere...etc) My impression with Beached Miami is that it started as a blog about random Miami happenings by two passionate dudes, but has become a business about aggregating content from a wide range of subjects. In this case, yes it may be hard to find willing bloggers to volunteer their time to create good content without paying them. But it is also a false choice to say that either the site makes money or it dies. SFDB is a perfect example of dedication and consistency without financial incentive. (Or Eye on Miami, or any of the other blogs on the sidebar).
Great blogs are popular because they either have: a voice that people have come to identify with (like the rants from Eye on Miami's Genius of Despair) or a well researched hyper-specific subject area (like South Florida Lawyers) or both. You can't be everything to everyone - and if you try, people stop reading. If you focus on one thing - and do it really really well - then you might be able to make money without sacrificing quality (talk to the Coconut Grove Grapevine, or MiamiBeach 411). Leave the content aggregation and covering of local news to Huff Post, Riptide, and the Herald.
My 2 cents.
PS. Transit Miami is not going nonprofit, or for-profit. We are seeking a one-time Knight Foundation grant (and we are up against some tough odds) for a web app and to pay an administrator to run the app for a limited time. The point of the app is to diversify content creation so that we don't have to rely on any one writer to create content. If we don't get the grant, we'll build the app anyway and keep writing about urban planning and transportation issues in Miami- for free. The point is not to pay a writer, but to continue to build the site as tool for community advocacy. "
- Tony Garcia [of Transit Miami], Beached Miami Evolves