There isn't much too it — pretty basic stuff. I think the most difficult part is keeping an open mind and checking if a niche site makes sense and a good domain is available.
1. Come across something cool on Youtube that you think might make a good niche site.
2. Check to see if there are any decent domains available for that niche.
3. If so, but the domain and set up the niche site.
4. Write a post on your current blog about it so that ti gets indexed by the search engines.
5. Leave it be and work on other projects.
I happened to see this guy who made instruments out of different types of vegetables which lead me to an orchestra that plays nothing buy vegetables when they give a concert. I simply posted the videos of them creating the instruments and playing them.
There are a lot of quality videos out there like that and if you can find a group niche of them, there is a good chance that you can make a bit of money continually from them.