I don't immediately understand what this solves over say patreon, which has a lot lower fees (10% + 2.5% for CC fees... holy crap). Whats the value add here? And for publishing text? Is there DRM involved?
It feels like you're just charging for a paywall and a mailchimp list... maybe thats enough, but given the amount of failures in the space, it feels like just another to go on top of the pile. Maybe its the right mix, and they have some big plans?
One issue from the Terms - if you post something publicly, they can keep it published and licensed to them forever, even after you delete your account. I'd think for such a high price, and a high emphasis on content creator control, you'd not take away the legal rights to delete public posts.
Also pretty disappointed at the arbitration agreement and unilateral terms of use updates (they can update them at any time, and if you don't agree you will be kicked off the platform).
[edit: its certainly easy to see the value of something like this existing - just trying to understand why this is different than the others]
Is there any site that doesn't allow for unilateral terms of use updates? I'm not being snarky; I genuinely haven't seen one, and I'm not sure what the alternative would be. "We're changing our terms of use, but if you don't agree with our changes, you can keep following the old rules you originally agreed to" sounds like it'd be a nightmare to keep track of in practice.
> It feels like you're just charging for a paywall and a mailchimp list... maybe thats enough, but given the amount of failures in the space, it feels like just another to go on top of the pile.
What are the other paid-email failures from the pile?
Surprised something like a simple platform for paid email newsletters would be something that catches the eye of VCs hoping to find the next unicorn. The best case scenario feels like Medium, which to my knowledge has changed course dozens of times and doesn't seem to be going particularly well.
The current subscriber figure I've seen is around 50k paid subscribers across all newsletters. I think even in a best case scenario of having 1m subscribers pay $10/month, that is 1m x $10/mo x 12mo x 10% = $12m in revenue/year (at 20x the current subscriber rate). Unclear how that translates to a VC-sized unicorn biz.
FWIW, Medium launched their subscriber program two years ago and hasn't changed course since.
I think Medium's move is a winner and as a result, I started three profitable publications there. But... I'm worried about getting squeezed down the road. Right now Medium passes all their subscriber revenue on to the authors & publishers. But eventually they'll have to take a cut and the size of that cut will be balanced out by what other opportunities authors and publishers have.
So I think it's great that the ecosystem for paid writing is growing (Substack & Patreon). And I think paid is a great model now that we've seen what the mature version of free looks like (IMO, very bad). As an occasional writer, it's refreshing to just write the best piece I know how without trying to hack in virality and upsells.
Also, I want to +1 doing the math on their business. I see so much surprise/outrage when companies pivot. But all of us here are savvy enough to see this pivot coming from miles away. If they are venture backed, then you're right, $12M ARR is not high enough. So that implies they will make a significant pivot down the road.
So don't get too attached to this version of Substack--it's temporary. And IMO, that's totally fine. It just means you need to be ready to pivot along with them (and/or have a plan B business).
hey! This is andrew from a16z -- substack is still relatively new (~2 years) and the product is solving a real problem for writers. The numbers are already strong, but think about where it might be over the next 5-10 years. I think your calculation focuses too much on where it is now versus where it might go in the future
For a number of years, a lot of people have said that “newsletters are the new blogs” — and to a certain extent that’s true. During TinyLetter’s heyday, it was often easier for someone to create a newsletter and send it to people that wanted to read it than it is to setup a website and deal with what the entails (which sadly, in 2019 is more complicated than it was in 2006).
But setting up a newsletter isn’t without its own costs and considerations. What platform do you use, how much does it cost to send emails (something that’s hard to ascertain if you don’t know how many subscribers you have), checking formatting for various mail clients and services, avoiding being marked as a spammer, etc. And that’s before you get into the aspect of creating the newsletter — which again, TinyLetter aside, is often difficult because most newsletter services are geared towards marketing/customer acquisition, rather than something akin to a blog.
And if you want to charge for your newsletter, that’s another challenge. You have to figure out a payment processor, a membership signup system, deal with account issues, etc.
For the Ben Thompsons’s of the world who were early/pioneered the game of paid subscription newsletters, the investment costs of infrastructure and technology is probably worth it. But for many others, it’s not.
So Substack has the potential to be that defacto place/platform. I see it as trying to be the Blogger or WordPress.com for content-based newsletters, subscription or not.
I’ve almost started a newsletter about 18 times and I even signed up with Substack a few years ago (but haven’t set it up yet because I had a few concerns about how to migrate away from Substack), because of all the options — it’s the one that seems to have the least-amount of friction.
Now, in a perfect world, there would be an open-source way to do all of this with the option for both hosted and self-hosted options. Owen Williams’ newsletter/website Char.gd [1] has a great setup (he showed it to me at XOXO last year) and I know Ernie Smith from Tedium [2] has a really cool custom setup as well. I’ve been wanting to convince either or both of them to go in on a platform for this concept with me, because although I think Substack is definitely the easier way to do things for lots of users — there’s also a market (albeit smaller) for people who might want to have more control over the platform/ecosystem, but don’t want to have to cobble the whole thing together.
VC here: why? the market is fucking G I N U N G O (potentially). Email is a ubiquitous technology. Any platform that could potentially lead the monetisation of it is worth serious consideration. Substack is probably the company with the best traction today. Given that, I think there will be a land grab now with lots of copycats charging the same or less - limited moat. Doesn't mean the company can't grow to be a monster - see Shopify.
Long, nice (and a bit too verbose) article about the media space, and why A16Z has invested in the series A for Substack.
I am personally very excited to see how Substack will evolve. I think that they are trying to solve a very compelling problem, and I also think the founders have managed to build a straightforward, polished product.
Side note / rant: I wish the large majority of the "crypto" crowd would take note of how "solving a problem" should trump any "cool tech stuff" when you want to build a company. (and no, I don't want to name any names here, you can find plenty of examples, even specific to the media industry, just by googling for a few minutes).
The model of cryptocurrency is nothing like a traditional business. In one sense, it is arguably the most fair way to pay developers for their work - the more useful a coin / token, the more it's worth, and the majority of overhead goes straight to developers for their work on the software.
This conversation is extremely complex and I'm not sure why you related investment in substack to crypto.
If you want to understand the appeal of Substack to journalists/writers, there's a great interview on the BOC podcast with one of the more successful authors on the platform, Robert Cottrell (formerly of The Economist)
I don't have any strong opinions on the product being built by Substack Inc, but I do feel weird that they swiped the name "substack", which is a handle that's been used by open source hacker James Halliday for at least a decade. [0]
It's been his handle on GitHub, Twitter, Hacker News, YouTube, Reddit, etc., and it makes me uncomfortable to see a startup try to turn his name into a corporate brand.
This was my immediate association as well. I've followed the open-source work of substack for many years, and continue to use many of the modules he published.
1. The founders of the corporation were not aware of the established personal brand James Halliday had built under the handle, or didn't preform a google search to find out.
2. The founders were aware and just didn't care or lacked the creativity to construct a unique brand.
Both make me disinterested in whatever they're shilling.
Substack seems like a not-horrible acq target for Medium, if Medium has the funds to buy it. Many content creators appear to trust Substack and trust the potential to earn money on it. The acquisition would be worth it for the trust alone.
The model for paying content creators seems interesting, but I'm really curious what the market opportunity here is. My guess is that it's not that high... so it seems likely that Substack would consider inserting ads into the free newsletters.
However, if they pivoted to other mediums like video, then maybe there's something here. People will pay really little for a blog post emailed to them each week, but they'll pay a ton more for great video content.
I wrote a short blog a few months ago about how to get most of the benefits it offers with way less cost (and without being tied to a single platform) - plugging together Mailchimp and Trolley with a static website and a l'il bit of Zapier.
People are willing to pay for educational content, most of the content on Substack is news. It's hard to get people to pay for news. Interesting to see another play in this space though, hope someone gets it right.
[+] [-] taurath|6 years ago|reply
It feels like you're just charging for a paywall and a mailchimp list... maybe thats enough, but given the amount of failures in the space, it feels like just another to go on top of the pile. Maybe its the right mix, and they have some big plans?
One issue from the Terms - if you post something publicly, they can keep it published and licensed to them forever, even after you delete your account. I'd think for such a high price, and a high emphasis on content creator control, you'd not take away the legal rights to delete public posts.
Also pretty disappointed at the arbitration agreement and unilateral terms of use updates (they can update them at any time, and if you don't agree you will be kicked off the platform).
[edit: its certainly easy to see the value of something like this existing - just trying to understand why this is different than the others]
[+] [-] chipotle_coyote|6 years ago|reply
[+] [-] jpalomaki|6 years ago|reply
If people are already registered on Substack and have payment method in place then onboarding is smooth.
[+] [-] jokull|6 years ago|reply
[+] [-] eudora|6 years ago|reply
[+] [-] joegahona|6 years ago|reply
What are the other paid-email failures from the pile?
[+] [-] dawhizkid|6 years ago|reply
The current subscriber figure I've seen is around 50k paid subscribers across all newsletters. I think even in a best case scenario of having 1m subscribers pay $10/month, that is 1m x $10/mo x 12mo x 10% = $12m in revenue/year (at 20x the current subscriber rate). Unclear how that translates to a VC-sized unicorn biz.
[+] [-] tonystubblebine|6 years ago|reply
I think Medium's move is a winner and as a result, I started three profitable publications there. But... I'm worried about getting squeezed down the road. Right now Medium passes all their subscriber revenue on to the authors & publishers. But eventually they'll have to take a cut and the size of that cut will be balanced out by what other opportunities authors and publishers have.
So I think it's great that the ecosystem for paid writing is growing (Substack & Patreon). And I think paid is a great model now that we've seen what the mature version of free looks like (IMO, very bad). As an occasional writer, it's refreshing to just write the best piece I know how without trying to hack in virality and upsells.
[+] [-] tonystubblebine|6 years ago|reply
So don't get too attached to this version of Substack--it's temporary. And IMO, that's totally fine. It just means you need to be ready to pivot along with them (and/or have a plan B business).
[+] [-] andrew_null|6 years ago|reply
[+] [-] filmgirlcw|6 years ago|reply
But setting up a newsletter isn’t without its own costs and considerations. What platform do you use, how much does it cost to send emails (something that’s hard to ascertain if you don’t know how many subscribers you have), checking formatting for various mail clients and services, avoiding being marked as a spammer, etc. And that’s before you get into the aspect of creating the newsletter — which again, TinyLetter aside, is often difficult because most newsletter services are geared towards marketing/customer acquisition, rather than something akin to a blog.
And if you want to charge for your newsletter, that’s another challenge. You have to figure out a payment processor, a membership signup system, deal with account issues, etc.
For the Ben Thompsons’s of the world who were early/pioneered the game of paid subscription newsletters, the investment costs of infrastructure and technology is probably worth it. But for many others, it’s not.
So Substack has the potential to be that defacto place/platform. I see it as trying to be the Blogger or WordPress.com for content-based newsletters, subscription or not.
I’ve almost started a newsletter about 18 times and I even signed up with Substack a few years ago (but haven’t set it up yet because I had a few concerns about how to migrate away from Substack), because of all the options — it’s the one that seems to have the least-amount of friction.
Now, in a perfect world, there would be an open-source way to do all of this with the option for both hosted and self-hosted options. Owen Williams’ newsletter/website Char.gd [1] has a great setup (he showed it to me at XOXO last year) and I know Ernie Smith from Tedium [2] has a really cool custom setup as well. I’ve been wanting to convince either or both of them to go in on a platform for this concept with me, because although I think Substack is definitely the easier way to do things for lots of users — there’s also a market (albeit smaller) for people who might want to have more control over the platform/ecosystem, but don’t want to have to cobble the whole thing together.
[1]: https://char.gd/ [2]: https://tedium.co/
[+] [-] npollock|6 years ago|reply
[+] [-] FailMore|6 years ago|reply
[+] [-] simonebrunozzi|6 years ago|reply
I am personally very excited to see how Substack will evolve. I think that they are trying to solve a very compelling problem, and I also think the founders have managed to build a straightforward, polished product.
Side note / rant: I wish the large majority of the "crypto" crowd would take note of how "solving a problem" should trump any "cool tech stuff" when you want to build a company. (and no, I don't want to name any names here, you can find plenty of examples, even specific to the media industry, just by googling for a few minutes).
[+] [-] seibelj|6 years ago|reply
This conversation is extremely complex and I'm not sure why you related investment in substack to crypto.
[+] [-] andrew_null|6 years ago|reply
[+] [-] cjbest|6 years ago|reply
[+] [-] npollock|6 years ago|reply
https://podcasts.apple.com/us/podcast/this-indie-newsletter-...
[+] [-] jhardy54|6 years ago|reply
It's been his handle on GitHub, Twitter, Hacker News, YouTube, Reddit, etc., and it makes me uncomfortable to see a startup try to turn his name into a corporate brand.
[0]: https://web.archive.org/web/20091113043728/http://substack.n...
[+] [-] jasode|6 years ago|reply
Did they use the "substack" name because JH made it famous? I've heard of the word "substack" before but I've never heard of James Halliday.
"substack" was in use for several decades before 2006:
https://books.google.com/ngrams/graph?content=substack&year_...
[+] [-] lioeters|6 years ago|reply
https://github.com/substack?tab=repositories
I doubt it was an intentional move by the company, since these kinds of name clashes are inevitable in the global scope..
[+] [-] Vekz|6 years ago|reply
1. The founders of the corporation were not aware of the established personal brand James Halliday had built under the handle, or didn't preform a google search to find out.
2. The founders were aware and just didn't care or lacked the creativity to construct a unique brand.
Both make me disinterested in whatever they're shilling.
[+] [-] onemoresoop|6 years ago|reply
[+] [-] futureastronaut|6 years ago|reply
[+] [-] merpnderp|6 years ago|reply
[+] [-] shay_ker|6 years ago|reply
The model for paying content creators seems interesting, but I'm really curious what the market opportunity here is. My guess is that it's not that high... so it seems likely that Substack would consider inserting ads into the free newsletters.
However, if they pivoted to other mediums like video, then maybe there's something here. People will pay really little for a blog post emailed to them each week, but they'll pay a ton more for great video content.
[+] [-] cjbest|6 years ago|reply
You'd be surprised.
[+] [-] rorygibson|6 years ago|reply
I wrote a short blog a few months ago about how to get most of the benefits it offers with way less cost (and without being tied to a single platform) - plugging together Mailchimp and Trolley with a static website and a l'il bit of Zapier.
https://trolley.link/2019/03/03/paid-email-newsletter.html
(Disclosure: https://trolley.link , which I've used for the payment elements in this example, is my product)
[+] [-] tschellenbach|6 years ago|reply
[+] [-] tonystubblebine|6 years ago|reply
[+] [-] unknown|6 years ago|reply
[deleted]
[+] [-] ihm|6 years ago|reply
[+] [-] random023987|6 years ago|reply