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Creator economy journalism newsletters technology

🕵🏻‍♀️ #45: Substack: the Marketplace of Ideas

(and some great newsletter resources for you)

Interesting read from Ben Smith in The New York Times on the Substack debate. Media company vs tech platform, their editorial role (or not), the advances paid out by Substack Pro, and their biggest challenge: competitors like Ghost and Twitter/Revue.

The quote from John O’Nolan, Ghost CEO sums it up: Subscription newsletter publishing was ‘destined to be commoditized.’

The news is that Substack has signed up two high profile transgender writers – Danny and Grace Laverty so we have a household with two Substack incomes. A smart move, as it helps counter the backlash they’ve had from some writers who don’t want to share the platform with people who they said were anti-trans. It shows they want to be a platform for all – even those who criticise the company.

There’s been a media storm around Substack over the past year – about money, mostly (they are VC funded and valued at $650 million (Axios), the compatibility of VC funding and journalism, and the ethics of paying writers to join the platform. Why not? Authors get book advances, and we don’t bat an eyelid. And subscriptions are a much better deal for writers.

As Casey Newton said, Substack is taking up a lot of mindspace and has become a target for ‘a lot of people to project their anxieties.’

Substack has captivated an anxious industry because it embodies larger forces and contradictions. For one, the new media economy promises both to make some writers rich and to turn others into the content-creation equivalent of Uber drivers, even as journalists increasingly turn to labour unions to level out pay scales. – Ben Smith.

Some writers (a minority) are making big money on Substack – good for them. It’s inspiring to check the leaderboard and see what’s possible – it introduces a bit of friendly competition. They’ve built a following over time and bought their audiences with them.

But most (like me) are making money via support from readers, not paid advances. It’s a side hustle alongside their main job or freelance projects. It’s fun. I’m learning as I go, and it’s an opportunity to have a product and a platform. There’s no obligation to stay – I can take my work and publish it elsewhere.

Power to the creator 

The power shift has been happening for a while – Patreon CEO Jack Conte talks about it here. Substack isn’t creating it, but it’s part of it and riding the wave. There’s a cultural shift towards the creator economy, valuing good content and being willing to pay for it. David Lat calls it the ‘great reset’ of charging for content (we all need to get used to paying more for content!). And the fear is that it’s helping writers to discover their market value.

The genie is out of the bottle, and there’s no going back!

And it’s not legacy media vs Substack either – we have broad tastes, and there’s room for all types of media. I’m not paying for news on Substack; I’m getting opinion, analysis, and diverse views from people who may not fit the traditional media mould/niche, which is refreshing. Journalism is still largely a white, middle-class profession.

I am excited about Substack – it’s the biggest tech challenge in a while, and captures the spirit of early blogging with diverse views and a dose of reality. Columnist Heather Havrilesky is taking ‘Ask Polly’ from The New Yorker Magazine to Substack to ‘regain some of the indie spirit and sense of freedom that drew me to want to write online in the first place.’

As long as they keep adding value, supporting writers, and building community, I’ll stick around. It feels good to be part of a bigger mission.   

As a writer on the platform, the pain points are SEO – very important!! I’m giving away my Google juice. So I publish on my site first, tell Google I own the content and then share it to other platforms – Substack, Medium, and social media. And for those writers earning a living here, the 10% commission is a killer and needs to come down.

As a consumer, it’s expensive to subscribe to lots of newsletters – see this thread from Laura Hazard Owen. I can claim expenses if they are work-related, but I’d love to see more ‘bundling up’ newsletters in similar industries to offer value to readers. I’ve seen posts on Reddit asking if people are interested in joint subscriptions to split the cost.

Companies need to get in on the act, too – newsletter bundles would be a great perk for employees – fresh ideas and perspectives enhance workplace culture.


What are publishers doing to solve the ‘Substack problem’? 

  • The New York Times has bought columnist Paul Krugman’s free Substack to their platform.
  • @Choire is stepping down from the NYT Style desk and ‘taking on a new and exciting challenge, as a senior editor charged with a project to help expand our newsletter portfolio alongside Sam Dolnick and Adam Pasick.’
  • Vanity Fair meets Substack – former VF editor Jon Kelly is launching a new, private equity-backed publication. ‘Writers have been offered equity and a percentage of the subscription revenue they would generate.’

As Ben points out, the biggest threat to Substack isn’t politics amongst writers but another tech stack with a different (cheaper) model, e.g. Ghost, Twitter/Revue. Ghost is open-source and non-profit, which will appeal to many publishers.

They are aware of this and working hard on ‘brand Substack’. Good to see they’ve announced a $1 million initiative to support a new group of local news writers on the platform (non-famous writers ;-).

This is not a grants program, nor is it inspired by philanthropic intent. Our goal is to foster an effective business model for independent local news that provides ample room for growth.

There’s more to come. ‘We will make a large investment in a support program that includes initiatives related to healthcare, personal finance, editing, distribution, design, and coworking spaces.’ Which gives them the edge.

And writers will find creative solutions for siloed working and isolation. 💪

Today, eight writers with paid newsletters on tech and culture, including Casey Newton, Anne Helen Petersen, and Delia Cai, are launching Sidechannel –

‘A shared Discord server where our paid subscribers can meet, hang out, and participate in a vibrant daily conversation about tech, culture, and society.’

They have big plans – shared channels, jobs, networking, and Clubhouse-style chats where you can ask questions. Facebook CEO Mark Zuckerberg is their first guest tomorrow.

Let’s celebrate Substack’s success. Indie media is super important, as is diversity – we need more voices. Please support your favourite writers, artists, and musicians via Substack, Patreon, Podia, Soundcloud, and Stack Magazines – leave a tip or comment, share and like a post – a little goes a long way to help.

Self-publishing is a hard, lonely job 🎻

From the NYT comments:

In a media ecosystem where six companies own systems that deliver 90% of the news, indie platforms can only be a good thing.

Substack is filled with cancelled, edgy writers. It’s where Ernie Pyle, Hunter Thompson and Martha Gellhorn would be if they were alive and writing today.


Go deeper 🛠

✍️ Sovereign Writers and Substack (Stratechery) – Ben Thompson on ‘the fundamental issues about the Substack model specifically, and the shift to sovereign writers generally, that are being misunderstood.’

📬 Newsletters: The market is booming! (Marie Dollé). Mapping the newsletter ecosystem. ‘Creating content for and with your audience is exciting and crucial, especially when you realize that the community builder is the creator too!’ Brands, take note!

📣 You’ve Got Mail (Anna Wiener, The New Yorker) on the history of newsletters and embracing change: ‘Carving out new ways for writers to make money from their work is surely a good thing: the US lost 16,000 newsrooms jobs this year. I ❤️ Hayley Hahman’s comments on how writing her newsletter ‘Maybe Baby’ has made her reflect on how she measures success. 

👩‍🎨 Li Jin on the Passion Economy and the Future of Work (andreessen horowitz). ‘Gig work isn’t going anywhere—but there are now more ways to capitalize on creativity. This has huge implications for entrepreneurship and what we’ll think of as a ‘job’ in the future.’ 

And some newsletters resources for you 🤗

Categories
Creator economy future of work newsletters

#36 – Twitter takes on Substack; A new revenue opportunity for writers.

Thinking big 💡

Last week Twitter announced it has acquired Revue, a newsletter platform for writers and publishers. Their first move into building out long-form content on the platform and getting into the subscription revenue space.

Twitter wants all creators to join the platform – experts, curators, journalists & publishers and will offer an all-in-one integrated service that “will all work seamlessly within Twitter” said Product Lead Kayvon Beykpur and VP of Publisher Products Mike Park. They will add new features that help writers connect with their audiences, like allowing them to host chats with their subscribers and invest in community resources and other revenue streams later on. 

The platform will be free for all users, and Twitter will collect just 5% of paid subscriptions revenue compared to Substack’s 10%. They say writers will get paid compensation for how many Twitter users they convert to subscribers. It will strengthen its relationship with writers of all kinds who want a platform to share their content and ideas.

Twitter has been heading in this direction for a while. First, they expanded the character count on tweets, then stopped including photos and links in the count so you can write more. Then they introduced threads, so you can build a story. Last year they talked about acquiring a newsletter company, and there were rumours they were going after Substack, which co-founder Hamish McKenzie said was not going to happen. Of course, they want to keep writers on the platform – right now they publish their long-form content elsewhere.

I thought they might go for Medium given its history with Twitter, but Revue makes sense as it’s a small company and presumably hasn’t cost too much. They will remain an independent brand within Twitter, and Twitter will expand the Revue team over time.

Following the announcement, Hamish tweeted comparing the social media companies’ efforts to oil companies trying to be more environmentally friendly, but then wrote this post welcoming the competition. The media ecosystem needs a shakeup, competition is healthy, and platforms that put writers and readers in charge are better. Creators also need proper business models.

There are now more than 500,000 paid subscriptions across Substack, and the top ten writers collectively make more than $15 million a year. It’s still early days, but this thing is happening – Hamish McKenzie, Substack co-founder.

Newsletters are booming and of course, tech firms and publishers want a slice of the Substack pie. Facebook is also working on a newsletter tool for journos and writers (launching this summer). Forbes has launched a massive expansion into paid newsletters and has a 10-year history in this space with its contributor network.

There’s Ghost, Lede, LinkedIn, Podia, Patreon & many more. Mailchimp has bought Courier Media – the best mag, newsletter and podcast for small businesses and entrepreneurs. Hubspot has bought The Hustle, an email newsletter and content company in a deal valued at roughly $27 million.

Why are we newsletter nerds? Because the web is a vast space and cluttered. We don’t have time to filter through the crap to find the good stuff, and we want a personal subscription service that delivers content straight to our inbox. We’re happy to pay trusted curators to do the job. I look forward to reading daily Morning Briefings in my inbox – no more trawling through news sites, doom scrolling and dodging pop-ups and paywalls.

Niche media is a powerful tool.


A new revenue opportunity for writers ✍️

Substack has said it will remain ad-free, but the pressure is on. At least three startups – Swapstack, Upstart.me and Letterwell have begun helping small newsletters find interested advertisers. We’re already seeing some Substack newsletters running ads and sponsorship so it will be interesting to see how they respond if this becomes widespread. If writers can make money without turning on the paywall it’s not great news for Substack as that’s their business model – the platform is free for writers. They may have to rethink that decision.

I’ve signed up to Swapstack so let’s see how it goes. Good to have alternative income streams as I’m not comfortable pushing paid subscriptions in the middle of a global pandemic and recession – which is why I also have a tip me button. It also means you can keep your work accessible to all and not behind a paywall.


The advice 💬

2021 will be the year that publishers start to form strategies to deal with the “Substack problem”. By that, I mean they’ll need to find ways to discourage their star writers from leaving to launch their own Substack newsletters. In the most likely scenario, they’ll make deals with writers to launch the newsletter under the media company’s banner. They might structure the deal, so the writer gets to keep their current salary and then some percentage of the subscriber income they generate – similar to the advances and royalties that book publishers dole out. This will entice the writers because they get to maintain job security while also benefiting directly from their success. They can also grow their audience much more quickly with the help of the media company. It’s a win-win for both parties. – Simon Owens’ Media Newsletter


Go deeper 🕵🏻‍♀️

📩 Revue asked its readers to predict how newsletters will evolve in 2021

✍️ A new revenue opportunity for writers: Ads emerge on Substack’s ‘ad-free’ newsletters

🎧 Axios Re:Cap digs in on Substack and the future of media

👻 The Ghost team on how to build a sustainable newsletter growth machine

💻 A joy to read! Robin Rendle on Newsletters; or an enormous rant about writing on the web


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Leopard print, always. Worry less and rock a red lip. Remote work evangelist, problem solver, internet person.

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