This Startup Promises a New Way to Make Money on the Internet With Newsletters
The age of Internet publishing means its possible for anyone to find an audience and share their voice. But getting paid for that voice is another matter entirely.
As anyone familiar with media and publishing is painfully aware, it’s hard to persuade readers to shell out for writing (even good writing), in part because they’re used to getting it for free, and also because the tools to collect cash are often cumbersome.
That’s why it’s worth paying attention to a startup called Substack, which today announced its publishing service—which combines writing, newsletter, and billing tools—is available for free to the general public.
The idea behind Substack, which is the brainchild of entrepreneur Chris Best and former journalist Hamish McKenzie, is to let anyone copy the model of Stratechery—a highly regarded tech newsletter by Ben Thompson that has defied the odds and become a successful one man business. Here is how the Nieman Lab describes Substack’s value proposition:
Substack is designed to encourage countless more writers to create their own variations on the … Stratechery model. The company’s name refers to its “stack” of software tools, which include blog and email publishing, payment collection, analytics, article sampling, and even forums and other community tools. Together, they’re meant to offer a more streamlined alternative to the typical process of cobbling together tools (MailChimp, WordPress, Stripe, Memberful) that are essential to making the small publishing model work.
Substack has already running its paid newsletter service to a handful of writers, including Mallory Ortberg, who co-founded the popular feminist site The Toast as well as veteran NBA writer Kelly Dwyer.
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While it is obviously easier for such journalists, who have already made themselves a known brand, to charge for their content, Substack also offers promise for fledgling writers who are attracting passionate readers in a niche coverage area. That’s because such writers can use the service for free and also offer it to readers for no charge—and, when they feel the time is right, turn a dial to turn their newsletter into a paid offering.
In an interview with Fortune, Best explained that Substack’s cut is 10% plus credit card processing fees if a writer charges for their newsletter, but that it will allow anyone to use Substack as free service for the foreseeable future.
The launch of Substack comes at a time when the Internet is beginning to offer creators more options—from Patreon’s crowd-funded model to higher rates from subscription services like Spotify—to get paid, and possibly marking a sign that the challenging economics of online content creation is beginning to improve.
On Tuesday, Subtstack also announced the startup had received funding from the prestigious accelerator Y-Combinator.