Substack

Many different types of users produce content on the platform, ranging from journalists to experts to large media sites.[2] The New York Times columnist Mike Isaac argues that some of these companies see newsletters as a more stable means to maintain readers through a more direct connection with writers.[3] In 2020, The New Republic noted an absence of local news newsletters, especially in contrast to the large number of national-level political newsletters.[4] As of late 2020, large numbers of journalists and reporters were coming to the platform, driven in part by the long-term decline in traditional media (there were half as many newsroom jobs in 2019 as in 2004).[5]

In 2019, Substack added support for podcasts and discussion threads among newsletter subscribers.[6][7]

Substack usually takes a 10 percent fee from subscription payments.[2][8] Advertising to users plays no role in revenue generation.[5] In February 2019, the platform began allowing creators to monetize podcasts.[9]

Substack reported that 11,000 newsletters paid for the service as of 2018, rising to 50,000 in 2019.[9] In August 2020, Substack reported that over 100,000 users were paying for at least one newsletter.[10]

Chris Best discussing mobile advertising in 2015

Andreessen Horowitz provided $15.3 million in Series A funding in 2019, some of which went to bringing high-profile writers into Substack's network.[10] Substack has provided some content creators with advances to start working on their platform.[2] In 2019, the site provided a fellowship to some writers, which included a $3000 stipend and a one-day workshop in San Francisco. In 2020, following the onset of the coronavirus pandemic, Substack extended grants of $1000–3000 to over 40 writers to begin working on the platform.[8] The decline of sports-oriented publications such as Sports Illustrated, Deadspin, and SB Nation, coupled with the onset of coronavirus, led to a surge in sports journalists moving to write on Substack in 2019 and 2020. However, Substack competes with subscription site The Athletic in this submarket, so McKenzie says the company does not recruit as strongly in that market.[8]

The Substack founders reached out to a small pool of writers in 2017 to acquire their first creators.[11] Bill Bishop was among the first to put his newsletter, Sinocism, on Substack, providing his newsletter for $11 a month or $118 a year with daily content.[1] As of 2019, Bishop's Sinocism was the top paid newsletter on the service.[9] By late 2020, the conservative newsletter The Dispatch claimed the title of top Substack user, with more than 100,000 subscribers and over $2 million in first-year revenue, according to founder Steve Hayes.[5]

Substack was founded in 2017 by Chris Best, the co-founder of Kik Messenger; Jairaj Sethi, a developer; and Hamish McKenzie, a former PandoDaily tech reporter.[8][11] Best and McKenzie describe Ben Thompson's Stratechery, a subscription-based tech and media newsletter, as a major inspiration for their platform.[1] Christopher Best operated as chief executive as of March 2019.[3]

Competitors include TinyLetter, Lede, and the open-source Ghost.[5]

On July 28, 2020, Substack had a security and privacy incident when it sent out email notifications to all its users about changing privacy policies and notification about CCPA compliance. However, in this notification email, email addresses of all recipients were inadvertently included in the email 'cc' field rather than in the 'bcc' field.[12] Per an acknowledgement post on the social media site Twitter, the company indicated that the issue was remedied after the initial batch of emails, but did not disclose the number of users affected.[12]

• The Substackerati (Columbia Journalism Review, Winter 2020)