Subscription-based publishing platform Substack has disrupted the media world by empowering individual writers and thinkers to own their work and thrive outside traditional business constraints. This in-depth guide will analyze Substack‘s origins, distinct features, and widening impact across the media landscape as it pioneers the "passion economy" model for creators.
Overview
Purpose: Substack provides writers a platform to launch premium email newsletters funded directly through reader subscriptions. This model liberates writers from relying on ads or publishers, allowing more creative freedom to serve a loyal audience.
Origins: Founded in 2017 by Chris Best, Hamish McKenzie, and Jairaj Sethi, Substack emerged as a solution to issues like clickbait content and shrinking journalism jobs. The founders‘ tech and media expertise informed Substack‘s creator-first approach.
Business Model: Writers access features like newsletter templates, payment processing, analytics and legal support from Substack to run subscription publications. Writers keep ~90% of subscription revenue, with Substack taking a small cut.
Impact: Substack has gained over 250,000 paying subscribers, including former journalists and new voices across industries. It signals a shift towards niche, trusted media driven by creator-audience alignment over scale alone.
A Brief History: Empowering Writers in a Chaotic Media World
To properly understand Substack‘s explosive rise, we must first explore the wider media crises that inspired its founding.
Well before COVID-19 decimated the journalism industry‘s crumbling business models, online media faced criticism around the outsized influence of algorithms, sensationalized clickbait crafted for virality rather than truth, diminishing journalistic standards, and very real financial struggles for working writers.
"The last 20 years have not been kind to journalists or journalism…the glory days of journalism are long gone," wrote Substack co-founder Hamish McKenzie in 2020.
Having witnessed consolidation and layoffs ripple through publishing firsthand, technology reporter McKenzie envisioned Substack as a life raft for writers navigating this storm. He teamed up with former mobile chat app founder Chris Best and developer Jairaj Sethi in 2017 to build a platform enabling small publications to thrive through alignment with loyal readership bases.
Rather than relying on fickle social media and advertising, Substack would pioneer an alternative model where writers get paid directly by readers – restoring financial sustainability and editorial independence in one sweeping move.
Key Features: Tools to Run a Premium Newsletter
So what exactly is Substack? At its foundation, Substack is a software platform equipping writers with everything needed to publish and manage a paid email newsletter. Let‘s analyze how Substack‘s offerings differ from traditional blogging sites or basic newsletter tools through a handy comparison chart:
| Feature | Substack | Traditional Blogging Platforms | Basic Email Newsletters |
|---|---|---|---|
| Built-in subscription management | ✅ | ❌ | ❌ |
| Email delivery to list | ✅ | ❌ | ✅ |
| Custom domains | ✅ | ✅ | ❌ |
| Design flexibility | ✅ | ✅ | ❌ |
| Analytics | ✅ | ✅ | ❌ |
| Legal support | Optional add-on | ❌ | ❌ |
| Funding / advances | Case-by-case | ❌ | ❌ |
Built-in subscription management: Writers can publish free posts or offer paid subscription plans, while Substack handles secure payment processing and email delivery.
Own your audience: Substack newsletters live on writers‘ own custom domains, enabling true creative independence and control.
Design flexibility: Writers can customize newsletter designs, incorporating multimedia content beyond basic email tools.
Analytics: Substack provides advanced data on open rates, subscriber growth and more to inform strategy – lacking in generic listservs.
Support services: Optional extras like legal support, funding opportunities and event tools help writers scale their passion projects into sustainable businesses. Undergirding these features is Substack‘s firmly hands-off content philosophy.
"We believe that publishers and writers should have the freedom to publish what they want," CEO Chris Best told Bloomberg. This core commitment has attracted everyone from hobbyists to investigative journalists.
Impact: Key Examples Across Industries
It‘s impossible to convey Substack‘s influence without spotlighting writers using it to transform industries from journalism to food blogging. Examining a few superstars hints at the platform‘s breadth.
Reshaping Journalism
Within media, prominent voices have found freedom through Substack to produce stories buried by timid publishers, no longer forced to answer to advertisers.
Andrew Sullivan generates over $500k annually writing as a one-person operation unconstrained by past editorial teams. Investigative startup Project Veritas utilizes reader subscriptions to sustain controversial hidden camera scoops on public figures once deemed too partisan for television.
"[For] unfashionable writers dealing with taboo topics, Substack is a financial and creative lifeline," The New York Times observed in Sullivan‘s success story, signaling shifting power dynamics within media.
Building Community
Beyond hard news, Substack provides space for niche publications unviable within traditional models relying on scale and pageviews.
Passionate hobby writers like outdoorsman Justin McElroy and bibliophile Riley Black have cultivated small but dedicated reader groups through unpaid newsletters focused purely on what they want to write. Even major food blogger Alison Roman, boasting a New York Times bestselling cookbook, migrated to Substack to deepen engagement with fans.
The platform‘s emphasis on fostering community suits writers seeking more meaningful creation over commoditized blog posts optimized for Google indexing.
Rethinking Business Models
For those pursuing writing professionally, Substack offers new monetization paths blending creative output with events, peer groups, exclusive content and physical goods unavailable previously.
Take former sports site editor Erik Schlitt. By switching to a paid newsletter product, Schlitt expanded his $100k first year earnings through Substack advances funding insider athlete interviews fans crave, yet no ad-based model could sustain. For media companies like Morning Brew, email newsletters didn‘t displace their existing ad business but instead provided a crucial subscription revenue stream during COVID-induced market chaos.
Such creative experiments highlight Substack‘s potential in funding passions without compromising quality for scale.
Substack‘s Future: The Passion Economy‘s Next Giant?
Given its explosive early traction empowering writers to turn expertise into earnings, what could Substack achieve within a decade? Industry analysts predict it is well-positioned to ride multiple colliding media trends.
Casey Newton projects 50 million Americans could end up paying for premium online content by 2025 whether Substack newsletters, streaming entertainment services or community platforms like Discord and Patreon. As Visual Capitalist reports, analyst firm Juniper Research forecasts paid digital content ballooning into a $100 billion market within years.
Substack sits at the nexus of multiple colliding trends – the passion economy fueling individual creators, patrons directly funding arts once dependent on ads or institutions, and personalization reshaping noisy open internet spaces. With some reports estimating thousands more writers are quitting ad-based models each year for subscription alternatives, Substack may still be scratching the surface of its eventual footprint should readership habits continue shifting.
Most ambitiously, Substack aims to pave the path for 100,000 writers to make over $100k annually through its platform over the coming decade. This mission echoes a broader shift towards creators "getting paid directly by their biggest fans, rather than serving algorithms," writes Substack President Hamish McKenzie.
For now, Substack appears poised to accelerate transformations reshaping what – and who – defines media. By allowing independent writers and thinkers room to thrive, it may fuel more surprises still to come.
