After seven years as a reporter for the Montreal Gazette, Christopher Curtis was starting to feel stagnant. He was working in a shrinking newsroom, with a dwindling roster of reporters scrambling to cover the news—a problem that only worsened when the pandemic arrived. “We were chasing our tails,” Curtis says. He worried he’d be out of a job one day, competing with his similarly unemployed colleagues for a small number of gigs. Moreover, Curtis felt like he wasn’t doing his best work anymore. He preferred to spend time with a story, but in an understaffed newsroom, that became increasingly difficult.
So last year, Curtis quit his job and launched a paid newsletter called The Rover. It was a sizable financial risk, especially considering Curtis and his girlfriend are expecting their first child, but he says it has been worth it. The work is meaningful, and he’s secured around 700 subscribers who pay $12.50 a month to support his reporting from Montreal and Val-d’Or, along with personal columns. “It could go up in flames,” Curtis acknowledges, “but I’m happy to be part of a failed effort.”
Curtis operates The Rover through Substack, which makes software for writers to publish and distribute email newsletters. It’s run by Chris Best, a Canadian now based in San Francisco who oversees about 41 employees. Newsletters are an old concept, and Substack is not the first to offer them, but somehow it’s become an obsession for the media industry and secured millions in funding from Andreesen Horowitz, one of the biggest VC names in Silicon Valley.
More than 500,000 people pay for newsletters on Substack, which typically takes a 10% cut of a writer’s subscription revenue. There are newsletters devoted to politics, original journalism, cryptocurrency, pop culture, distressed investing, reviews of tinned seafood, the New York Knicks, recipes, Canadian public policy, meticulous recaps of Judge Mathis episodes, drugs, dogs, the Bible and artificial intelligence, among others. Writers can offer some or all of their content for free and set their own subscription fees. Five dollars a month is fairly common. Others are pricier: A finance industry newsletter called Petition is US$49 a month. One value-investing blog has hundreds of subscribers at US$125.
Best has ambitious goals for Substack, which he sees as a balm for a broken media landscape. “Substack is about creating a new model for quality writing in the age of the internet,” he says via Zoom from his basement in San Francisco, where he has lived since 2018. Best, 33, is the kind of person who can’t stop moving, hopping up and down in his chair and running his fingers through his hair. With Substack, he explains, writers get control, independence and a relationship with subscribers. Readers, in turn, choose who to reward directly through subscriptions. “It’s creating a lot of great writing that otherwise wouldn’t have been economically viable,” he says.
For some, it’s a tantalizing pitch. Journalism, you may have heard, is in crisis. Publications are fighting against falling ad revenue, budget cuts, layoffs, buyouts and outright closures. A number of high-profile writers in the U.S. have left their employers to go solo on Substack, sometimes lured by large advances and earning substantial incomes.
These days, everyone in the media seems to have an opinion about the company, and it has been the subject of many piping-hot takes and Twitter threads. Substack has been praised for freeing writers from corporate and editorial control and derided for posing a threat to traditional news media. It’s allowing new and diverse voices to flourish or just amplifying established names. It’s a respite from the toxic social media swamp but also hosts writers who espouse harmful opinions, according to some critics.
The various debaters might be getting ahead of themselves. Before Substack can save journalism or murder journalism or fulfill any other promises and foreboding prophecies, it has to achieve longevity as a business. The company is worth a reported US$650 million, which seems like a lot for an outfit that has effectively married mass emailing with payment processing. (Substack doesn’t even handle the latter part; it uses Stripe.) It doesn’t disclose revenue, but Best concedes it’s not yet turning a profit. There’s also growing competition in the newsletter space from Twitter and Facebook.
Best expected that. “There’s just no way you’re going to make a wildly successful independent company,” he says, “and not have Twitter and Facebook trying to copy Substack.” Indeed, launching a startup only to have much bigger competitors try to crush you is something Best experienced before. It didn’t end all that well.
If he wants things to be different this time, he’ll have to hustle. Substack hopes to remain independent—it doesn’t want to sell—and grow big enough to change the media landscape. The hitch is that it’s only as valuable as the writers on its platform, and it’s easy for them to leave. Some already have.
The idea for Substack originated a few years ago, when Best found himself with a lot of time on his hands. He had just capped eight years at Kik Interactive Inc. in Waterloo, Ont., an instant messaging company he co-founded. “It had been this crazy, wild ride,” he says, “and I didn’t want to blindly leap into something.”
Best grew up in Richmond, B.C., the son of two public school teachers. (His sister is a teacher too.) He took a different route and studied systems design engineering at the University of Waterloo. Through a mutual friend, he met fellow student Ted Livingston. Together, they started developing a music player for BlackBerry devices before pivoting to messaging and co-founding Kik in 2009. With Livingston as CEO and Best as chief technology officer, Kik went on to attract 240 million registered users and raise US$120.5 million in funding over the next few years.
Others took an interest in messaging too—namely Facebook. The social media giant launched its standalone Messenger app in 2011 and later acquired rival WhatsApp. There was no shortage of ways to contact people; every social media app incorporated messaging, and there was always plain old texting. Kik found itself fighting to keep pace. “It was very challenging because we were competing in this big category against competitors who didn’t need to make money,” Livingston says. “We didn’t have that luxury.”
Livingston looked at Kik’s leadership and decided to put someone who reported to Best in the CTO role. Best offered to resign instead, reasoning that was the only way someone new could succeed. He left in 2017. For Livingston, who says he didn’t expect his co-founder to quit, the episode represents a certain selflessness on Best’s part. “He was sort of making a sacrifice for what he felt was the benefit of the people,” he says. Livingston deeply regrets parting ways. “That was one of the biggest mistakes I’ve made in my career.” They’re still friends, and Livingston was an early investor in Substack.
Kik, meanwhile, continued to struggle. In 2017, it launched its own virtual currency as a way to make money and raised US$100 million through the sale of a digital token called Kin. Some of the money was raised from American investors, prompting the U.S. Securities and Exchange Commission to sue Kik for conducting an illegal offering. A U.S. court found the digital tokens amounted to a security, meaning Kik violated federal law when it conducted an unregistered offering. These days, Livingston is working on Kin with a small team. The chat app was sold in 2019.
As for Best, he didn’t want to think about what to do next for at least a year after leaving Kik. He’d always wanted to try writing, so he started drafting an essay railing against the detrimental effects of social media. The ad-driven business model that prioritized likes and clicks was polarizing society, degrading journalism and contributing to a mental health crisis, he argued. Best showed his writing to Hamish McKenzie, a former journalist from New Zealand who attended the University of Western Ontario and later worked at Kik as an editorial adviser. McKenzie suggested it would be more worthwhile to explore solutions, and they started discussing new media business models.
Subscriptions, the pair realized, were a more sustainable model than advertising, and newsletters created a direct relationship between writers and readers. (They drew some inspiration from Ben Thompson, of the tech newsletter Stratechery.) From those conversations emerged Substack. Best bashed out the first version of the code but convinced Jairaj Sethi, another Kik alum, to join as co-founder and CTO.
Substack launched in 2017, and Best and McKenzie published a manifesto of sorts promising “a new day” for writers. You might assume that three tech bros, only one of whom had worked as a journalist, making bold promises about the future of news and touting subscriptions as something novel would engender deep skepticism among professional writers. And they did.
Substack spoke to writers and journalists about what they’d want in a newsletter platform. Best reached out to Jen Gerson, a journalist in Calgary. He struck her as a passionate guy, but as soon as Gerson hung up the phone, she said to herself, Well, that’s going nowhere. The idea that professional journalists would take a flyer on newsletters in hopes of cobbling together enough subscribers to make a living struck her as “bonkers,” she recalls.
But Substack managed to find takers, in part by making it dead simple to start publishing instantly, zero technical skills required. McKenzie pitched hundreds of established journalists, columnists and essayists to join, and some made a big deal of doing so. Glenn Greenwald and Bari Weiss torched their former employers, The Intercept and The New York Times, respectively, upon leaving, which brought more attention to Substack.
For a spell last year, there was a rash of high-profile writers climbing aboard. That caused Gerson to reconsider joining Substack. “I saw a wave there that merited riding,” she says. Along with two others, Gerson now runs The Line, featuring opinion and commentary from a range of writers. So far, it’s attracted close to 5,600 subscribers, 1,300 of them paid. (It’s a part-time gig for Gerson; she still writes for other outlets.)
Millions in venture capital funding also raised Substack’s profile. McKenzie had approached an entrepreneur and writer named Andrew Chen about moving his newsletter to Substack. Chen wasn’t interested (he preferred to run everything himself, McKenzie recalls), but when he joined Andreesen Horowitz, he led a US$15.3-million round in Substack in 2019, followed by US$65 million this past March.
Part of the funding will be used to attract more writers through a program called Substack Pro. The company will fund a select few for their first year on the platform and collect 85% of the subscription revenue. Afterward, Substack’s cut falls to 10%. More than 30 writers have signed on so far, and although the company doesn’t divulge names, some have aired their details. Matthew Yglesias, formerly of digital publication Vox, took a US$250,000 advance. (He later calculated he would have been better off had he just kept a larger portion of his subscription revenue.)
Substack’s growth has not been without controversy, and there has been a certain ideological bent to some of the platform’s popular early adopters. Some, like Weiss, are writers who expound on the perceived threat of “cancel culture” and the supposed excesses of progressive politics, all while complaining about the constraints they felt were imposed on them by previous employers. Greenwald has tweeted that Substack empowers journalists to report “without the shackles of corporate editorial control or liberal pieties.”
As a result, Substack earned a reputation as a home for aggrieved writers to spout unpopular opinions. It’s worked to dispel that image and often points to Heather Cox Richardson, a little-known Boston College professor who has amassed tens of thousands of subscribers as she analyzes current events through a historical—not ideological—lens.
Jude Doyle, a writer in New York, was approached to join Substack in 2018. But Doyle, who is trans, soon became uncomfortable sharing a platform with writers they viewed as anti-trans. That includes Graham Linehan, an Irish television writer who was permanently suspended from Twitter last year for “hateful conduct” and maintains a Substack where he regularly writes noxious missives about trans people.
Doyle wrote about their misgivings about Substack (on Substack) and emailed the post to the company. Doyle found its response defensive and says it also raised the prospect of Substack Pro. “It just did not feel right,” Doyle says, “and that’s when I was out the door.” Doyle moved to Ghost, a non-profit platform. A number of other trans writers have since switched to rivals, as well. (A spokesperson for Substack says it did not attempt to influence Doyle. “The idea of offering contracts to change how people feel and what they think runs absolutely counter to the founding principles of Substack,” according to the spokesperson.)
“We’re sad about that,” Best says of the writers who have left, while adding “we’re delighted to have great trans writers on the platform.” Substack takes a light approach to moderation, and Best has argued it’s not as difficult a challenge for the company compared to YouTube or Facebook, which use algorithms to surface content. “Our goal is really putting readers and writers in charge of this,” he says.
That message has resonated with some. Gerson says the company’s guidelines make it clear what’s acceptable and what isn’t. “I don’t get the sense the goalposts are going to shift,” she says. For that, she’s willing to pay a premium to run her publication with Substack versus a cheaper competitor.
For Doyle, Substack’s position is a dodge and notes the company is a mess of contradictions. Best has said Substack is a platform, not a media company. Yet it launched promising “a better future for news.” Substack has also said it doesn’t make editorial decisions, but selecting writers and offering them money is effectively just that. It’s a bit of sleight of hand that social media companies have performed in recent years. Facebook has tried to insist it’s a platform, not a publisher, in hopes of absolving itself of responsibility for the content its users post.
Substack, in turn, wants to be seen as charting a bold new media future, while trying to remove itself from the content and the writers it hosts. “You still have to take responsibility for what you’re putting out into the world,” Doyle says.
In January, Twitter purchased a small newsletter company from the Netherlands called Revue. Much like Substack, it’s promising to help writers monetize their audiences. “Twitter is uniquely positioned to help organizations and writers grow their readership faster and at a much larger scale than anywhere else,” the company wrote in a blog post. (Twitter declined an interview.) Facebook is reportedly looking to get into newsletters and has plans to court writers, while there are plenty of smaller newsletter players too, such as Ghost, Pico and Letterdrop.
None have nearly the profile Substack does, though Ghost is seen as a cheaper alternative for large newsletters. Rather than taking a portion of subscriber revenue, Ghost charges a flat fee. The cost savings were part of the reason Uri Bram, who runs a newsletter with 11,000 paid subscribers called The Browser, switched from Substack to Ghost last year. “We’re paying 90% less than we were on Substack,” he says. “What’s not to like?”
Best admits there’s a part of him that’s apprehensive about the arrival of Twitter and Facebook, but no more than that. “The thing I tell the team here is we should let our competitors influence our speed but not our direction,” he says.
The crowded field does raise the question of what makes Substack unique. Best and McKenzie often point to more ephemeral qualities, arguing everything the company does is geared toward writers, unlike Twitter and Facebook. Earlier this year, McKenzie wrote it’s the “calmness of the model that’s the real killer feature” of Substack. Best emphasizes it’s only successful if writers are, a principle that will always remain. “Part of my theory on how companies go wrong is if you have a bunch of principles and you have a business model that pulls you in some conflicting direction,” he says. “At some point, you run up against this hard choice of either giving up your principles or don’t have a successful business.”
Still, will that be enough? “Your commitment to writers and your desire to help them publish good newsletters is not a proprietary thing,” says Mathew Ingram, chief digital writer for the Columbia Review of Journalism. Substack, by design, makes it easy for writers to leave (they own their content and email list) and take their subscribers to a different platform. That fits with Substack’s ethos of doing well by writers, but creates an obvious problem.
Twitter may also have a built-in advantage. It’s the place many Substack writers have built their audiences and promote their newsletters. Newsletters seem to be a natural extension for Twitter, whereas Substack lacks an easy way for readers to discover new writers, beyond featuring a handful each day on its website and maintaining a leaderboard for the most popular in various categories. Revue also takes 5% of subscription revenue—half of Substack’s cut. (It’s worth noting Twitter has bungled acquisitions before, buying beloved video app Vine only to shut it down a few years later.)
“We definitely can’t rest on our laurels,” McKenzie says, “and it’s a good incentive for us to make a better product and build it fast.” Substack is taking more steps to support independent writers in the meantime, such as a legal program to deal with defamation threats and putting up US$1 million to help local news writers and pair them up with mentors. “We’re going to put a much greater effort and much larger investment into these areas now,” he says.
But for Twitter and Facebook, newsletters are likely going to be a tiny part of their overall businesses. Each company can afford to lose money in an attempt to capture the space, much like how Facebook used its dominance and financial resources against Kik. Best is not one to dwell on parallels, though. When asked if there are any lessons he’s applying to Substack, he seems a little stumped. “Kik gave me a sense of what’s possible,” he says after thinking about it. “And the importance of running your own race.”
For Substack, it’s been a fast one. In March 2020, the company had 100,000 paying subscribers; it has 500,000 today. Some question whether it can keep up the pace. Om Malik, a former journalist and venture capitalist, is a supporter of Substack but says the company faces challenges with both readers and writers. The willingness of the public to pay for multiple subscriptions is limited, he reasons, and the number of writers worth paying for could hit a wall. “They will have to find thousands of creators who can build sustainable audiences that will pay for their content over a long period of time,” Malik says. “Scaling won’t be that easy.”
Best, in turn, says the company will nurture its own stars. “The vast bulk of the opportunity for Substack over time is having people start from relative obscurity and grow,” he says. “Those people who are going to be massive tomorrow might come because they see the people who are successful today.”
That’s a rare thing, though. Christopher Curtis, the former Montreal Gazette reporter, says the platform “disproportionately favours people who are established.” He spent years cultivating an audience and has some advantages other Substack writers might not. He’s partnered with another media organization, Ricochet, to run some of his stories and provide him with editing. It’s also gruelling work to maintain a publication largely on your own. Curtis is making less than he was at the Gazette (he supplements with occasional freelance work) and putting in more hours, not only for writing and reporting but also for branding, marketing and dealing with subscribers. “You’re kind of doing everything,” he says.
It’s little wonder the most popular Substack newsletters skew heavily toward opinion, commentary and analysis, not labour-intensive reporting. Still, the success of Substack will partly depend on the grit of people like Curtis and on Best’s ability to support them. “We’ll see the next generation of institutions being created on Substack,” Best says. It’s a typically bold claim, and one that won’t be realized for some time, if at all. For now, Substack has shown that writing—and some writers—still have value. And in an industry facing an existential crisis and conditioned to expect terminal decline, that’s a success in its own right.
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