Will Substack Go Beyond Newsletters? A Company Weighs Its Future.

There are things that newsletter writer Kirsten Hahn misses about substacks. They are not enough just to cross the downsides.

She disliked how the platform presents itself as a haven for independent writers with fewer resources while offering six-figure advances to some prominent white men. The hand-off content moderation policy, which allows transphobic and anti-vaccine language, did not sit well with it. She also did not like to earn $ 20,000 in subscription revenue and then pay a $ 2,600 fee to Substack and its payment processor.

So last year Ms. Han moved his newsletter, We, The Citizens, to a competitive service. She now pays 780 per year to be published by Ghost, but said she still made almost the same in subscriptions.

“It wasn’t too hard,” she said. “I saw some of the options that people were talking about.”

Not long ago, Substack harassed mainstream media executives, preyed on their star writers, seduced their readers, and, they feared, endangered their viability. Filled with venture money, the start-up was dubbed the “future of the media.”

But now, Substock no longer considers itself a wonder but a company facing challenges. Depending on who you talk to, those challenges are either standard start-up growing pains or risks to the company’s future.

Tech giants, news outlets and other companies have launched competitive newsletter platforms in the last year. Customers loaded on newsletters during the epidemic began to scale back. And many popular writers have departed, such as Grace Lavery, an associate professor of English, and climate journalists. Mary Annis Hegler and Amy WesterweltOften complains about the company’s policy of moderation or the pressure to deliver consistently.

“The substack is at a critical point where it needs to think about what will happen when it grows up,” said Nikki Usher, associate journalism professor at the University of Illinois Urbana-Champaign.

The good news for the five-year-old company this summer is that it is still growing. Its paid subscriptions to hundreds of thousands of newsletters increased from 50,000 at the end of last year to more than 1 million by mid-2019. (The company will not disclose the number of free subscribers.) It hopes to hire more than a dozen engineers, product managers and other specialists. Executives hope to eventually take over the company – which has raised more than $ 82 million and is said to be worth $ 650 million – revealed.

But to sustain that growth, substack executives say, the company should offer more than newsletters.

In an interview at Substock’s office in downtown San Francisco, its co-founders spoke in clear statements about the “Grand Substack Theory” and the “Master Plan.” Chris Best, Chief Executive, described the desire to “change the way we experience culture on the Internet” and to bring “art into the world”.

“Substack in its full ambition is the type of alternative universe on the Internet,” he said.

In practice, this means that Substack will be more of a multimedia community, not just a delivery channel for written newsletters. The executive wants users to create a “personal media empire” using text, video and audio, and interact more extensively with subscribers. Comments Which can display GIF images and profiles for readers. This week, Substack announced new tools for authors to recommend other newsletters.

Jayaraj Sethi, co-founder and chief technology officer, described the vision of subscribers gathering around the writers like fans at a concert.

“If you just give them a place to get together and interact with each other, there are some pretty kind of bonds,” he said.

In March, Substack launched an app that consolidates subscriptions in one place, rather than scattering them separately via email. This month, the company announced a podcast expansion.

“From the beginning, we intended to do more than just provide subscription publishing tools for the company,” Hamish Mackenzie, co-founder and chief operating officer, wrote about the app.

But as the substack evolves outside of newsletters, it risks appearing like any other social network or news publisher – which may make it less appealing to writers.

Ben Thompson, whose tech-focused Stratcherry newsletter inspires Substack, wrote last month that Substock is trying to put the “Substock brand front-and-center” by becoming a “faceless publisher” behind the scenes, making its application as one. Is. Destination on the backs of writers.

Wrote to Mr. Thompson.

Publication on the substack is free, but authors who charge a subscription pay 10 percent of their revenue to the substeck and 3 percent to its payment processor, Stripe. The company also offers heavy advances to a small group of authors, whose identities it refuses to disclose.

Substack has one major difference from most other media companies: it refuses to chase the advertising dollar. ,On my dead body“Mr. Mackenzie once wrote,” Opposing what Substack wants to be, “Mr. Shrestha said.

“If we, through greed or mistake, get into that game, we will effectively compete with TikToks and Twitters and Facebook of the world, which is not the only competition we want to be in,” he said. Best added.

This means that the subset subscription depends on the revenue. Subscribers pay more than 20 million a year to read the top 10 authors of Substack. The most successful history professor is Heather Cox Richardson, who has over a million paid and unpaid subscribers. Other notable writers include Knight novelist Salman Rushdie, punk poet winner Patty Smith and Eisner winner comic book writer James Tionion IV.

Emily Oyster, author and professor of economics at Brown University, who has given divisive advice on controlling epidemics with children, said Mr. Mackenzie recruited him. Her newsletter, ParentData, has over 100,000 subscribers, including over 1,000 paid readers.

“The substack has definitely become a bigger part of the media landscape than I ever thought it would be,” she said.

But Dr. Oyster’s primary source of income is his education and his books; Most of her newsletter revenue goes to editing and support services. Most users have struggled to support themselves by writing exclusively on the platform and have instead used their earnings to supplement other paychecks.

Elizabeth Spyres, a Democratic digital strategist and journalist, said she left her substack last year because she did not have enough time or paid readers to justify her long weekly essays.

“Also, I started getting higher paid assignments elsewhere, and putting content on the substack didn’t make much sense,” she said.

But Substack’s biggest conflict has been over content mediation.

Mr. McKenzie, a former journalist, describes the substack as the antidote to the focus economy, a “nice place” where writers are “rewarded for a variety of things, not throwing tomatoes at their opponents.”

Critics say platform culture recruits (and therefore supports) war instigators and is a hub for hate speech and misinformation. Last year, many authors abandoned Substack for its inaction on transphobic content. This year, the Center for Countering Digital Hate said anti-vaccine newsletters on the substake generate at least $ 2.5 million in annual revenue. Charlie Warzell, a technology writer who quit his job at The New York Times to write a substack newsletter, describes the platform as a place for “internecine internet beefs.”

Substack has resisted pressure to be more selective about what it allows on its platform. Twitter employees who were concerned that its content moderation policies would be relaxed by Elon Musk, the world’s richest man and the platform’s largest shareholder, were told Do not apply for a job On the substack.

“Eat your vegetables,” Mr. Best said. “If we agree or disagree with everything on the substack, it will be less than what a healthy intellectual climate would look like.”

Substakes make it easy for writers to break up, and defectors have a fast-growing collection of competitors waiting to be welcomed.

Over the past year, newsletter offers from Twitter, LinkedIn, Facebook, Axios, Forbes and the former Condé Nast editor began. The Times last year made multiple newsletters available to subscribers only. Mr. As part of his newsletters push in November, Warzel moved his galaxy brain from the substack to the Atlantic.

The media platform Ghost, billed as an “independent substack alternative”, has a gatekeeper service to help substack users transition into their work. The media outperformed its editorial publications to advance a more substantial model of “supporting independent voices”. Zestworld, a new subscription-based comics platform, called “Substack Without Transphobia”.

Mr. Shrestha said he welcomed the contest.

“It’s worse than not copying just one thing,” he said.

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