What is Substack?
Substack is a subscription-based publishing platform that allows writers to monetize their content through newsletters. Launched in 2017, the platform enables creators to publish text, audio, and video content directly to subscribers' inboxes. Its unique model emphasizes a reader-funded approach, eliminating the need for advertisements. Writers retain ownership of their content and mailing lists, giving them full control over their audience.
Revenue and Financial Performance
Substack generates revenue by taking a 10% fee on writers' subscription earnings. In 2021, the company reported gross revenue of $11.9 million, a significant increase from $2.4 million in 2020. By 2022, estimates suggested a 58% growth, bringing revenue to approximately $19 million.
Growth and Funding
Substack has experienced rapid growth since its inception. As of early 2024:
- Monthly active subscribers: Over 20 million
- Paid subscriptions: Over 2 million
- Earning writers: More than 17,000
The company has raised $90.2 million across five funding rounds, with investments from notable backers like Andreessen Horowitz. Additionally, in March 2023, Substack launched an equity crowdfunding campaign to allow writers and readers to invest in the platform.
Terms and Conditions
- Revenue share: Substack takes a 10% commission on paid subscriptions.
- Payment processing: Stripe fees apply for transactions.
- Ownership: Writers retain complete ownership of their content and mailing lists, allowing them to migrate their audience if they leave the platform.
Notable Writers on Substack
Some of Substack’s most prominent writers include:
- Heather Cox Richardson ("Letters from an American")
- Matt Taibbi ("TK News")
- Andrew Sullivan ("The Weekly Dish")
- Glenn Greenwald
- Taylor Lorenz ("User Mag")
Traffic and Subscriber Metrics
- Monthly traffic: Substack’s website attracts approximately 49.4 million unique visitors.
- Subscribers: Over 20 million monthly active subscribers, including more than 2 million paid subscribers.
Financial Overview
In 2021, Substack reported:
- Gross revenue: $11.9 million
- Net loss: $22.9 million
Despite its rapid growth, the company has not yet achieved profitability, as it continues to prioritize expansion and creator support.
Ownership and Founders
Substack was co-founded in 2017 by:
- Chris Best
- Jairaj Sethi
- Hamish McKenzie
The company remains privately held, with significant venture capital backing.
Content Moderation and Removals
Substack champions free expression and maintains a relatively hands-off approach to content moderation. While it has faced criticism for hosting controversial content, there is little public information on writers being removed from the platform. Substack’s terms ensure writers maintain control over their mailing lists and content, granting them autonomy over their publications.
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