It is often said that the news business is a dying industry. If so, it must be having some kind of end-of-life rally. While it might be true that advertising revenues, print circulations, and newsrooms at many outlets are shrinking, one form of media is going in the opposite direction: the humble newsletter.
Substack, a newsletter platform whose model is based on paid subscriptions, is flying particularly high. It announced on Tuesday that it was raising a further $65m from investors, in a round led by Silicon Valley VC firm Andreessen Horowitz that will reportedly value it at $650m. Established in 2017, Substack now has more than half a million subscribers — double what it had in December. And some of its biggest names are making out like bandits.
Glenn Greenwald, the Pulitzer Prize-winning journalist who in October resigned from The Intercept, the online media platform he co-founded, citing “repression, censorship and ideological homogeneity”, has between 20,000 and 40,000 paid subscribers to his newsletter, each contributing at least $5 a month. Once Substack has taken its standard 10 per cent cut, and after payment processing fees, I calculate that Greenwald is left with between $80,000 and $160,000 a month, or about $1m to $2m a year. Not bad for a mere hack.
“It’s a lot,” Greenwald tells me. “It’s obviously way more money than I’ve ever made in journalism before, or than I ever thought I would make.”
What’s intriguing is that there’s little difference between what is received by Greenwald’s subscribers and by those who sign up for his free content. Greenwald says he only puts about 10 per cent of his writing behind the paywall — publishers can choose how much of their work they charge for — and even this is made available to everyone within 24 hours.
“They’re not paying because they’re getting something in return; they’re paying because they want to support journalism that they think . . . needs to be heard,” Greenwald says. “That’s what Substack in a lot of ways has become: this kind of brand that people are eager to support as a cause.”
So what exactly is this cause? Substack’s roster of writers is hugely varied, with newsletters focusing on such niche subjects as “hard-to-describe feelings” and “unbeatable recon”, each garnering thousands of paid subscribers. But the platform has also, notably, provided something of a refuge for journalists who have broken away from the mainstream media. The success of the likes of Matt Taibbi, Greenwald, Andrew Sullivan and Matthew Yglesias, who feature near the top of Substack’s “politics” rankings, and who are all outspoken critics of the establishment media, suggests that a sizeable audience feels it is not being catered to by the polarised identity politics of the mainstream press.
“There are a lot of people who want options that aren’t either some 27-year-old white woman yelling at you about being racist or ableist all day long, or Fox News,” says Freddie deBoer, a freelance journalist turned Substack writer who has amassed more than 1,400 subscribers since joining the platform a month ago.
What could stop Substack? Some argue it is not scalable and will only provide a sustainable income for those who got in early. This seems like a fair concern, though there is no sign of this group having reached capacity. Others point out that the company lacks any kind of “moat”, or sustainable competitive advantage, and will not survive competition from companies such as Twitter, which recently acquired newsletter company Revue, and promised to take just a 5 per cent cut from subscription income.
But Substack’s user-friendliness and its commitment to free speech, which it was forced to make clear in a statement last week after calls to deplatform some of its contributors for hate speech and transphobia, is turning the platform into a brand in its own right. I would argue this constitutes the first droplets of a moat.
The fact that a platform can stand out simply by committing to remain neutral should tell us something about how ideologically driven much of the media has become. Substack’s success makes it clear that not all readers like this polarised landscape.