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Substack has been successful in creating buzz among the media crowd, and there's definitely a business there riding the trend toward subscriptions in the media

Substack has been successful in creating buzz among the media crowd, and there's definitely a business there riding the trend toward subscriptions in the media biz, but unfortunately taking on $17M in VC money has set them up for a disappointing end. Here's how this plays out. The successful writers on Substack will eventually leave the platform for more control over their audience and lower fees (there's a reason Ben Thompson isn't on Substack). As this happens, and as the honeymoon PR period dies off, the journalists will turn on Substack, just as they do on every single thing Silicon Valley puts out (see Lambda School). Prior to taking on a16z riches, Substack was a cool indie brand. Now they're officially "big, evil tech." The fickle journalist twitterati just haven't realized it yet. Inevitably as more non-influencer writers head to Substack they'll start to see, like with Patreon, that only a small minority of creators will ever generate enough income to make a living. This, combined with competition from Patreon, Podia, Memberful, Ghost, Revue, the next indie platform darling, etc. will spell doom for a16z's growth goals for the platform. My guess is 3-7 years from now, after more funding rounds, they get acquired by Patreon for roughly the same amount of money investors put in. Employees will get nothing, founders might get Cush jobs and possibly a minor payout, VCs would have done better investing in the S&P. This is the type of business that works better bootstrapped IMO.

seemslegit 6y ago
> Here's how this plays out. The successful writers on Substack will eventually leave the platform for more control over their audience and lower fees (there's a reason Ben Thompson isn't on Substack). Except the entire model of substack is based on writers not having access even to their audience's mail addresses.
- ves 6y ago
  well, you may not have their address, but you have their inbox. “References and supplemental video content available on my website at ...”
  - seemslegit 6y ago
    Great, so now you have a website to maintain and pay for and your customers with their associated revenue are still owned by substack. Getting paying subscribers to change their subscription method is huge friction and risk of churn, the more revenue you already have established on substack the bigger the risk cost of trying to move away, aka the boiled frog business model.
- sails 6y ago
  Substack writers do have access to their signups and can easily export them. https://support.substack.com/hc/en-us/articles/360037465992-How-do-I-export-my-email-or-subscriber-list- https://support.substack.com/hc/en-us/articles/360037465992-...
  - edouard-harris 6y ago
    Yes. This has been the case from the very beginning of their platform, as far as I'm aware.
- chinathrow 6y ago
  > Except the entire model of substack is based on the writers not having access even to their audience's mail addresses. Is that correct as of today? https://support.substack.com/hc/en-us/articles/360037465992-How-do-I-export-my-email-or-subscriber-list- https://support.substack.com/hc/en-us/articles/360037465992-...
  - seemslegit 6y ago
    I'm not sure, their Publisher Agreement seems to also have been very recently revised to remove some very strong prohibitions against trying to gather your subscribers data on your own so maybe they realized it's a bad idea - do you know what information is included in the csv ?
klelatti 6y ago
I think what Ghost (as you mention) is trying to do here with v 3.0 is interesting - seems to have most or all of the features of Substack - easy to set up on their hosted option plus full ownership of the email list and open source / potentially self hosted. Interesting that "The Browser" is on Substack (one of the top 5 newsletters) but the affiliated and more recent "The Viewer" is on Ghost. Of course Ghost still has a relatively small ecosystem compared to Wordpress which I think is why Ben Thompson still expressed a preference for a Wordpress based setup. [1] https://thebrowser.com/ https://thebrowser.com/ [2] https://theviewer.is/ https://theviewer.is/
- johnonolan 6y ago
  Hey! John from Ghost here - yes, TheListener and TheViewer are already on Ghost, and TheBrowser is the next that will be migrating :) We're still in relatively early stages with our memberships and subscriptions features (they're officially still 'beta') but we're shipping updates and new versions every single week, and working toward making the product easier to get started with and less technical to setup. We'll have a larger release later this year, but Ghost is already powering many thousands of paid memberships in the wild.
yoshuaw 6y ago
> Prior to taking on a16z riches, Substack was a cool indie brand. The name "Substack" was co-opted from James "Substack" Halliday [1][2], a well-known hacker in the Node.js community. It wasn't an indie-brand-turned-corporate; it's a person. The way substack.com has used VC money to take over someone's identity and feed off their reputation is incredibly scummy. [1]: https://github.com/substack https://github.com/substack [2]: https://twitter.com/substack https://twitter.com/substack
- woah 6y ago
  Do you really think they intentionally chose to collide with someone’s GitHub username???
  - yoshuaw 6y ago
    Sure do. Substack the company was founded in 2017 [1]. At that point Substack the person was already a household name in open source — with 76.000 GitHub stars to his name his projects' popularity were on par with the likes of Mozilla [2]. Naming an upstart company after a household name that isn't protected by copyright is incredibly clever. You get to use an established and trusted name, but can't get sued for using it. [1]: https://www.crunchbase.com/organization/substack#section-overview https://www.crunchbase.com/organization/substack#section-ove... [2]: https://web.archive.org/web/20170115065014/http://git-awards.com/users https://web.archive.org/web/20170115065014/http://git-awards... — GitHub stars aren't a perfect metric, but it's the best I can come up with to convey the degree of name recognition back in 2017
    - jklm 6y ago
      Anecdotally, I’ve never heard of this person until today (despite having heard of the company). I’d guess I’m not alone.
- UnbugMe 6y ago
  Do you have any evidence that Halliday's reputation has benefitted Substack (the company) in any way or that this was intentional? I view it simply as a catchy name and nothing more.
Cenk 6y ago
> As this happens, and as the honeymoon PR period dies off, the journalists will turn on Substack, just as they do on every single thing Silicon Valley puts out (see Lambda School). This doesn’t really seem true. Journalists “turn on” every single thing SV puts out? Do you think the reporting on Lambda school is dishonest? Or do you think that journalists reporting on a SV company is in and of itself somehow wrong?
- pembrook 6y ago
  Every single thing in Tech that becomes buzzy and popular begins with uncritical journalists fawning over the hot new thing, and ends with those same uncritical journalists thinking said thing is now evil and dystopian. Nothing is ever as good or as bad as journalists on twitter think it is. You can watch this pattern in literally every piece of consumer technology of the past 100 years. For some recent examples: 1999: The internet is going to change everything! 2001: The internet was a scam 2008: Smartphones are our savior! 2018: Smartphones and screen time are ruining everything 2010: Social media is going to connect the world! 2016: Social media is evil 2006: Google is the greatest, most innovative company in the history of the world! 2020: Google is an evil monopolist bent on world domination 2018: Zoom is the best video conferencing tool ever! 2020: Zoom is a massive Chinese conspiracy 2018: Lambda school is going to fix education! 2020: Lambda school is a giant scam Etc. Etc. Etc.

seemslegit 6y ago

> Here's how this plays out. The successful writers on Substack will eventually leave the platform for more control over their audience and lower fees (there's a reason Ben Thompson isn't on Substack). Except the entire model of substack is based on writers not having access even to their audience's mail addresses.

ves 6y ago
well, you may not have their address, but you have their inbox. “References and supplemental video content available on my website at ...”
- seemslegit 6y ago
  Great, so now you have a website to maintain and pay for and your customers with their associated revenue are still owned by substack. Getting paying subscribers to change their subscription method is huge friction and risk of churn, the more revenue you already have established on substack the bigger the risk cost of trying to move away, aka the boiled frog business model.
sails 6y ago
Substack writers do have access to their signups and can easily export them. https://support.substack.com/hc/en-us/articles/360037465992-How-do-I-export-my-email-or-subscriber-list- https://support.substack.com/hc/en-us/articles/360037465992-...
- edouard-harris 6y ago
  Yes. This has been the case from the very beginning of their platform, as far as I'm aware.
chinathrow 6y ago
> Except the entire model of substack is based on the writers not having access even to their audience's mail addresses. Is that correct as of today? https://support.substack.com/hc/en-us/articles/360037465992-How-do-I-export-my-email-or-subscriber-list- https://support.substack.com/hc/en-us/articles/360037465992-...
- seemslegit 6y ago
  I'm not sure, their Publisher Agreement seems to also have been very recently revised to remove some very strong prohibitions against trying to gather your subscribers data on your own so maybe they realized it's a bad idea - do you know what information is included in the csv ?

klelatti 6y ago

I think what Ghost (as you mention) is trying to do here with v 3.0 is interesting - seems to have most or all of the features of Substack - easy to set up on their hosted option plus full ownership of the email list and open source / potentially self hosted. Interesting that "The Browser" is on Substack (one of the top 5 newsletters) but the affiliated and more recent "The Viewer" is on Ghost. Of course Ghost still has a relatively small ecosystem compared to Wordpress which I think is why Ben Thompson still expressed a preference for a Wordpress based setup. [1] https://thebrowser.com/ https://thebrowser.com/ [2] https://theviewer.is/ https://theviewer.is/

johnonolan 6y ago
Hey! John from Ghost here - yes, TheListener and TheViewer are already on Ghost, and TheBrowser is the next that will be migrating :) We're still in relatively early stages with our memberships and subscriptions features (they're officially still 'beta') but we're shipping updates and new versions every single week, and working toward making the product easier to get started with and less technical to setup. We'll have a larger release later this year, but Ghost is already powering many thousands of paid memberships in the wild.

yoshuaw 6y ago

> Prior to taking on a16z riches, Substack was a cool indie brand. The name "Substack" was co-opted from James "Substack" Halliday [1][2], a well-known hacker in the Node.js community. It wasn't an indie-brand-turned-corporate; it's a person. The way substack.com has used VC money to take over someone's identity and feed off their reputation is incredibly scummy. [1]: https://github.com/substack https://github.com/substack [2]: https://twitter.com/substack https://twitter.com/substack

woah 6y ago
Do you really think they intentionally chose to collide with someone’s GitHub username???
- yoshuaw 6y ago
  Sure do. Substack the company was founded in 2017 [1]. At that point Substack the person was already a household name in open source — with 76.000 GitHub stars to his name his projects' popularity were on par with the likes of Mozilla [2]. Naming an upstart company after a household name that isn't protected by copyright is incredibly clever. You get to use an established and trusted name, but can't get sued for using it. [1]: https://www.crunchbase.com/organization/substack#section-overview https://www.crunchbase.com/organization/substack#section-ove... [2]: https://web.archive.org/web/20170115065014/http://git-awards.com/users https://web.archive.org/web/20170115065014/http://git-awards... — GitHub stars aren't a perfect metric, but it's the best I can come up with to convey the degree of name recognition back in 2017
  - jklm 6y ago
    Anecdotally, I’ve never heard of this person until today (despite having heard of the company). I’d guess I’m not alone.
UnbugMe 6y ago
Do you have any evidence that Halliday's reputation has benefitted Substack (the company) in any way or that this was intentional? I view it simply as a catchy name and nothing more.

Cenk 6y ago

> As this happens, and as the honeymoon PR period dies off, the journalists will turn on Substack, just as they do on every single thing Silicon Valley puts out (see Lambda School). This doesn’t really seem true. Journalists “turn on” every single thing SV puts out? Do you think the reporting on Lambda school is dishonest? Or do you think that journalists reporting on a SV company is in and of itself somehow wrong?

pembrook 6y ago
Every single thing in Tech that becomes buzzy and popular begins with uncritical journalists fawning over the hot new thing, and ends with those same uncritical journalists thinking said thing is now evil and dystopian. Nothing is ever as good or as bad as journalists on twitter think it is. You can watch this pattern in literally every piece of consumer technology of the past 100 years. For some recent examples: 1999: The internet is going to change everything! 2001: The internet was a scam 2008: Smartphones are our savior! 2018: Smartphones and screen time are ruining everything 2010: Social media is going to connect the world! 2016: Social media is evil 2006: Google is the greatest, most innovative company in the history of the world! 2020: Google is an evil monopolist bent on world domination 2018: Zoom is the best video conferencing tool ever! 2020: Zoom is a massive Chinese conspiracy 2018: Lambda school is going to fix education! 2020: Lambda school is a giant scam Etc. Etc. Etc.