4 ms·

Given the recent public disclosures of their finances through 2021, I would expect the experience to continue to deteriorate. https://www.theverge.com/2023/4/7

by runako 3y ago

Given the recent public disclosures of their finances through 2021, I would expect the experience to continue to deteriorate. https://www.theverge.com/2023/4/7/23674178/substack-burn-2021-numbers-bad https://www.theverge.com/2023/4/7/23674178/substack-burn-202...

wpietri 3y ago
Yeah, I think they had the right idea at the start: a simple, minimal, low-burn platform. Once they took VC money the only plausible fate was Doctorow's "enshittification". They had no moat and low network effects. If they'd followed the frugal path they could have held on to the user focus. But once you borrow money from Fat Tony, your primary job is making sure Fat Tony gets paid.
- moneywoes 3y ago
  I guess BeeHiv took their lunch? Also isn’t the network effects the notes app and referrals to other newsletters?
badtension 3y ago
Jesus how can a blog platform burn so much money? Where do they go? Wages? What do those people do?
- red_trumpet 3y ago
  As you can see, "Partnership expenses" increased almost 20 fold. They paid people to write on substack.
  - runako 3y ago
    That's just the negative revenue side. They also spent another $16 million beyond that, primarily on salaries ($10mm).
  - badtension 3y ago
    Is this really necessary? Competing on merit no longer works? I see platforms burning money left and right and can't really understand how is this "the new norm". Especially with something simple like a blog platform.
    - comte7092 3y ago
      > Is this really necessary? Competing on merit no longer works? No longer? Not trying to say no one has ever competed on merit along, but I don’t think there exists a bygone era where people didn’t use $$$ to gain leverage in a market.
      - badtension 3y ago
        Yeah sure, with all the advertising madness going on merit is something that will get you a polite smile at most. But why even bother with something like a blog platform? You're not even innovative (looks like substack is simpler than medium so... cutting back on features?) so why pour all that money into it? Just to have yet another shitty platform and take investors money while trying to grow it?

by runako 3y ago

wpietri 3y ago

Yeah, I think they had the right idea at the start: a simple, minimal, low-burn platform. Once they took VC money the only plausible fate was Doctorow's "enshittification". They had no moat and low network effects. If they'd followed the frugal path they could have held on to the user focus. But once you borrow money from Fat Tony, your primary job is making sure Fat Tony gets paid.

moneywoes 3y ago
I guess BeeHiv took their lunch? Also isn’t the network effects the notes app and referrals to other newsletters?

badtension 3y ago

Jesus how can a blog platform burn so much money? Where do they go? Wages? What do those people do?

red_trumpet 3y ago
As you can see, "Partnership expenses" increased almost 20 fold. They paid people to write on substack.
- runako 3y ago
  That's just the negative revenue side. They also spent another $16 million beyond that, primarily on salaries ($10mm).
- badtension 3y ago
  Is this really necessary? Competing on merit no longer works? I see platforms burning money left and right and can't really understand how is this "the new norm". Especially with something simple like a blog platform.
  - comte7092 3y ago
    > Is this really necessary? Competing on merit no longer works? No longer? Not trying to say no one has ever competed on merit along, but I don’t think there exists a bygone era where people didn’t use $$$ to gain leverage in a market.
    - badtension 3y ago
      Yeah sure, with all the advertising madness going on merit is something that will get you a polite smile at most. But why even bother with something like a blog platform? You're not even innovative (looks like substack is simpler than medium so... cutting back on features?) so why pour all that money into it? Just to have yet another shitty platform and take investors money while trying to grow it?