The gritty reality for Substack’s middle class
Star journalists generate six figure revenue within weeks after launching on Substack, but that's not the reality for most writers.
Welcome! I'm Simon Owens and this is my media newsletter. You can subscribe by clicking on this handy little button:
In November 2019, I turned down a six-figure job so I could continue working on this newsletter.
The job offer came from a major DC media company that I had been working for on a freelance basis. The outlet sold high-priced, branded content (aka, native advertising) to blue chip companies and then hired me as the journalist who would digest the creative brief, interview the client’s senior leaders, and then churn out a 1,500 word article.
It wasn’t the most exciting work, but it paid well, and the outlet threw me plenty of projects once it realized that I was reliable and deadline-oriented. It was because of that reliability that two of its senior executives took me out for coffee to pitch me on a full-time role as a senior editor. In this position, I’d oversee the content production for all of the company’s native advertising clients, managing a small group of in-house producers and freelance writers.
Given the outlet’s prominence and name recognition, the role would have been a great resume builder — the kind that could be parlayed into just about any media job I wanted. But at the end of the coffee meeting, I left them with a single question: If I took the job, could I keep my newsletter and podcast?
At the time, the newsletter and podcast were just side projects, but I’d poured all of my free time into building them, and I wasn’t willing to abandon all that work. As I continued to go through the interview process for the media job, I kept reminding them of this question. A few weeks after the initial coffee meeting, a vice president called me up with some news: He was ready to draw up an official offer, but the job would preclude me from operating the podcast and newsletter. According to this vice president, the higher ups were nervous that it could present a conflict of interest, especially in cases where I interviewed the outlet’s competitors.
I held firm to my demand, but not without a fair amount of agonizing self-doubt. After all, neither the podcast nor the newsletter were producing any direct revenue. In fact, I thought at the time that it might be years before I’d make a go at turning them into a business. But I also knew I wouldn’t find much fulfillment from helping Fortune 100 companies produce sponsored content and that I wouldn’t last long in any such job without some kind of creative release valve.
The vice president and I went back and forth over a period of weeks as we tried to hammer out a compromise, but eventually the discussions tapered off. A few months later I learned that he’d left the company.
The second major job opportunity I turned down came in January 2021.
By this point I had been running the paid version of my newsletter for about eight months. A former editor of mine had gone on to work for a major tech platform, and a job promotion meant that he needed to find a successor to fill his current role. The work would have involved serving as a kind of liaison between the tech platform and the media companies that use it to distribute their content. The job would have no-doubt paid well and come with the lavish perks common among Silicon Valley companies that are flush with cash. While I wasn’t guaranteed the job, the person recommending me would be its current occupant.
In some ways, this was even harder to pass on than the media role. At least in that previous instance, I had a steady stream of freelance work. But starting in February 2020, around the exact same time I launched the paid edition of my newsletter, I began winding down all my client work so I could focus on the newsletter and podcast full-time. By January 2021, I was only generating about a thousand dollars a month, which really meant that I was hemorrhaging money when you accounted for all of my business and life expenses. Could I really afford to pass on what would easily be the most high profile and well paid job of my career thus far?
And yet pass on it I did. Perhaps I was merely succumbing to the sunk cost fallacy, but I was in too deep. While the previous 10 months hadn’t been the most remunerative of my career, they were the most creatively rewarding. The tech job would have been cool, but it would have also been just another iteration of the behind-the-scenes work I’d done over the previous decade. It wouldn’t have done anything to further me along the path I wanted to be on.
Why am I telling you all this? Because I belong to a group of Substack writers who don’t get written about much in the media — let’s call them Substack’s “middle class” — and I want you to understand the sacrifices we have to make while building our newsletter businesses.
If you search for the word “Substack” in Google News, you’ll find story after story that namechecks a handful of the same writers. Prior to launching their Substack newsletters, these writers tended to work for high profile media outlets that helped them build huge Twitter followings into the hundreds of thousands. When they announced their Substacks, their announcements were amplified by hundreds of blue checkmark colleagues who encouraged their audiences to sign up and subscribe. Most of these high profile writers reached 1,000 paying subscribers within days or weeks of launch. Some even received generous six figure advances from Substack itself.
That isn’t the reality for the vast majority of Substack writers. Most don’t reach their first 1,000 paid subscribers within their first week. Hell, most don’t reach that threshold within the first six months.
Instead, they face a daily grind, one where they attempt to convert one paid subscriber at a time. There’s usually no “tipping point” moment for them; instead, they just put in the work, week after week, until they build a sustainable business. I’ve interviewed dozens of them for my newsletter and podcast, and most told me it took them upward of several years before they reached what they considered a “comfortable” income.
Given the disproportionate amount of coverage of the star Substack writers, I wanted to write about the less sexy reality for everyone else. It’s a reality that poses significant challenges, and by discussing them here, I hope to set more realistic expectations for those thinking about embarking on the same journey.
Let’s jump into the lessons I’ve learned:
You have to learn to say “no” a lot
When growing a paid newsletter, you constantly face two problems, both of which are related to each other. On the one hand, you need to produce enough high quality free content to get new readers into the top of your purchase funnel. On the other hand, you also have to produce enough paywalled content to make a paid subscription worth the price of admission.
This places a huge burden on a solo creator. Every moment not spent creating content is a moment that you’re not feeding these two insatiable beasts. Slack off on the free content, and your lead generation crumbles. Slack off on the paid content, and people start unsubscribing in droves.
Because of this burden, you really have to minimize time spent on anything other than content creation. This means saying “no” to a lot of stuff, and I’m not just talking about turning down job offers or other paid opportunities. For instance, weekday socializing has gone pretty much out the window for me. If my wife is meeting up with friends for a happy hour, she doesn’t even bother asking me if I want to join. With the exception of (very short) vacations, all of my socializing is confined to Fridays and Saturdays. I even try to keep Sundays off limits so I can fit a few hours of work in.
As a creator’s profile rises, they also start getting a lot of emails from random people on the internet who want to talk on the phone. I get pitched by a lot of people who are in the process of building products that they want to demo for me over Zoom. I used to humor these people, but these days I don’t even respond to emails unless there’s a good chance I’ll want to feature the person in my newsletter or podcast.
Don’t misunderstand me; I’m not bragging that I’m one of those crazy people who work 80 hours per week. I’m a person who likes to have dinner with my wife each night and watch TV with her before bed. I try to exercise every day and am even training for a half marathon right now. But in order to focus on these non-work priorities, I had to get better at saying “no” to anything that didn’t lend itself to content production during my designated work hours.
You need some sort of financial cushion
Many aspiring creators have this fantasy that they’ll be able to work on their newsletter as a side hustle and then quit their full-time jobs at the exact moment that the newsletter revenue replaces their full-time income.
This scenario is known to happen sometimes, but it’ll be difficult to achieve for most. Why? It all ties back to growth.
While we’d all like to say that content quality is the biggest driver of growth, the truth is that publishing consistency often plays a much bigger role. You can produce the most brilliantly-research, well-written newsletters, but if you’re only publishing twice a month, you’re not going to grow very fast, at least without a large following on some other platform or a sizable marketing budget. All things being equal, a daily newsletter will grow much more quickly than a weekly newsletter, even if the daily newsletter is slightly lower in quality.
What does this mean in practice? That embarking on a newsletter career requires a leap of faith — a departure from full-time work so you can increase your content output, even though you’re not yet generating enough income to replace your salary. In other words: you need some sort of financial cushion.
By “financial cushion,” I mean anything from savings to a spouse’s income. It might also mean you need to cut back on spending or put off buying a house. I can’t say for certain how big your cushion needs to be, but I think it’s safe to say that you’ll want to have a minimum of one year’s salary in the bank before even considering making the plunge.
Before I move onto the next section, I want to acknowledge that there’s a lot of privilege contained in that last sentence. I don’t want to downplay how difficult it is for the average person to take the equivalent of a one-year salary cut in order to embark on a newsletter career; instead, I’m simply acknowledging the harsh reality of creator economics.
It’s incredibly difficult to set benchmarks for success
It’s easy for large media organizations to A/B test different strategies. When you’re generating hundreds of thousands — or even millions — of pageviews each day, you can collect a lot of data on user behavior very quickly. Want to test out a new call to action or content recommendation widget? You can probably have a good idea on if it’s working within a matter of days.
This kind of user testing is extremely difficult for solo creators. Let’s say you want to test out a new format for your newsletter, and soon after launching it you notice a slight decrease in your open rate. Was the decrease caused by the format change, or by the fact that a mere 20 of your subscribers went on vacation during the month of August? You simply don’t have a large enough sample size to definitively say.
This problem is especially bad during the early days of running a newsletter. In the first few months after launching my paid edition, I’d have weeks where I considered myself lucky if I got one new paying subscriber. While I was constantly experimenting with small tweaks during this time, there was simply no way to collect quantitative data on whether they were actually effective.
The good news is that this is the perfect time to collect qualitative feedback. Starting in July of last year, I started making it a priority to schedule phone calls with my subscribers. Not only did I get to learn about their media business — which led to several interviews for my podcast and newsletter — I also was able to gain a better understanding of why they’d subscribed and what they were looking to get from me.
It’s not all bad
I think I’ve struck a pessimistic tone in this article, so I want to end on an optimistic note.
A few weeks ago I got into an argument with someone in my Substack’s comments section. He argued that people like me were selling a pipe dream, because becoming a successful creator is about as unlikely as making it into the NBA; sure it’s possible, but the odds are overwhelmingly against you.
I’m confident that that’s not the case. Some estimate that creators have collectively taken home about $20 billion in the last year (I ran through the math in this video). If you divide that by the median household income of $50,000, that means the creator economy supports upwards of 400,000 jobs. The NBA has roughly 500 players, so there are 800 times more creators than there are NBA players.
While the 2010s birthed a generation of social media megastars, the 2020s will see the emergence of a creator middle class. I do think it’s very much possible for the average person to join this middle class, but it’s important that everyone understands the punishing economics at play. Learning about the successes of journalist megastars like Matt Yglesias and Glenn Greenwald is useful in some respects, but you should only embark on this journey with the understanding that their experiences are far outside the norm.
Can you support my work?
As I mentioned, I consider myself to be a member of the Substack middle class, which means that every single subscription adds a meaningful contribution to my bottom line. For the month of September, I’m offering a 30% discount. Subscribers not only support all the free content I produce here, but they also receive extra Friday emails. Subscribe here:
Simon, you've got a great newsletter here. As a substack writer myself (I think I'm lower class lol) who is experimenting with selling some sponsorships (I charge way more than typical ads) and I am thinking about going the paid subscriber route I do see a lot of these problems you describe. Selling sponsorships is additional work. I'm not 100% sure it's worth it. It's nice to have a bit of side income early on, but it's also annoying to have to cold email people, follow up, and get rejected.
One thing I think we forget is that people like Casey Newton had a free newsletter for 5+ years before he started doing substack. The same is true of other successful writers here that might have had careers as journalists just grinding it out. If you are a new newsletter writer the idea of working on something for peanuts for 5+ years as a side hustle seems crazy. It's what I'm doing and I'm in year 2 (hopefully breaking 1000 free sign-ups by June).
I think perhaps I'm just getting to a point where I'd feel comfortable doing a paid version. Maybe in the next few months.
As a middle-class newsletter writer myself (I write L'Économiste Sceptique, a French-speaking newsletter popularizing economics: https://www.ecosceptique.com), I agree with a lot of what you wrote. Or at least, I have a very similar experience myself. The difficulty of A/B testing and collecting data on what works and what doesn't. The harsh learning curve of “marketing” when you start — regularity over quality. How you need to carefully plan the financials. And so on.
That being said, I also agree that in the middle run, building a sustainable newsletter is definitely possible.