When we started Substack to build an alternative media economy that unlocks the full potential of the internet and gives more power to writers and readers, we didn’t know if the model would work. A lot of people told us that no one would pay for newsletters. Others didn’t think there was any “scalable” financial future for writing or the news media.
That was in 2017. Now, it’s clear that the Substack model, based on subscriptions instead of advertising, is working. Writers are gaining the independence they need to do their best work. Readers are finding writing that has been crafted for them and not for an economy based on engagement-based algorithms. A wild array of new voices is emerging to produce work you can’t find anywhere else.
Over the last three years, readers have paid writers tens of millions of dollars through Substack. More than half a million people pay to subscribe to a publication on the platform. The top 10 publishers are grossing more than $15 million a year.
Six months ago, as a demonstration of our confidence in the model, we started a financial program to help writers launch their own businesses on Substack – and it’s working so well that we are going to expand it rapidly. In fact, the viability of the Substack model has become so clear that Facebook and Twitter are now chasing us.
We intend to do a lot more and move a lot faster. In the weeks, months, and years ahead, we will invest deeply in writers, helping them to build sustainable media businesses on Substack and giving them the most powerful subscription publishing tools ever seen. We are not going to do this by half-measures. We are all in.
To that end, today we’re pleased to announce that we have agreed to a $65 million Series B funding round led by Andrew Chen of Andreessen Horowitz that will allow us to make a significant investment in writers.
Here are some ways we will spend the money:
- An expansion of our financing program, which helps writers start media businesses by derisking the first year of their work on the platform.
- Investing in community for all Substack writers, by building programs to help a new generation of writers excel with the subscription publishing model. These efforts will include more fellowships, grants, mentorship programs, educational resources, events, and a lot more.
- Investing in initiatives to support local news and reporting, in an effort to kickstart the development of a news ecosystem that thrives on direct support from readers.
- Building a support infrastructure for independent writers, which includes an expansion of our legal support program, and initiatives around healthcare, editing services, design, tax advice, and more.
- Building increasingly powerful subscription-publishing tools, to help more writers go independent and run their own media empires.
- Assembling a team of world-class people who are committed to building a better future for the media economy by putting writers and readers in charge.
We started Substack because we were dismayed by the state of the media ecosystem. Writers were losing jobs and newspapers were going out of business. At the same time, the rise of the attention economy had locked us all in newsfeeds optimized for engagement, rewarding the types of behavior and content that harm discourse, making it harder for people to understand each other and work together. Substack is our attempt to build a new and better model. We have set out to show that platforms that put writers and readers in charge are the way forward.
These are just the very early days of a new ecosystem, but we are encouraged by how it has been going so far and excited for the years ahead. To all the writers and readers who have been part of this journey with us: thank you. There is a lot more to come.