Substack CEO on the Newsletter Economy
Should we not treat it like that in the first place?
Yesterday, I read a terrific newsletter issue by Substack founder, Hamish McKenzie.
He calls himself the Chief Writing Officer and rightly so. That’s a great designation that companies never had.
He has written a lot of really appealing articles that you all will resonate with. And this one is no different.
In his latest post, Please stop calling it the ‘newsletter economy’, he points out the newsletter rush that happened not so long ago.
Some of the facts caught me off guard. It amazed me. For example, Facebook had developed a direct competitor of Substack with the name Bulletin.
Facebook, or Meta, is shutting down Bulletin in early January next year, less than two years after its launch.
Decide for yourself if it’s good news or bad.
Overhyped and VC-funded?
I dived a bit into not-so-distant history to find out what this entire newsletter rush was all about.
It appears big on the surface itself. From The New York Times starting its own line of exclusive member-only newsletters to Twitter buying Revue to set up a competitor for Substack, to prominent writers leaving their companies and organisations like The Verge to start a Substack. It was huge!
A lot of hype was created around the “newsletter economy.” A lot of VC money entered the system to “boost” the growth. And then the winter came.
Substack fired employees and decided not to raise any more VC funding.
Twitter shifted its focus from Revue and the results are clearly visible in the form of outages lasting hours.
Facebook is going to completely shut down Bulletin. News companies that joined the hype didn’t benefit from newsletters as much.
So who benefitted?
The writers. And companies like Substack, who were not playing the short-term game.
Everyone faces difficulties in the beginning. Be it us, individual writers, or a multi-million dollar company like Substack.
In order to have skin in the game, you have got to play the game that’s worth playing. Oftentimes, it’s the long-term game.
That is exactly what Hamish pointed out in his post.
“The trend that Substack is part of is not a newsletter trend, or even the much-hyped creator economy. We are part of a seismic shift in the media economy that is all about writer and creator ownership and independence.”
Trends shift. With time it changes; it’s volatile. What’s not is a vision that holds you in place when that change is happening.
Substack had a grand vision and they held onto it. That’s why we see it prospering today, while others who have (and had) a lot more resources are suffering, if not already at the brink of shutting down the shops.
Lessons for us, the writers
If you take anything from this article, be it this one piece of advice: focus on your long-term game and see where your interests coincide with the demand of the readers.
We all struggle with this. We want that pot of gold even without setting sail. That’s borderline impossible — unless you are a celebrity starting a newsletter.
The start is always rocky. There are ups and downs. having realistic expectations is what will help you the most.
Start a newsletter, but not with the motive Facebook started Bulletin. If we play a short-term game, we’d be disappointed most of the time.
But if we play the long-term game, we not only reap the rewards of compounding but also become more resilient towards the challenges that come our way.
“All the benefits in life come from compound interest — relationship, money, habits — anything of importance.” — Naval Ravikant
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