- What is Substack, and how does Substack work?
- How does Substack make money?
- Commissions from writer’s paid subscriptions
- Substack subsidiaries, acquisitions, and exits
- Substack profit and revenue
- What is the Substack business and revenue model?
- Substack funding, net worth, and valuation
How does Substack make money? Well, here is a full, in depth, breakdown of their main revenue stream and services they offer, as well as the Substack business and revenue model, how much money Substack makes per year, and how Substack works.
What is Substack, and how does Substack work?
Substack is an online publishing platform that has built the infrastructure to enable writers on Substack to send digital newsletters directly to their subscribers.
Founded in 2017 by Chris Best, Hamish McKenzie, and Jairaj Sethi, Substack now has more than 1 million paid subscribers on the writing publications platform.
So, how does Substack work? Signing up on Substack as a reader or writer is free.
But if a writer decides to start charging readers to receive their newsletter, the cost of how much the monthly or yearly subscription will depend on what the writer decides to charge. Aside from that, Substack does not charge readers any additional fees.
How does Substack make money?
According to Substack, Substack has more than 1 million paying subscribers on the platform. So how does Substack make money off of all these subscribers?
Below is a breakdown of how much money Substack makes and its revenue model. Including their main revenue stream and how much they charge for their services.
Here is how Substack makes money in 2022
Substack has a revenue model that makes money in just one (1) way; from the commissions they take from their writer’s paid newsletter subscriptions.
#1. Commissions from writer’s paid subscriptions
Substack makes all of its money from the commissions they take from its writers on the platform.
If publishing as a writer is free on Substack, how does Substack make money off of its writers? Well, Substack makes money when writers decide to add paid subscriptions to their Substack newsletter. From that, Substack takes 10% of all the revenue that the writer is generating from their paid newsletter.
For example, if a writer makes $10 per month off of their newsletter, SubStack will take $1 per month as their 10% cut.
How much does Substack cost?
- Substack takes 10% of all paid subscription revenue
Note: Substack has more than 1 million paid subscriptions to publications on the platform.
Substack subsidiaries, acquisitions, and exits
To date, Substack has made a total of 3 acquisitions.
Substack profit and revenue
Substack has not released any official reports in regards to company earnings.
Note: Because Substack is a privately held company, they are not required to make their annual reporting, such as Form 10-K’s, pubic.
What is the Substack business and revenue model?
Substack makes money through a few revenue models that they combine within their company, they are:
- Commission based business model
- Mergers and acquisitions (M&A) business model
Substack funding, net worth, and valuation
Substack’s Crunchbase profile shows Substack has raised $82.4 million over 4 rounds and has a valuation of $650 million as of May 2022.