Paid Newsletters: Audience = Optionality, 1,000 True Fans, Micro-Monopolies

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๐Ÿ” Problem

Some content wouldn’t exist without direct support.

When audiences are large enough to attract advertisers. They alter incentives.

๐Ÿ’ก Solution

Paid newsletters make niche content possible that wouldn’t otherwise exist.

You can write for your readers. Not sponsors.

๐Ÿ Players

๐Ÿ”ฎ Predictions

โ˜๏ธ Opportunities

๐Ÿ”‘ Key Lessons

  • Most paid newsletters are micro-monopolies:
    • They’re the sole source of a particular voice, point-of-view or perspective. In a category of one. There are no substitutes.
    • They can survive tough conditions. Like giving up 20% of revenue and being less capital efficient. Some use paid acquisition. But it’s not a life or death decision for monopolies.
  • Audience = Optionality. Paid newsletters are audience-first products. You can lobby trust and attention from your newsletter to courses, communities and funds.
  • Change the incentives. Change the outcome. Writing for sponsors and readers alters your writing. Beware of chasing two rabbits.
  • 1,000 True Fans. Small, supportive audiences power niche newsletters. You don’t need millions or thousands of supporters. Maybe 100 will do.

๐Ÿ˜  Haters

“What about newsletter fatigue?”
It pushes quality up. With cheap distribution, writers can choose to bundle. Or not. Bundling recreates graduation problems facing traditional media. ๐Ÿ‘† See micro-monopolies.

“Information wants to be free.”
It wants to be made too. Some things wouldn’t exist without direct support.

“You can only monetize a percentage of your audience with paid newsletters.”
What’s your north star? Sponsors change underlying incentives. If this is ok. Carry on… There’s no right or wrong. But don’t fool yourself.

“Most newspapers have sponsors. Why can’t I?”
You can. But you aren’t immune to conflicts of interest.

“Sponsors won’t change what or how I write.”
*Meet Richard Feynman*

“I can find win-win-wins between my audience, sponsors and I.”
You can. Especially in theory. In practice, competing priorities add complexity and break down quickly.

“Ok. But what about income diversification?”
Buy stock. Or real estate. Or build a value ladder. You know your audience and can reach them with low (or no) customer acquisition costs.

“Are you anti-sponsor?”
No. I’m anti-blindspot. You may see ads on one day.

“Substack is quick to start. And I can use Hiye or Cloakist. So why Ghost?”
“Inspiration is perishable.” If this resonates with you. Use Substack. But know this… Google will index the Substack subdomain. You’ll pay 10% transaction fees (not including payment processing fees). But… “Done is better than perfect.”

“Ghost costs too much.”
It’s open-source. Instead of paying $29/month. Pay $5/month. And keep transaction and switching costs low with 0% fees and your own domain.

“Everyone uses Ben Thompson as an example. But how many Ben Thompsons are there out there?”
I don’t hear this asked for OnlyFans. That aside… You don’t have to be Ben Thompson. You need 1,000, or 100, True Fans.

๐Ÿ”— Links

  1. Who has a paid newsletter? โ€ข The tweet behind this report.
  2. Product and Media are New Leverage โ€ข New fortunes will be made with products and media.
  3. Why I left Substack and the Email Renaissance โ€ข A breakdown of the pros and cons of Substack.

๐Ÿ™ Thanks

Thanks to Josh Spector (This Is How I Do It), Gonz Sanchez (Seedtable), Max Haining (100 Days of No Code), Sibi Murugesan (Apple & Banana + Earnest Capital), Reza Saeedi (Out of Curiosity), Ankit Ghosh (Hie), Nicolรกs Cerdeira (Failory), Ethan Jones (Tools for MGMT) and Dan Runcie (Trapital). We had a great time jamming on this report.

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