Substack co-founder on how Substack Pro works: year one, writers get upfront pay, Substack keeps 85% of revenue; later, writers keep 90% revenue, no minimum pay
The thinking behind Substack Pro — When we started Substack in mid-2017, the future for writers was frightening.
Substack BlogHamish McKenzie
Context & Ripple Effects
Substack is publishing the actual mechanics of its Substack Pro advance model after weeks of pressure over which writers it pays: in year one the company fronts the money and keeps 85% of subscription revenue, then flips to a 90%-to-writer split once the minimum expires. Days later it disclosed that 30+ writers have signed up under the program.
Two threads make this more than a pricing explainer. Substack itself concedes the selection of paid writers is an editorial judgment about what kind of writing it wants to exist, and by late 2024 the company was still unprofitable despite adding 1M+ paid subscribers in a year — so Pro is effectively venture-funded audience acquisition wearing a journalism hat.
First-order effects
Selected writers get a guaranteed income floor for year one, trading an 85% revenue share to Substack for downside protection they would not get going independent.
Readers and rival writers now know exactly which big-name newsletters are subsidized, converting what was opaque dealmaking into a public list Substack has to defend.
Second-order effects
Competing newsletter and membership platforms face pressure to offer their own advances or lose anchor writers, pushing take rates from flat commissions toward negotiated, tiered deals.
Because Substack admits the picks are editorial, every future signing doubles as a statement about the platform's politics and taste, inviting the same criticism cycle each time a controversial name is funded.
Third-order effects
If advances become standard, creator platforms stop being neutral tools and start operating like publishers with commissioning budgets — closer to the direct-to-fan businesses Substack itself says it should be judged against than to plain infrastructure.
A two-tier creator economy hardens: platform-subsidized stars with guaranteed pay versus everyone else on pure revenue share, with the platform's balance sheet deciding who gets the runway.
The trend: Creator-economy platforms are increasingly spending their own capital to recruit star talent, turning neutral hosting tools into de facto media companies with editorial stakes in who gets paid.
The writers and Substack denied it for a year... but it was clear Substack was paying folks (huge) upfront payments to leave their main-stream media gigs A brilliant move in @a16z's bitter battle with the media/journalists: gut their talent (very CAA of them)!!! https://twitter.c…
This, by the way, is why I believe in the authenticity of Substack's commitment to free discourse and their determination to reject media and activist demands that they censor. From co-founder @hamishmckenzie's defense of diverse thought: https://blog.substack.com/... https://twi…
Fantastic article on how @SubstackInc creates incentives for writers to write on their platform. The secured first year income in exchange of 85% of revenue is an amazing growth hack! Love it. Also love their transparency that it's a business decision https://blog.substack.com/..…
This is basically “we're totally not making editorial/content decisions just decisions like an investor or business owner” and very clearly & deliberately ignoring the fact that those decisions are implicit editorial decisions. https://twitter.com/...
“No writer who says anything important is universally loved; and in fact, sometimes those who engender the fiercest opposition are the ones most deserving of support,” says Hamish about the criticism of Substack recruiting a bunch of transphobes.
one possible way for substack to address this, though lol if they will, is to split into a clear editorial wing and an open platform for anyone. But substack would have to see that “poaching specific writers” is an editorial & publishing decision, and who knows if that'll happen
I *bet* there is/gonna be a controversy over substack & the @hamishmckenzie letter but as I read it I thought: “this is basically book publishing” and if you are going to critique Substack you should also take a look at book publishing. Who are you under contract with?
Later in this very same piece they say “we aim to host a broad array of voices because we believe a diversity of thought is essential to healthy discourse.” That's an editorial point of view!
@atrubek @alyssaharad and I couldn't begin to disentangle “it seems like substack is disproportionately hurling coins at a specific kind of established writer” from “a certain kind of established writer is disproportionately looking for an exit strategy from traditional media”
The problem with this statement is the continuing reliance on saying Substack is a platform—equal access, etc—rather than a publisher. By offering deals to writers they're the latter. https://twitter.com/...
as someone cobbling together an income writing in a bunch of places, I would very much like Substack's editorial decisions to stop being so toxic that I can't in good faith ask people to give them money. But first, Substack has to accept that it's making editorial decisions.
Hamish has yet to say a single word to me, publicly or privately, but it seems that's for the best. If I were him, I wouldn't be able to look me in the eye, either.
@AthertonKD And I think this is a great point to make because it is in Substack's interest to hide/obscure the distinction between the two, and reap the merits of both frames.
I wanna just point out the sleight of hand between ‘controversial’ and ‘important’ here, which elides all criticism of these writers away as simple controversy, and simultaneously elevates what they say to a position of great importance needing of protection and support. https://…
We pay writers in an effort to recoup more money later, but these writers do not write *for us* is a hell of a logical leap, you almost gotta hand it to them. https://twitter.com/... https://twitter.com/...
I think Substack is a great option for some writers, but I'm genuinely confused how these are “investment” decisions rather than “editorial” ones. These are many of the same kinds of questions editors ask when hiring writers? https://blog.substack.com/... https://twitter.com/...
Game changing. When I was a writer I wouldn't have had the courage to go independent because I didn't have a big following. This changes the calculus for unknown writers. https://twitter.com/...
“We don't disclose the names of the writers with whom we've done deals because it is their private information and up to them whether or not they want it publicly known.” this makes transparency and accountability on hires impossible, so that's very SV. https://blog.substack.com/…
“We are not a PUBLISHER, no no no! We merely seek out writers whose work we would like to make money off of, and then we pay them for the right to try and make money off it.” https://twitter.com/...
A question @hamishmckenzie. We are doing a conference next week where the topic is ‘diversity in independent publishing’. Substack Pro is interesting, but of all the people included so far, what is the gender split? https://twitter.com/...
This is, of course, beyond insufficient, and frankly beneath contempt. It justifies the decision to platform trans-eliminationist hate speech as “controversial,” “important,” and, specifically, MORE worthy of support than the trans people calling for accountability. https://twitt…
“We see these deals as business decisions, not editorial ones.” If you specifically seek out certain writers and not other writers, and you pay the writers you pick to publish things, then you're making editorial decisions. It's not rocket science. https://blog.substack.com/...
We have a program called Substack Pro where we pay minimum guarantees to writers to help them start publications (businesses) on Substack. Here's an explanation of how it all works. https://blog.substack.com/...
seems reasonable. but leaning into culture war schtick by saying “defund the thought police” strikes a very different tone. if you want people to believe you're just running a business trying to make writers profitable, stick to this. https://twitter.com/...
Well here's the Substack “why we pay writers” post, and it boils down to “we don't understand that we're making editorial decisions, and also we want to keep those editorial decisions secret.” https://blog.substack.com/...
I haven't wanted to wade too much into the Substack discourse over the last few months (let alone days), but I read @hamishmckenzie's post and have some thoughts. The TL;DR is that Substack is neither the savior nor the villain of publishing/journalism. 🧵 https://twitter.com/...
business decisions = editorial decisions = content moderation it's fascinating to watch people try to change the tenor of the discourse by changing the framing (it has always been thus, of course) https://twitter.com/...