Answer
May 14, 2022 - 10:41 AM
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Substack is quickly becoming the go-to platform for writers and journalists looking to monetize their content.
But there’s a reason why it seems like only popular journalists from established media companies like Buzzfeed, The Verge, and the New York Times are flocking to Substack.
And that’s because—besides not wanting to sell their souls—it's easier to succeed with Substack if you’ve already built an established audience base that’d be willing to pay for your content.
Here’s How Substack Works
Starting your newsletter on substack is a pretty easy process. And once your account is created, substack allows you to send emails and track their performance with Substack’s analytics tool.
With substack, you can choose to offer your content for free, lock them behind a paywall or charge your subscribers a minimum monthly fee of $5/month, and it can go as high as $50/month. And this leads us back to the validity of Kevin Kelly's 1000 true fans theory.
Are 1000 True Fans Enough on Substack?
The simple answer is yes. And that’s simply because, in Kevin Kelly’s statement, he suggested you’d need a thousand readers to pay you $100/year. And after running the numbers, that puts the monthly payment per user at $8.4.
But seeing that the minimum payment for subscribers is $5 and new writers without a robust personal brand usually price their subscriptions at this point, we decided to base our findings on writers who manage to get 1000 readers at $5/month.
Our Findings
Let's say you have 1,000 loyal subscribers, each paying $5/month, which means you’d be earning $5,000/month and $60,000/year.
That may seem like a lot, but when you consider that Substack charges 10% in fees, Stripe—substack’s financial service provider—charges approximately 3% in fees, not to mention a 30-cent transaction fee for each subscriber.
So, at $5,000/month and $60,000/year, you’d be paying:
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$500/month and $6,000/year as Substack’s 10% fee.
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Approximately $150/month and $1,800/year as Stripe’s processing fee.
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$300/month and $3,600/year in subscriber transaction fees.
That put’s your monthly earnings at approximately $4,050 and your yearly earnings at $48,600. And yes, that’s all before state and federal taxes which can be anywhere north of 22%. Altogether, that can leave you with a little over $30,600, almost half of your earnings.
So, yes. You can earn a living from Substack, but that depends on how quickly you attract new subscribers to your newsletter.
We recommend anyone wanting to get into substack must first build their personal brands on Facebook, Twitter, or YouTube. And one vital thing you must do is to build your email list.
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