Will Substack writing become "winner-take-all?"

Power Laws are everywhere; can Substack avoid them?

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I have been writing on Substack for about 1.5 years. In that time, I have published 450+ articles. I am retired, and I have no need for extra income. I simply enjoy writing on topics that interest me, and I want to share them with others. Of course, I want my subscriber base to grow fast as this enables me to get out the message.

This has got me thinking of where Substack is going. In particular, I have been thinking about what it means for writers with a relatively small subscriber base (let’s say under 10k) who are nonetheless churning out great content.

Do those types of writers have a legitimate chance of making Substack their primary income? Or will Substack always be a side hobby that needs to be squeezed into the spaces between full-time work, education, and family responsibilities?

First, a few observations. I do not have any data to back most of them, but they seem relatively sound:

1. Substack is a for-profit business, so Substack executives want to concentrate corporate resources where they have the greatest positive marginal impact. I assume that their goal is an IPO with a high price. Potential investors demand reasonable returns. There is nothing wrong with that.

2. Readers have limited time for reading. Reading is actually one of the most time-intensive acts that humans perform.

3. Writing is even more time-intensive. It takes at least ten times as much time to write an article as to read it. And readers have the luxury of stopping mid-article with no consequences.

4. Because of the above, Substack users are largely divided into two big groups (with a tiny middle ground):

   1. Writers

   2. Readers, who publish few if any articles.

   3. A few people, including me, who devote a huge amount of time to doing both. My sense is that very few Substack users publish hundreds of articles and actually read (or skim) hundreds of articles each week. Very few Substack writers with a huge subscriber base fit into this category. They have an incentive to focus their time on writing the next article.

5. Readers naturally want to focus their time on Substack writers who consistently deliver the best content. So it makes sense for readers to limit their subscriptions to the very few Substack writer with a huge subscriber base.

6. Unless a reader has a media/social media following before starting with Substack, it takes many years of writing content to build a large following. As a wild-ass guess, we are talking about 500 articles (as a point of comparison, I have written 455 articles as of today and still have relatively few subscribers).

7. It takes decades of practice to become a good writer. I have never met anyone who is really good at writing in their early twenties. Even the best young writers need lots of practice to really hone their trade.

8. Most Substack writers start as a sideline hobby where they also have work, education and family responsibilities on the side. This means that they will have a very hard time ever getting to 500 articles. For these people, publishing one article per week is difficult, so it will take 10 years to get to the 500 threshold!

9. A key to growth are Recommendations coming from the Substack writers with large subscriber base (that is about 2/3 of my subscriptions), but:

   • Writers do not have the time to read hundreds of articles from smaller writers.

   • The more a writer recommends another writer, the greater the diminishing returns of each recommendation.

The emerging Power Law

Where this unfortunately likely leads us toward is a Power Law, where a few hundred Substack writers have massive following (and income) and a huge number of Substack writers competing for the scraps (let’s say 10,000 or fewer subscribers). As Substack grows, the small writers will grow as well, but it is not clear that many of them will ever catch up to the few hundred Substack writers with a massive following.

My guess is that the distribution of Substack readers (as measured by articles read) look something like a Random Distribution (on the left), while subscriptions to Substack writers look something like a Power Law distribution (on the right).

Meet the New Boss; Same as the Old Boss

So Substack has torn down the Gatekeepers of the traditional media and publishing houses, but now the big Substack writers with a huge number of subscriptions are the new gatekeepers. Or more accurately, they are the Amplifiers, because their recommendations carry huge weight. With a simple click of a button, big Substack writers can grant thousands of new subscribers to small writers.

Ironically, a very sizable percentage of the big Substack writers with a huge number of subscriptions acquired their following before they got into Substack. They acquired their following via the old Gatekeepers:

• Writing columns or reporting for traditional media.

• Publishing books from the traditional publishing industry.

• Known academics

Those big Substack writers have no incentive to grow subscribers for new writers, though many of them do so anyway. The problem is that they have a strong incentive to focus on their own writing. They are not being greedy. They are just implementing sound time management strategies.

Most big Substack writers appear to have made their Recommendations early in the their Substack career and rarely add new Recommendations. I know from personal experience that Recommendations for my site came regularly one year ago, but now they rarely come. My guess is this is a general trend. Big Substack writers simply do not have the time to read the huge number of articles that it takes to separate the wheat from the chaff.

My fear is that the profit-motive for Substack will mean that the company will focus their efforts on promoting the big writers who can reliably up-sell free subscriptions into paid subscriptions. Ironically, this is exactly what the traditional publishing industry does.

So we go from one Power Law to a different Power Law.

I am not writing this article as a criticism of Substack. I love writing for and reading Substack. It is merely a set of observations about reality. Even if Substack works hard to promote small writers, the Power Law may be very hard to shift toward a Random Distribution.

So let’s get back to my original question:

Do small writers who are just starting out have a legitimate chance of making Substack their primary income? Or will Substack always be a side hobby that needs to be squeezed into the spaces between full-time work, education, and family responsibilities?

Of course, Substack could grow its readership and paid subscriptions so fast as to make up for that trend. The big writers will get a huge share of paid subscriptions, but the platform will grow fast enough to support a much larger number of medium-size writers.

I think the real unknown will be: Assuming the Substack readership and paid subscription grow rapidly, what percentage of that growth goes to writers with less than 10,000 subscribers? And will that percentage grow or contract over time?

The Substack version of The Valley of Death

My guess is that very, very few Substack writers will ever be able to approach a reliable 60k income. Based on my wild-ass-guess, this requires at least 60,000 subscribers, which is a pretty large number.

Those below that threshold are left with a choice. Either they seriously cut back on their material standard of living, or 99% will be forced to:

• Continue writing as a hobby that earns a little extra money on the side, or

• Give up and find another hobby.

This is just a different flavor of the Valley of Death that all entrepreneurs face. Can founders keep the business in operation long enough to scale up into a self-sustaining business?

My guess is that each year, it will get progressively more difficult for new writers to break through to 60,000 subscribers. And Substack has a strong incentive to keep that fact a secret.

I will be happy to be proven wrong.