Thinking of investing in the newsletter space?
Here's your executive summary -- everything you need to know in 3 mins or less, including:
-How the media industry is changing
-How the business model works
-Major funding & acquisition deals
-etc
Based on 6+ months research
...
Here's your executive summary -- everything you need to know in 3 mins or less, including:
-How the media industry is changing
-How the business model works
-Major funding & acquisition deals
-etc
Based on 6+ months research

The media industry is changing.
Since '08, newspapers have experienced a 68% drop in ad revenue. Down to roughly HALF what it was in 1956.
https://www.brookings.edu/research/local-journalism-in-crisis-why-america-must-revive-its-local-newsrooms/
Since '08, newspapers have experienced a 68% drop in ad revenue. Down to roughly HALF what it was in 1956.
https://www.brookings.edu/research/local-journalism-in-crisis-why-america-must-revive-its-local-newsrooms/
Papers are folding left and right.
In 2020, Berkshire Hathaway sold its 30-paper news unit to Lee Enterprises for $140m.
Today, 200 US counties have neither daily nor weekly news papers.
In 2020, Berkshire Hathaway sold its 30-paper news unit to Lee Enterprises for $140m.
Today, 200 US counties have neither daily nor weekly news papers.
Newsletters may fill this void:
Across 40 countries, ~16% of readers get news via email (~21% in US).
Worldwide: ~4B email users with ~100m joining each year.
US: ~252m unique email users w/ ~4-6m joining each year.
Still lots of opportunity. https://bit.ly/3xmugdp
Across 40 countries, ~16% of readers get news via email (~21% in US).


Still lots of opportunity. https://bit.ly/3xmugdp
COVID had a huge impact on newsletter signups.
@TheAtlantic added 90k paying subs between March and May 2020.
@SubstackInc grew to 250k+ paying subscribers by Dec. Reportedly 500k+ today.
https://backlinko.com/substack-users
@TheAtlantic added 90k paying subs between March and May 2020.
@SubstackInc grew to 250k+ paying subscribers by Dec. Reportedly 500k+ today.
https://backlinko.com/substack-users
Long-time print publications are making major bets on email too:
NYT shifted from ad-driven to primarily subscription-driven revenue
Business Insider bought a controlling stake in Morning Brew for $75m
Forbes announced it's working on newsletter publishing tools



The Online News Association further legitimized the space by adding an "Excellence in Newsletters" category to its annual awards.
(congrats to @JuddLegum who took home the very first
) https://twitter.com/revue/status/1308406339098619905
(congrats to @JuddLegum who took home the very first

Here's how the business model works:
You make money via...
-Free subscriptions (monetized via ads)
-Low-cost subscriptions
-High-cost subscriptions
Readers move like this:
Free -> Low-cost -> High cost
Much more on this here: https://twitter.com/damn_ethan/status/1381969678399049730
You make money via...
-Free subscriptions (monetized via ads)
-Low-cost subscriptions
-High-cost subscriptions
Readers move like this:
Free -> Low-cost -> High cost
Much more on this here: https://twitter.com/damn_ethan/status/1381969678399049730
Let's talk about roadmaps for hiring, growing, and scaling revenue.
Broadly speaking, newsletters grow through 3 key phases:
0 - 10k Readers: Finding product fit
10k - 100k Readers: Monetizing
100k - 1m+ Readers: Scale
Here's a look at how Morning Brew's revenue evolved.
Broadly speaking, newsletters grow through 3 key phases:
0 - 10k Readers: Finding product fit
10k - 100k Readers: Monetizing
100k - 1m+ Readers: Scale
Here's a look at how Morning Brew's revenue evolved.
2 things often happen when a newsletter passes 100k subscribers:
Failed deliveries start to cut into revenue at this point, so they often upgrade their technical stack to fix.
Make their first technical hire.
Here's a closer look at MB's team size over time.


Here's a closer look at MB's team size over time.
Here's one more look, showing Morning Brew's hiring roadmap vs revenue.
If you're hiring, or advising a portfolio company hopefully you find these helpful.
If you're hiring, or advising a portfolio company hopefully you find these helpful.
As for major deals -- I worked on this one for a while, but they just don't translate well to tweet form.
So here's a doc with a bunch of data on industry leaders, funding, acquisitions, and people to follow (including other investors in this space)
https://docs.google.com/document/d/1SHXAA21O8-r1zJMBUNx4rBeWjARpw58lL42WiyNrkZ8/edit?usp=sharing
So here's a doc with a bunch of data on industry leaders, funding, acquisitions, and people to follow (including other investors in this space)
https://docs.google.com/document/d/1SHXAA21O8-r1zJMBUNx4rBeWjARpw58lL42WiyNrkZ8/edit?usp=sharing
If you found this interesting or helpful, follow me ( @damn_ethan) and check out http://trends.co .
We've got 300+ pages of distilled research & examples to share over the next 38 days.
DM if you have questions or want me on your podcast. Happy to dish!
We've got 300+ pages of distilled research & examples to share over the next 38 days.
DM if you have questions or want me on your podcast. Happy to dish!
TL;DR
-Newspapers are folding left and right
-Newsletters might fill the void
-COVID led to a huge subscription bump
-Large companies like Forbes & NYT are bullish
-Newsletters grow through 3 main phases
-Hiring goes Editorial > Technical > Revenue
-100k subs is a crucial time.
-Newspapers are folding left and right
-Newsletters might fill the void
-COVID led to a huge subscription bump
-Large companies like Forbes & NYT are bullish
-Newsletters grow through 3 main phases
-Hiring goes Editorial > Technical > Revenue
-100k subs is a crucial time.