Substack took shots at TikTok last week by introducing live videos and offering a US$25,000 (RM109,875) prize to the creator whose video inspired the most TikTokers to migrate to its platform. But it’s not stopping there. As part of its new mission to become a home base for creators of all kinds, Substack has now set its sights on beating out other paid subscription platforms.
Yesterday, the newsletter platform announced the launch of a US$20mil (RM87mil) fund to help creators move their paying audience over from competitors like Patreon, Supercast, and Circle.
It’s a pretty sweet deal. Substack is promising creators “white glove service” – meaning an employee will personally assist them through the process – as well as early access to new features. And if creators see a dip in revenue during their first year on the platform, Substack says it’ll “make up the difference.” The program requires creators to close all other paid subscription accounts, however.
“The creator economy is on the precipice of something new,” Substack co-founders Hamish McKenzie, Chris Best, and Jairaj Sethi write in a blog post about the initiative. “The recent tumult of social platforms” – meaning the TikTok ban – “has highlighted the challenges creators face: They cannot rely on social media alone to build their audience or their business.”
The creator fund is “one of many initiatives we plan to roll out in the coming months as we build the new economic engine for culture,” they add.
Many social experts agree that after this month, creators are more focused than ever on diversifying revenue streams, so Substack’s timing is advantageous.
Still, transitioning isn’t always easy. Justin Robert Young, who moved his podcast Politics Politics Politics from Patreon to Substack three months ago, writes that he experienced a couple of technological hiccups in the switch. He also received a few angry emails and comments from frustrated subscribers.
Young writes that he lost 36 paying subscribers but gained more than 6,100 free subscribers. Overall, it seems like his move was successful: “I suspect I will make more my first year on Substack than I did my most profitable year on Patreon, mostly because I have already been paid close to 70 [percent] of the money I would otherwise make from the year.”
Substack takes 10 percent of a creator’s subscription revenue, while Patreon charges anywhere from 5 to 12 percent, depending on which plan creators choose.
Some existing Substack users are frustrated about the platform’s new direction. Sara Jin Li, author of the newsletter Gut Feelings, for example, writes that Substack “is doing itself a disservice by trying to advertise it as a creator platform when the reason for its success is because [writers] use it.”
And because the fund will only accept creators who make US$2,000 (RM8,790) or more per month on other platforms, another user writes, “I’m worried this could make things even harder for the people with few subscribers. The newcomers who are able to import their big audiences will have a great advantage.” – Inc./Tribune News Service
