First Time Founders: Has Substack Changed Media For Good?
Timestamps are as accurate as they can be but may be slightly off. We encourage you to listen to the full context.
Podcast Summary
In this insightful episode, Chris Best, CEO and co-founder of Substack, shares his journey from building messaging app Kik to creating a new economic engine for media. The discussion explores how Substack emerged during a time of profound media transformation, when trust in traditional outlets was collapsing and creators needed sustainable ways to monetize their work. (05:38) Best explains how his vision began with writing an essay about media frustrations on the Internet, eventually evolving into a platform that has fundamentally changed how writers, journalists, and creators connect with their audiences.
- Main Theme: The episode focuses on Substack's mission to create a new economic model for media that aligns creator success with platform success, moving away from ad-driven attention economies toward subscription-based quality content.
Speakers
Chris Best
Chris Best is the CEO and co-founder of Substack, the subscription-based media platform. He previously served as CTO and co-founder of Kik, a messaging app that gained hundreds of millions of users and achieved a billion-dollar valuation with investment from Tencent. Best brings extensive experience in building large-scale technology platforms and understanding the dynamics of online communities.
Ed Elson
Ed Elson is the host of First Time Founders, a podcast focused on interviewing successful entrepreneurs about their startup journeys. He brings a keen understanding of media trends and business models to his conversations with founders.
Key Takeaways
Economic Alignment Creates Better Incentives
Best emphasizes that Substack's success stems from aligning economic incentives between the platform and creators. (40:25) Unlike ad-driven platforms that profit from attention regardless of quality, Substack only makes money when creators make money through a 10% revenue share model. This fundamental alignment means the platform succeeds only when creators produce content valuable enough that readers willingly pay for it. This creates a virtuous cycle where the platform's interests align with both creator success and reader satisfaction, rather than optimizing for addictive but potentially harmful engagement.
Subscription Models Enable Creative Independence
The subscription model represents more than just a payment mechanism - it's a social contract that enables creative freedom. (13:57) Best describes how the core innovation was creating "a new economic engine for culture" that allows writers to make money doing work they believe in, rather than being constrained by advertiser preferences or algorithmic demands for viral content. This model particularly resonated during COVID when quality independent voices were being marginalized by traditional media outlets, providing them with a sustainable path forward.
Platform Design Shapes Human Behavior
Best learned from his experience at Kik that the rules of online platforms fundamentally shape how people behave within them. (09:03) He explains that you can create "heaven or hell with the exact same people" depending on how you structure the digital environment. Substack's design choices - like allowing creators to export their email lists and maintaining subscription ownership - build trust by avoiding lock-in tactics, which paradoxically makes creators more likely to stay and invest in the platform.
Quality Content Requires Different Discovery Mechanisms
The challenge of growing an audience while maintaining content quality led Substack to develop social features like Notes and video capabilities. (28:48) Best acknowledges the paradox: subscription models incentivize quality, but paywalls limit discovery. Substack's solution involves creating lighter, more accessible content that serves as an entry point to deeper, paid content, similar to how Twitter's best moments combined quick discussions with substantive long-form articles and real-world conversations.
Media Consumption Reflects Deeper Human Needs
Best positions Substack as addressing fundamental human needs for connection, meaning, and intellectual growth in an increasingly digital world. (59:02) He argues that successful digital platforms must facilitate genuine human interaction and community building, not just passive consumption. Substack's comment sections, meetups, and creator communities serve this function by creating spaces where readers become participants in ongoing conversations rather than mere consumers of content.
Statistics & Facts
- Substack has grown to over 5 million paid subscribers, demonstrating significant adoption of the subscription model for independent media. (14:28)
- During the platform's first customer launch with Bill Bishop's China newsletter, six figures in revenue rolled in within hours, validating the business model from day one. (19:01)
- The platform has attracted more than 35 million total subscribers across free and paid tiers, showing substantial audience reach beyond just paying customers. (02:53)
