Ana Marie Cox on the Shaky Foundation of Substack as a Business
50 comments
·August 2, 2025barrrrald
elicash
This post linked to a different article (former Bloomberg reporter) that said it expected this round to be at $750 million ($50 million above the previous valuation).
And so yes, that's significantly less than it ended up being, $1.1 billion, but I'm not sure it impacts the argument being made. Except that the multiple would be even greater!
lapcat
> This post didn't age well – 3 weeks later Substack announced a $100m fundraise at $1.1b valuation.
From the article: Newcomer says Substack is “pitching investors on a round between $50M and $100M that would value it above its roughly $700M last round price.”
Also: And if Substack does manage to raise that $100M they’re looking for now? Things will get worse.
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DoctorOW
At no point in this post does she even write the word "censor"/"censorship". The post relentlessly criticizes Nazis but wanting silence to her dissent isn't pro-speech, it's just pro-nazi.
I'm really sick of this argument. You never see free speech extremists defending anti-fascism or even questioning the decisions of governments as long as they're right wing.
add-sub-mul-div
She specifically talks about what happens next after raising that $100m. The higher valuation creating more urgency to be profitable, which could lead to a descent into Twitter-style outrage engagement stupidity, influencers, etc.
If she's wrong about anything, it's that you can assume enough people will leave a declining platform to keep it from staying alive.
hiddencost
[flagged]
SilverElfin
Yes, censorship. Which is a bad thing. Ideas, even disagreeable ones, should be permitted. Otherwise you don’t have a real democracy.
slg
This is an ironic response to a comment on HN that is being downvoted and soon will be censored by the crowd based flagging and voting system for being "disagreeable".
archagon
Should it be the responsibility of a periodical to publish every random Nazi op-ed? (And then send out push notifications for it?)
Assholes can self-publish, as always, IMO.
_Algernon_
That's no longer a justification once you have algorithmic amplification which Substack introduced with its Twitter immitation.
At that point they ceased to just tolerate these ideas but to amplify them. At that point they carry more responsibility, and people rightly blame them for it.
Free speech is fine. A private company handing nazis a megaphone and not accepting criticism for it is not.
jeswin
> It’s as unstable as a SpaceX launch
Hate makes people blind. Starship is failing by design - that's just how they're choosing to develop it. The chopsticks video that we saw earlier was very nearly science fiction. And as far as regular launches go, SpaceX has done more successful launches than any company or nation ever.
But more generally, this idea of abandoning an app (or product) the moment you encounter people who disagree with you is disheartening.
randallsquared
Abandoning a community the moment you encounter people who disagree with you is how one builds a bubble strong enough to say things like the bit you quoted.
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archagon
Why would I spend my precious time wallowing in filth and squalor with some radicalized “influencers” who spout evil nonsense and entirely lack self awareness?
I’d rather go read a book and discuss it with some actually intelligent friends.
KerrAvon
[flagged]
hiddencost
[flagged]
lapcat
That was just a metaphor, a throwaway line in the article, no more important than Stephen Miller's marriage. It's peculiar that this is the subject you chose to expand on in the comments.
null
KerrAvon
I agree that hate makes people blind, which is why you need to get off X. That line doesn’t imply anything other than that SpaceX launches are unstable! The explosions are a highly notable feature of said launches.
_Algernon_
>But more generally, this idea of abandoning an app (or product) the moment you encounter people who disagree with you is disheartening.
It is a behavior Substack itself encourages by turing itself into a social media platform instead of simply a newsletter provider.
Yes, it is useful for building a moat of network effects, but it also forces views and opionions down people's throats that reflect badly on the platform.
karaterobot
Here's how little I understand business: $45 million in revenue, earned by taking a totally fair 10% of subscriptions that other people do all the work to get, seems like it ought to be enough. If leadership is trying to scale up to be thousands of employees, or to go public, they are lunatics and deserve to fail. Why not just run a successful newsletter platform?
danpalmer
It’s interesting you say the 10% is fair. I think some disagree.
In short they are selling web hosting and card payments, which are most likely worth far less than 10%. However, they’re clearly going for being a Brand that people want to publish under. Substack is worth 10% because it’s Substack, not for the tangibles they provide.
Now that leads to the question: what do they need to do to be a brand people want to be a part of? Is censorship part of that? Maybe, maybe not.
The other interest related piece that is topical at the moment is whether Substack might be worth 10% for card payments alone if certain publications would be unable to use payment providers otherwise. Porn and gambling sites often pay that sort of rate because it’s hard to get a payment provider. Maybe laundering nazi sympathy in with a bunch of tech blogs is worth 10% to them.
add-sub-mul-div
Greed doesn't have to be the same thing as the ambition it takes to start a company like this, but in practice it pretty much always is.
Kwpolska
Running a successful platform is not enough for VC grifters who funded them, the only thing that matters to VC is growth.
derektank
The network effects of substack seem pretty weak. Authors can use their own domain name and export a list of their subscribers any time. Their value is in providing software that is sticky for writers and solves a lot of the problems of creating and retaining an audience, which they seem to be doing pretty effectively. For better or worse, I don't think substack has much influence on the broader ecosystem either way; it's all down to consumer demand.
dash2
I feel ambivalent about Substack's Notes (its version of X/Bluesky). On the one hand, the signal/noise ratio is higher than either X or Bluesky. On the other hand, I can see signs of the social media engagement farming nonsense that I've come to dread.
But, I can just click on the "Following" link to avoid it. In fact, I can even set that as my homepage. So, so far, it's not that bad. And I continue to enjoy the diversity of writers; and am much more worried by virtuous scolds than by neonazis.
techpineapple
Why is it that Substack can’t just be run as a 10-20 person small-medium sized business forever? If publishers want to go there for a basic product, and Substack can collect rent from them, what’s the problem?
chowells
They took VC funding. That requires them to attempt to grow to the size of Facebook or Amazon, or implode. Merely being profitable forever is not an acceptable outcome.
rectang
I wonder how many profitable, sustainable, rewarding medium-sized businesses that have never taken VC money are utterly invisible to HN.
“You know, you could just not take VC money.”
“… We don’t do that here.”
rwmj
There must be an opportunity here for someone who can stand up a medium-sized website and integrate it with a payment provider to take Substack's lunch money?
scyzoryk_xyz
I've always struggled to understand this part: what is it that Substack came up with that we did not have earlier?
Aren't there a hundred examples out there of medium-sized websites providing a similar infrastructure mix?
akudha
What about https://ghost.org/about/
They seem to be doing well, 8.5 million in revenue
skwashd
Buttondown already offers this - https://docs.buttondown.com/paid-subscriptions
derektank
Ghost exists
senko
> Why is it that Substack can’t just be run as a 10-20 person small-medium sized business forever?
They have taken VC money.
mcepl
You cannot give millions of USD to potential authors if you are tiny webserver-running small business. That’s what the article was all about.
RamblingCTO
VC money and you can't boast to your peers with your monopoly valuation that doesn't have any real merit.
elicash
There are already small newsletter businesses that offer basic products.
throw_m239339
> The problem isn’t just that Substack makes money off Nazis, it’s that they don’t seem to care who they make it from.
Ana Marie Cox can move to Medium, they have that "diverse and inclusive" editorial policy she is seeking, we all know how "great" Medium has been doing...
Invictus0
[flagged]
This post didn't age well – 3 weeks later Substack announced a $100m fundraise at $1.1b valuation. [1]
Ana's contention that Substack is "rickety" seems motivated by her conviction that they should adopt a more assertive, aggressive censorship regime, and that "we need a world where a social safety net protects risky writing".
There are certainly many interesting questions about the future of media and Substack's business – but the parade of people saying it can't succeed without more moderation keep being proven wrong.
[1] https://www.nytimes.com/2025/07/17/business/substack-fundrai...