WEBVTT

00:00:00.000 --> 00:00:16.865
You have probably heard people talking about making money on Substack, and maybe you're not sure if it's real, or maybe you're not sure if it's the right choice for you personally, or you are already on Substack and you are wondering how to finally leverage paid subscriptions.

00:00:16.945 --> 00:00:29.905
Well, this video is going to give you the honest full picture so you can decide for yourself and map out your action plan. Because here's what I can tell you. There are publications on Substack generating $10.50

00:00:29.760 --> 00:00:31.760
50 or even a $100,000

00:00:31.760 --> 00:00:36.000
a year. Some even 7 figures through paid subscriptions

00:00:36.000 --> 00:00:38.560
alone. No ads, no sponsorships,

00:00:38.560 --> 00:00:55.775
no complicated product launches. Just readers who choose to pay a monthly fee because they genuinely want to support the creator behind the publication. And in a world that is completely flooded with AI generated content with recycled takes and shallow newsletters

00:00:55.775 --> 00:01:24.665
that nobody asks for, people are actively looking for creators they can trust. Creators whose work they want to see in their inbox and creators that are genuinely worth paying for. That is the opportunity you have right now. And in this video, I'm going to break down exactly how the model works, what the math looks like, and how to think about building it from scratch. And I want to start with why people are even paying for newsletters right now because I think the skepticism

00:01:24.665 --> 00:01:39.660
around this topic is completely valid, and it's worth addressing directly. Most of us grew up on the Internet believing that content should be free, and for a long time, that was the dominant model. You create, advertisers pay, readers consume.

00:01:39.660 --> 00:01:48.445
Nobody pulls out a credit card for a newsletter. Right? But that model is changing right now, and it's changing because readers are exhausted.

00:01:48.445 --> 00:01:52.925
We're exhausted by feeds that are engineered to keep us scrolling.

00:01:52.925 --> 00:02:04.270
We are exhausted by content that exist to capture attention rather than deliver actual value. And we are exhausted by AI generated posts that are technically coherent,

00:02:04.350 --> 00:02:18.285
but completely hallow. And when someone finds a creator who's thinking they genuinely trust, whose work actually helps them or makes them feel something, they want to support that. And it's not because they have to, but it's because they genuinely

00:02:18.285 --> 00:02:21.005
want to. That's a massive cultural

00:02:21.005 --> 00:02:36.910
shift driving substance growth right now. People aren't paying for newsletters because it's a new habit. They are paying because they found something worth paying for, and that is happening on Substack twenty four seven. There are creators with tens of thousands of paid subscribers,

00:02:37.150 --> 00:02:38.830
some generating 7 figures

00:02:39.255 --> 00:02:55.030
purely from the subscription model. These aren't media companies. They are individual creators with a specific audience and a paid tier that consistently delivers value. And now here's the honest version of that story. You don't launch a paid tier and immediately make $10,000

00:02:55.030 --> 00:03:08.745
a month. Well, unless you already have a large established audience that trusts you and is ready to invest in your work right away. But for most people, it's a compounding model. First, you build your free list, you earn trust, you convert gradually,

00:03:08.745 --> 00:03:13.465
and over time, your numbers will grow. But making your first 1 to $2,000

00:03:13.465 --> 00:03:15.465
a month through paid subscriptions,

00:03:15.545 --> 00:04:05.105
that's even achievable for new first time creators, and it changes everything about how you think about the value of your own work. And before we talk about how the paid model actually works, there's a distinction I want to make sure you understand because it shapes how you behave on Substack. On Substack, there are two ways someone can connect with you. They can follow you or they can subscribe to your publication. A follower will see your notes in the Substack feed inside the app. They might like your content. They might interact with it, but they don't receive your emails. They are not on your email list. A Substack follower is similar to a social media follower on any other platform. Platform. A subscriber on the other hand is on your email list. They receive your posts directly in their inboxes.

00:04:05.105 --> 00:04:24.810
That's your owned audience. That's the asset you are building by showing up on Substack instead instead of investing into social networks right now. And here's how seriously we take this distinction at right build scale. With our clients, we don't even encourage them to look at their follower count. We ignore it entirely because followers are worthless when it comes to building

00:04:25.475 --> 00:04:26.275
business.

00:04:26.275 --> 00:04:28.915
They look impressive, but they mean nothing.

00:04:28.995 --> 00:04:46.240
The only number we track and the only number that actually matters is the subscriber count. It's the email list. The people who have invited you into their inbox and are actively building a relationship with your work because those are the only people who can become paid members and clients

00:04:46.240 --> 00:04:56.815
beyond Substack. And everything you do on the platform, every note you publish, every post you write, every conversation you start should be pointed at converting

00:04:56.975 --> 00:05:15.750
one into the other. Now let's talk about the actual mechanics because this is where most people get fuzzy, and I want to make it completely clear for you. Now Substack is free to use. There's no monthly platform cost, no list size fee, no paying for features. You publish for free until you decide to turn on paid subscriptions.

00:05:15.750 --> 00:05:34.525
And what I genuinely love about that model is this. Substack only takes a fee when you actually make money. Their incentives are entirely aligned with yours. They only win when you win. When you turn on paid subscriptions, here's exactly how the fees break down. Substack takes a 10% cut off your subscription revenue.

00:05:34.685 --> 00:05:39.700
Stripe, which handles all payment processing, takes approximately 2.9%

00:05:39.700 --> 00:05:44.740
plus 30¢ per transaction plus a 0.7%

00:05:44.740 --> 00:05:50.660
recurring bill fee on top of that. In total, you're looking at roughly 13 to 16%

00:05:50.660 --> 00:05:57.835
of your gross revenue to platform and process fees, which means on a $10 per month subscriber,

00:05:57.835 --> 00:06:10.550
you are taking home around 8 and a half dollars depending on the specifics. So if you are charging $10 a month and you have a 100 paid subscribers, you are generating a thousand dollars and taking home around 850.

00:06:10.550 --> 00:06:17.910
This is recurring revenue every month whether you launch anything or not. Now to reach a thousand dollars a month at $10

00:06:17.910 --> 00:06:36.410
per month, you need a 100 paid subscribers. At $15 a month, you need around 70. The math is a lot more approachable than most creators assume. But here's something I really need you to understand about the subscription model, and I say this because I want you to build something that actually lasts. The reality is retention

00:06:36.410 --> 00:06:48.330
is everything. A subscription business is fundamentally different from selling a one time product. When someone buys a course, for example, the transaction is done. When someone pays you a monthly subscription,

00:06:48.490 --> 00:06:54.745
they are making a decision to stay with you every single month. If you want to grow your income through paid subscriptions,

00:06:54.745 --> 00:07:10.990
you have to genuinely over deliver. You have to build something people will love being part of. A high churn rate of subscribers who cancel month after month will make it almost impossible for you to grow because you are not just trying to add new paid subscribers,

00:07:10.990 --> 00:07:21.125
you're trying to keep the ones you have. The publications that reach hundreds or thousands of paid subscribers do it by making the paid tier feel irreplaceable,

00:07:21.125 --> 00:07:50.225
something their readers genuinely can't imagine giving up. It should be a no brainer to be part of the subscription month after month, and that should be the standard. So if you are a creator who cares about this seriously enough to be watching this video, you are already thinking about it the right way. Now let's get to the question I get more than almost any other. What do I actually put behind the paywall? The way I think about it is this, your free content earns trust. Your paid content

00:07:50.305 --> 00:07:56.625
rewards it. Free content is where you teach the what and the why. It's your stories, your perspective,

00:07:56.625 --> 00:10:08.335
your frameworks in broad strokes. For coaches, consultants, experts, which is a lot of who I am talking to here, your free content is where you demonstrate your thinking, you build credibility, and you give people a genuine reason to stick around. Think of it this way. Your free content says, here's how I think. Here's what I believe. Here's what's possible. Your paid content says, here's exactly how to do it. Your paid content is the how. It's the step by step guides, the templates, the frameworks people can actually apply right now. Prompts, tools, resources that would take someone hours to piece together on their own, distilled into something that they can use immediately. At Writal Scale, our weekly rhythm looks like this. Every Monday, we publish a free podcast episode available to every subscriber, but we also publish a free post each week. Usually, one of our YouTube videos embedded and written out as a full Substack post. That way subscribers get the value directly into their inbox without having to go anywhere else. We also go live on Substack at least once a week, either a live stream with the whole Ripe Build Scale team with me and my cofounders, Philip and Yari, or one of us is interviewing a guest or one of our students to share their best practices. And on Fridays, we publish our paid post. This is usually a workshop, a deep dive how to, or something very actionable that paid members can put to work right away. We have two free touch points, one paid only piece, and at least one live session every week. And that rhythm keeps the free audience engaged while making the paid tier feel like a no brainer. And here's the principle behind all of this. The more value you deliver at the free level, the easier it becomes to convert free subscribers into paid ones. And it's not because you are wearing them down, but because they've seen enough of your work to trust that whatever is behind the paywall will be genuinely worth it. You don't have to sell them on the paid tier anymore because they are seeing the value upfront. Now let's quickly talk about pricing because this is where most new creators either leave money on the table or they overthink themselves into paralysis.

00:10:08.335 --> 00:10:47.710
So let's make this simple. For most publications in the early stages, a monthly price in the 7 to $10 range with an annual option at roughly 2 months free is a reasonable starting point. You don't want to price your paid tier at $5 a month. The conversion rate between five and ten is not dramatically different, and you're cutting your revenue in half. People who are ready to pay for a newsletter are already past the stage where they ask themselves if they're willing to invest money at all. And the jump from 5 to $10 is not the barrier that you might think it is. Now pricing also reflects your positioning. And as your publication matures and your reputation grows,

00:10:47.710 --> 00:10:54.350
your price can grow with it. At Rightbill Scale, we intentionally charge $20 per month and $85

00:10:54.350 --> 00:11:11.095
per year because we are not competing on price. Our publication has years of consistent publishing behind it, a rich archive of paid resources, and an audience that knows exactly what they are getting. We have basically earned the right to price at that level by growing to over 45,000

00:11:11.095 --> 00:11:29.900
subscribers and more than 1,600 paid members. Our positioning in that sense is deliberate. We don't want to have a cheap monthly tier. Now before I get into the bigger picture here, if you want to get your Substack set up the right way and in a way that's actually built to convert free readers into paid subscribers,

00:11:29.900 --> 00:11:47.255
I have put together a free resource called the Substack Bestseller Workbook. It's a PDF guide with setup checklists and the strategy guides to help you launch and grow the right way. You can find the link to download it for free in the description box below. Now let's talk about how paid subscriptions

00:11:46.840 --> 00:12:04.525
actually fit into the full picture, and I want to be fully transparent here because the most useful thing I can do is give you a real view, not just the exciting one. At Rightbill Scale, less than 10% of our total revenue comes from paid subscriptions. Subscriptions. We currently generate more than $50,000

00:12:04.525 --> 00:12:20.390
a month as a business and subscriptions are a meaningful piece of that, but they are not the whole thing. We also have courses, coaching programs, and digital products that go way beyond our paid tier. But here's what I want you to understand about why the paid tier still matters enormously

00:12:20.390 --> 00:13:02.425
even when it's not your primary revenue stream. Our paid subscription is the first step through the door. A significant number of our high ticket coaching clients and core students started as paid subscribers. They wanted to see what it felt like to work with us before committing to something bigger. They read our posts. They experienced our live sessions. They got a real taste of what our work looks like at a deeper level. And that made the next step easy because it's much simpler to move someone from a paid subscription to a higher ticket offer than it is to convert a cold subscriber who has only ever seen your free content. I like to think about the paid tier as a trust accelerator.

00:13:02.425 --> 00:13:38.950
Once someone has paid you, even a small amount, the relationship is fundamentally different. They have decided that your work is worth investing in, and when you consistently over deliver at that level, moving them deeper into your world becomes a natural next step, not a sales push. And there are publications that run entirely or primarily on subscription revenue. It's a completely legitimate model. And for the right creator in the right niche, it's a very powerful one. But I would be doing you a disservice if I didn't tell you that building to 6 or 7 figures through subscriptions alone takes time, real consistency,

00:13:38.950 --> 00:14:05.330
and a paid tier that earns its renewal every single month. What I would actually recommend, especially early on, is this. Don't try to build five revenue streams at once. Focus on one or two. Go deep and let them stabilize before you layer anything else on top of them. If you are starting out with a paid tier, make that the priority. Grow your list, deliver consistent value, and give your paid tier the time it needs to actually compound.

00:14:05.410 --> 00:14:32.465
So if this has you thinking seriously about launching a paid tier, here's how I would approach it practically. First, don't launch paid until you have a consistent free publication. If you are publishing regularly and people are actually opening and engaging with your work, that's your signal that there is enough trust to introduce a paid option. Launching paid to a cold or disengaged list is the fastest way to get a disappointing conversion rate that makes you want to give up entirely.

00:14:32.790 --> 00:14:43.590
Second, when you do launch, be very specific about what paid members get. Don't say things like exclusive content. This could mean anything. Be specific.

00:14:43.590 --> 00:14:48.790
Something like every Friday, paid members get a hands on workshop and prompts

00:14:48.845 --> 00:15:07.580
can use immediately. Specificity is what turns a free subscriber into a paying one. And number three, give it time. Paid subscription growth is slow in the beginning and then it compounds. The publications that quit after a few months of low paid conversion are usually the ones who were just about to see things

00:15:07.740 --> 00:15:47.700
start to move. The opportunity is real right now. The model works. The platform works. And the earlier you build it properly with the right content rhythm, the right pricing, and real value behind the paywall, the sooner you will see that compounding growth. It took us way longer to get our first 500 paid subscribers than it took us to go to 1,600 where we are right now. And now at this stage, the growth just keeps compounding because the trust is there, the fundamentals are there, and our content works in our favor. Now paid subscriptions are genuinely powerful, but as I mentioned, they are just the starting point. If you want to see exactly how we have built our substack business infrastructure,

00:15:47.780 --> 00:16:00.495
the digital products, the courses, the model that takes you well beyond the paid tier, watch this video next where I break down five ways to make money on Substack without relying on paid subscriptions

00:16:00.495 --> 00:16:02.015
at all. I'll see you there.