Authors avoid Substack tax

Substack, the once popular news platform, is losing a lot of writers to competing platforms that most people have never heard of. Just last month, The Anklerone of Substack’s most popular publications, left behind by a platform that gives it more control over its site. Others who have left Substack over the past year have voiced similar complaints and cited the platform’s increased focus on social features and a pricing model that puts their business in jeopardy.

Substack experienced a talent drain in 2024 linked to the inclusion of a Nazi newsletter platform, but now it’s not just the nature of the hate speech platform that’s driving creators away.

Sean Highkin, creator of NBA-focused publishing Rose Garden Reporthe recounts Verge that he made “more money” after switching from Substack to Ghost last April. “When I first joined, [Substack] it pushed me a lot and exposed me and brought a lot of people into me, which led to good growth,” Highkin said. “But when I wasn’t one of the ‘hired new talents’ they could play, they stopped showing me and I saw my growth slow down.” Highkin now pays $2,052 a year for Ghost and an add-on called Outpost, compared to $4,968 a year for Substack. Rose Garden ReportThe number of subscribers has grown by 22 percent since the end of 2024, Highkin said.

It’s the same story for creators switching to other platforms like Beehiiv. Matt Brown, creator of Extra Pointscurrently with 71,000 subscribers, it moved from Substack in 2021 and finally to Beehiiv, where it saves thousands of dollars a year. “Given the size of my publication right now, I would have to pay Substack over $25,000 a year in costs,” Brown said. “I pay Beehiiv about $3,000-ish.”

The Ankler – a popular publication about the entertainment industry – announced plans to leave Substack for Passport, a platform created in collaboration with the owner of WordPress.com Automattic and Tactics founder Ben Thompson. “This change marks a defining moment in what has been going on: moving beyond books to a fully integrated media company, now brought together in a single, easy-to-navigate home,” The AnklerJanice Min and Richard Rushfield wrote in a blog post explaining the change.

Min echoes this in a statement to Oliver Darcy’s The situation newspaper, saying The Ankler “It required more flexibility and control across products, revenue, and audience relations than a platform [Substack] it allows you.” But The Ankler it’s far from the dominant publication or newsletter that Substack has switched to in recent months. Last October, Cultural Studies Creator Anne Helen Petersen moved from Substack to Patreon, saying: “I didn’t want to be on a platform that was constantly—and not subtly—improved.” The situation also reports that The BulwarkMehdi Hasan Zeteoand Emily Sundberg’s Feed me “quietly browse” to another platform.

Substack was launched in 2017 as a platform that allows authors to create their own newsletters and manage paying subscribers. Unlike some of its larger competitors, Substack takes a 10 percent cut of gross subscription revenue. That tax may not seem huge at first, but it quickly adds up as creators gain subscribers and start charging more for subscriptions. A calculator on Substack’s own website estimates that for a newsletter that charges $10 a month for 400 subscribers, the total monthly cost — including a 10 percent platform cut and credit card processing fees — can add up to $636. That cost jumps to $15,900 a month for 10,000 subscribers and rises to $79,500 a month for 50,000 members — about $1 million a year.

Many of Substack’s competitors charge a low monthly fee, instead of a commission. Ghost, an open source platform for blogs and newsletters, starts at $15 per month with 1,000 members for website creation, email newsletter capabilities, and custom domains. Beehiiv, a platform for creators with tools to launch a newsletter, website, and podcast, is free for up to 2,500 subscribers with limited access to certain features, such as a built-in ad network, while its other plans vary in price based on subscriber count. Someone with 10,000 subscribers, for example, would pay $96 per month for Beehiiv’s “Scale” plan. There is also Kit, a newsletter platform that offers a tiered pricing model similar to Beehiiv, which costs $116 per month with 10,000 subscribers in its “Creator” plan.

Pricing on Substack isn’t the only pain point for creators, as critics argue that it also locks authors and subscribers into a closed ecosystem. First, Substack has limited integration with third-party applications, leaving authors with a set of built-in platform tools that may not have everything they need. It has added several new features over the years, including tools for podcasts, videos, and social media-style features like DMs. But it sparked controversy earlier this year with its new TV show and merger with prediction market Polymarket.

Creators must also contend with the platform’s limited customization options that can make it difficult to stand out in a sea of ​​other newsletters. Substack pastes its logo at the bottom of newsletters, too, while “.substack.com” even appears on the creator’s website address if they don’t buy a custom domain.

Meanwhile, rival services like Beehiiv and Ghost offer deeper customization options. In interview no The VergeBeehiiv founder Tyler Denk likens the platform to Shopify, rather than Amazon, as it gives creators the tools and infrastructure to build an audience without attaching their brand to its members’ websites. “We don’t want to be praised for the work of our content creators,” Denk said The Verge. “Shopify powers and builds millions of websites and businesses for these merchants, and you wouldn’t even know you were on a Shopify website, which is kind of the point.”

Substack is also investing heavily in building its discovery and recommendation features, and while that may help some creators build an audience, it adds more pressure to participate in writing tweet-style “Notes” to appear in the user’s algorithmic feed. Users who “follow” an author through the subscriber notes feature in their newsletter, too. This may benefit Substack’s engagement, but it is only beneficial to the authors if they get a new subscriber to it.

That’s because Substack owners can only send subscribers – not followers – when they leave the platform. Substack founder Hamish McKenzie disputes claims that the platform is a “walled garden,” saying that “no walled garden can allow you to remove your mailing list, content, and even payment relationships at any time.” But he also acknowledges that this portability doesn’t extend to followers, saying Notes is “a growth engine that helps you get subscribers, that you can send them.”

Additionally, Substack began allowing creators to enable in-app payments in its iOS app, but Apple handles these purchases — not publishing — and charges a 30 percent commission. Creators who leave Substack cannot take their Apple-based payment information with them.

“We’ve always believed that creators should have their own relationship with their audience, including the freedom to move if they want,” said Hanne Winarsky, Substack’s head of New Media, in an emailed statement. “At the same time, there are many examples of publishers and authors who have returned to Substack after exploring elsewhere, including SemiAnalysis, Glenn Greenwald, and Joe Posnanski, to name a few.” Substack is working to expand its platform into other markets, too, with paid subscriptions for UK figures such as Charli XCX, Jamie Oliver, and UK Prime Minister Keir Starmer surpassing 500,000.

Platformer creator Casey Newton, who left Substack in 2024, says that while the book saves money for Ghost, “the most important thing is that we have a home on the open web that we control, and any anti-creator changes that Substack is forced to make in the future to live up to its valuation will not affect us.”

Another high-profile departure may not mean the end of Substack, but it may signal a shift that positions the platform as a jumping off point for publishing, rather than a permanent home. However, the rise of competing platforms can make it very difficult to find new Substack publications that don’t want to be reduced to just that: Stacks.