How Lenny Rachitsky earned $65,000 in his first year of writing
We invited Lenny Rachitsky, creator of Lenny's Newsletter, to host a workshop on how to launch a paid newsletter. Read on for Lenny’s learnings around how he grew his early subscriber base, why he decided to launch paid subscriptions, and specific tactics for going paid.
This transcript has been lightly edited for readability. You can watch Lenny’s talk in the above video and check out his slides here.
Takeaways
Deliver consistent value. If you create value for people, they will naturally want to follow you, subscribe, and share their newsletter with friends.
Don’t be shy about sharing. Find out where your audience is and try to get in front of them. Share your newsletter on social media (especially Twitter). Write guest posts. Get featured on podcasts. Reach out to influencers. Try ads. These strategies can all help you attract readers.
Commit yourself to the long-term. Your newsletter audience won’t grow overnight, so don’t feel disappointed if your numbers don’t meet your initial expectations. It’s just the beginning of a longer journey. Growing your revenue usually happens gradually – but when you look back, you can see your growth and feel proud.
I write Lenny's Newsletter. It’s a weekly newsletter that's an advice column for product and growth people, and people dealing with working and stress at the office. I launched about a year ago. I launched paid a few months ago. I'm at about 15,000 free subscribers, 500 paid, and it's making me about $65K a year before fees.
How I started writing my newsletter
I spent seven years at Airbnb as a product manager. After I left, I was just trying to figure out: what did I learn from my time at Airbnb, and what can I take to my next project or startup, or whatever I end up doing?
So I started writing an Evernote, and ended up turning it into a Medium post, which ended up doing extremely well – much better than I expected. It got into the top few hundred of Medium posts. Medium featured it. The CEO of Airbnb, Brian, shared it within the company because he was excited about it.
It ended up driving a bunch of traffic, and made some money, which I didn't know was a thing on Medium, but that was a little surprising. Two things came out of this for me. One is maybe I have some stuff that I could share that people find useful, and two is you can make money writing. That got the bug in me to do this a little bit more.
So, I kept writing. I ended up writing five other posts on Medium about product management and performance reviews. Around this time, I was advised that I should not be using Medium and I should be using Substack, because you have a direct relationship with your audience. You build up an email address list that is useful for whatever else you end up doing. In June I moved to Substack, and I basically just copy and pasted everything from Medium and just started there.
In parallel, I was tweeting things, the same things I was writing about: just little nuggets of insights that I've picked up about performance reviews, career ladders, things like that. I started to build a Twitter audience in parallel, and that ended up being really important for the growth of the newsletter.
Build your audience by going where they are
I started the Substack, and then I was like, “Okay, maybe I should tell people I have this thing. I don't actually have a newsletter yet, it's just a place I'm writing.” So I shared on Twitter: "Hey, I have a Substack. Check it out if you want. I don't have any plans for it, but it's there." That got a little love on Twitter from people that have a nice following, and so that led to my first 500 subscribers, basically, that tweet.
Then I did a guest post on another newsletter that has essentially my target audience subscribed to it, and that led to another 500 subscribers – in total, that got me to 1000 subscribers.
Then I decided, okay, let me just try an actual newsletter that's weekly and see how it goes. My idea was: what if I just do an advice column, kind of what it is today, for product managers and growth people and people managers, inspired by Julie Zhuo, who's been doing the same kind of thing for designers. I tweeted: “I'm going to try this thing, see how it goes,” and again people on Twitter got excited about it and shared it, including Julie, and that got me another 500 subscribers.
At that point, I just started writing every week. Every week for three months, at this point. I answer three questions a week, and kept building, and did another guest post that made me look really cool, in another blog/newsletter that is a lot of my target audience. That got me to about 3000 subscribers. A little learning here is guest posts are effective, because they allow you to get in front of your potential audience in a really easy way.
Guest posts are effective, because they allow you to get in front of your potential audience in a really easy way.
Mix up your posts
In parallel, I was working on this really deep post that took hundreds of hours of work and months of time to put this together. It ended up being an eight-part newsletter post about how to build a marketplace business. That was the first big effort I put into the newsletter, and that led to about 2000 subscribers. The lesson there is hard work pays off.
I was at about 5000 at that point. (Zooming into the future for a moment, if you look at my entire growth trajectory, 50% of my growth came from just two posts, which is crazy.) So, on the one hand, big, epic posts are really powerful. On the other hand, the other 50% came from the everyday, every week regular posts.
And so, I don't think the answer is just do these big, epic posts, because they take a lot of time. I think the answer is mix them up. Try to do straightforward, regular posts, and then in the background, I would suggest working on something really epic that takes a while to get through.
Going back, I launched that marketplace post, and just kept writing every week again for another three months, and got to about 9000 subscribers just through that.
You may be wondering, “Where are these people coming from? How do you get to 9000 subscribers by writing posts?” The story is, it's basically word of mouth, people telling their friends about it, posting to Twitter and LinkedIn and Facebook, and sharing it with their colleagues, and then there's a little bit of SEO that starts to happen here.
Create value for your readers
If you create value for people, they're going to want to follow you, pay attention to what you’re doing, and share with their friends. That is my secret tip for success: just deliver consistent value to your audience, and they're going to want to subscribe and pay and tell their friends about it. You can do that with a newsletter, you can do that with Twitter, you can do it in other places. It all comes down to just creating value for people.
If you create value for people, they're going to want to follow you, pay attention to what you’re doing, and share with their friends. That is my secret tip for success.
If you think about newsletters as a category, it feels like you're either trying to entertain your audience or make them smarter – so just make sure you're doing one of those really well. When I write my newsletter, I think about these three rules:
Make sure every post is very actionable and concrete. I'm very much in the “make people smarter” category, not the entertainment. So, with that, I'm trying to make it very actionable and concrete, because there's a lot of fluffy stuff out there, and there's a lot of free content, so you want to differentiate.
Only talk about things I know. If I don't know it, I look at an expert.
Add something new to the conversation. There's so much content out there. People are not going to pay attention if it's just the same old thing. This is exactly what's reflected back at me from reader comments, which tells me I'm on the right track.
How I launched my paid newsletter
The reason I went paid, when I had zero intentions to go paid initially, is because I finally had the confidence I could do this. I did 10 months of free and I was able to feel like, “wow, I could actually keep this up.” I was getting a lot of positive feedback. I was enjoying it. I didn't have a job at this point. I had taken some time off, and I was trying to avoid getting a real job if I could, so that's why I decided to embark on this experiment.
There were five steps that I followed to launch the paid newsletter. The first I just talked about, which was building an audience initially. There are plenty of newsletters that launch straight to paid, and I think that works for a lot of people, but I think it's a lot easier if you come into it with an audience that's already bought into what you're doing, that's already found value, and you're not just starting from scratch. And you'll see partly why, because a lot of your stuff is hidden now, and you can't share it because it's behind a paywall.
Five steps to going paid:
Build an audience
Decide on your price
Craft your pitch
Seed it with people
Watch what happens
Price your newsletter based on research and reflection
Pricing is a pretty complicated question, and I spent a lot of time thinking about it and talking to a lot of people. Here’s the advice I got and what I found important.
First, think about how much discretionary income your audience has. My audience is tech employees, and so they have higher earning power, and so they're going to pay more, so I upped my price.
An important element is: how valuable is this to people? Is it a painkiller? Is it going to solve a real problem for them, or is it just a nice-to-have? And then, just how unique is this? Can I get this for free somewhere else or from another newsletter?
I found it important to validate it with a few readers to see if I could find three people that would pay for it at this price with the pitch that I was crafting. I would recommend trying to do that.
I would also suggest trying to feel a little uncomfortable with your price. I think everybody starts at, “I'm just going to do $5. Why would anyone pay more than that? I'm going to get all these subscribers at $5, it's going to be great.” And the advice I got, partly from the Substack folks, is you want to feel a little uncomfortable with the price, because the economics of it actually work out so much better if you're charging even a few dollars more than you naturally.
I looked at the top 20 paid newsletters on Substack. Their prices are basically $5 to $50, across three categories of newsletters: news, insights, and entertainment.
It looks like entertainment and news sadly are at the low end of the spectrum, which are $5-10, and then insights are more like $10-50. That should help you figure out what price to set. I set mine at $15. I don't know if that was the right decision. It feels fine. I don't know if it would have been different at $10 or $20.
Craft your pitch in your launch email
Now you've got to figure out your pitch and convince people to subscribe. I found that it was important to have six parts for the pitch. It’s important to just remind people who you are.
Show your readers: What's actually changing? What do you get if you pay and not pay? Very tactical, concrete information, like when it's changing, why someone should subscribe, why subscribe now. That one ended up being really important. People get this email, and they're going to be like, “Okay, I'll check it out later,” and if there's not a reason for them to act now they're not going to necessarily do it. And then, answer the question of how to subscribe. Make it easy.
Points to address in your paid pitch:
What’s actually changing?
What do you get if you pay and don’t pay?
When is it changing?
Why should someone subscribe?
Why should they subscribe right now?
How do they subscribe?
In my newsletter, I found it useful to summarize at the top, just TL;DR, here's the most important things. What's changing, what you need to know, and why it's great, and then go into more detail later.
And then the FOMO piece, the “why now:” I gave people a 33% discount if they subscribed in the first 48 hours. It does impact your economics. You end up making a lot less than you think you would, because that initial flood is 33% lower than you expect. But it got subscribers in, and I think it's a good idea.
Seed interest in your paid newsletter
You want to think of your going paid as a launch, because it's a big event and it's a big deal. For me, I thought about: who are the people that my potential readers pay attention to?
I looked for champions of the newsletter that are really excited about it and supportive of it, and have a big following. I let them know ahead of time what I'm working on. I got their feedback, which ended up being really useful, just for feedback's sake, and then I gave them a heads up before I launched and after I launched, and that worked really well. My emails were simple, just like, “Hey, I'm launching this thing, if you're inclined, maybe share it.”
Create a launch plan
A couple practical things you want to think about are: there's a switch you need to flip in Substack to turn on paid, so don't forget to do that before you send out the email. And there are some things you want to set up ahead of time before you do that, like create a Stripe account, set your price, and things like that. Don’t wait until the last minute to check that stuff out.
When you do that, send your email, announce it on all your social media. Don't be shy about, “Hey, I'm trying this thing, maybe subscribe.” And then, pick your “influencers.” I put influencers in quotes because they're just regular people with a Twitter following.
Finally, I would say keep expectations low. Don't count on this to be exactly what you want it to be. This is just the beginning of a longer journey. You're going to be at this for a while, so don't be sad if you're not hitting some goal that you had.
Don't count on this to be exactly what you want it to be. This is just the beginning of a longer journey. You're going to be at this for a while, so don't be sad if you're not hitting some goal that you had.
I recommend putting together an actual launch plan that lists out day-by-day what you're going to do to make this successful, and who you ping, and what emails you're going to send.
When I launched the paid plan, it was very nerve-wracking, because you're putting yourself out there and asking people for money for something you've never asked for money for. Luckily, people really connected and were excited and shared it, and it did really well.
I got to about 200 paid subscribers the first couple days, and then I sent another reminder a week later with a little bit of social proof and a thank you to early supporters. Then I had a different discount – instead of 33% it was 20%, just to create still a little bit of why should I act now, and I think that worked. That got me to about 250 subscribers.
Looking at my subscribers that day, about 50% came from just that first week of launch. It's just a reminder of how important the launch period is, so it's important to really think it through.
Looking at my subscribers that day, about 50% came from just that first week of launch. It's just a reminder of how important the launch period is, so it's important to really think it through.
I found I got a big bump in free subscribers from that same time. I got a few hundred free subscribers coming in the day I launched paid, and I think it's because you convey value, and it's like, “this is really good, I guess, if people are paying for it,” and so people will sign up for it just to be a part of it, even if they're not paying.
So, I launched it, did some reminders, sent a post every week for the next three weeks, and then I had my one free post, which actually did extremely well, unexpectedly, more so than I thought. That's the huge bump at the end. That's a bunch of free subscribers and then 39 paid subscribers. The learning here is just once you're behind a paywall, assuming you still have a free post every once in a while, you want that free post to be extremely good, because that's basically how you're going to grow after you go paid.
Stay true to what you love
Especially once you go paid, people are going to want specific content from you and they're going to push you in certain directions.
I find that it's really important to always stay close to what you actually enjoy writing about, and not just do things because you have to do it, because you don't want to be pushed into creating a job for yourself that you don't enjoy. This is growing. It's not a “one day and you're done” kind of thing. This is an ongoing thing, so just keep at it.
It’s important to stay close to what you actually enjoy writing about, and not just do things because you have to do it, because you don't want to be pushed into creating a job for yourself that you don't enjoy.
A few things to consider before going paid
Going paid sounds like, “Great, I'm going to get paid, I'm going to make all this money, it's going to be amazing.” But here a few things that I learned afterwards that might be useful [to think about before you go paid].
Assume you're going to be doing this for a while. People buy yearly plans, and they buy yearly plans through the year – so there's not a point at which they run out. And so, you have to be ready to write for a long time, at least a year, and maybe forever. I don't know how you stop. You maybe have to stop accepting payment and then phase it out over the year. That's something to think about.
Make sure you have enough high-quality ideas and content. I found that writing for 10 months gave me that confidence.
Think about the take-home income you make. You might be like, “I'll do $5 a month, I'll get 100 subscribers, that's $5000. Or, 500 subscribers, that's like $5000 a month, that's amazing.” But you have to think about the Substack fees, Stripe fees, and then taxes. If you look at the number, $65K, I keep maybe 60% of that after all those things, so it's not as huge as it seems. But it's still money, and it's amazing, and I'm very thankful for it.
Consider how you're going to grow after you're behind the paywall.
Just make sure you actually enjoy this. You don't want to create a job for yourself that you're not enjoying, because what's the point of that? So just think about: Am I enjoying this? Do I want to do this for a year-plus? Always think about that.
For more advice on transitioning to a paid newsletter, check out our guide to going paid.
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