How to Make Money on Substack: My $267K First Year, Broken Down

You make money on Substack primarily through paid subscriptions — readers paying a monthly or annual fee — plus founding tiers, and, if you’re strategic, the services and products your newsletter sells for you. In its first year, my publication Make Writing Your Job reached $267,000 in gross annualized revenue with 1,900+ paid subscribers out of 42,000+ total — and became a Top 20 Business bestseller on Substack. No paid ads, no existing celebrity, no venture funding: a laptop and a publishing schedule.

Here’s the honest breakdown of how the money actually works.

The revenue formula (it’s simpler than you want it to be)

Newsletter revenue is three numbers multiplied together: free subscribers × conversion rate × price. Mine converts roughly one in twenty free readers to paid. That means every lever matters — double your free list, your conversion rate, or your price, and you double revenue. But the free list is the lever with the highest ceiling, which is why I always point writers to growth before monetization.

What Substack takes

Substack is free to use and takes 10% of your paid revenue, plus payment processing (Stripe’s standard cut, roughly 3%). So a $100,000 paid-subscription year nets out to about $87,000 before taxes. That 10% stings at scale — but you’re getting the recommendation network, hosting, payments, and an audience of readers who already pay for newsletters. My take on that trade-off is in Is Substack Worth It in 2026?.

Revenue stream #1: paid subscriptions

The core engine. A clear paid promise, strategic paywalling, and regular (yes, regular) upgrade asks. I wrote the full conversion playbook in How to Get Paid Subscribers on Substack — it covers paywall placement, launch sequences, and pricing psychology, so I won’t repeat it here.

Revenue stream #2: founding tiers

Substack lets readers pay a higher “founding member” price — and a surprising number will, especially if you attach something personal: a call, a manuscript review, early access, a thank-you in print. Founding tiers meaningfully raise your average revenue per subscriber without adding publishing workload.

Revenue stream #3: the newsletter as storefront

This is the part most “make money on Substack” articles miss: the newsletter doesn’t have to be the whole business — it can be the front door to one. My newsletters send readers to my books, and my visibility on Substack brings me Substack consulting clients and ghostwriting work. A few thousand engaged readers who trust you is a client pipeline most businesses would kill for. Even at a fraction of my subscriber count, this stream alone can out-earn your subscription revenue.

Revenue stream #4: serialized and creative work

Fiction writers, this one’s yours: serialization is having a genuine renaissance on Substack. I publish serialized fiction on my second publication, Sutoscience, where an unfolding story gives readers a reason to subscribe (and upgrade) that a static archive never will. The same applies to any sequenced body of work — a curriculum, a challenge, a book written in public.

A realistic timeline (read this before you quit your job)

Year-one six figures is the exception, not the promise — I came in with a decade of professional writing experience and an existing body of work pointing at my newsletter. A more typical honest arc: months 1–6 building the free list and cadence, going paid somewhere in months 3–9, and reaching meaningful revenue — a few thousand dollars a month — as the free list crosses into five figures. Slow is normal. Compounding is real.

The math for your newsletter

At $10/month: 100 paid subscribers ≈ $12,000/year gross. 500 ≈ $60,000. 850 ≈ six figures. Work backwards: at a 5% conversion rate, six figures means roughly 17,000 free subscribers — which is exactly why the growth playbook comes first and the paywall comes second.

If you want help building your own version of this — positioning, launch, paid strategy, the whole engine — that’s what my Substack consulting is for. It starts with a free discovery call, and I only take on newsletters I genuinely believe can work.