I was wrong.

A few months ago, I thought to myself…

“Are we in a newsletter bubble?”

“Surely people can’t be reading all of these newsletters???”

“Are people building real businesses behind their newsletters, or is this all just a front?”

Well, I was wrong to think those things.

Some context before I share why:

Last night, I attended a private dinner held by a16z that included about 60 creators, journalists, newsletter operators, etc.

Last week, I attended a creator event hosted by beehiiv & Google, with about 200 creators & newsletter writers.

And a few weeks before that, I hosted an event in LA for a bunch of creators from all different backgrounds.

And without a doubt, I can say that I was wrong.

People are building successful, profitable, and very scalable businesses on the backs of their newsletters.

But it’s not the original ad model that Morning Brew and The Hustle pioneered.

Here are my takeaways after having well over 100 conversations with creators the past few weeks.

1/ New revenue models

The traditional ad-based model seems to be dying (either because it’s getting more competitive to sell one-off ad slots or creators just don’t have the time/energy/resources to be constantly chasing advertisers every week).

I was shocked to learn that most of the super successful newsletter creators who I spoke to are actually finding different ways to monetize.

This ranges from sponsorship bundles (social, email, events) to consulting to long-term partnerships with tech companies to even building their own SaaS products and funneling people to sign up.

And they are finding it to be much more profitable than trying to sell one-off ads.

Allowing them to funnel a good portion of profits back into growth (paid ads, partnerships, events, etc.)

Very smart.

2/ Less of a focus on open rates

This might sound counterintuitive since open rates have always been a key metric that people harp on.

But more and more newsletter creators seem to be focused on creating highly shareable evergreen content that will be discovered in the future — sorta treating it like a blog.

Not as stressed out on getting a 40%, 50% or 60% open rate (because they realize if the post gets shared by the right people or is found later, once published, then it has the potential to be seen thousands of times more).

3/ LLM SEO

I’m not an expert when it comes to LLM SEO and don’t think any of us are (yet), but I got the sense that the majority of creators are using their newsletters to try and rank higher in ChatGPT and other LLMs.

This, along with social content, awards, speaking engagements, and online mentions.

I’ll be paying close attention to this one in particular.

4/ Team size doesn’t matter

I met people who had dozens of employees who work on their newsletter, and I also met tons of people who run it by themselves (or with a partner).

Funny enough, the ones who operated super lean seemed to be making the most money.

Only downside is key-man risk.

If they don’t do it every week, then it doesn’t get done, which could lead to burnout if they are juggling a bunch of other things.

But almost everyone seemed to love their niche and a sustainable cadence.

5/ “Own your Distribution”

We all know and understand this one.

But a bunch of creators seem to be getting increasingly more frustrated with the constant changes in social algos, lack of reach in their content, and the exhausting hamster wheel that comes with the entire process of building a social presence.

One creator said to me:

“I remember building a FB page to millions of followers, only for my organic reach to go down to 1%. I know this can and probably will happen to my X or LinkedIn audience that I’ve worked so hard to grow, so it helps me sleep better at night knowing that I’ve built my email list.

Email is still one of the few ways to truly own your distribution as a creator.

In closing, I was wrong.

Newsletter businesses aren’t dead — they’re just evolving.

And it’s really nice to see.

I hope you enjoyed this short post.

If you did, reply to this email and let me know what you thought.

(and if there’s something you’d like me to cover in a future edition, just let me know)

Cheers,

Ish 🫡

btw, you’d also like this…

in case you missed it, here’s my latest Internet Empires episode