Transcript

00:00:00 - Speaker 1: We both really, really like writing and are good at it, and care a lot about the written quality of the product, and we both also have this product DNA where we’ve built software products before, and we know how that works, and we’re trying to figure out if you put those two things together, what can you make?

00:00:23 - Speaker 2: Hello and welcome to Meta Muse. Muse is a tool for thought on iPad. This podcast isn’t about Muse the product, it’s about Muse the company and the small team behind it. I’m Adam Wiggins here today with Mark McGranaghan. Hey, Adam. Joined by our guest, Dan Shipper of every.

00:00:40 - Speaker 1: Thank you. Thanks for having me.

00:00:41 - Speaker 2: And Dan, I know you like me are quite a reader, reading anything good these days?

00:00:47 - Speaker 1: I am. I’ve been actually reading a lot. I also just have to say, like, the way that you do that intro, it feels so calming. I feel like I’m in good hands. I wanna like slow down and just bask in it a little bit.

Perfect. Yeah, but what am I reading? I just finished this book by John Green, who I love called The Anthropocene Reviewed, and John Green, he typically writes novels. I know him for his novels. He’s written a couple books called like A Fault in Our Stars, another book called Turtles All the Way Down, which have been really impactful for me, and this is the first series of his essays that I’ve read.

It’s basically a collection of essays. And the conceit is that in the Anthropocene, which is the era that we’re in right now, which is the era in which humans are affecting the environment. One of the central things that we do is we give reviews to everything. If you go on Google Maps or Yelp or whatever, everything in our world has like a review that boils everything down to between 1 and 5 stars.

00:01:43 - Speaker 2: Yeah, I always find it funny when you look up something like, I don’t know, the Atlantic Ocean or like an abandoned power plant or something like that, and there’ll be reviews in there, which are often hilarious to read, but yeah.

00:01:57 - Speaker 1: Yeah, it’s really funny. He opens it up by saying that he noticed that someone had given a park bench, like a 5 star review, and it’s like, what is that? What is that about? Why do we do that? And so the conceit of it is every essay in it is a review that boils everything down to between 1 and 5 stars of lots of things like sunsets or sycamore trees or bacteria or every single topic at the end of it, he’s like, I give sunsets 5 stars, and then every time he does it, it’s hilarious, but it says something I think really interesting and I just tore through it in like 2 days. It was really good.

00:02:30 - Speaker 2: Yeah, for sure. I feel like he’s got quite a personality as a podcaster. I think YouTube was even maybe where he got started, kind of classic blogger, but yeah, great observations on the world, but also, yeah, very poignant observations, but also just really funny, really entertaining, and so that makes it, yeah, easy to read.

I am at the point in my life actually, where there are many great books that have had a big impact on my life that are kind of a slog. But with being a busy parent and business owner and whatever else, I really appreciate something that’s just easy to read. It’s fun, it’s written in a way that it just flows smoothly and you can both get those great insights and widening of perspective, that is the reason why we consume media, especially things like long form books, but in a way that maybe it’s a little less costly in terms of your own personal activation energy.

00:03:22 - Speaker 1: I totally, totally agree. Like, there’s all those books where you’re like, I should really read this and I should really like it, but I’m just feel like I’m kind of out of gas, like, I don’t have the mental energy to do it, and then there are other books where you just kind of tear through it.

I just went through this whole series of books. I basically went through the ouvre of this guy Irv Yum, who’s like a psychiatrist, and he writes, basically what I would term therapy fan fiction.

And it’s so good.

I read like 5 books in like 3 days and I just could not stop reading it, and I just like finding those things sometimes as a refresher to all the heavy stuff that we end up thinking about and reading day to day.

00:04:00 - Speaker 2: Absolutely. Well, tell me a little bit about your background. You kind of come from maybe a more classic Silicon Valley tech entrepreneur background, but then you had this journey of being early as a kind of substack paid newsletter, and now you’ve got your business every, which is very interesting, kind of modern internet media business, writers collective has some elements of some of the small giants, the business stuff we talk about here, but yeah, tell us the journey that brought you here.

00:04:28 - Speaker 1: The journey that brought me here, so my background basically started in software, really in technology and software. I started programming when I was in middle school.

I read a Bill Gates biography and decided I wanted to start a Microsoft competitor, so I learned Basic, and I was going to build a Microsoft competitor called Megasoft, and Didn’t actually end up ever writing an operating system, although I really wanted to, but just fell really in love with that whole thing because I was super interested in business, and the only way to really start a business when you’re in middle school, is to be able to program cause that’s the only way that you can start a business where the only cost is your time.

So, built a lot of apps, started with apps for BlackBerry in high school.

And then the iPhone came out and I started building iPhone apps.

That’s kind of how I paid for gas and food in high school, and then in college, finally met people that were also programmers and were also into like starting companies and stuff like that, and started my first company, it’s called Firefly.

And there was an enterprise software company we built co-browsing, which is kind of like screen sharing, but all of that happens in a web browser, and we applied it to customer service, so built that for several years, primarily bootstrapped, so you’ll notice like a thread in my life is kind of this whole bootstrapping type mentality, and then sold it to Pega, which is this big public enterprise software company, right as I was coming out of school, and that was really, really good experience.

I learned a lot about building a business. I ran the firefly business inside of Pega for a little while, and then I spent the next couple of years just like trying to figure out what I wanted to do with my life.

00:06:06 - Speaker 2: And I think this may have been the point where we met and I think what you described to me at the time and you had just started the super organizers newsletter and you were starting to interview people.

Correct me if I’m wrong on this, but what I remember is you’d reached out to me and said, you know, hey, can we chat? I’m working on this kind of interview newsletter and the way you described it was, well, you didn’t exactly know what was next, but you figured talking to lots of really Interesting, accomplished, productive people might lead you to that somehow, and it really resonated with me because I was working on ink and Switch at the time, which in some ways had a similar origin after my sort of big career success in the form of Furoku and that ending and me trying to figure out what was next.

Starting a research lab was a way. To kind of maximize my optionality, stay in divergent mode, not pick a thing to work on, basically, and eventually that did turn into something that was pretty focused around some specific goals, but at least in the beginning, the point was to do a thing that was incredibly exploratory and didn’t like tie me down to one very specific path.

00:07:10 - Speaker 1: Yeah, totally. And I definitely did that and the newsletter that I started Super Organizers was part of that.

I think like, I went through this phase where I was writing a novel, which I wrote like 4 drafts of.

I did tons and tons of other like little software projects and worked with a bunch of different people and had a bunch of different ideas that I was excited about.

And eventually, I started this newsletter called Super organizers, cause I realized that I was just super interested in productivity and note taking.

I’d had a bunch of ideas.

In the, I would say like tools for thought space for a long time, kind of stemming from my first company where I just felt like I was this information processing machine, but my tools for processing information were like not great, and I was really interested in building software to like make that better.

So when we talked to you, I basically started super organizers and the conceit for me, the reason for starting it was I wanted to build a productivity software company.

But I didn’t exactly know 100% what I wanted to build, so I decided, hey, I’ll start a newsletter. I’ll interview like really smart, interesting people about how they think about their own productivity systems, and I’ll use that to inform the product I make.

I’ll write the interviews up and get an audience, but like the real idea is it’s a way for me to do customer interviews with smart people.

And so talk to you, published a bunch of interviews with a bunch of really, really smart people, and along the way, I just actually decided or found that people loved the newsletter, and loved the writing, and I could build a business with it, and that was very exciting to me and not something that I’d really considered before. So it kind of put me on this path of like, how would I do this as a business instead of like actually just going and building software cause I love writing, I love business, and this is a way to put them together.

00:08:56 - Speaker 2: Another interesting thing here, I feel like is the timing that sort of email newsletters were on the rise, maybe as kind of a replacement for blogs, RSS. I’m not sure exactly. Substacks obviously a big part of the story. You were early there and sort of the concept of paying a subscription for an email newsletter was something that I feel like kind of came out of nowhere, but then suddenly was getting a lot of traction and you were, I felt like very much in the right place at the right time to take advantage of that.

00:09:26 - Speaker 1: Yeah, it was a really, really interesting time. It was that wave about a year and a half ago where this started to really pick up that I was running super organizers and starting to think about this as like a business, and at the time I didn’t really understand that it was becoming this like trend, and it was kind of at that time that I started talking to my co-founder Nathan Behez.

We’ve been friends for a long time, and we just both, at the time he was the first employee at Substack, so he was really feeling it and like, had been on this train for a long time and kind of knew that this was coming, I think in a lot of ways, and we started talking together at the time he was no longer at Substack.

And we started talking about what could we build together, what we do together, and what that turned into is us kind of thinking about what would it look like to build a media company in this kind of environment where solo paid newsletters are becoming a thing, lots of writers are leaving their publications to do it on their own, and there’s a lot of benefits to that, but there’s also a lot of drawbacks, both for writers and for readers, that I think People maybe aren’t as sensitive to right now, but will become more and more important over time.

And so we started thinking about how do we build a publication or a media company under this kind of environment, and we knew we wanted to build something that had a group of writers that was covering topics that we’re most interested in, which is basically topics in tech, topics that are about business, but that, you know, when you read them, you’re both entertained and you kind of feel like you’re getting something out of it. I would put this podcast in that kind of category too, where you feel like you’re getting something that is going to help you think better, make better decisions, be better at your job in some way. So we’re kind of like toying around with what is that kind of a media company look like? How do you build that? and how do you build the supply of writers and create incentives for them to all be in one place when there’s so much incentives to be on your own, especially if you’re someone that can write well enough to do that. And so, that’s where we started to come up with this idea for a writer collective, which I can explain, and start on this journey of like taking all these individual writers who could really write on their own in this environment and figure out how do we actually write together because in a lot of ways that’s better.

00:11:34 - Speaker 2: Well, that brings us really nicely to our topic today, which is, let’s say, building a media empire in the internet age, or just simply creating a media brand, an internet era media brand.

And I think one of the things that was maybe eye-opening for me, watching your journey on this was thinking about what I would call classic media brands, I guess that’s the way to put it. Something like magazines and newspapers like The Economist is one that comes to mind, or The New York Times, maybe if you go more to entertainment, you have something like Disney, there’s one that I’ve read quite a bit about just because, yeah, Walt Disney is a really interesting entrepreneur and everything that’s been created there and how that company has evolved over time, is also really interesting.

But I remember you telling me a bit about some of these what I would now call I guess like internet native media brands, and that’s something like Vox, for example, or Vice. So both of these to me are very evocative of like I know instantly what their voice is and what their kind of view on the world is, but they’re not one single media, right? Like you know, the Economist is a magazine. And so it’s writing, and that’s pretty much it. And then they have, I don’t know, data visualizations and things, but Vox, well, they have articles on their website, but they also have a bunch of podcasts, and then they have some YouTube videos, but they also have like a Netflix series and there’s definitely something that unites all of them, but at the same time they feel different to me in some ways from these more classic brands.

And then you’re on this journey of bringing your perspective as a software entrepreneur, I don’t know, maybe it’s a software is eating the world kind of thing to, OK, how does the internet change media and especially if you’re doing it more at this indie level and yeah, as you said, like, how writers and publications and stuff even gets distributed to people, all of that is changing, which maybe creates confusion. It’s hurting some of these existing classic publications, and people have talked about the death of journalism and that sort of thing, but that it also creates new opportunities.

00:13:35 - Speaker 1: Yeah, totally. There’s a lot in there, there’s a lot to unpack.

I think on the kind of like traditional media side, the way it has worked for a long time is, yeah, you have an editor at the top that is kind of assigning stories, is responsible for the voice and the vision of the publication, and writers kind of like slot into that more or less, and the publication is.

Well, for, they pay you a salary, they give you an editor, they give you kind of like support, you kind of know what to expect. And a lot of cases, they don’t even give you a salary now because it’s too expensive, but like they give you some money and the publication’s job is to go figure out how to get distribution.

Sometimes it’s like magazine stands. Now it’s on the internet.

And if they get more distribution and then can sell a lot of ads or can sell more subscriptions, the writer doesn’t get paid more necessarily.

And so they kind of like make the difference there.

And I think for a lot of those non-internet native publications, it’s been a difficult transition to the internet because the style of writing is not really native to what gets shared on the internet, like a headline. In The Economist is usually not something that people are gonna want to like click on on Twitter, but it makes a lot of sense in the context of the Economist, where you’ve already bought this thing and you’re kind of like going through the full piece of content and you kind of like reserve time versus like, you’re just seeing something in the stream of information and you kind of like click it, cause it feels really worth your time like right now, it gives you that little dopamine hit.

00:14:58 - Speaker 2: And I think the bad version of that or the immediate interpretation of this is not a good thing. We might have talked about this a little bit with Tobias back in our social media episode, but sort of in some ways the clickbait headlines of the internet era are all throwback to kind of yellow journalism where because every newspaper was sold on the street corner and there’s just some kids saying.

Extra, extra, read about, you know, war declared and blah blah blah, and they’re just very incentivized to have these flashy headlines that would often just be completely false. And the subscription model where you essentially buy a year’s worth of whatever newspaper it is that’s delivered to your door, they’ve already got your money, they’ve already got your attention. So now it’s more about this long term value building trust and giving you really good and useful information, they don’t need to catch your attention with flashy headlines.

00:15:48 - Speaker 1: Right, totally. I think your history there is really good, and I think that’s what the internet native brands that we know have figured out how to do is they have writers and editors that have grown up with the internet and know what is going to catch people’s eye. And so the way that they have built their brands is to try To amass large audiences, usually by getting them from existing big social platforms like Facebook or Twitter, and then still advertising against those audiences and they’re trying to get as big and serve as many people as possible, and it has worked, it hasn’t worked like as well as I think a lot of investors hoped when they first invested in them in like 2012 or 2013 or 2010 because These brands are still really subject to platforms, and when Facebook changes its algorithm, a lot of them have had a lot of trouble, and they’re still around, like Fox and BuzzFeed and all those companies are still around, and I think they’re probably going public soon, but it’s been a really tough road, basically.

And I think that you’re right, people are feeling like a lot of those brands ended up. Doing things that are more clickbait, and so you end up losing trust in them and you don’t feel like maybe they’re doing as high quality stuff as you want, and I think that has been one of the reasons why we transitioned to subscription media is people feel like they’re developing a relationship with a specific writer that they like, that is not feeding them just kind of garbage that they have to write in order to get them to pay attention and get the algorithms to put it in front of them. And I think that’s a really interesting move. I don’t think it at all solves the problem. I think you can still be kind of outrageous and not fact-based as a subscription writer, but it solves some of the problem for sure. If we write something controversial, it definitely still gets views and we can convert those views into subscribers. You still have to think about top of funnel if you’re a subscription writer, you do.

00:17:39 - Speaker 2: How do you find this as a business owner where you know you need to sort of justify your existence and make sure you can keep the lights on and everything like that? Do you find yourself compelled towards kind of the controversy, clickbait titles just a little bit? I mean, I don’t think you’re very much in that vein, but do you find yourself with the mental debate of we could title this this way, and I think that would get a bunch of like outrage posts, and I know that that’s worth $10 to me because I know how that converts, right?

00:18:09 - Speaker 1: Sometimes, I think for us, I’m pretty probably afraid of controversy.

I don’t really like outrage, so I’m not tempted to. I think some other people that I work with are a little bit less afraid of that and are a little bit more tempted to do it, but I think that there are definitely incentives around what kinds of topics we cover, what we think people will pay for, and those are not necessarily the same as what we think we should cover in every single case, and like a really, really easy example is We know if we cover crypto, people are gonna read it and probably buy it. It’s the most interesting thing that is happening right now to most people, and it’s just hard to find writers, and I think we have them, which is really great, but it is actually kind of hard to find writers that cover crypto in a way that feels actually balanced and responsible.

And if we just found someone who was more of like a crypto, just a pro crypto, like all the way person, like really, really breathless, I think we would get a lot of readers and subscribers. We just would. It would sacrifice our brand and it wouldn’t be the thing that we want or care about, but it would work pretty well.

And so I think that the trap that it’s easy to get sucked into is thinking about what is everybody else covering that’s in the ecosystem at our level of the value chain, what is everyone else covering. And why aren’t we doing more of what’s working for other people? And that’s a really quick way to just kind of court disaster, because you can never do anything actually interesting or that actually moves the conversation to a new place, if you’re just trying to figure out what everyone else at your level of the information value chain is. Chasing trends. So we try not to get sucked into that, but business incentives wise, it can feel like the local incentives are to do more of that. Hm.

00:19:56 - Speaker 2: And maybe we can talk about the writers collective part of things. You entered that a little earlier, so we talked about the sort of the sub stack thing, the paid newsletters. Something I like a lot about this overlaps really well with what we’re doing with the muse business, which is this kind of indie thing, which is if there’s a smaller team, especially.

One person, obviously it’s one writer, but even if it’s just a few, where you feel a very kind of personal relationship to them, you know, their personality and style, and it feels like a much more human transaction somehow you want to support this one person or a small set of people than sort of the big faceless corporate monolith.

And so that’s part of what SubStack potentially offers when you see some of these writers go off and go indie. I know I like this one writer. I like their take on the world, and I want to support them, and therefore it sort of has a farmer’s market vibe a little bit there, but obviously there’s many downsides to kind of being independent like that. How do you see the writers collective as fitting into that equation?

00:21:00 - Speaker 1: So what a writer collective is, or the way that we defined it is we’re trying to be for writers somewhere between having your own sub stack and working at a big media company.

So on the big media company side of things, what we try to provide for writers are things like distribution to an audience, so you’re not just fending for yourself, trying to get views on Twitter, you have an organization that’s going to put your stuff out to readers and find readers for you.

We give you an editor, so you’re not just kind of alone trying to turn out as much content as you possibly can. There’s someone there who can help you think about the sentences and the ideas. You have a group of other writers, so it’s not all on your shoulders, you know, Ben Thompson writes 4 days a week and it’s all him, it’s not all you in this model.

00:21:41 - Speaker 2: Yeah, interesting there, Ben Thompson, I think is also sort of a prototype or an archetype in this. He writes tracheri. I know I’ve linked to their articles a number of times in our show notes. He’s been doing this quite a while, but yeah, kind of independent business, charges money directly through his own website, and yeah, apparently it’s just able. To continue producing really good content essentially every day and has done so for I don’t know what, better part of a decade or something like that. That’s obviously a pretty remarkable case, but it has shown, I think he served as a role model for a lot of the modern email or kind of independent writer, independent subscription paid writers.

00:22:18 - Speaker 1: Right, totally. And so what we want to do is give people those benefits that Ben Thompson doesn’t really have access to, and give them a lot of the benefits that they get if they write their own substacks.

So we want to give them more of an ability to write stuff that is their own voice and vision, not something that they have to conform.

Like if you write for the economist, you have to write in the economist style. We want to be less like that.

There’s obviously always a spectrum, but we want to be more allowing people to do the thing that’s most interesting to them in their own voice, cause that’s what we think the best writing is.

And then we want to share upside, so we want to measure who is subscribing to the collective for a particular writer and pay that writer, we pay writers 50% of the profit from each reader that is subscribed for them. So writers don’t have to ask for a raise.

If they’re writing good stuff that’s attracting readers or obtaining readers, they get paid more. And then we also want to give writers the list of emails.

What we believe is because we’re in this world where readers primarily subscribe to publication for the voices of the people that they most like, that when a writer develops a relationship with a reader, they should be able to contact that reader, even if they leave, and we’re not interested in retaining writers by holding their audience hostage.

And we think this kind of a deal where writers get upside and maintain access to their readers is more reflective of the reality of who is driving value for publications in the internet age, and is the kind of deal that we think more publications will do or have to do over time.

So that’s the basics of a writer collective and I think it comes back to this thing that you mentioned earlier, which is this realization that we had that most people 50 years ago were thinking about reading The Economist.

But today they’re more thinking, I really like Matt Levine, or I really like Ben Thompson.

So if you want to create a publication where you have multiple writers together, which is what we want to do because we actually do think that that’s better for a lot of reasons, which I can explain, you have to both market it to readers as being voice first. It’s like, here are the voices that you’re going to get when you subscribe and you’re gonna like those people, but you also have to compensate the writers as if they’re the ones driving the value, which they are. And so that means sharing upside and sharing emails.

00:24:26 - Speaker 3: Yeah, it’s really cool to see that you’re actively exploring different approaches here.

We’ve had this incredibly important change with communication and media that’s ultimately gonna have massive impacts in terms of how we organize ourselves as wild as it seems, we’re still in the very early stages of that.

But anyways, when that first hit, of course, the first thing that we tried to do was transliterate the old world onto the digital world.

So we took a magazine and Put like www in front of it and said, oh, we’re an online magazine now, right? And you know, that’s a very common pattern, but now we’re in the more interesting phase of exploring what you can do with the new affordances that you have with digital mediums.

And so things like direct subscriber relationships and smaller writer collectives and different platforms that support those in different ways with substack and Ghost and whatever, and uh just a very interesting time.

00:25:11 - Speaker 1: Yeah, I feel really lucky to be a part of it. It’s something that I kind of stumbled into, but it’s such an interesting amalgamation of my own interests and such an interesting time in history to be figuring it out. And obviously we don’t have all the answers, but it’s really fun to get to think about.

00:25:29 - Speaker 3: And I think it’s interesting to think about what are some of the underlying reasons why we’re getting pulled towards these other solutions that are not called the online magazine transliteration, and we’ve talked about some of them here, like one is You can have a much broader variety of voices just because you’re in these long tails and you don’t need to funnel everything through one of a small number of oligopoly media publications, right? But also you can have that long tail effect also applies to like the subject area and even the balance of the opinion, you know, whether that’s political opinion or whatever.

Another thing I think that’s happening and that we’re starting to see with this little bit of tension call up between the legacy platforms and The newer smaller outlets and even individuals is there’s a little bit of kind of escape and routing around institutional dysfunctions in the larger legacy publications. And I don’t have a fully developed theory of what’s happening here, but I think it’s something like these older public like take like the New York Times or The Washington Post, they’ve built up an incredible amount of capital through tens or hundreds of years of in many cases, quite good journalistic work. And now I think there’s a constant temptation if you’re an individual at one of those firm.

Terms to basically draw down the capital for your own benefit or for the benefit of whatever your pet cause might be, that might be you basically take advantage of the masthead to like write some wild opinion piece that doesn’t make any sense, you know, for example. And it feels like it’s become so compelling to do that and people have developed basically better strategies for doing that, that I think basically we’re seeing that happening and indeed, if you look at the Just broad-based opinion polling in the US, these legacy media publications will be at almost the very bottom, right? I think that reflects this capital getting drawn down.

And meanwhile, the individuals, the entrepreneurial publishers, these individuals, they see that they could potentially build. For themselves and write for themselves either as a single individual or as part of a small collective, and you get more of this builder’s mentality of like, you’re basically accruing capital, and you’re getting 50% of the dividends that get paid out because of more readers. And I think that’s just a powerful dynamic that’s happening right now.

00:27:38 - Speaker 1: Yeah, I haven’t really worked in one of these big publications before, so it’s a little hard for me to like, comment on the internal dynamics of why people do the things that they do or how they maybe kind of draw down the institutional capital or whatever.

It is true that if you’re working at one of these large companies, it’s easier to hide, right? Like you can write an article that’s like, OK, and it doesn’t matter as much cause it’s got the New York Times masthead behind it, whereas if you’re on Substack, if you don’t write something awesome.

Until you are Ben Thompson, Ben Thompson gonna write lots of bad stuff and it doesn’t matter, but until you are Ben Thompson, you have to write good stuff, right? So I think that’s one interesting thing, and then I think the other part of that is that there are a lot of people who can hide at those big publications, and then there’s a lot of people at those big publications that are the ones that are carrying it today, that are increasing the capital, right? And sometimes they feel underpaid or undercompensated.

00:28:29 - Speaker 3: Right, and that’s a big piece of this tension that I was alluding to, right, where basically people are looking, these individuals are looking at both sides of the fence and saying, hey, wait a minute, I’m building up all this capital here. I’m not getting paid and it also seems like it’s getting drawn down by others for nefarious purposes.

What if I just, you know went over here and, you know, paid myself a $250 million a year with really nice news on there, right? That’s the sort of dynamic.

And then The tension is that that reveals a sort of fundamental problem or issue with the larger firms, organizations, so they’re basically scrambling to either fix that or address that somehow in their approach.

00:29:00 - Speaker 1: Yeah, totally. I think that. 5 years ago it was not seen by people as a legitimate thing to like go and start your own newsletter like that just seemed crazy. And it’s something that writers over time are learning is something that you can do if you are a certain kind of writer, and I really underscore if you are a certain kind of writer, it’s not for every writer, and if the only option was to start substacks, the world would be like way worse off because the kinds of writing that you can do on substacks successfully are very specific, and the kinds of people who can do sub sub stacks are very specific.

But I think the trade-off for those people that do leave is they’re a losing security, which is really important for a lot of people. Oh yeah, if you’re a writer and you haven’t really been making a lot of money in your career and you have a family, like the security of working at a big company is really important to you. But you’re also really losing the respect and credibility that comes from being able to say I write for the New York Times, I write for The New Yorker, and I think a lot of people in those communities really deeply value that. It’s not something that they want to just throw away.

When you grow up dreaming of writing for The New Yorker, like, and you get to do it, it’s like a big deal, and it’s a big deal for more than just the money.

It’s very similar to growing up wanting to be a movie star, and then being like, well, I could start a YouTube channel.

I think for a long time, starting a YouTube channel was not acceptable to people that grew up wanting to be movie stars. I think kids today, it’s different. I think most kids today are interested in being internet famous, or interested in being TikTok stars, and being a Hollywood star is just, it feels old. or just like less like the thing they want. And I think the same is true of writers. And it’s probably just taking a little bit longer because like just happened and YouTube’s been around for a longer period of time. But I think previous generations of writers wanted to write for big publications. They wanted to have their books published by large publishers, and that’s a huge thing in their psyche. And that’s why you get into writing is not for the money. It’s for this kind of thing. It’s for having a chance to be in a bookstore and win the Pulitzer Prize or whatever. I think now we are starting to see generation people where that stuff is a little bit less valuable to them. They’re more interested in internet native types of respect, credibility and success. So those institutions are a little bit less valuable to those people, and that creates an opportunity for players like us that we feel like we’ve also grown up on the internet and we can give them something that they want, but also give them kind of the experience of being part of a collective, which is something that I think a lot of people value.

00:31:22 - Speaker 3: Yeah, for sure. By the way, this reminds me of one of my pet peeves, which is you’ve probably seen this like meme or statistic that in the US, the number one job aspiration for young people is to be like a YouTube star.

And in China, it’s like to be an astronaut or something. And people often say that in a way that’s like derogatory to the US or as if it reflects badly on the US.

But the way I always saw that is people in the US. to run their own small businesses and control their own destiny and make their own way in the world. And it’s obviously lots of good things about aspiring to be an astronaut, right? But it does have this element of like, you got to be one of the three people that the government picks every decade, versus having a shot to make it on your own. Right. So, to kind of reflect your point, I think there’s a lot to be said about having the desire and the initiative to strike out on your own, whether that’s to run a traditional small business or the sort of emerging class of small businesses with online media.

00:32:12 - Speaker 1: Yeah, it’s so easy to just be the kids these days meme, like kids are so shallow and whatever, and I would rather just be actually interested in what does that mean to people to be YouTube stars and how is that actually probably similar to other things that have happened in the past and what are the good things and the bad things about it and not just like, oh, yeah, everyone’s just terrible and shallow and. Losing so much to China because they want to be astronauts. It doesn’t mean anything to me.

00:32:35 - Speaker 3: We could probably do a whole episode about this, but there’s this fascinating, it’s actually a big and serious business to be a major YouTube personalities. People like they have multi-channel media empires, they have staffs with organizational hierarchies. They have like these huge discords. They have all kinds of payments going in and out. It’s no joke of a business. I think people sometimes forget that.

00:32:54 - Speaker 1: Totally. I mean, It’s really hard when, and this is one of the big things that we try to address for writers is, if your business is about you, then every single moment that you’re not making content is a moment you’re missing out on money, and it’s really easy to burn out that way because you have to be on 24/7.

If you’re a YouTube star, you haven’t got to produce a video a week at least. A lot of them produce more than that.

Casey Neistat, a vlogger, famously vlogged every single day for like 2 years, 7 days a week, while having kids. Like that is crazy.

And these vlogs are like edited. They’re not just like 10 minutes of staring in front of a camera, it’s like highly edited 10 minutes of his day told in the story format.

It’s crazy, but the same thing is true of writers, like, the fact that Ben Thompson every single day, 4 days a week for years, has to have an opinion. That’s hard. It’s really, really, really hard.

And I think that there’s a generation of people who are starting to do that. And in 2 years, a lot of them will be like, fuck, I want to do this once a week, not 4 times a week. How can I do that?

00:33:59 - Speaker 3: Yeah, totally, which brings us right back to the importance of experimenting with these new platform technologies, whether that’s, you know, collectives, I think is going to be an important one. Also different recommendation algorithms can kind of address this by basically helping out people who make good content, but like take a month off, the algorithm can bring you right back and not kill your business. So yeah, much more to explore in this space.

00:34:21 - Speaker 1: Yeah, I think the weird thing is that the algorithms right now are not built that way for creators. They’re not built with creators like mental health in mind. They actually just penalize you if you go away for a while so that you don’t go away. And a lot of creators just end up feeling terrible. And I hope that that is fixed over time. It is within the power of these platforms to do it. It’s not clear yet that they really care.

00:34:43 - Speaker 3: Yeah, or, you know, be the change you want to see in the world and start your own media company where you have different incentives.

00:34:48 - Speaker 1: I mean, that’s what we’re trying. That’s what we’re trying. We’ll let you know how it goes in a couple of years, you’ll have to have us back.

00:34:53 - Speaker 2: And the algorithmic recommendations, and I think that touches also on something you spoke about earlier, Dan, with the audience ownership, the email basically that your writers get the email list, and I think Substack also and maybe newsletters in general, I think part of why they emerged in that moment in time was a sort of Push back to these platforms and their algorithms that decide what you see and people realize that, OK, someone following me on Facebook, following me on Twitter, subscribing to me on YouTube.

I think YouTubers in particular, there was a lot of outcry and concern over algorithmic changes where someone can subscribe to your channel, but they still actually don’t even know that you put out. a new video, because the algorithm doesn’t decide to recommend it.

And they have this bell where you can get notified. And in any case, I saw a lot of YouTubers basically decide, OK, we can’t have our fate be decided totally by this platform.

I need to collect my own email list so that I can let people know when I have a new video, so people that really want to follow me and I can build my own audience and own that separately from this larger organization, this larger company that decides where to take a platform may decide in the future, and I think that’s a lot of where the substack thing came from. OK, here’s still a platform that can help you with, you know, the software and the distribution and the monetization, but in the end, if you’ve got an email address for every person in your audience, that’s extremely portable and you’re trying to do that with as well.

00:36:22 - Speaker 1: Right, totally, and I think that one part of the problem is, even if you are a YouTuber that can ask for emails, your conversion rate from a video to an email is like pretty low.

It’s a pretty leaky funnel.

You have to go type in something into the URL bar and like put an email and that’s not great.

And 2, I think that platforms that are already established and have huge, huge distribution like YouTube, just like. have very little incentive to add the ability to go off platform right now, but I think that younger platforms that understand this dynamic better, so subst is one, I think we are kind of like in between a platform and a publisher in a lot of ways, but we are another where we’re thinking about this from the beginning, are going to be a lot more friendly about that and give creators that option, and I think that these kinds of platforms will end up being dominant over time.

We’ll see, but I think it’s the kind of deal that incentivizes creators to use you in a way that they might not use a legacy platform for fear of not really having any ability to access their audience aside from what you allow them to.

00:37:31 - Speaker 2: The positive side of the algorithms for a person who’s consuming media, whether it’s video, writing something else, finding new stuff that you wouldn’t have come across before.

This is the classic long tail article, I think from the early 2000s where they talked about, OK, the internet is going to allow us because we don’t have this limited number of channels or this limited number of places to discover content.

And therefore, what’s on your television channels when you don’t have that many of them, it has to appeal to a very wide audience. There’s just no space for niche stuff.

Maybe cable helped out a little bit, but with the internet, yeah, you can have infinitely long tail and furthermore, you could find it through algorithmic recommendations through a Spotify recommendation or an Amazon product recommendation.

Or whatever, you start with something pretty mainstream and then based on those likes, you can in pretty small number of hops get something much more niche and in theory, that’s really good for small creators.

00:38:27 - Speaker 1: Totally, I think part of the problem for small creators right now is that if you monetize with ads and you’re writing niche stuff, you don’t make a lot of money, and so a lot of creators are starting to use subscriptions, and that’s kind of what we overall want to be able to do is You have a bunch of creators who are writing on little niche topics that are all bundled together under one subscription price, so those creators can basically make a subscription, be part of a larger collective, and we can be in the middle kind of directing traffic from readers to the writers that they should be reading.

But within a sort of walled garden where not everyone can write on here, it’s like there’s a certain bar for quality and a certain tone that we want to meet, and then within that we are kind of making connections between writers and readers and distributing the subscription to the writer that is driving most of the reader attention.

00:39:17 - Speaker 2: So you’ve curated the writers, the topics, there is a kind of, if not a unifying brand voice, then at least maybe a general vibe that cuts across it, unlike a YouTube or a Facebook or a Twitter, that’s just wild west, anyone can post anything. But at the same time, you could potentially. This is where your background as a software entrepreneur and just the affordance of the new tools, unlike those traditional media, you know, the newspaper that’s delivered to your front door, you can send someone an email that is, here’s things that you will like based on your past interests the same way that Spotify does.

00:39:54 - Speaker 1: Exactly, and this is something that my co-founder Nathan, who first employed Substack, he basically built our entire CMS almost by himself.

We also have a couple developers who are really talented, but it’s really a lot of him, and I think this is one of the things that he is most excited about and pushes deeply is that we have this like, I think one of the things that we have that I will say is rare, which you tell me if it’s rare, is we both really, really like writing and are good at it, and care a lot about the written quality of the product in a way that I think is similar to a lot of the like. I don’t think we’re as good as the New Yorker or Harvard Business Review, but it’s similar to the attitudes that a lot of those people have, the reference that they have for writing, and we both also, and Nathan really primarily leads the way here, but we both also have this like product DNA where we’ve built software products before, and we know how that works, and we’re trying to figure out if you put those two things together, what can you make? And we have a bunch of ideas for what can come out of that, but we think that that’s somewhat unique in the kind of media landscape. Usually you’re one or the other. You’re either like a product person that is like trying to build some sort of aggregator or platform and you don’t really have too many opinions about the writing, or you’re a writing person and you’re just kind of like, I use a WordPress, you know, and if you can be kind of in the middle and have both, like what can you do? And that’s the animating force behind every.

00:41:15 - Speaker 2: Yeah, that’s really interesting and I agree that that is part of what makes your team unique. And I do wonder how you balance those, which is, I think curating great writers, providing those editorial services, really caring about the content. is one whole huge job, and then there’s what I would call the software business side of it, a lot of which is just, yeah, you built your own CMS so that means, you know, you got to spend time on, does it work in this browser.

What about this responsive design thing, oh this person’s having trouble logging in because of this, that and the other thing, the payments. You know, all that stuff.

So do you find that you’re sort of pulled in two directions, or do you have a good way that you even think about how to allocate like your own time, but also your team time? Do you think, OK, we got to put 70% into the writing and the curation of the great content because that’s what it’s about 30% of the software, or how do you find the balance there?

00:42:11 - Speaker 1: Yeah, it can be hard, and I would say most of the burden is on my co-founder Nathan, but I think first of all, at the heart, we know that the business survives or dies based on the writing. It’s not based on the technology. The technology is going to help the writing reach the right audience and it will be a multiplier on the quality of the writing, but like if the writing is a zero, the technology can’t do anything to fix that. So, the heart of it has to be the writing, we have to get that working and get people excited about the things that we’re writing and then on top of that, the technology is the thing that can help us, you know, if we want to, for example, have a bunch of overlapping niche audiences that we’re serving. It can help us figure out, OK, who should see which article. It can help us figure out, OK, who should get paid based on this reader’s behavior or the survey that this reader filled out, like, there’s all these mechanics of the business that the technology can help make smooth and work better and especially scale better as we get bigger, but the heart of it still has to be that really high quality writing.

And I think it gets back to this thing that you mentioned earlier, which is that we’re not totally bootstrapped. We’ve raised some money, but we haven’t raised so much money that we can just like hire a gigantic engineering team and like not have to worry about it. Like, we are constantly thinking about, we have a small team. We have technology to build and writing to produce, and we’re constantly thinking about what should we do and where should we focus our resources, and that can seem painful, but I think it’s more like the kind of pain that you get working out at the gym versus like the kind of pain that’s gonna like really end up holding you back, because When I think of venture money, especially for business like ours, like a media business, it’s a little bit like an anti-gravity machine, and if you’re in the anti-gravity machine for too long, your bones get weak, and it’s much better for us right now while we’re still kind of figuring out the model to have some gravity. We don’t want full gravity, we’re not at like 1G, we’re at like, you know, 0.8gs or whatever, because we have money in the bank and we can run experiments and all that kind of stuff we don’t have to be profitable every single month. But we have enough drag or enough gravity to deal with that we can’t be stupid for too long, and that is, I think, really, really important. So we’re kind of constantly figuring out what’s the balance between these two parts of the business, and we know what the focus is, and we just got to make sure that we’re balancing things correctly.

00:44:28 - Speaker 2: That’s really well said, Mark and I in many episodes and many different forums have talked about venture money and yeah, the Silicon Valley Standard Model and some of our pushback to that, which is why we’re doing something a little different with Muse, but also part of the reason it’s a reference point is that it is this incredible thing to get a bunch of money to work on an interesting problem space, especially in an emerging domain where there’s so many unknowns, you just don’t even know what the opportunity is because all the variables are in play. And so if you’re totally focused on survival and earning money from customers so that you can keep your lights on from day one, that can hold you back from being experimental, seeing all the opportunities, trying weird stuff, but the other extreme which is having so much money that you don’t really Feel the, it’s called the discipline of the market, the real world, kind of like peering over your shoulder and sweating a little bit.

When you see the bank account balance ticking down, then I think you lose touch and become free floating, ivory tower, as you said, you’re more likely to do things that are unwise.

So I think there’s a middle ground there. I’m very much in favor of businesses taking investment. But I also am really in favor of not taking too much investment, even though that seems like a good thing. So I actually find myself in when I’m just like having kind of, let’s call them advisory calls with people, people that come from a really strong bootstrapping mindset of like, I’ll never take investment. I end up trying to convince. them know, you should take a little money, but then people who come from more of a Silicon Valley, or they just see, oh, great, I can raise 10 million bucks for basically me and my two friends and our idea, and I go, wait a minute, I think you’re setting yourself up for failure by doing that, you should take less or try to be more close to the middle, you might say.

00:46:16 - Speaker 1: Totally, yeah. I mean, it’s been a journey for me.

My previous company was bootstrapped and I was never like outright against taking money, but I felt like I wanted to prove a lot before that seemed like a good idea.

My default is for any business, like don’t take money, basically. My co-founder Nathan is the opposite. He took money for his last business and I think his default is to take money for various reasons.

One is just like money and people help you kind of figure out your business, and then another reason is Being able to participate in the venture funded entrepreneur community is like a real benefit as much as bootstrapping is an identity, being a venture backed founder is an identity, and it’s a little scary to like take yourself out of that if you’re in it.

I was a little bit more bootstrapper identity, and he was a little bit more venture funded identity, so we had to kind of like figure out how do we merge these two things, because there are real things that bootstrappers feel that are worth taking into account when you’re thinking about how to build a business and they’re a real thing that venture funded entrepreneurs think about, and they’re real trade-offs to each.

And so how do you figure out the middle ground or figure out, not even a middle ground, but like a smart way to address each of the concerns and each of the benefits of both paths. And so where we came to was, let’s raise some money. We’re going to raise some money from A venture fund and some smart angels who we think are going to be able to help us. So we raised about 600, 700K led by Bedrock, who’s the main investor in the athletic, which is a big consumer subscription media company that is very similar to the kind of business we want to build, so we have and we raised pretty much of.

So we have smart people on board, we have some money where we can experiment, but when we raised it, we said very clearly to everyone, like, this might be the last money that we raise, and we’ll raise it in a way that if we don’t raise more, it’ll convert into equity. So, you know, you’ll have a chunk of the business and all that kind of stuff.

So it’ll give us time to figure out what kind of business this is. And if it is a venture right business, and we do overall believe that this is going to be a big business, and that’s what we want to achieve, it just may take longer than the venture timeline allows for. And if it does end up becoming a venture backed business, we will raise more money. And if it doesn’t, and we find that it’s not exactly that shape of business, we still want to have people on board and want to have the optionality to take that route without it kind of being taken off the table too early.

And I feel really good about it. Like, I feel really good about having taken money.

Had never raised money before, so going through a fundraising process was kind of fun. I’ve been an investor, so I’ve seen it from the other side. It was very interesting to get to do that and actually kind of fun, even though it was stressful. And I don’t think it has materially changed how we think about the business. It has just allowed us to do more, a little bit more quickly and not have to worry as much. And we’re still in some gravity. So we’re still finding a shape of the business that can survive without having to pump more money in every 18 months. And I don’t know what the future holds, but I feel pretty good about this kind of path for us.

00:49:05 - Speaker 2: Well, before we go, Dan, one thing I’d love to get your take on is how the changing media landscape here, for me, there’s these very deep questions about who we trust to help us interpret and understand the world.

For example, when there’s something in the technology world, there’s technology news, some big company goes public and I think I want to understand what this means exactly and who do I go to. Do I go read Divination, which is Nathan’s newsletter? Do I go read Ben Thompson and Strachery? Do I go read The Generalist, for example, and this is also true for political events and every other part of understanding the world around us and how it’s unfolding.

And you’ve talked about the history, we’ve talked a lot about the history of these big institutions, the New York Times and whatever, and where all this kind of trust or what Mark calls capital that accrued to these long term brands and institutions, the writers then were kind of cogs in the machine for maybe now we have this more transition to yeah, individual YouTube personalities, individual writers on substack, people where I follow this one person and I trust them and their voice.

How’s that gonna evolve, do you think in the coming decade, let’s say?

00:50:17 - Speaker 1: I think that there’s obviously there’s a lot of issues of trust at the heart of our society.

I don’t know that I have like a answer for like how we begin to trust, cause it’s not just journalists, as politicians too, it’s like our socio-political establishment more, that feels like definitely outside of my pay grade, but I do know that when it comes to business topics, people feel like They’re less likely to trust Business Week or like Bloomberg or Entrepreneur magazine to like really tell them what’s going on, and they’re more likely to trust certain individual voices that have experience and credibility on a particular topic to help them understand the world.

And you’re seeing that kind of play out as you mentioned with like voices like Ben Thompson or Nathan writing divinations where people go to him because they know his background and experience is relevant to the topic that they want covered.

And I think the problem with that is being someone like Nathan or being someone like Ben Thompson, where you’re one individual voice, and you are the publication in its entirety, is it’s really fucking hard to do that for years on end. You have to be Willing to grind it out for day after day after day and constantly be putting yourself out there in a way that most people are not prepared for, and in a way that like a lot of topics are not well suited to.

If you’re going to be a person like that, you have to have a specific beat, there has to be news a lot that you can comment on really quickly. It’s not particularly good for someone who’s doing a lot of like long detailed reporting or in-depth thinking about a particular topic. You basically do all the thinking and put out a couple of those big Essays like aggregation theory, and then you just continually refer to them every single time a news event comes out. And so what I think we’ll we’ll see over time is writers and readers beginning to realize that there’s a lot of benefits to being attracted to a specific voice, but there’s also a lot of drawbacks to like, subscribing to like one man or woman publications.

And what we’ll find is, I think more collectives people emerge where writers are navigating the trade-offs of being part of a group and also trying to retain a lot of the things that they got used to or would have come to expect from writing on the internet, which is like upside and money and all that kind of stuff, and we’ll we’ll see groups emerge that are voice focused, so when you subscribe to the publication, you’re doing it because it has a writer or two that you really, really like and trust. And the writers are compensated in a way that reflects that reality. I think you’ll see that in writing, you’ll see that in other types of content creation like video and audio and all that kind of stuff is, it is generally better if you can do it to be together rather than alone. It’s better to share the load. And people are going to try to find new models for being together that are more reflective of the new reality of what it means to create stuff on the internet, and that’s what we’re trying to do. We have one way of thinking about it, but there’s going to be lots of other people that are going to try to do it, and I think one will emerge as kind of a new standard over the next 5 to 10 years.

00:53:24 - Speaker 2: Well, let’s wrap it there. Thanks everyone for listening. If you have feedback, write us on Twitter at MuseAppHQ or on email, hello at museapp.com. Really helps us out if you leave a review on Apple Podcasts. Dan, thanks so much for letting me follow along with the every journey so far. It’s made me, I think, much more aware or just interested in what’s happening in the media landscape, which I think is not only intellectually interesting, but probably important for our society. So looking forward to seeing the next steps in that story.

00:53:57 - Speaker 1: Thank you, thanks for having me.