With Substack minting millionaires, at least according to its CEO, could the newsletter platform’s founding members program be a key ingredient in the recipe for reaching millionaire status?

The founding members program is an additional plan on top of Substack’s monthly and annual subscription offerings, allowing readers to show extra support by paying more than the annual plan. Some newsletters use it as a way to receive donations, while others offer exclusive goodies to “founding members” in return for their higher contributions. 

For Doomberg, the second most popular finance newsletter on Substack (though largely focused on the energy industry), when it came to the pricing of subscriptions they ignored the platform’s general advice of pricing low and going for volume. Instead, they analyzed the top 40 finance newsletters and landed on a median price point of $300 for annual subscribers and $1,200 for “Doomberg Pro” subscribers, which is the newsletter’s moniker for the founding members tier.

Doomberg has around 300,000 total subscribers and a purple badge which signals that the publication has tens of thousands of paying subscribers. In an interview with AMO, Doomberg, a pseudonymous green chicken representing a small team of writers, confirmed that around 20% of revenue from paid subscribers comes from Doomberg Pro, which means the publication makes at the very least $2.4 million in revenue from 2,000 Pro subscribers and $2.4 million revenue in from 8,000 annual subscribers since at least 10,000 paid subscribers are needed to secure the Substack purple badge.

“Our expenses are incredibly small,” Doomberg said. “All we do is Doomberg. We’ve said no to speaking fees. We’ve said no to consulting offers. Doomberg is more than enough [income] for our very small team and Doomberg is the work of our lives and so Doomberg is all we do.” 

So, what extra goodies is Doomberg offering these subscribers who are willing to pay $1,200 a year? A whole hour-long Zoom presentation per month.

The founding members tier is clearly working wonders for Doomberg, who generally is a big supporter of the platform having invested in its community fundraising round. But what about everyone else? 

The Flywheel Effect

The team behind Doomberg originally began as a consultancy on the energy industry up until Covid-19 when they suddenly lost 85% of their business. They pivoted to providing consulting services to content creators and newsletter writers who were targeting Wall Street and finance professionals. Eventually, they launched their own newsletter using the guidance they had been providing to other content creators.

“In helping those creators we studied everybody in the business and developed a real good sense of the market and we realized that there was a huge market inefficiency, or opportunity, available for Doomberg,” they said. “There wasn’t really anybody writing successfully about energy that had relevant industrial experience—so the commentators in the energy space were either reporters, professors, government officials, but there wasn’t really that industrial lens and so that was the opening that we seized and the rest is, sort of, history.”

Doomberg describes launching the publication “with intent” using five pillars: brand, channel, technology, demand creation and operations. Demand creation was generated through Twitter (X) as well as around 100 podcast appearances per year including the David Lin Report and Blockworks’ Forward Guidance. The newsletter remained free for a year before switching to paid.

“Since we’re a premium product targeting a wealthy client base, knowing who amongst your 300,000 total subscribers are your biggest fans and willing to pay $1,200 a year for what amounts to an extra webinar a month, that list is itself extremely valuable because you have your super fans,” Doomberg said. “Not that we’ve ever done anything with that list, but the potential is certainly there”

Dacy Gillespie, a personal stylist who runs the Unflattering newsletter almost as a side gig, launched her “unflattering membership” tier with only one additional goodie: a spreadsheet of retailers, which she maintains for her job. Over time, she has expanded it to offer other services, such as access to her mini courses on styling and a service where she does online personal shopping. Rachel Karten, who writes the Link in Bio newsletter, recommends this approach of starting small.

“You can always add on more paid perks, but you can’t take them away,” she said at a Substack event. “That’s something that I would think about when you’re going paid: what can I promise to offer that is so valuable and that I know I can deliver on?”

Most of the goodies that Gillespie offers are things that she has already created for her business. The AMA and personal shopping threads are the only things she has to manage ad hoc. When she first turned on the “unflattering membership” many of the subscribers just signed up because they wanted to support her, she said, but now a lot of people talk about how much they like the personal shopping service.

Gillespie has around 11,500 total subscribers and 95 of those are founding members, she said. She also offers regular subscriptions at $6 a month or $60 a year and has several hundred of those. Founding members pay $150 and account for at least $14,250 in revenue per year. While the revenue figure might not be as eye watering as Doomberg’s, it doesn’t need to be as Gillespie’s newsletter is only an additional revenue stream on top of her personal shopping business, Mindful Closet. She had been writing a newsletter for several years, which was sent via Active Campaign, before switching to Substack.

“In my mind when I was starting I was just like, okay, I’m already doing the work to write this newsletter,” Gillespie said. “If I go over to Substack and like five people pay me, that’s great. You know, that’s more than I was doing before and it’s the same amount of work.”

But not everyone is finding success with the founding members program. Several prominent writers who advertise a founding members tier told AMO they don’t really use or do much with the program.

An Ideal Model for B2B Audiences

The name of the program itself is kind of misleading. Both Gillespie and Doomberg found success in building up their audiences before seeking support through the tier rather than securing “founding members” straight away. It also seems to be more lucrative when positioned as a VIP tier where publications can either offer additional services and/or have business clients, or super fans, who can afford to pay more. 

Karten positioned her founding members tier at business professionals by calling it “The C-Suite,” recognizing that many of her readers could expense a paid subscription for professional development. She also provides a prewritten reimbursement request template.

“If you read our about page, we have very carefully chosen how we describe each of those tiers,” Doomberg said. “One of the things that is always important in the marketing business, you have to make it easy for people to pay you and easy for them to understand what they’re buying.”

Matt Brown, who runs the Extra Points newsletter which is focused on the business of college sports, had to give up his founding members program when he made the switch in 2021 from Substack to alternate newsletter platforms—first to Ghost then to Beehiiv—in pursuit of diversifying revenue streams to include advertising sales and sponsorships.

“You don’t want to be dependent on just subscription revenue, and for a long time that’s what Extra Points was. Until this year we were 90%-plus subscription revenue as opposed to sponsorships or tech sales or events,” Brown told AMO. They are trying to bring subscriptions down to representing more like 70% of revenue. 

Moving away from the founding members program wasn’t a major loss as there were only a few founding members relative to his around 1,000 paid subscribers, Brown said. As the newsletter has grown and he has developed a better understanding of his audience—35,000 subscribers including 2,200 paid—and added more services, such as his educational tool the Athletic Director Simulator 4000 and the Extra Points Library, he is keen to reintroduce variable pricing, which is something Beehiiv, a Substack competitor, rolled out last year.

“Hypothetically, if I went right now to my top 200 engaged paid subscribers and just raised the price on them, I think most of them would pay for it and [then] say you can hop on a Zoom with me once a month or I’ll give you something small, I think they would probably do it,” Brown said. “But they wouldn’t have done that in 2020 or 2021.”

Having variable pricing makes sense for a newsletter such as Brown’s as he targets both consumer and business audiences. Out of his 35,000 subscribers around 8% to 10% of those will be industry professionals such as athletic directors, head coaches and conference commissioners, he said.

“There’s going to be some people that the consumers who may be happy to pay $7, $8, $9 a month, but there’s going to be some content that they’re just not interested in,” Brown said. “And for the B2B audience, because I’m mostly serving leaders in the college sports industry, those people all make $450,000 a year and they can write off my newsletter as professional development. They could afford to pay more and that isn’t something that we’ve completely built to where we want it to be yet, but that was part of the [original] thought process behind having two different price points.”

“I imagine we will seriously look at different variable pricing before this fall and potentially implement something,” he said.