Substack's Discovery-Driven Monetization
Justin Gage, founder of Technically, on how Substack earns its 10% take rate
Substack wins more from being the place where discovery happens than from helping writers measure discovery precisely. Justin Gage describes a workflow where a writer can see post level readership splits like email versus direct, but cannot cleanly trace which channels produced recent subscriber adds. That fits Substack’s broader product shape, where growth comes from publishing cadence, recommendations, front page placement, Reader, Notes, and one click conversion inside the network, not from deep marketer style attribution tools.
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Gage says new posts are still the main growth engine. Every post creates something people can forward, share, or surface in search, and guest posts or influential shoutouts can create visible spikes. The missing piece is a clean dashboard that rolls those touches into a usable subscriber source report.
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That is a real product choice, not just a missing chart. Gage also says Substack lacks good CRM style filtering and targeted messaging, so a writer cannot easily pull out active free readers and send them a conversion email. Kit and Beehiiv have competed by leaning harder into analytics, interoperability, and operator tools.
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Substack has kept growing anyway because its network can manufacture demand inside the platform. Recommendations and the internal feed were already driving roughly 25% of paid conversions by early 2026, and the company has kept expanding from a newsletter tool into a social reading product with Reader, Notes, Chat, and live video.
The likely direction is more internal distribution and more monetization layered on top of it. As Substack pushes further into feed based discovery and ad products, the gap between audience growth inside the network and measurable channel attribution outside it will matter even more. Writers who want a publication business will keep comparing that tradeoff against the cleaner operating stack offered by Beehiiv and Kit.