Substack's 10% Fee Penalizes Success
Justin Gage, founder of Technically, on how Substack earns its 10% take rate
The 10% fee works like a tax on success, which means Substack gets more expensive precisely when a writer has built a real business. A small newsletter may barely notice it, but at six or seven figures of subscription revenue the cut can outweigh the value of hosting, checkout, and basic growth tools. That is why price becomes the cleanest reason for top publishers to compare Substack with flat fee rivals like Beehiiv and Kit.
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The math compounds quickly. Substack reached about $45M annualized revenue in mid 2025 by taking 10% of roughly $450M GMV across 5M paid subscriptions. For an individual writer, every extra $100,000 of paid revenue sends another $10,000 to the platform before payment processing.
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Competitors attack that pain point with software pricing instead of revenue share. Beehiiv charges a flat monthly subscription up to large list sizes and now layers in ads and referral products, so a growing publication can keep more subscription dollars while still getting monetization tools.
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Writers still often stay put because moving is operationally messy. The archive lives on Substack URLs, old posts rank in search, subscriber billing has to keep working, and recreating redirects, content history, and email flows takes real technical effort. That friction protects Substack even when fees sting.
The next phase of the market is platforms trying to justify or replace the take rate with extra revenue streams. Substack is adding more discovery and ad products to make its cut feel earned, while Beehiiv and Kit keep bundling ads, referrals, and software into flat fee plans. The winner will be the platform that lets successful writers keep more upside without asking them to rebuild their business from scratch.