How Substack Pricing & Fees Work
Substack is a newsletter platform that makes it easy to launch a paid newsletter. It's free to use,
but Substack takes a cut of your subscription revenue. Understanding these fees is crucial for
setting your pricing and revenue expectations.
Substack Fee Structure
| Fee Type |
Percentage |
What It Covers |
| Platform Fee |
10% |
Substack's cut for hosting, infrastructure, and features |
| Payment Processing |
2.9% + $0.30 |
Stripe credit card processing fees |
| Billing Fee |
0.7% |
Recurring subscription management (as of 2024) |
Total Fees: Approximately 13.6% - 14% of your subscription revenue goes to fees,
meaning you keep about 86% of what subscribers pay.
Recommended Pricing Strategies
The most common and successful pricing structure on Substack is:
- $5/month or $50/year (save $10) - Entry-level, high conversion
- $7-10/month or $70-100/year - Sweet spot for most newsletters
- $15-20/month or $150-200/year - Premium, specialized content
Substack's default recommendation is $5/month or $50/year, which works well for new newsletters.
Typical Conversion Rates
The percentage of free subscribers who convert to paid typically ranges:
- 5-7% - Average conversion rate across most newsletters
- 8-12% - Well-established newsletters with loyal audiences
- 15%+ - Top-performing newsletters in specialized niches
With consistent high-quality content, most newsletters should aim for a 10% conversion rate as a realistic goal.
How to Maximize Your Revenue
- Build Your Free List First - Get to 1,000+ subscribers before going paid
- Offer Clear Value - Explain exactly what paid subscribers get
- Annual Discounts - Offer annual subscriptions at 15-20% off (2 months free)
- Founding Member Tier - Offer higher-priced tier ($200-500/year) for super fans
- Free Trials - Offer 7-day free trial to reduce friction
- Consistent Publishing - Weekly publishing schedule builds trust
Revenue Examples
Example 1: New Newsletter (1,000 subscribers, 5% conversion)
Total Subscribers: 1,000
Paid Subscribers: 50 (5% conversion)
Price: $5/month
Gross Revenue: 50 × $5 = $250/month
After Fees (86%): $215/month or $2,580/year
Example 2: Growing Newsletter (5,000 subscribers, 10% conversion)
Total Subscribers: 5,000
Paid Subscribers: 500 (10% conversion)
Price: $10/month
Gross Revenue: 500 × $10 = $5,000/month
After Fees (86%): $4,300/month or $51,600/year
Example 3: Established Newsletter (20,000 subscribers, 12% conversion)
Total Subscribers: 20,000
Paid Subscribers: 2,400 (12% conversion)
Price: $15/month
Gross Revenue: 2,400 × $15 = $36,000/month
After Fees (86%): $30,960/month or $371,520/year
Frequently Asked Questions
How much does Substack take from subscriptions?
Substack takes 10% of your subscription revenue, plus payment processing fees of about 2.9% + $0.30
and a 0.7% billing fee. In total, you keep approximately 86% of your subscription revenue.
What's the best price for a paid newsletter?
$5-10/month is the sweet spot for most newsletters. $5/month ($50/year) has the highest conversion
rate, while $10/month ($100/year) balances revenue and conversions well. Premium newsletters can
charge $15-20/month if they deliver specialized, high-value content.
How many free subscribers do I need before going paid?
Most successful paid newsletters have 1,000-5,000 free subscribers first. This builds proof of
value and ensures you have enough conversions. With 1,000 free subscribers and a 10% conversion
rate, you'd get 100 paid subscribers ($500-1,000/month at $5-10 pricing).
Should I offer a free trial?
Yes! 7-day free trials can increase conversions by 30-50%. Readers get to experience your paid
content risk-free. Just make sure you deliver high value during the trial period to encourage
subscription continuation.
Can I change my pricing later?
Yes, but existing subscribers keep their current price (grandfathered). You can increase prices
for new subscribers anytime. Many successful newsletters start at $5/month and increase to
$7-10/month as they grow their audience and improve content quality.
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