Substack Cofounder Says Fast Progress on Publisher Tools After Ankler Exit

Substack is building a sponsorship marketplace that connects authors with advertisers. McKenzie said the platform is “pretty close” to a full rollout. The pilot started with a small group, including Bill Bishop of the China newsletter “Sinocism.”

The revenue split for sponsorships will mirror the 10% cut Substack takes from subscription revenue. That is a thin margin for a marketplace business, it keeps the pricing simple for both authors and advertisers. The sponsorship marketplace could become a second revenue stream for Substack beyond subscriptions, reducing its dependence on the commission model.

Competitive Pressure from Beehiiv and Ghost

Substack’s commission model is under assault from rivals offering flat fees. Beehiiv and Ghost charge a fixed monthly rate and let publishers keep 100% of subscription revenue. For a large publisher like The Ankler, the math favors flat fees once revenue crosses a threshold.

• Beehiiv: flat monthly fee, no commission on subscriptions
• Ghost: open-source, self-hosted option with no revenue share
• Passport: built by Automattic and Stratechery, targets larger media companies

McKenzie argued that Substack’s network effects – shared discovery, cross-recommendations, and a unified reader experience – offset the higher fee. The defection of a top publication weakens that argument unless the new toolset can replicate the features publishers need.

What Confirms or Weakens the Publisher Retention Thesis

Substack is privately held, the strategic shift has implications for investors in adjacent markets. If Substack successfully retains or attracts larger publishers, it pressures rivals like Automattic’s Passport and raises the barrier for new entrants. The 10% sponsorship cut is a low-margin addition, it diversifies revenue beyond subscriptions.

For a hypothetical public equity analogue, consider software platforms that layer marketplace revenue on top of subscription fees. The key metric to watch is publisher retention, especially among the top 50 newsletters. A second data point is the take rate on sponsorships: if the 10% cut holds at scale, the segment could add meaningful revenue without raising subscription fees.

• Risk to watch: If large publishers continue to leave for flat-fee platforms, the toolset may be too late.
• What confirms the thesis: A high-profile publisher signs a multi-year deal using the new features.
• What weakens the thesis: Another top-10 publication announces a migration to Beehiiv or Passport.

Substack’s response to The Ankler’s departure is a direct attempt to broaden its addressable market. The sponsorship marketplace and generalized enterprise tools address the two biggest complaints from growing publishers: lack of ad revenue and limited brand control. The 10% revenue split is competitive, the real test is execution speed. If Substack can deliver the toolset before more publishers defect, the platform keeps its network effects intact. If not, the flat-fee competitors will continue to chip away at the top end of the market.