Rumors are swirling that Substack, the newsletter platform, is discreetly raising a new investment round ranging from $50 million to $100 million.
Following its last valuation of $700 million, this round could significantly boost its worth, reflecting growing interest from investors. Notably, Benchmark has emerged as a potential backer, joining existing supporter Andreessen Horowitz, signaling strong confidence in the platform’s trajectory.
The decision to seek new funding appears tied to the surging popularity of Substack’s native app, which has driven a wave of paid subscriptions. The platform now hosts over 500,000 creators, collectively earning approximately $450 million annually, though Substack itself generates a more modest $45 million in annual recurring revenue (ARR). This gap highlights the platform’s role as a conduit for creator earnings rather than a direct profit engine.
Political and business newsletters, such as Mehdi Hasan’s Zeteo, The Bulwark, and Emily Sundberg’s Feed Me, have particularly captured attention, fueling the platform’s growth. In response to this momentum, Substack is reportedly considering the introduction of advertising sponsorships, offering creators an additional revenue stream beyond subscriptions.
Also read:
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Essentially, Substack is positioning itself as a potential YouTube alternative — a core hub for creator realization. Last year, Patreon attempted a similar pivot with free subscriptions but faltered, failing to gain traction. Substack’s native text format and focus on podcasting, however, might give it an edge, potentially establishing it as a top-of-the-funnel destination — a role Patreon never managed to secure.
