Substack - A Product Teardown

It's a teardown of one of my favourite apps - Substack.

I come on Substack mostly as a writer, but I also follow a few fellow writers who inspire me to write, think clearly, and structure my thoughts better.

Who is Substack for?

Substack serves three distinct user segments:

• Creative writers like me - using it as an outlet, not yet monetizing

• Solo entrepreneurs - building community and staying in touch with their audience

• Professional writers - for whom writing is a livelihood and monetization is critical

Product Teardown: 01

What is Substack?

Substack is a marketplace for readers and writers. Unlike Beehiiv or Ghost, which are content management systems built for marketers, brand managers, and solo entrepreneurs to own and grow their brand. Substack connects writers directly to their readers on a shared platform.

The North Star Metric

After analysing how Substack makes money, I understood the north star metric of the platform -

Active paid subscriptions spread across writers

Substack earns a platform fee for every transaction that happens between a writer and their paid subscribers. This means the more writers monetize and the more readers pay, the more Substack wins.

Three Core Insights

1. Identity Crisis

While I understand the platform, the revenue model, and the north star metric, I realized there’s a core tension — an identity crisis.

Substack is built for articles, newsletters, and long-form content. Yet the platform is increasingly emphasizing short-form content through the Notes feature, which works a lot like Twitter.

While Notes helps with visibility and platform engagement, it is also deviating from the north star. Short-form drives engagement. Paid subscriptions require trust, depth, and long-form value. These are not the same thing.

“Substack’s business depends on paid subscriptions, but the product is increasingly optimized for short-form content, which risks conversion rate.”

2. Monetization Friction

There is significant friction in setting up a monetized account, especially for writers from non-Western countries. Substack’s dependency on Stripe means writers without a business registration or GST number — like most independent writers in India — cannot easily monetize their accounts. This directly limits the growth of the north star metric.

This is not a product fix. This is a business and partnerships call — and needs to be prioritized by the respective teams.

3. Writer Retention Paradox

There is a writer retention paradox on the platform. Writers on Substack don’t own their audience — unlike Beehiiv or Ghost where writers have full control. If a writer decides to leave Substack, they cannot take their readers with them.

This works in Substack’s favour as a retention mechanism. But it also indicates concentration risk — if a few big writers leave, a disproportionate share of paid subscriptions leaves with them.

What I'd Build

Getting to what’s under the product scope, I would work on resolving the identity crisis first.

Add long-form articles to the home feed that surface content based on a reader’s search history and interests, to drive paid subscriptions towards the north star.

This keeps Notes alive for discovery and engagement, but ensures long-form content gets equal, if not more, prominence on the home feed for readers who are most likely to convert to paid subscribers.

What I Would Not Build

• Do not make Substack short-form first. Notes should remain a discovery tool, not the identity of the platform.

• Do not compete with Beehiiv or Ghost by becoming a CMS. Substack’s strength is the marketplace model, readers and writers finding each other. That’s defensible. Becoming a brand-building tool is not.

• Do not over-engineer user segmentation early. The marketplace model works precisely because it serves all writer types on one platform. Fragmenting the experience too early risks diluting the network effect.

This was my attempt on product teardown. Follow along if you want to join me on my job hunting journey!

Thanks for reading, more soon :)

Cheers,
Apoorva 👍🏻