Or even Substack - What's their strategy? Is it really that difficult for a new product to come up with web hosting+ subscription management + e-mail automation + payment processing. What is the real value they are offering to writers that's so difficult for a competitor to copy? Why is it so hard for a competitive startup to copy their features and offer it to writers at a steep discount, say a take of 5% (instead of substack's 10%).
I actually listened to a podcast on Substack recently where one of the co-founders actually walked through their strategic thinking, but my quick understanding of their approach:
(1) connect readers and writers directly vs relying on middle-layers (e.g. publishers)
(2) avoid relying on anachronistic models (e.g. ads) that don't incentivize good writing
(3) enable writers to reach audiences in new ways (e.g. bundles)
(4) remove money as a hurdle for good writers to get up and running (e.g. fellowships)
(5) allow savvy readers to curate their feeds themselves (e.g. multi-subscription discounts)
to answer your specific questions, I don't think the tech is that hard to copy, but reaching a critical mass of quality writers / paying readers is difficult to bootstrap (and they have) - also, by allowing creators to just export their distribution lists (audience) and take elsewhere they are already acknowledging that they have to provide a great experience / clear incentivizes vs relying on lock-in or migration difficulty to make it work
some problems that I think they will need to solve to ultimately be successful:
(a) only top 1% of writers can make a living this way, so what about the rest?
(b) how does good writing / new writers rise to the top? (bootstrap problem)
(c) how does a reader find relevant content when everyone is newsletter-ing?
(d) is subscriptions the primary way for writers and readers to exchange value?
(e) is enabling writers/writing enough or is the future content creator multi-medium?
the crux of any product strategy comes down to (i) choosing which problems to tackle vs not and (ii) sequencing the solutions in the right order to the right degree to capture the market - let's see what they do =)
Ibramin - Thanks. A request - a lot of newsletters focusing on strategy templates, but very few try to bring these template to life by providing real examples. Do you think you think you can do some posts explaining strategy through the example of a startup, say Asana. What is their strategy, what is it that they are doing thats so different from all the other proj mgmt SaaS companies out there? Do they have any real differentiation? How does their differentiation tie back to their value chain. Something along these lines would be really useful. Many thanks
great idea - I did exactly this on a recent podcast - attempted to reverse engineer the strategy for a product/feature (Twitter/DMs) based on public information - the episode will drop on 12/4 and you can watch for it here -> https://buildpodcast.drift.com/public/13/Build-45671
I'll also be doing an accompanying write-up to cover some angles we didn't get to in the podcast...but in general I agree with you that deconstructing a work-in-progress strategy is a better way to learn than just focusing on generic templates
Ibrahim - this thread offers some pretty good insight into differentiated product strategy in action https://twitter.com/ProtagorasTO/status/1335254106760470532?s=20
Or even Substack - What's their strategy? Is it really that difficult for a new product to come up with web hosting+ subscription management + e-mail automation + payment processing. What is the real value they are offering to writers that's so difficult for a competitor to copy? Why is it so hard for a competitive startup to copy their features and offer it to writers at a steep discount, say a take of 5% (instead of substack's 10%).
I actually listened to a podcast on Substack recently where one of the co-founders actually walked through their strategic thinking, but my quick understanding of their approach:
(1) connect readers and writers directly vs relying on middle-layers (e.g. publishers)
(2) avoid relying on anachronistic models (e.g. ads) that don't incentivize good writing
(3) enable writers to reach audiences in new ways (e.g. bundles)
(4) remove money as a hurdle for good writers to get up and running (e.g. fellowships)
(5) allow savvy readers to curate their feeds themselves (e.g. multi-subscription discounts)
to answer your specific questions, I don't think the tech is that hard to copy, but reaching a critical mass of quality writers / paying readers is difficult to bootstrap (and they have) - also, by allowing creators to just export their distribution lists (audience) and take elsewhere they are already acknowledging that they have to provide a great experience / clear incentivizes vs relying on lock-in or migration difficulty to make it work
some problems that I think they will need to solve to ultimately be successful:
(a) only top 1% of writers can make a living this way, so what about the rest?
(b) how does good writing / new writers rise to the top? (bootstrap problem)
(c) how does a reader find relevant content when everyone is newsletter-ing?
(d) is subscriptions the primary way for writers and readers to exchange value?
(e) is enabling writers/writing enough or is the future content creator multi-medium?
the crux of any product strategy comes down to (i) choosing which problems to tackle vs not and (ii) sequencing the solutions in the right order to the right degree to capture the market - let's see what they do =)
oh and here's the podcast with Chris Best (CEO of Substack) https://podcastnotes.org/venture-stories/chris-best-on-venture-stories/
thank you very much for the detailed reply!
Ibramin - Thanks. A request - a lot of newsletters focusing on strategy templates, but very few try to bring these template to life by providing real examples. Do you think you think you can do some posts explaining strategy through the example of a startup, say Asana. What is their strategy, what is it that they are doing thats so different from all the other proj mgmt SaaS companies out there? Do they have any real differentiation? How does their differentiation tie back to their value chain. Something along these lines would be really useful. Many thanks
great idea - I did exactly this on a recent podcast - attempted to reverse engineer the strategy for a product/feature (Twitter/DMs) based on public information - the episode will drop on 12/4 and you can watch for it here -> https://buildpodcast.drift.com/public/13/Build-45671
I'll also be doing an accompanying write-up to cover some angles we didn't get to in the podcast...but in general I agree with you that deconstructing a work-in-progress strategy is a better way to learn than just focusing on generic templates
Kiran, here is the episode as promised https://buildpodcast.drift.com/public/13/Build-45671/fb16db9b
thanks, listening now....