Substack ditched plans for a Series C as VC market sours
"Amid an industrywide downturn, venture investors are preaching austerity and halting new deals, particularly for companies that have spent aggressively on growth." —NYT
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After a few years of insanity, VC investment has started to cool down.
It also appears that some of Substack's financials contributed to its series C falling though. The company hit a $650 million valuation, however, it "told investors that it had revenue of about $9 million in 2021."
Many other folks are looking for Substack alternatives like Ghost. It'll be interesting to see what impact a prospective recession will have on the broader creator economy and its companies.
I think Substack is one of those pandemic success stories. Don't get me wrong: They a leader in their space, have made cool products and they've spurred creative companies.
Their crazy growth though seems to be tied to people being stuck at home. We'll see though!
Substack takes a 10% cut and Stripe takes another 3%. I read a few Substack newsletters but I'd definitely pass on starting a newsletter on Substack.
With inflation, interest rates and the tanking stock market, it's not too surprising to see Substack struggling as it is. People don't want to spend as much on food writers.