How Chris Best and Hamish McKenzie built Substack into a writer-owned media platform

Executive overview

Mainstream media's ad-funded model rewards engagement over quality, leaving writers dependent on platforms that control their audience. Chris Best (ex-CTO of Kik) and Hamish McKenzie (journalist, ex-Tesla) co-founded Substack in 2017 on a single insight: make readers the customers, not advertisers.

The model is brutally simple — writers charge subscribers directly, Substack takes 10%, everything else is free. No tech skills required.

The core insight: own the subscription relationship and the economics align with quality, not outrage.

The idea and early skepticism

• Chris left Kik in 2017 after eight years, wanting to write; his frustrated media essay prompted Hamish to ask: "What's the solution?"
• Core observation: Ben Thompson (Stratechery) was making over $1M/year on a paid newsletter but required 19 different tech tools and rare triple-skill overlap
• The Substack thesis: remove all the friction so any writer can just type into a box
• Pitch failed the "blank stare" test — "nobody pays for anything on the internet" was the universal response
• Parlor trick that revealed latent demand: ask skeptics to name their favourite writer, then ask if they'd pay $5/month for that person — they always said yes

Building and launching

• Chris bootstrapped the tech from Canada; Hamish handled writer outreach from San Francisco
• Launched October 2017 with Bill Bishop (Sinocism) as first publisher — he made six figures on day one
• Applied to Y Combinator with $0 revenue; updated to "six-figure ARR in a day" at the interview
• 7,000 paid subscriptions across the network by end of YC in March 2018
• Emmett Shear (Twitch co-founder) invested early, calling it "Twitch but for journalists"
• Equity split 50/50 from day one, funded partly by Hamish's inheritance from his grandmother

Business model design

• 10% cut only on paid subscriptions; all hosting, email, and tools are free
• Only make money if writers make money — no SaaS fees, no ads
• Started paid-only, then added free tiers fast: writers need free subscribers to convert to paid
• At scale, 1,000 paid subs at $50/year = $50K; 10,000 = $500K — writers consistently failed to do this multiplication themselves

Growth through disruption (2019–2021)

• Raised $15M from Andreessen Horowitz in summer 2019
• COVID and institutional media pressure triggered a wave of prominent departures: Andrew Sullivan, Matt Taibbi, Bari Weiss, and others
• Grew ~6x in 2021; positioned Substack as the "getaway vehicle" for journalists under institutional pressure
• Content moderation stance — no incitement to violence, no spam, no doxing; otherwise hands-off — was non-consensus but proved durable
• Theory: the subscription model removes the outrage incentive; sensationalism just doesn't work when readers pay directly

The Elon Musk episode

• In 2023, Substack launched Notes (short-form feed); gave Twitter/X a courtesy heads-up before launch
• Elon responded by offering to acquire Substack and make Chris CEO of X — Chris declined, believing it would not support independent, neutral publishing
• Twitter then suppressed all Substack links and accused Substack of API abuse
• By then, Twitter traffic was already a small and declining share of Substack referrals — the threat didn't land
• By 2025, Elon was tweeting Substack links himself

Lessons from Kik applied to Substack

• Kik reached ~300M users with no business model; eventually tried a cryptocurrency pivot before fading
• Lesson one: have a business model from day one
• Lesson two: keep the main thing the main thing — avoid chasing pivots when the core product isn't finished
• Substack runs ~100 employees; structured to not need further fundraising, keeping financial control in-house

Where Substack is heading

• 5 million+ paid subscriptions as of mid-2025; revenue exceeds many major legacy publications' subscriber bases
• Platform is format-agnostic by design: writing, audio, video — built around the creator relationship, not the medium
• Not yet profitable but not dependent on new fundraising
• Long-term vision: as AI tools make high-quality audio/video production accessible from a phone, Substack becomes the distribution and monetisation layer for all of it