For years, Substack was the promised land for the independent writer. It offered a seductive simplicity: a place to build a mailing list, a way to charge for subscriptions, and a discovery engine that could turn a niche obsession into a full-time career overnight. For many, it felt like the ultimate liberation from the traditional newsroom’s editorial whims and precarious paychecks.
But for the creators who actually succeeded, that liberation has come with a steep price tag. A growing number of high-profile writers are now fleeing the platform, citing a pricing model they describe as a “chokehold” on their businesses. The exodus is no longer just about the platform’s fraught relationship with content moderation or its stance on hate speech; it is increasingly about the “Substack Tax”—a 10 percent cut of gross revenue that becomes punishingly expensive as a publication scales.
The trend has accelerated with the departure of The Ankler, a prominent entertainment industry publication. Its founders, Janice Min and Richard Rushfield, recently moved the site to Passport, a new platform born from a partnership between Ben Thompson, the founder of Stratechery, and Automattic, the company behind WordPress.com. The move reflects a broader desire among professional creators to transition from being “newsletter writers” to operating fully integrated media companies with total control over their digital infrastructure.
As a former software engineer, I find the technical tension here familiar. Substack operates less like a tool and more like a landlord. While it provides the house and the utilities, it takes a percentage of everything the tenant earns. For those reaching the “creator middle class,” the math simply stops adding up.
The Math of the Creator Tax
The fundamental friction lies in the difference between a commission-based model and a software-as-a-service (SaaS) flat-fee model. Substack’s 10 percent cut may seem negligible for a hobbyist with a few dozen paying subscribers. However, for a professional operation, the cost scales linearly with success, creating a perverse incentive for writers to leave once they hit a certain threshold.
Consider the case of Matt Brown, creator of Extra Points. With 71,000 subscribers, Brown noted that staying on Substack would cost him over $25,000 a year in fees. By switching to Beehiiv, he reduced that cost to approximately $3,000. Similarly, Sean Highkin of The Rose Garden Report found that moving to Ghost—an open-source alternative—slashed his annual overhead from nearly $5,000 to just over $2,000.
The disparity becomes stark when comparing the top-tier costs across the most popular alternatives for creators with significant audiences.
| Platform | Pricing Model | Typical Cost (10k Subs) | Ownership Level |
|---|---|---|---|
| Substack | 10% Revenue Cut | Variable (High) | Managed / Closed |
| Ghost | Flat Monthly Fee | Low to Mid | Open Source / Full |
| Beehiiv | Tiered Subscription | Low | Managed / High Control |
| Kit | Tiered Subscription | Low to Mid | Managed / High Control |
Beyond the Balance Sheet: The ‘Enshittification’ Problem
While the money is the primary driver, a deeper philosophical divide is emerging regarding the “open web.” Several departing writers, including Anne Helen Petersen of Culture Study, have used the term “enshittified” to describe the platform’s evolution. The term, coined by Cory Doctorow, refers to the process where a platform first provides value to users, then shifts that value to its business customers, and finally degrades the experience for everyone to maximize profit for shareholders.
For writers, this degradation manifests as a loss of control. Substack has leaned heavily into social features, specifically “Notes,” an algorithmic feed designed to keep users within the app. While Substack argues that Notes is a “growth engine” to help writers find new subscribers, critics argue it creates a “walled garden.”
The technical nuance is critical: you can export your subscribers (the email list) from Substack, but you cannot export your followers from Notes. So that while your mailing list is portable, the social graph you’ve built within Substack’s ecosystem belongs exclusively to the platform. When a writer leaves, they leave behind a significant portion of their discovered audience.
the lack of deep customization makes it difficult for a publication to establish a unique brand identity. Many writers find themselves trapped in a sea of identical templates, with “.substack.com” permanently etched into their URLs unless they pay for a custom domain.
The Counter-Argument and the Path Forward
Substack is not conceding the territory without a fight. Hanne Winarsky, Substack’s head of New Media, maintains that the platform remains committed to creator ownership, pointing to the fact that mailing lists and payment relationships are exportable. The company also highlights a “boomerang” effect, where writers like Glenn Greenwald and Joe Posnanski have returned to the platform after experimenting with other services.
Substack is also diversifying its reach, expanding aggressively into international markets. In the UK, the platform has seen a surge in high-profile adoption, with paid subscriptions for figures such as Prime Minister Keir Starmer and pop star Charli XCX reportedly surpassing 500,000.
However, the shift in perception is palpable. Substack is increasingly viewed not as a permanent home, but as an incubator. It is the perfect place to start—where the barrier to entry is zero and the discovery tools are powerful—but it is no longer the place where the most successful independent media companies want to stay.
As more creators migrate to platforms like Ghost and Beehiiv, the industry is moving toward a “Shopify model” for journalism: providing the infrastructure to build a business without taking a cut of the product sold. The “Substack Tax” may not kill the platform, but it is forcing a maturation of the creator economy, where the value is placed on the ownership of the audience rather than the convenience of the tool.
The next major indicator of this trend will be the rollout of the Passport platform, which aims to merge the flexibility of WordPress with the monetization ease of a newsletter. As more “power users” migrate to these bespoke setups, the industry will see if Substack can evolve its pricing to retain its elite talent or if it will remain a jumping-off point for the next generation of digital media.
Do you think a revenue share is a fair trade for growth tools, or is the flat-fee model the only way for creators to truly scale? Let us know in the comments.
