Eric Newcomer was a Bloomberg journalist for around 6 years. During the pandemic, he set out on his own and was part of the initial group of journalists leaving their jobs to start a Substack publication.
He sent his first issue of the Newcomer newsletter in October 2020 and has since been able to build an audience of over 65k subscribers bringing in more than half a million dollars each year.
While working at Bloomberg, he always felt like there was more to the story and a lot that went unsaid. He set out to be an independent source covering both sides of the story, and he’s killing it.
The Growth Timeline
After starting the newsletter, Eric had around 2,500 people follow him from Bloomberg.
Growth was pretty steady until April/May 2022 when Substack launched its recommendations feature. Eric’s free subscriber list started growing at a much faster clip after that.
But that wasn’t the only thing that helped him get to over 65,000 subscribers and over $500k in annual revenue. Let’s take a look at how he was able to grow at that rate.
The Growth Levers
Here are some of the growth levers Eric has used to translate his experience into a creator business.
1. Relationships. Eric built incredible relationships while working as a full-time journalist, and he’s been able to translate those into helping grow his business.
2. Live events. We don’t see this one very often. Eric put on a small conference in March 2023 that made the news in a pretty big way.
3. Substack recommendations. I mentioned this above, but it was a big part of helping Eric hit “escape velocity” with the newsletter.
4. Scoops and exclusives. People crave exclusive content. By leveraging his relationships and the trust he’s built with his sources over the years, he’s able to continuously give the people what they want.
5. Take a contrarian angle. Working at large media publications means you can’t always share the stories you know are important.
1. Focusing on Quality Relationships
There is a throughline that links many of these growth levers together, but I wanted to call it out on its own – building quality relationships.
While working at Bloomberg, Eric was able to connect with a lot of top names in the tech and VC space. But he wasn’t just “the reporter guy”, he ended up building lasting relationships that helped him transition over into a new venture when the time came.
And similar to what we’ve seen in the past with Gergely Orosz and Mario Gabriele, Eric has built up a lot of trust with people in the industry. This trust allowed him to get “scoops” or insider information, allowing him to break massive stories that haven’t been reported on elsewhere.
The level of quality this brings to his content is why his subscribers don’t mind paying $199/year or more.
Relationships are nothing without a deep sense of trust.
Eric put on a conference around AI called Cerebral Valley in March 2023.
He did a few really smart things when he put this together.
The conference was invite-only, and while you could apply to attend, Eric was the one deciding who would attend. This made sure the event was high-quality, and not just newcomers (ha!) who were kind of interested in the AI space.
On top of that as a past journalist, he knew how to get people talking about the event.
In some cases, he invited writers at top publications to come to the event. A lot of these writers and contributors either wrote a “pre-event” piece or a “recap” article after the event.
Some of these articles were featured in top publications, driving a lot of eyeballs to the event:
- The Verge: A Visit to Cerebral Valley
- TechCrunch: ‘There’s too much opportunity’ in Cerebral Valley
- Business Insider: Dozens of AI enthusiasts gathered in San Francisco’s Cerebral Valley for a summit. Here are the top 3 takeaways from the event.
- Washington Post: AI is reviving San Francisco’s tech scene. Welcome to ‘Cerebral Valley.’
If you’re into AI and you saw any of these articles, chances are you’d click to read them and end up learning about the event.
After the event, he posted all of the videos on his YouTube channel for anyone to watch. Each video has over 200 views, with some even closing in at 10,000.
Of course, these are not huge numbers. But you have to remember, he’s going for quality, not quantity.
The people watching these are getting introduced, or re-introduced to him and his brand. His brand is now associated with these top names in the AI tech space.
Eric posted a few weeks ago that two people met at the Cerebral Event, and ended up partnering on a $1.3 billion deal:
Talk about having an impact on people’s lives. While only 200 people attended, this event is going to have ripple effects for a while because of the quality of attendees.
3. Substack Recommendations
You can see the “recommendations effect” on the right side of this chart Eric shared on Twitter.
It’s kind of unreal growth, to be honest.
Eric told Simon Owens that the free subscribers coming from recommendations don’t convert into paid subscribers as well as other sources have in the past. But with that level of growth, you’re bound to get at least some of those people turning into customers.
Of course, you need to have good content for others to feel comfortable recommending you to their audience. But Eric has been able to translate his experience and industry relationships into great original writing.
4. Scoops & Exclusive Content
Eric Newcomer has been able to channel these relationships he’s built and the experience from working at a major publication into writing “scoops” and exclusive content.
“Reporting on Coatue and Tiger Global were huge subscriber moments for me,” Eric told Simon Owens.
These big stories lead to a lot of eyeballs on his work, which a portion of then subscribe and become paying members. Most of his articles have a paywall on them, and Eric does a great job of teasing the story above that.
With the Coatue example, he wrote about how the hedge fund is down 17% this year and then goes on to tease exclusive slides he got access to.
If you’re interested in this story even slightly, you’re probably going to pony up the money to be able to read it. Especially if it’s going to help you be more informed about your job and investments.
It’s a typical marketing play of creating an open loop and forcing them to take action to close that loop. He could have just written the title and paywalled it at the top, but instead, he gives you a taste of what you’ll get and then gives you a clear reason to subscribe.
5. Be the Contrarian
While working at Bloomberg, Eric got to see multiple sides of the story, but he wasn’t always able to write the stories he knew were important.
But when you’re working for mainstream media, you can’t always say what is actually going on because it could affect their funding and/or reputation.
But as an independent journalist, you have a lot more control in terms of what you publish.
That helps him stand out among readers, but it doesn’t come without its own risks.
Eric also doesn’t invest in the companies he’s covering, nor take outside money, which keeps his stories more level in terms of skew. We saw a similar theme with Edwin Dorsey last week.
He said that sometimes he’ll get flack from the conservative right, and other times he’s making liberals mad. He likes it that way because that means he’s leaving his own bias out of the pieces as much as he can.
It goes without saying, but I think people are just hungry for this kind of content anymore. After only having a few options in terms of what we were able to read, it’s nice to be able to support the writers we relate to and enjoy their content.
How You Can Use These Growth Levers 🗺️
While Eric had a bit of a headstart since he was working as a reporter for so many years, he still had to figure out the business side of things and how to carve out a niche.
Here are a few ways you can replicate some of his success.
Get Recommendations Going
Discovery for newsletters is notoriously bad. But “Recommendations” for newsletters have changed the game quite a bit. By teaming up with other creators who are in a similar space, you can speed up your growth by helping each other out.
You recommend them, they recommend you, etc. Here is what mine looks like:
It can be challenging to find a good match in terms of creators who are open to this, but once you do it’s a great passive way to grow your email list.
But, the recommendations craze is not going to last forever in its current iteration. I think people are going to get tired of being recommended other newsletters after they join one.
But for now, it seems to be working well. My open rates from recommendations are around 40%, so while it’s not ideal, it’s still pretty good.
If you’re on ConvertKit, sign up for the Creator Network.
If you’re using Beehiiv, they have a built-in recommendations option as well.
I’d get this going sooner rather than later.
Consider Alternative Ideas
Eric put on a live event that really amplified his brand and messaging in the tech space.
Is there a way you can test out different routes to get in front of some heavy hitters in your ideal audience?
We don’t see a ton of “newsletter writers” running live events. The GIST, a sports newsletter geared towards women, had an in-person launch party that got them 1,000 subscribers on the first day.
Other than that, there aren’t many. You can also put together virtual events as a middle ground, but having people in person builds up relationships and affinity for your work.
Build Quality Relationships
I’ve said it before and I’ll say it again. Relationships are the core of any good business.
Even if you are trying to go the solopreneur path, you’re going to need other people in your corner at some point. By building up relationships over time, you can see new ideas and get help with any problems you might be struggling with.
In Eric’s case, relationships help him create much more robust pieces of content, and help those spread across the industry.
How Newcomer Makes Money
It only took Eric a few short months to more than replace his journalist salary from working at Bloomberg.
He told Simon Owens that by February 2021, just 4 months after launching the newsletter, he had over 1,000 paying subscribers. That’s the point when he felt secure enough and that this whole thing was going to work.
In 2022, Eric said he brought in around $310,000 in net revenue.
Premium subscribers make up a majority of the revenue Eric brings in.
He charges $19/mo or $199 for the year.
If we estimate that around 4% of his subscribers end up paying for the newsletter, with 65,000 free subscribers it’s safe to say he has around 2,600 paying members.
If we use a conservative $199 for the year, that’s $517k in annual revenue.
I’m willing to bet he has closer to 7% conversion from free to paid, which would put him at 3,900 paying subscribers, and $776k in revenue. But, that’s just speculation 🙂
Since relaunching the Newcomer podcast, formerly known as “Dead Cat,” he’s started including sponsors as well.
I can’t speak to the rates he charges for a podcast sponsorship, but he’s in a similar space to Lenny Rachitsky, who mentioned in an interview that his podcast was going to overtake paid membership revenue in 2023. Wild.
They have similar sponsors, but again, I have no insight into the rates they’re charging. The Newcomer podcast is also not as popular a podcast as Lenny’s.
When he held the Cerebral Valley AI Summit in March 2023, he had quite a few sponsors on board.
The partner sponsor was Volley, an AI platform, and there were 13 others as well, including Samsung Next as the main sponsor.
With these last two, I’m in the dark about how much they’ve contributed to revenue, but it’s really nice to see a newsletter operator hosting an in-person event as another way to build community, grow subscribers, and add an additional revenue source.