How I Grew My Paid Newsletter to Over $114K of Recurring Revenue

3 years after quitting my job and launching a paid newsletter, I can say, this is for real.

  • 330 paying members
  • +65% y/y revenue growth
  • $114,000 annual recurring revenue

Here are some reflections on my first 3 years as an entrepreneur.


Focusing on Performance

I launched my newsletter before Substacks were cool.

When I launched, people associated newsletters with scammy companies like Agora and Empire.

I wanted to be different.

I was told to underemphasize performance. Afterall, who knows if you will outperform.

But I wanted to be accountable.

So every week in my newsletter, the first page shows absolute and relative performance of every pick (current and past).

So far so good.

Average holding period: ~12 months

Average return: +25.5% (+10% vs. S&P500)


Was quitting my job and launching my newsletter risky?

It depends on how you define risk.

On the one hand, yes it was.

My wife wasn’t working and I had one kid and a baby on the way.

But I don’t think it was risky.

I did some “fear setting” (H/T to Tim Ferriss) and asked myself “What’s the worst that could happen?”

I had two years of living expenses saved.

Worst case is after two years, I would have to go back and get a job.

Maybe I wouldn’t make the exact same salary right off the bat. But I was confident that I would be able to work my way back over time.

In my opinion, it was risky to NOT take this shot.

Jim Koch summed it up well when he wrote, “Isn’t the biggest risk of all that you’ll waste your life doing what you don’t really enjoy doing, making compromise after compromise?”


What have been the biggest challenges?

First, my 2nd and 3rd pick were $KLXE and $RVRA. Ouch.

I lost a lot of money but what felt worse was letting my subscribers down.

Luckily, since then, the winners have more than made up for the losers.

The other challenge was in early 2019.

My business was growing but not fast enough.

At that growth rate, I would eventually run out of money and that was stressful.


What has worked?

  1. Twitter. I was so late to fully understand the power of Twitter for my biz. @StockJabber was kind enough to give me some tips and Twitter will remain a huge focus going forward.
  2. Hype emails when I’m about to publish a new recommendation (drives urgency).
  3. Raising prices. I’ve raised prices twice since launching and it has driven urgency to sign up before the price hike.
  4. Sales. They definitely work. Everyone likes a deal. However, you can’t do it too often or your list will “wait for the next deal”
  5. Cross promotions. I’ve done deals where another newsletter promotes my newsletter and we share revenue.
  6. Podcasts. I love getting on podcasts because it requires virtually zero preparation (I just talk about the stuff that I’m already working on) and it drives paid subs.


What hasn’t worked?

  1. Seeking Alpha. I launched a parallel subscription service through Seeking Alpha’s marketplace and that bombed. After a year, I shut it down.
  2. The Moneyshow conference. I traveled to Philadelphia and then Florida for two conferences to present about spin-offs. I don’t think I got a single sub. I think it works for other newsletter providers, but just didn’t work for me.
  3. Getting published on Friends and family were impressed when Forbes featured my analysis, but it didn’t drive any business. It was good for my ego, but didn’t help my biz.


Is $114K of recurring revenue enough to support my family?

In short, no. I live in an expensive suburb of Boston and have two kids.

But I write a micro cap newsletter for Cabot Wealth and am also a Partner in a Private Equity Firm (check out Better Way) that my former boss started.

With these other jobs, I can fully provide for my family.

And business is good!

I estimate I will make more next year than I made when I was at Citi (my last employer).

And the best part is I’m in control of my life and my upside is unlimited.


What are my next plans for my newsletter biz?

There is a ton of low hanging fruit.

1) Currently I only have 1 tier of service. I will eventually offer an intro tier and a premium tier.

2) Other products. This is tricky because I only have so much time. So I will likely have to hire someone to lead the product. Ideas include: bank thrift conversion, merger arbitrage, SPAC research, options, etc.

3) Create a course on how to find, analyze, value and invest in spin-offs.

4) Write a book. This won’t be very profitable, but I would love to write a book and share all that I’ve learned.


What’s my long term future?

I’m not sure. But it’s exciting.

I always wanted to start an investment partnership. I figured the newsletter biz would provide me with the recurring revenue to support my partnership as it scales up.

But I’m really enjoying writing the newsletter and managing my own money.

Time will tell.


Should You Write a Newsletter?


Start out publishing a free newsletter using Substack. I would have started with Substack (I use WordPress now) if I had to do it all over again. WordPress has a lot of bell and whistles that I appreciate now, but Substack is an amazing all-in-one solution.

But whatever you do, definitely start a newsletter:

  1. It will make you a better investor. I don’t know why but publishing for an audience holds me accountable. I don’t want to look like an idiot with poorly thought out ideas.
  2. You will be able to learn as your newsletter will provide you with the ability to review past success but more importantly, past errors.
  3. You will meet incredible people. Your newsletter will be a beacon for like-minded people. You will develop a network that you can use to find and discuss new ideas.


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