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[upbeat music] Welcome to the Rebooting show. I am Brian Morrissey.

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This week's episode is brought to you by our partners at Beehiiv, which I'll be telling you about regularly on the Rebooting show because Beehiiv is its new headline sponsor.

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When you are running a media business, email is usually the backbone. At least it should be, I think, for most. And getting it right, unfortunately, is usually harder than it should be, and that's where Beehiiv comes in.

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This is a platform that was built by the people who scaled Morning Brew to millions of readers, and they created the platform they wish they had when they were in your shoes.

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And so that's why it's no surprise that companies like Time and the Texas Tribune are already running their newsletters on Beehiiv.

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It is designed for serious media operators, not marketers bolting on a newsletter as an afterthought.

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And here's the thing, if you're running a publication with more than a hundred thousand subscribers, Beehiiv is built for you.

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Their team has scaled newsletters at places like The Information, Puck, and Morning Brew, so they understand the challenges that big publishers face.

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From seamless migration to enterprise-grade deliverability and monetization, Beehiiv makes it easy to grow, retain, and engage audiences at serious scale.

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If you wanna see what your next stage of growth could look like, and I hope you do, go to beehiiv.com/trb. That is spelled B-E-E-H-I-I-V.com/trb.

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And you can meet with Beehiiv's team of growth and newsletter experts today. So go to beehiiv.com/trb. Thanks a lot to, to Beehiiv. And to kick off this partnership, I'm actually joined by Tyler Denk, the CEO of Beehiiv.

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I've known Tyler for really since the beginning of Beehiiv. I think it was before the [chuckles] you, you didn't really have a, a product.

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But I met with Tyler, we talk about this in the show, over the pandemic when he was... and his, and his co-founders were starting to build Beehiiv.

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And he was, he was asking me all kinds of questions about frustrations I had as I was getting the Rebooting off the ground. And I was like, "What are you doing?"

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And it turned out that he was building his own email platform from what he learned at Morning Brew.

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And I was really impressed with the vision that he had, and that's why I invested in the company's seed round, because I thought that the market needed what he and his team were building.

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I recently switched over to Beehiiv, and I've been impressed by, you know, how he and his team have built an enterprise email platform in such a short period of time that's so powerful.

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To me, the biggest difference that I've seen is just simply the number of tools that are available that are missing from alternatives that often treat email as just one of several channels in a larger, you know, platform, or maybe it's a creative platform or creator, creator network, social network.

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We get into all of this. The analogy I, I made then with Tyler, and I still make, is, is being Shopify to Amazon.

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You know, Shopify took a completely different approach than Amazon in quote unquote arming the rebels rather than acting as an everything store.

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And I see the current email landscape, you know, similarly as a company like Substack, for instance, shifts to being a social platform really, and others are retrofitting email onto a web-based publishing platform.

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There's a lot of other email service providers out there, and, you know, I think Beehiiv is a, a real modern alternative. Of course, it always depends on what kinds of business you're going to build.

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But for mine, you know, email is, is at the center of, of what we do 'cause it's a way to build a habit, direct connection, and understand the audience far better. I wish podcasts, for instance, allowed that.

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Tyler and I discuss all this, and we discuss the idea of peak email. Unsurprisingly, Tyler [chuckles] this is not buying into it. It's something I always feel perhaps irrationally.

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We also talk about the, the open approach Beehiiv is taking versus a closed system, why email is a great leveler between the largest publishers and individuals, and the challenges that big publishers still have when it comes to legacy email technology.

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I hope you enjoy this conversation with Tyler. I know I did. Send me feedback to Brian@therebooting.com. And please leave the podcast a rating and review. I always like to see them.

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Supposedly, it helps people discover the podcast because podcasts are not as straightforward as, say, email. [chuckles] Now here's my conversation with Tyler.

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[upbeat music] Tyler, s- so happy that we are, we're doing this. Welcome to the Rebooting show. I'm really excited that we're doing, that we're doing this partnership.

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And, like, I was actually going back through my email for when we first met in, like, twenty twenty-one, and it's, like, the height of the pandemic.

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I had the best job in capitalism without capital because I was, like, paid not to work. But I was still...

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You know, I was just starting my newsletter journey, and you were-- We went to dinner with a bunch of Morning Brew people, and you were like...

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You're, you're asking a lot of perceptive questions, and I was like, "What are you doing?" You were like, "Um, I'm, I'm at Google." [chuckles] And you're like, "I'm working on something."

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And here we are, and you've built, like, an amazing platform, and I'm excited to be, you know, moving to Beehiiv and just... You know, after that, after that dinner, I was, I, I gave you a little money.

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You're my only angel investor. This is TRB Capital- Honored. Yeah... only has Beehiiv.

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So I'm, like, one for one if anyone [chuckles] I, I don't even remember the questions I was asking at the dinner, but I must have been asking the right questions. Well, no, because I was.

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You know, I was, you know, I was like, "Oh, uh-oh, he's, he knows what he's doing." And really impressed, obviously, with, with what you've done with, with the platform. But I wanna get...

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I wanna start by getting your theory of the case about media. Like, I feel like I, I'm either talking with people who the sky is falling or with people who are, like, see nothing but, like, opportunities.

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And, and it's, like, a very strange time in media. But what is your theory of the case?Yeah. I, I mean, I've wrote a post about this.

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I'm trying to be like Brian Morrissey, and I'm trying to write my own newsletter and talk about media every now and then. So I wrote about this two weeks ago. Stay in your lane. I know.

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[chuckles] I, I can't do as good of a job as you do. I can't do software, so I think we're in agreement. [chuckles] So, so I wrote a post about this two weeks ago, but

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a lot of it was actually inspired by the Cloudflare CEO joining Stratechery and Ben Thompson in his interview of how Google kinda built the modern internet with the, the promise of, "We'll scrape your websites, we'll send you traffic, and we'll help you monetize," right?

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So from like AdSense and everything else, you get page views, we'll help you monetize those page views.

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It was like a fair trade, arguably, at the time when it works, and that's like what kinda built like the, the modern digital media ecosystem.

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Same thing happened with Facebook way back when, and all of these brands from BuzzFeed to Hot Ones or, or whatever else would, would post content on Facebook. The thinking was if you drove...

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If you got likes and followers on Facebook and you posted content frequently, the Facebook algorithm would show that content to the people who like your page.

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That would drive page views back to your website, which you're monetizing with Google AdWords.

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And so there was this like ecosystem play between, call it Facebook, Twitter, and Google, where the more content you created and posted, you were rewarded by driving more traffic back to your website.

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Changed in 2018 when Facebook decided to deprioritize content from brands and publishers in favor of like friends, community, and family. Mm-hmm.

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And so a product decision, or Mark or whoever made that decision to change the algorithm, and traffic basically bottomed out for publishers after that.

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And we've seen all of those big brands like the Buzzfeeds of the world and others, a lot of them had layoffs, down rounds, or shut down entirely in the aftermath of like the Facebook saga of 2018.

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Twitter in 2022 did something similar where they deprioritized links to external... or like external links on the platform. Thinking's pretty straightforward, right?

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Their KPIs are keeping people on the Twitter feed and on the platform. If you're a publisher linking back to your website, that's taking people out of the Twitter ecosystem and onto the website.

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And then recently you've seen with Google and the AI summaries that why, like the, the promise of we crawl your website then drive traffic is now diminishing with the proliferation of AI and the fact that consumers want a single answer.

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And so they're just prompting and asking questions and receiving answers with the summary at the top. And you're seeing publishers lose traffic 40 to 50%. And so that's like the chaos of everything.

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Through all of that, the, the companies that you've seen in the media brands that have done really well over the past few years, Morning Brew, Axios, Politico, Puck, The Information, a lot of those, the commonality is that they're email first, and the difference is like they own their audience and they own their distribution.

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And so when Morning Brew...

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I mean, we depend on Facebook and Google for driving leads to get their email, but once we've got their email, every time that Morning Brew wants to send an email each morning to their four or five million readers, it doesn't really matter what the algorithm of Facebook or Google is doing, because through the inbox, it's one of the few direct channels that they have, and they've been able to grow extremely well.

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They got acquired by Business Insider. And so I think a lot of media is waking up to that, if they haven't already, very recently with the Google changes.

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And then as you see the other business models, y- you've seen all of the legacy publishers, one, change their email from just like an email that drives links back to their website to monetize with- Yeah...

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page views to like an actual newsletter product that they can monetize standalone, and then subscription as well. So I don't know if that like broadly- Yeah... answered your question, but like- Go on...

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j- I think the ownership of your audience and distribution is, is very front of mind for everyone in media. That's it, the distribution part, right?

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Because like, you know, I always say like people make media super complicated, but it's really about what do you make, how do you distribute it, how do you make money off it, right?

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S- there's, those are the three jobs, you know. And when media lost control of its distribution, it lost control of its business because y- I just covered it as a jour- as a journalist over the years.

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I mean, the contortions that these businesses had to go through in order to cater to a, a third party algorithm at the end of the day, which was just, you know, amazing.

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And those, and those businesses were premised on, you know, move fast and break things, et cetera. And so they were just constantly chasing after, you know...

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And, and so I don't really sort of blame necessarily the tech platforms.

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I think they, they PR'd themselves as something different than they were, and of course, now, you know, they're obviously just looking out for themselves, and they have, they have consumers that go to them.

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And I think a lot of publishers maybe lost sight, maybe, maybe, I'm not saying that. Many publishers pretended that, you know, Facebook or Google's audience was their audience, and w- th- those things are not the same.

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And that's changing.

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So I think a lot of publishers, the way forward is, is simple but hard in that you have to develop, you have to develop audience-focused strategies and direct connections with those audiences, and then you'll have a, a chance to monetize.

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But the idea of like building a publication off of SEO is, I think, dead at this point. Yeah. It, it's own versus rented, right?

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And, and even going back to what made Morning Brew special, we looked at like the push versus pull. And there was a time back when I was in college- Mm-hmm...

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where I would go out of my way, go to TechCrunch, and I'd read like the top 10, 15 stories, right? But that required me to have that muscle and that behavior of going out of my way- Yeah... to go to TechCrunch's website.

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And what made Morning Brew and I guess like the newsletter model so special is people are checking their inbox regardless throughout the day, whether it's for work purposes, whether it's for information or entertainment or anything else.

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And so having the information that you've already opted into sent directly to where you already are as the push versus pull, I think that was like a very powerful narrative that we leaned into early with Morning Brew and a lot of the reason for the success.Yeah.

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And, you know, the numbers end up being smaller.

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I think a lot of the media brands, some which you, you referenced already, you know, had a, a pretty flimsy infrastructure in place because they were so dependent on, on platforms for their audience.

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And when that went away, you know, their businesses in many, in many cases went away.

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Obviously, Morning Brew, uh, where you were an early employee, took a, a very different approach, and it paid off by having a much more solid foundation around email. Now, today, everyone has gotten the email religion.

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Tyler, I used to like, you know...

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I used to interview people, like, on stage at Digiday events, and they would be talking about Comscore and all these things like this, and I would go back, like, you know, in our business and be like, "We never even thought about it.

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We thought about email lists." Because anyone who was in B2B email, they knew if you send out an email about some event, like, things happen, like, tons of money comes in.

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Like, you can tweet until [chuckles] like the cows come home, but that's not happening. So like, B2B was always, I, I feel like early on to, to, to email because the...

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just the contours of the business were totally different. And now I feel like these two worlds are coming together even more. What are you seeing when it comes to email, though, as a very crowded channel?

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You know, like I think if you go back, email, like, really started in, like, th- in, I guess, the '80s really, but I would say probably a couple of years after it started, somebody declared email to be dead, and it never has, right?

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But what is the, what is the role you think because of, of, of email within a, like, a modern media organization as, like, infrastructure? Yeah. I mean, I think we're gonna see just like...

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N-no one says that podcasts are dead, right? Or video is dead just because more and more people are creating short-form video or long-form video, or Netflix has a million series for anything you could possibly imagine.

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Email always, I think it's just because it is somewhat dated in the infrastructure and, like, the actual underlying technology hasn't changed a ton.

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People are very quick to proclaim that email is dead and that a surplus of newsletters is, is net bad or, like, there's some ceiling there where there's not a ceiling for other forms of media.

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So I'm not sure where the narrative comes from, but you don't have to log into Netflix, and you don't have to watch YouTube videos.

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I think for almost any working professional, you kinda have to log into your email to communicate and do business in the world, right? So that is, like, the centralizing force that brings people back to email.

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Yeah, and I, I think for, like, media companies, what we're seeing is, again, going back to my TechCrunch example, I used to sign up for the TechCrunch email that just recapped their top 10 stories from the day previously, put that into email form to drive traffic back.

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I don't know if it's the Skimm, Axios, Morning Brew, and, like, this wave of email newsletter companies that have built, like, newsletter as a product, but I think we're seeing, and, and Times, a customer of ours, as are a lot of these other large legacy media companies, seeing the newsletter as not a means to an end to drive traffic back to your website, but as, like, an actual monetizable product that, one, adds value to the customer 'cause they don't have to log in, they don't have to go to the website to check content.

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Something they can sell against. They know it's in this, like, distraction-free environment in your inbox. You can monetize those eyeballs, and you can even double-dip, right?

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You can monetize the newsletter and somewhat drive traffic back to your website. But I think people are getting very sophisticated, and to your point of the example of if you send an email, things are going to happen.

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Email as a product doesn't necessarily have to be ads.

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Whether it's paid subscriptions, where you have a freemium newsletter that you're driving paid subscriptions, whether it's podcasts, whether it's community, whether it's events, just viewing email as, like, a sophisticated top-of-funnel channel that you can build your business around is what I think a lot of these brands like Industry Dive and others have experimented and done really well with.

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Yeah. So you guys are still into email, right? W-we love email. [chuckles] Okay. Ar-ar-ar-arguably too much.

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[chuckles] I mean, I say that because, like, I think it is a counterpoint to, to your friends at Substack a little bit. And, you know, Substack got started...

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I was on Substack originally, you know, so I know the platform real well, and at least u-up until I left. And, you know, they, they sort of moved away from email because they wanted to be a platform.

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And I can remember early on talking, talking to you, and I was like: Be Shopify, don't be Amazon. [chuckles] Because, like, I, I saw the... I, I'm not very original, so I'm not acting like I coined it or something.

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But, you know, basically, you know, when Amazon was always going to be in, in a competition with the retailers, even when they invite the retailers onto the platform, Amazon is going to be in competition with, with you.

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Like, and I think that was something that was obvious from the beginning, but they had such scale, right? That, that retailers had no choice.

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But Shopify, their whole thing was they were gonna arm the rebels, they were gonna be on the side of, you know, of the retailers, and that's a very clear sort of lane. But how do you see this sort of differentiation?

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Because, you know, it seems like, you know, Substack wants to be this all-in-one platform, you know, where it's like OnlyFans for words or, or something of that nature. Um- OnlyFans for words is good. [chuckles] Yeah.

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Which, yeah, OnlyFans is a great business model, but I'm not sure if it's the same about email or newsletters. But how do you end up seeing that?

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Because, you know, we are seeing what, like, my friend Troy Young calls, like, the media singularity of all kinds of formats coming together, but email is still, like, essential.

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So how do you see Beehiiv versus, say, Substack? Yeah. I mean, I think your analogy is correct. I think...

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I mean, if anyone who's been paying attention to Substack, I think it's pretty obvious they're looking to build the next Twitter.

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They, they're clearly going after building a social network and everything that that entails, and I would actually put Substack closer to a competitor to Twitter, Threads, and Blue Sky than an email platform like, you know, an ActiveCampaign, Mailchimp, or, or us really.

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Yeah. And I wouldn't even put us next to, like, ActiveCampaign and Mailchimp either. The, the Amazon versusShopify analogy is great. I, I'll give you credit for it. Maybe you are the first one to tell me that.

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We'll just- Um, but I've used... I've, yeah, I've, I've used it a ton, right? When, when you go to Amazon, when you're shopping on Amazon, it's Amazon's website, it's their branding.

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You purchase something, you talk to the Amazon support agents, it shows up in an Amazon box. Oftentimes when I'm buying on Amazon, I barely even know who the actual retailer is behind it.

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So they have like totally created the app, the website, the ecosystem, and that's how you engage with buying stuff on Amazon.

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The same way with Substack, like people even-- don't even refer to it as like their media company or their newsletter or their website. They say, "Sign up to my Substack." Yeah.

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And so Substack really is the brand- And they're called Substackers... it's the distribution. Right. Exactly. And so- That's what hasten... That's, that's what got me to the exits, being called a Substacker. Yeah. It...

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Exactly. So if... for, for Substack, you are really building on their platform. You go through their reading experience, you download the Substack app, and it's also a bit insidious that...

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smart and insidious in the way that if you are a writer on the platform, the second that you move your list of, call it a hundred thousand people over to the platform, they are sending email comms, not from you- Yeah...

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but on your behalf to get them to download their app.

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And so I think you kind of cede control over the reader relationship the second you enter the walls of Substack, because their KPIs are app downloads, so they can get your readers to subscribe to many other publishers.

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And look, th-there's a play there.

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I think there's some genius to the strategy of like if you are going to build a social network, which is what they're building, the way that they started with email as a wedge and have built around these writers who have a large following, you can commend them for that as a social platform and a growth strategy.

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But along the- And I think, I think it's also, it's like what you wanna build really. Because like to... I, I, I almost think of it almost like, like countries.

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Like countries have different like levels of sovereignty, right? If you're gonna join the European Union, you're gonna give up sovereignty.

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I mean, if you don't have control over your, really over your interest rates, you don't have your own... issue your own currency, you're giving up a lot of sovereignty at the end of the day.

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And different countries have different, you know, approaches to that based on, on where they are. And I feel like some platforms, you, you'll give up more sovereignty than, than with others.

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And, and I think that's fair, right?

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Like, a-again, I, I can commend Substack for their strategy and how they've been able to grow the business, and I've seen people and writers who like it's an incredible fit for their goals, their ambitions, and what they're looking to accomplish.

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We are all the way on the other end of the spectrum of the Shopify analogy, where truly arming the rebels and being able to allow you to own your audience, own your distribution.

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You can create your own custom website, your own custom newsletter, everything. There's no, "You aren't on a Beehiiv, you aren't part of our platform." We'll never send an email to your readers on behalf of you.

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Like it is purely a platform where you can plug in and build your own independent business. And even today, we, we launched earlier today an integration with YouTube and an integration with Discord.

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And so the fact that we are an open ecosystem with APIs and webhooks means if you have a large community on Discord, rather than forcing them into our walled garden, we allow you to play nice and push people who upgrade to a paid subscription to join your Discord server as like an example for community, the same way we can connect with any third party on the internet.

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And I view that as whether it's creator friendly, writer friendly, publisher friendly, just being able to give our users the optionality to build the type of business that they want and meet their audience where they are, I think is a fundamental shift away from the walled garden of Substack, where it's their way or the highway.

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And again, I don't think there's a right or wrong. I think it's different depending on what your goals are and who you are as a publisher or a writer. But I'm a big believer in open platforms.

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I think it is much more friendly. And then we also, obviously the big difference is we don't take a cut of revenue from our users.

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And so as someone who's building a subscription business, not paying a fee or toll to the platform that you are using, I think is very advantageous.

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And then just recently, they launched and forced every writer to offer Apple in-app payments- Yeah... which actually is a form of lock-in because you don't actually control the billing relationship.

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Apple controls that billing relationship. And so in the hypothetical situation that Substack raises their take rate from ten to 15%, that will infuriate a bunch of writers.

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But when those writers want to explore moving to Beehiiv or another platform, once they realize that 10% of their paying subscribers are using Apple, and those Apple subscriptions don't actually port over, then you're kinda stuck between a rock and a hard place because you either leave 10% of your subscriptions behind, which is not something you want to do as someone who's dependent on that revenue, or you eat the 15% take rate because you don't have an option to leave.

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And I think that's where you see a lot of problems with these creator and writer businesses that are built on a take rate model, where it's attract and then extract is- Yeah...

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the business model that we've seen over and over again, and I think we're gonna see that come to play more and more. Yeah, they inevitably become extractive. I mean, this is the story of Silicon Valley, right?

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Like they... it, it inevitably becomes extractive just by the nature of, of the business really. And again- And, and if I were to predict, I think the, the Apple in-app payments is like the first step.

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They'll become much more prominent in showcasing how much growth or subscription growth that they're driving through the platform to justify their take rate. Yeah.

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And then eventually they'll increase the take rate, and then you're stuck between a rock and a hard place of it's impossible to migrate all of your subscriptions, or you pay the, the extra fee.

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And so I don't think I'm a prophet predicting that. Well, let me ask you- But yeah. No. [chuckles] I know. I think, I think we see it like, you know, I think... I know for me, like, when...

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like, when they, when they, when they took the money from Andreessen, I was like, "Okay, I can see where this is going." And they came out with notes.

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It's actually when I left Substack because I was like, this is inevitably... like, they've built an amazing business, but inevitably the business doesn't really work as is, even though they've succeeded in many ways.

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And so they're gonna have to figure outAnd they'd pin themselves in the corner with, with being anti-advertising, et cetera, that they're gonna have to figure out a way to extract more and th-this is how they're gonna, they're, they're gonna do it.

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So who... Let me ask you this. Who is your customer? Yeah, it's a great question. So we, we serve a few different cohorts. Large publishers like Time, like The Ringer, like Texas Tribune.

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Like, we can serve very large customers that have multiple newsletters, a newsroom, different publications, and like a full cohesive media strategy.

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We serve those customers extremely well and at, like, a fraction of the cost of legacy players with the modern infrastructure that we provide. There's also, like, a talent play, right?

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So as you expand, and I think the lines blur between who has an audience and who uses email as a distribution channel, like Arnold Schwarzenegger has a million e-emails on us, right? Yeah.

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He sends a five-day-a-week email newsletter on health and wellness. There are brands who use the company. So whether it is Brex or Calci, like all of these sophisticated...

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And, and I think HubSpot actually opened the door to this by acquiring the hustle.

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But I think it's an incredible analogy and a playbook that it takes a bit more of a discipline and sophisticated company to y- see earn or like media and earn attention as lead generation.

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And so what I mean by that is, like, no one wakes up and wants to spend fifty thousand dollars on a CRM and just jumps to, like, make that purchase.

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Typically, you have to be nurtured for quite a bit to be join that funnel. So HubSpot isn't spending money on direct response to get people to land on their landing page and pay fifty thousand dollars.

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So they acquired the hustle around the same time that Morning Brew was acquired. The hustle speaks to the same ICP of people who would per... in theory, buy and purchase HubSpot for their company.

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And so rather than the hustle having ads for different companies, every day there's a HubSpot ad, and they have, like, different funnels that they're building there.

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So on day a hundred that you've read the hustle and you've gotten extracted a lot of value from the content that they're creating, when you eventually realize that you do need a CRM for your business, HubSpot's been in your face every day for the past hundred days.

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Yeah, exactly. And so it's, it's, it's an incredible acquisition method, and from everything that I've gathered from the team there, has been extremely ROI positive.

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So I guess that's a kind of like the third bucket I'd say, is like businesses and, like, s-software providers who want to use email- Yeah... and content and high-quality content as a way to generate leads.

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But those are kinda like the, the big- Right... three buckets, I'd say. But it's the, it's the person hitting publish too, right? Like, at the end of the day- Yeah... it's a publisher.

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I think that the definition of publisher is, you know, now, and this is the exciting part to me about, about media.

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You know, there's a lot of like bad parts in the institutional media part and, you know, those businesses need to be refactored and they need to modernize both their infrastructure and their business models.

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But at the same time, you know, I call it the information space, there, there are tons of people out there who are u- who realize that media is undervalued in some way.

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I, I went to a newsletter growth conference and I met a Beehive user.

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He's a real estate agent in Cincinnati, and he realized that for him to, like, differentiate against the other real estate agents, like, he was going to be doing, like, a newsletter about, like, the things that are happening in, in Cincinnati, in our real estate and the community.

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And that i-- and so he was there because he's a publisher now too. He's like, "I didn't think I would be, you know, publishing, but this works." And- Well, local newsletters are huge, right? So we've- Yeah...

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seen a huge wave local media and, and a time where a lot of these business models for traditional media have been hurting.

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We've seen newsletters because it's so low cost to run to be able to step into this, like, local media ecosystem, and there's tons of local medias, newsletters and, and publishers who are having a ton of success.

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The other thing about that person that's interesting is I actually think in a time of AI, being able to create content is, like, a huge differentiator. And so, like, I do it for my personal newsletter.

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I don't think I'm much better of a CEO than other CEOs perhaps, but I've been able to build a brand around transparency and basically building, like, a media persona in building in public and sharing my story.

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And when you think of CEOs, like somewhere, if you're in these circles, like, I come up because of this media arm that I've created for myself.

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And so I do think it's interesting while AI will lead to displacing some jobs and being able to, like, have to shift around, like, how do you differentiate a good product manager from, like, an incredible product manager?

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And in a world where there's so much information and so much of the same, I think the product manager who has some sort of form of, like, writing and publishing where you can see how they think about things and they showcase- Yeah...

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their work will jump out as, like, the more attractive candidate who gets hired before the others. Yeah.

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I've got like a ninety-eight percent open rate for Big Desk Energy, so I, I, [chuckles] I- Oh, yeah, I appreciate it. Are you c-clicking on the ads as well? [chuckles] I, I, well, I told you, I got that super...

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Is it Superhuman? I got the blood testing app from- Yeah, Superpower... from your newsletter. What is it? Superpower. I get them confused. Superpower. Super, uh, Superhuman is the email app. I, I did the superpower.

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I got... It's interesting, I told you, it's like a Quest Diagnostics wrapper, because I think like- Yeah, they hate when you s- they hate when you say that, but yeah.

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[chuckles] I know they hate when I say that, but it's... I, I believe it's true. There's nothing wrong. Most of the economy is filled with wrappers. That's what I realized.

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[chuckles] I'm like, "Our entire world is just wrappers." W-R-A-P-P-E-R. But it, it is a... I, I think DTC Health is, like, a massive area, a really- I'm glad my ads provide value. That's the other thing, right? You see?

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So that's, that's the other, that's the other... So I guess there's a through line there to, like, the opportunity with Beehive that I think is so interesting.

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And back when we chatted in twenty-twenty, twenty-twentyone, the, the big... Substack has been around for three or four years, and the big bet is paid newsletters are the future.

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And I think that's great, and I think there's a space for that, and obviously subscription businesses are a great revenue stream. Ben Thompson, I think, made that very com...

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not common, but, like, brought that to the surface of, like, I could run a one-person paid newsletter and make millions of dollars in revenue, and he kinda paved the way for what I think Substack saw and wanted to build infrastructure around.

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And there's a lot of Ben, Ben Thompson imitators out there now.Yeah. And he's great, right? I've, I've, I have a hundred percent open rate with him too for the past like probably six years.

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But, but what I realized fairly early on in following this, the rise of Substack pre twenty-twenty one and then seeing the rise of what I was doing at Morning Brew, which was entirely ad based, was like, there's only so many newsletters.

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I paid for Ben Thompson at the time.

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There's only so many newsletters that I'm going to pay for, and I think that number has proliferated quite a bit since like the barriers of entry have been lower and there are more content creators.

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But there's still like a finite ceiling to how many newsletters I think I'm willing to pay for.

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And it's also hard as a publisher, especially an independent publisher, to create differentiated content with your own perspective that people are willing to pay ten, twenty, thirty dollars a month for.

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And so I saw that and I was like, well, I see Morning Brew closing seventy thousand dollar a day deals with Apple, Visa, and all these other brands, and I think there's a whole segment of the market of newsletters who could benefit from just the old-fashioned model, model of advertising and...

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But it requires a lot of time and a lot of effort. So when I was at Morning Brew, the largest team was the brand partnerships team. Yeah.

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And so I saw the work that went into it, and then I would get all of this inbound from other newsletter writers or journalists or creators who are like, "I want ads, but I don't know the first person to reach out to on these, like, brand marketing teams."

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And so that really was, like, the, the big impetus for Beehiiv was like, is there a way where, yes, we need to build the core infrastructure to make sending emails incredible and allow the infrastructure from automations, website, email to exist so you can have success.

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But can we also bring all of the top advertisers in the world so they can reach thousands of different newsletters at once? 'Cause that's a terrible process for brands.

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Like, brands don't wanna reach out to a hundred different newsletters, and publishers don't wanna reach out and do ad sales to a bunch of different brands.

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And so if we can bring those together, I really do think it is a win-win. And today, fast-forward, you know, four years, we have brands like Nike, Netflix, Roku- Yeah... HubSpot, et cetera.

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So we're kind of bringing that vision to life and, and really we are pro monetization however our users wanna do it. So where- Amen... Substack was very opinionated, right? Like it is- Yeah.

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Initially they were very anti-ads altogether. Not even like, we aren't going to do it, but we don't want you doing it on our platform 'cause they thought less of it and were only paid newsletters.

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We are firmly in the camp of you can do paid subscriptions all day long and we won't take a cut of your subscription revenue, but we also have advertisers who would love to get in front of your audience and it's totally opt-in.

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And by the way, if you wanna monetize with affiliate or anything else that you can come up with, we have APIs and third party integrations.

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You can build and monetize however you want and we don't have to get our hands dirty in anything that you're doing, and I think that's the stance that we've taken. Yeah.

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I mean, I used to say to Substack people, I, I really like the Substack people I worked with, but I would be like, the idea that you in San Francisco know my business better than I do is kind of insulting.

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Like, I mean, give me a break.

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Like, I, I think I, I think I know better, like what, what is, what is gonna work and, and again, the idea of success in quotes being that you don't make money off of ninety-five percent of, of your audience is...

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It just doesn't make sense as anyone who has run a publishing business, like, knows. Like that, that's just, you don't run a publishing business that w- uh, that kind. It just...

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Th-they didn't exist like that pretty much ever. I mean, you can make like small examples like Grant's Interest Rate Observer and these little sort of financial newsletters that were mailed out, but like

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almo- all of media has been multi-revenue stream and, and it kinda always will be and, and I know that they'll go in that direction. So you built in the, the ad network.

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I remember when we started talking I was like, "You gotta get to the ad network," 'cause like that's what... Again, going back to the, you know, what you need is you...

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What you make, how you distribute it, and then how you make money off of it, and subscriptions are just one way. There's lots of different ways to make money.

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And so you added the ad, ad network, and then you've also added like a website builder, which is, I've been using, which is, is... It's, it's really good. So what is next for the platform, right?

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'Cause we've seen, I don't mean to keep comparing to Substack, but you know, they've gone into like video and all kinds of different things. How do you think about what,

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you know, what the roadmap is for, for the platform? Yeah. I, I always describe it in three big buckets. It's email, website, and monetization, and monetization primarily is the ad network.

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And so in my mind, just like taking a step back of like what publishers and what creators care about, I think it's always like two things.

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They wanna grow faster, and they wanna make more money, and if you can help them do both of those things, I think that is like the, the solution that they will be most attracted to.

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And so email, everything from our automation suite to our APIs to the, the flexibility and our editor and everything, I think is best in class, and I think we can compete with the best of the best of legacy ESPs to more modern ESPs to everything in between.

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Like, emails are bread and butter. It was born out of the Morning Brew experience. I think we do that better than anyone else in the industry, and so that's always going to be the core of what we do.

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A year ago, we acquired a website builder called TypeDream. We rebuilt it entirely into our own ecosystem, and now we have a website builder that I believe can compete with WordPress, Wix, Squarespace, et cetera.

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Truly drag and drop, depending on when this launches, AI features as well, so like some vibe coding where you can basically prompt what you want to build. You can drag and drop.

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It's a full, you know, CMS as well, so a website builder that allows you to build an incredible website for whatever purpose, whether it's media or collecting leads or events. Yeah.

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It's like very flexible.And then the ad network. The ad network today has hundreds of brands.

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We're doing over a million dollars in revenue per month, and that is simply just providing opportunities to publishers that they can opt in. There's no... It's not LiveIntent, right?

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Like, I think that's what people typically compare it to is- So LiveIntent is, is a programmatic ad- LiveIntent is a, is a JavaScript pixel thing that you are like, uh, some sort of pixel that you drop in an email.

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It'll auto-populate for you on your behalf what ads are shown, so you don't have control over the advertiser- Like banners. So the banner ads in email. It's a banner ad, and it's a- Yeah...

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fraction of a penny with a fraction of a percent of a click-through rate. So it's the, the lowest effort that you need to put into as a publisher who's sending email.

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It's also the worst looking and the worst converting and probably the worst paying. Our ads are native ads, kind of like what you would see in an Axios or a Morning Brew. Mm-hmm.

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You have full control, so every week you get opportunities from all of the different brands who wanna sponsor your newsletter. You can opt in, you can...

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You don't have to run any of them, and you get paid monthly with, like, full transparent pricing. And so I think that equation of can we be best in class in email? Can we be best in class in website?

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'Cause the bundling of those are really powerful. Again, depending on when this launches, we are going to build web analytics as well.

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So you can think of, like, Google Analytics, but then it's like de-anonymizing the traffic on your website. What are people clicking on on your website? Are those same people opening your emails?

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Are they clicking your emails? Are they purchasing your products? Are they upgrading to a paid subscription?

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Being able to tie that, 'cause historically, and this was the thesis from, like, day one when we built Beehiiv, and from what I built at Morning Brew, is software exists to kind of do all of these things in isolation, but it's very hard to be able to take all these disparate pieces together, especially as a one-person team or a media or publisher that doesn't have, like, super dense engineering talent, and make one coherent solution where you can get the answers you need to how do I engage my audience?

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How do I monetize my audience better? And how does all of these, like, four or five different pieces work together seamlessly? So it's, like, really the North Star of what we're looking to build.

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And then, yes, audio and video are a part of that. We, we have some plans later this year to launch different podcasting solutions, and then video is probably more of a twenty twenty-six thing.

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We integrate with YouTube as of today, so that's like pulling in your channel, your playlist- Mm...

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and being able to drive traffic to and from, but, like, more of a native video solution, I would expect sometime in twenty twenty-six. Yeah. And you're working with bigger publishers.

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I'm wondering how you think about that, 'cause I think, I think, you know, normally you would think about Beehiiv with like, you know, in the, the... Put it in the creator economy bucket, right?

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But, I mean, you worked with, like, The Globe for a while. As you said, you're working with, like, Time, and, and I assume that these, these companies are looking for a more modern, you know, email.

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A lot of c- a lot of these companies have tech debt. That's just the reality. And I would guess, I don't wanna speak for them- Mm-hmm... that they wanted it to... They wanna try stuff that's a more modern software.

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And w- what... Talk to me about, like, building the platform so that it can service the, like, both the smallest and the biggest.

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Yeah, and I think you kinda have to, like, work your way up and earn the trust of the large legacy media players, right? In the sense that they...

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There's tech debt, they have large teams that they've trained up over years to work on different legacy ESP solutions. Yeah. And it just kind of is what it is.

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And it's hard as a new entrant into the market to earn the trust and reputation to be able to serve them.

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I think in the three and a half years that we've been around, whether it's The Boston Globe, Time, The Ringer, Texas Tribune, a lot of other big names in pipeline that are closing this week as well, TechCrunch as well.

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Yeah, I, I think we've been able to earn the trust and reputation that we can serve them really well. We obviously start with, like, the long tail of people on Twitter who have a newsletter.

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You were an angel investor 'cause you had a newsletter, Liquidity and Exec Sum. So we kind of worked our way up the market from- Hey, no offense... independent operators. [laughs] You gotta start somewhere. No offense.

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Or n- now, now, now we're trying to get y- now we're trying to get you back, right? Um, and, and so we're excited to launch with you. But yes.

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But, but more so through the lens of, like, independent journalists, writers- I gotcha... content creators now up to, like, larger publishers I think we can serve really well. We're investing heavily there.

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Like, that I do believe is, like, the future of the business. We n- are... have a new enterprise engineering team that we're starting with engineers who are solely focused on building enterprise solutions.

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We've invested a ton into our send API to RSS recurring sends. Dynamic content is coming any month now.

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Building out a stronger API and webhooks that can integrate with, like, different CRMs and different tools that these enterprise and publishers are already using. That's the roadmap, right?

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And so it went from, "Oh, it's cool that they want to diversify away from these incumbent email providers and maybe take a look at us," to we're putting a lot of firepower and weight and intentionality behind serving these users best in class.

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So I'm very excited about it. I think the market is seeing that. And as far as, like, who we kind of go head to head with, I think this space is, like, slow, it's antiquated.

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Like, a lot of these legacy ESPs, like, have... are either post-acquisition or haven't been updated in years. Mm-hmm.

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They're expensive, they're overpriced, and I think that it's, like, ripe for disruption, and I think we have the right team, the right mentality, and the right software to really show them that there's a better path forward, that we can serve them with a more modern solution, save them money, and ideally make them money through the ad network and subscriptions and everything else.

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Yeah. And I think a lot of ESPs end up... It's just the nature of the business. They, they end up becoming, building their products for retailers first because they see more money in retailers.

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And so, I mean, I've seen this just over and over again in the media space. You know, people start by building software for publishers, and then they're like, "Ooh, this is hard."

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And their investors are like, "Have you seen this retail category over here?" And all of a sudden, you know, they become, you know, retailer tools. Yeah.

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And I think one of the problems of, you know, Google Analytics is not... It's used by publishers, but it's really, you go into Google Analytics, it's made for, it's made for retailers at the end of the day.

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And so, you know, there... I think there's a giant opportunity in that, in building software for, for publishers at the end of the day. I mean, the businesses are related, but they're not-Exactly the same. Yeah.

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And, and we, we brushed over it. We didn't really talk about the background, but, like, my background was being the second employee at Morning Brew. Yeah.

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So I built the infrastructure, the engineering, the product, and the growth that took Morning Brew from 100,000 subscribers to four million up until we got acquired by Business Insider.

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So it really is from a place of building of, like, we aren't just building software to build software.

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We kind of have the case study of we've done this before for an email first publisher, arguably one of the most successful in the past, you know, five or six years or so.

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And then again, going back to our philosophy of we want our publishers and creators to monetize however they want. Yes, we have a website builder. We're also building native integrations with WordPress, right?

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Like, we know a lot of these publishers are already- Yeah... on WordPress, and, like, it isn't an our way or the highway approach of, like, we wanna be flexible.

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If you want to use our all-in-one solution with the website builder, I think our website builder's incredible and getting better every week, and I think we can replace your existing website solution, but I'm not gonna be so opinionated to say, "That's not...

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We know better how to run your business than you do." Right.

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And if you have tech debt and workflows and, and, and teams that are trained on your WordPress, you know, whatever, we, we can integrate play nicely with all of these third parties and, like, we really want to put the publisher first in everything that we're building.

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Right. So if they want just the email, they can just have the email. They don't need to, to use the webs- website builder. And I think that is the difference of having, like, an all-in-one platform approach.

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I mean, there's... Look, there's, a- again, there's trade-offs to everything. There's some advantages to that, but it won't work for many companies. And, and we tread the line, right?

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Like, we are somewhat going all-in-one in the sense of- Yeah... like, you could do website and email and monetization all under one roof.

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Where we differ is we also have a parallel track with integrations and, and plugins and anything else where you can integrate with whatever tech stack you want and just use the pieces of us that...

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and we play nicely with them, and we help support all of them. So yeah, we kind of do a little bit of both.

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Yeah, because it, it was always, like, an either/or, you know, where you can have, like, a WordPress plus ActiveCampaign and, like, you know, you're piecing together everything yourself, and, like, that, that was just the old way you did things, right?

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And then, you know, it's like, or you just operate on a platform, you become a NoStack Media company, and, you know, there's some people that just wanna be, you know, kinda in between.

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And you s- I think you see that, like, with a lot of, like, newsletterers who have achieved some kind of, like, breakout, even if they're, they are on Substack.

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They're, they're using a, they're using a variety of platforms at the end of the day. With the exception of maybe The Free Press, although they did build their own app, so. They built their own app, so there is that.

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So tell me about, like, what do you see, what trends do you see within, you know, the Beehiiv, the people who are building media companies on, on Beehiiv?

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'Cause I feel like we went through this period, right, where there was a sort of, I don't wanna say a newsletter bubble, but there was a lot of people who were trying to build the Morning Brew of X, or more likely, they were trying to build the Milk Road of X, right?

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Like, so Milk Road was, like, a crypto newsletter that grew up on, on Beehiiv, right? They were on Beehiiv. Yeah. Yeah, yeah. And they s- One, one of our first big case studies. Yeah. Yeah.

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They sold, and it was, it was a, it was, it was a great exit, it was a great case study, right? And it, it was very fast, and, you know, in some ways that attracts any number of imitators, right?

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And I feel like the blue... You know, it's like anything.

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It's like I, I used to run marathons all the time, and everyone was chirping, like, in the beginning of the race, and then everyone gets, like, you know, it gets, it gets quiet somewhere around, like, mile 17 or 18 'cause this, these, these things take a long time ultimately.

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Are you seeing, like, kind of a winnowing or are you, uh, of, you know, a lot of the people who flocked into the newsletter space? No, I'd say...

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So Milk Road was kind of like the original Morning Brew for X, X being crypto, and then that kind of proved that the Morning Brew for X model could work, and so everyone be- tried to become, like, the, the Milk Road for X, right?

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Okay. What, what I think we're seeing now is much more sustainable in, if you think of Morning Brew or Milk Road, what they were going for was, like, mass adoption of consumers, and they're going for volume, right?

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So it was, "Let's grow as quickly as possible.

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Let's run ads, arbitrage," so you have the growth flywheel where you make money from ads, you put that into a growth budget, you grow quicker, then you charge more for ads, and you're just trying to reach as large of an a- audience as possible.

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So it's like the Morning Brew and The Skimm model of, like, mass appeal, very little niche, right? So a mile wide, an inch deep.

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I think what we're seeing now across the board in the creator economy and for publishers is, like, niche is great, right? If you can get 1,000, you know, CEOs on a, on a...

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like tech CEOs that live in San Francisco on an email list, like, the amount of events, products, et cetera, that you can sell them and upsell knowing that you have a stranglehold on that type of- Yeah...

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reader is really powerful and arguably easier to attain if you already have an in with any of these different niches and different communities, and I think that's a lot more sustainable.

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And I also think broadly, again, this is more creator economy in the sense that I think maybe a decade ago or five years ago, all of these brands just looked for the largest creators and, like, the vanity metric of follower count.

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So they were kind of going after, like, the Morning Brew equivalent of, like, yeah, how big is your audience, not how engaged or who are they.

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And recently, brands have gotten a lot smarter and want to sponsor and put money behind much smaller, like, micro creators who really understand their audience. Engagement is through the roof.

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They know exactly who they're speaking to, and they can actually convert.

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And so looking for engagement and that type of, like, brand affinity at a much smaller scale is, like, how the creator economy has shifted, and I think we've seen that in media broadly as well.

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And so rather than going for the Morning Brew, I want to get a million subscribers in a year- Yeah... sell, you know, very broad ads across it, lower CPMs. I still have no idea who I'm writing to.

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Like, really doubling down on niche communities, smaller cohorts, and being able to upsell IRL eventsVery specific ad products or subscription.

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That's working much, much better, I think is much more sustainable, and I think there are so many niches to go around. Yeah.

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It's like my, my friend CJ Gustafson from Mostly Metrics who, who had recently switched to Beehive. He's very happy, by the way. He's got a great business.

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It's for, it's, it's for CFOs, and there's a lot of newsletter businesses that get a lot of focus whose businesses are nowhere close to where CJ's business is because he has an extremely valuable niche, but also he's a former CFO himself and, and th-that combination...

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And he can produce, like, good content. That combination is, is killer and, and those are the kinds of businesses that are gonna last without a doubt. Yeah. To-- And, and they're, they're much more attainable.

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I think, like, the proliferation of our platform and, and others have br-basically brought down the barriers of entry, so that's possible, right? So- Mm-hmm.

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-for him to run this newsletter probably costs him a hundred dollars a month plus a little bit of his time and anything else that he puts into it.

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But, like, that's the other thing about email and newsletters as a distribution channel is, like, the business model is incredible.

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I'll never forget when at Morning Brew we were five people, and I think we had maybe one point two, one point three million subscribers, and I looked around and I was like, "Yes, we want to be like a, a venture-backed business and scale this thing, but we could have us five just do the roles that we're doing now," and we're paying, you know, I think it was sale through at the time, maybe a hundred, two hundred thousand dollars a year.

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But, like, we could have ran that profitably as a lifestyle business and all, like, take home-- took home our dividends, right? Like- Yeah.

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-the, the-- It's such a, it's such an attractive business model where as the volume and audience grows, the input kind of stays the same and your costs are pretty variable, but very predictable. Awesome.

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Tyler, thank you so much. This was a great chat. Yeah, I'm glad that I'm your only VC check or angel check, and hopefully it works out for you. [both chuckling] I do too. Cool. Thanks for having me.

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