Newsletter Monetization Strategy: Half Free, Half Paid. But the Other Way Round

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About B2B Publishing

In general, I think creators addressing a B2B audience, covering business topics for business people, tend to be more successful when it comes to monetization via payments from the audience. Maybe that even is a no-brainer. Because it is hard to imagine anybody tackling industry topics out of pure fun. Whilst the vast majority of creators publishing stuff which is not-business related are motivated intrinsically, not by money. So B2B creators from their very beginning will strive to monetize successfully. Whilst most B2C creators will, well, just create, and see what happens later on.

So I am not surprised to learn about another B2B-orientied newsletter author to be successful. The story about Dru Riley’s newsletter called my attention because of the speed of its success. Indie Hackers published a 65min podcast about Dru and his newsletter (Episode 173). I’ll give the gist of it as a 10min read.

About Dru’s Newsletter is a newsletter about markets, ideas and business opportunities. That doesn’t sound very unique. What is it, that makes Dru’s newsletter successful then? What is his newsletter creation recipe?

Trends.cs newsletter makes use of a lot of visuals which at the same time are fun stuff AND support the lecture. And it is full of crisp bullet points instead of lengthy paragraphs

First of all: shortness! His publishing style is bullet points instead of paragraphs. Then, though publishing text, Dru makes use of a lot of visuals which at the same time are fun stuff AND support the lecture. Just have a look at this screenshot. It gives an immediate understanding of how this newsletter is different from others. If there is one frequent failure of newsletter-publishers Dru will never make, it is using too many words, not coming straight to the point.

Another thing this screenshot shows is the structure of the newsletter. It always starts with ‘problem’. The first question it answers is therefore: why is this important? Immediately after the problem comes the solution. Then the players section, which allows looking for help if problem&solution are relevant to you. Then follow predictions of problem/solution-related trends or parties and then come opportunities. Because Trends.vs is a newsletter for entrepreneurs and startups, ‘opportunities’ might be the most important section.

Nonetheless, the most brilliant section idea, I think, is ‘Haters’. Here, Dru anticipates what people might put forth against his ideas. So he can make his points even before opposition actually shows up. And it might be a good way to tackle the problem of half-cocked counterarguments at the roots, which is so common in the digital discourse.

Finally, please note that links to other resources at least have the same weight as Dru’s own ideas in his newsletter. So a big part of the value Dru’s newsletter provides isn’t Dru’s own ideas but his curation of content from other people.

Dru really likes bullet points coming as symbols – even when presenting himself

Rapid Growth – But a Long Runway

When I talk about speed, I am referring to the speed of growth of his subscriptions business. Drew launched the paid tier of his newsletter about a year ago (in March 2020). And five months later he cashed in above US$20,000 a month from his paying subscribers.

That’s really fast. But it doesn’t tell the whole story. Dru needed quite a bit of a runway before lift-off. Dru quit his job as software and data engineer in Feb 2017 – that is three years before launching his paid newsletter. And in between he basically didn’t earn any money, living from his bank account, which fortunately was worth a solid US$250K. That’s a hell of a lot of money. But as a would-be newsletter creator willing to make a living out of your writing you must have a critical look at your savings. Thomas Baekdal developed a perfectly reasonable calculation why you should have at least US$150K of savings, when you start a new newsletter venture. Myself, I needed some 18 months before pv digest would feed my family. Fortunately I could afford to live without income for around a year when I started that project (not accidentally being a B2B-publication anyway).

In those three years before starting his paid newsletter business, Dru did a bit of this and a bit of that, by far not all of it with a business perspective in his mind. But sometime, he realized that travelling and other fun stuff started to drain his savings and that earning some money again would be a good thing.

It wasn’t as if he hadn’t done some serious stuff all the time. There were software projects he was following without a clear path, just because he felt “like I miss building, and I’m just building for fun”. But none of these projects felt like, on which he worked full steam from the end of 2019 on. “I picked up because it felt like something I could do forever”.

One of the projects he was working on in this in-between-time wasn’t a coding project. It was a content project already. Drew published a book about marketing for SaaS-companies. He published it sequentially, chapter by chapter. So not only did he dive into the world of text authoring. But also he learned about sequential publishing and to connect to an recurring audience. The only problem was: books are finite products. They are complete at some time.

So, Dru started several newsletters, being one of them. But turned out to be the one he liked most working for. The first few Trends newsletters were hosted on Dru’s personal website. They weren’t even proper newsletters, just webpages. And (“big mistake”) he didn’t collect mail-addresses. The growth of started only after migrating the publication to its own website and to build a subscriber list.

That list grew slowly at the beginning. An important tool to grow his subscriber base is Twitter. “I still feel like tweet threads are underrated. What I would do is break the report down and into tweets, just like a big tweet storm.” Then, very important, he tags people in his Tweets. Dru says ha cannot predict which Tweets would be hits and which misses. But “if you just consistently do them, some things will hit”.

The point when Dru went paid was his report #11 about, imagine!, ‘paid newsletters’. At first, he used the popular mechanism of sending out free newsletters and trying to convince people to subscribe to further editions coming as paid newsletters. That didn’t work out.

The mechanism which worked for him was splitting each newsletter into two parts. A free part and a paid part. It wasn’t his idea. He even wasn’t convinced of it. The idea came from people close to Dru. “I didn’t want to do that because I felt like the reports were already short. But it ended up working.”

2 newsletters full of interesting stuff. How to monetize, publishing some content for free to grow your audience and make other content exclusive, for paying subscribes only?
Have you thought of this solution?

At first, it wasn’t a subscription model. Instead, he sold the paid part of his newsletters for $3 in single transactions. But some of the buyers asked for a subscription, so that they wouldn’t have to buy each newsletter separately. (Funnily, none of those people actually asking for a subscription option did subscribe at the beginning, Dru says).

After he implemented the subscription offer, the number of paying subs grew steadily. Then, in August 2020, was rated the #1 Product of the Month at Product Hunt. That was a real booster which catapulted his sub business into the $20K per month region.

That is, how Dru promotes his paid newsletter: the free newsletter ends with a quantified list of what free-riders are missing.