Challenge

Substack is where independent voices share ideas, build communities, and earn a living on their own terms. Whether its videos on politics, podcasts on fashion and beauty, or newsletters on food, pop culture, and basketball, Substack gives creators the tools to publish and monetize original work across formats.

That goal extends to offering a payments and billing ecosystem that is fast and frictionless for publishers and subscribers alike. Substack, which is based in San Francisco, aims to give publishers control over the payment methods they accept and the prices they set, while providing subscribers with a simple, smooth checkout experience.

It should be really simple for a subscriber to choose whether they want to pay monthly or annually, and then to pay in their preferred means in a way that is easily legible to them, said Seth McMillan, an engineering manager who oversees payments at Substack.

Substack publishers gain valuable insights into their subscribers behavior, which they can use to inform their publishing strategy. Its important that the transparency extends to payments, so publishers can gain the insights they need to reward top subscribers, provide special offers, and manage their earnings. At the same time, Substack needs to provide transaction and customer account data compliantly, protecting subscribers personal data while also providing robust fraud protection.

Solution

When Substack launched in 2017 as a platform for writers, the company built its payments system on Stripe. I cant imagine not using Stripe if youre building a tech company, said McMillan. It just feels like the natural choice because of the developer ergonomics.

The entire ecosystem, supported by Stripe Connect, is optimized to drive revenue for publishers. Substack can monetize every transaction through a revenue-sharing model, enable its publishers to accept payments from subscribers, and reliably receive payouts on their earnings in local currencies. Meanwhile, Stripe-hosted onboarding ensures identity verification and compliance with Know Your Customer (KYC) requirements everywhere Substack has publishers.

Platforms powered by Connect get access to Stripe Payments, which Substack uses to drive a fast, frictionless checkout. With Stripes Optimized Checkout Suite, which includes the Payment Element, Substack ensures its publishers can offer a variety of payment methods to convert new subscribersincluding cards, wallets, and bank transfersas well as an array of currencies.

With Payments, Substack can save cards across its platform, so someone who subscribes to one publisher can add a subscription to another without having to re-enter payment detailsa key step in optimizing conversion.

Substacks subscription engine is powered by Stripe Billing, which is embedded so publishers can monetize their products. The company used Billing to build Substack Boost, a configurable program that automatically shows individual subscribers discounts and special offers at the right moment to maximize publisher revenue.

Substack uses Stripe Radar to detect and prevent fraudulent activity, including small test charges from stolen cards. Radar uses AI powered by Stripes global data network to identify and block fraud in real time.

Results

50,000+ active paid publications powered by Connect and Payments

Substacks Stripe integration has supported the companys growth since Day 1. Today, more than 50,000 paid publications are published on Substack. For publishers, turning on payments is a quick and easy process, requiring little maintenance by Substacks engineers.

We dont have to worry about things like adding an extra step to our onboarding flow because the rules changed somewherethose updates are built in, said McMillan. We havent had to change the Connect Onboarding code for the past four years.

Connect drives accurate, on-time publisher payoutswith the data to support transparent cash flow

Getting publishers paid for their work is one of Substacks core principles. With Connect, Substack gives publishers transparency into when and how much theyre getting paid. We dont get questions like, Wheres my money? or Why did I get paid out this amount? said McMillan. The best sign that our payouts are working well is the fact that we dont hear about them much at all.

Publishers can choose whether to consult their Stripe Dashboard for detailed transaction data or access high-level Stripe data directly from their Substack account. Its totally legible why theyre getting paid the amount they are, said McMillan.

Publishers can choose from 11 payment methods, plus cards

With the Optimized Checkout Suite, Substack is able to turn on new payment methods in response to publishers and subscribers preferences. The platform recently added bank paymentsits 11th payment method besides cardsto support demand from subscribers in the EU.

Saving card information makes subscribers 3x more likely to pay for a subscription

Because Substack uses Payments to save subscribers card information securely and compliantly, they can sign up for additional subscriptions with one click, which boosts conversion. In fact, people with credit card information saved in Substack are three times more likely to pay for a subscription.

Its actually quite complicated when someone has paid over here to one publisher and now they want to pay over there to a different one, said McMillan. But Stripe made it really easy to offer this functionality.