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Lenny Rachitsky has more than 325,000 newsletter subscribers. He says he makes “significantly more” money from it than he once did as a product lead at Airbnb.
“It’s a wild number that I never imagined,” he says. “I highly suggest exploring this path if you’re interested. There are downsides though: No PTO and no 401(k) matching. No time off, no parental leave, none of that. But it’s pretty sweet.”
So how’d he do it?
Rachitsky’s newsletter is called Lenny’s Newsletter, and it’s the top business newsletter on Substack. It’s primarily targeted to people who work in product development. (He now also has a companion podcast.) He says he built the newsletter in distinct phases, starting with these:
- He tested out ideas and mediums, and got his first few hundred subscribers.
- He became more intentional about growth, including partnering with other newsletter writers to reach a broader audience.
- He drilled deep into his audience, served them spot-on content, and drove organic growth.
- He put up a paywall, and experimented with how to increase value.
In this episode of the Entrepreneur podcast Problem Solvers, Rachitsky walks through these phases in detail, and explains what he’s learned about building a chart-topping newsletter.
Listen here, or read the unedited transcript below.
On a personal note: In our conversation, Rachitsky discusses the importance of hyper-focusing on your audience — and that inspired me to make a big change in my own newsletter. I’m already seeing the benefits.
Here is the transcript:
Jason Feifer:
Lenny, what’s your background? So people understand where you’re coming from.
Lenny Rachitsky:
I was originally a software engineer, went to school for computer science, ended up starting a company, so I was a founder for a bit, then turned into a product manager, became product manager at Airbnb, and we sold our company to Airbnb and then left that about three years ago and unexpectedly went down this path of being a newsletter person, which now became a podcast person and I’ve kind of realized this is my fourth career, which I did not expect.
Jason Feifer:
Well, that’s awesome. And you have… 300,000 newsletter subscribers?
Lenny Rachitsky:
325,000 as of today, roughly. I don’t check every day. No, I don’t.
Jason Feifer:
I don’t believe that because I look at my numbers every day.
Lenny Rachitsky:
No, I was… My sarcasm may have not have come through. I check it often.
Jason Feifer:
All right, Lenny, you have the kind of scale in your newsletter that people dream of because many people start newsletters. Many entrepreneurs start newsletters and they just don’t know how to get anybody to subscribe to this and as I look at your newsletter, I think some of the things that I’m seeing here fly in the face of expectations. For one, it’s just called Lenny’s Newsletter, which isn’t descriptive of what you’re going to get aside from a promise that there’s a guy named Lenny behind it and also that so much of it is behind a paywall, which I think also feels counter to what people think they need to do in order to drive new subscribers and audience. So let’s start at the beginning and I’m really curious to understand how it is that you’ve built this up. You started the newsletter when?
Lenny Rachitsky:
Started writing… I started writing on Medium, actually, and that’s kind of the path I followed because things just started working but I started around 2019, early 2019, around June I think.
Jason Feifer:
And at that point you had some amount of following that you were able to convert over, I assume because you had an audience from Medium.
Lenny Rachitsky:
Actually, not really. Medium doesn’t really bring you, give you an audience. I think that’s why Medium’s not doing great. You just build this following there that you can’t do anything with. You can’t email them, you can’t tell them easily, like, Hey, I’m over here now. What started working is I was tweeting a little bit, summaries of things I was writing on Medium. So the Twitter audience started to grow and that actually helped a bit initially.
Jason Feifer:
Huh, so was that your seed? What was the first way in which you brought people into the newsletter?
Lenny Rachitsky:
So there’s kind of these phases. Phase one was just writing a few things that people seem to like, but really maybe my first thousand subscribers, they came from two guest posts. I wrote a guest post on the first round review, which happened to be a similar audience to my newsletter. And I wrote a guest post on Andrew Chen’s blog who’s now a partner at Andreessen Horowitz. He’s a longtime kind of growth mind and so I was working on some, I showed it to him and he’s like, “Hey, I want to write… I want to have this in my newsletter.” And those two brought me to around a thousand plus a bit of tweeting that like, hey, I’m starting a newsletter, you should check this out. And I only had maybe 5,000 followers. It wasn’t anything crazy, but that was the first phase.
Jason Feifer:
So that’s interesting because there is much talk of swaps of some kind of value in the podcast ecosystem and the newsletter ecosystem. And a thing that people grapple with a lot is, well, okay, how do I get on the radar of or do any kind of work with someone who is working at scale and I’m not? If I have a tiny newsletter, I can’t really offer them anything. If I could plug their newsletter in my newsletter, but who’s, they’re not going to care about that because I’m not reaching that many people. The solution that I’m hearing to that is that you were just providing value to them in the form of content, which saves them the time of having to write their own posts someday and if they like it, they’ve distributed it and some number of their audience therefore is willing to follow you over. Is that a strategy you find scales?
Lenny Rachitsky:
Not only scales, honestly, I think that’s the root of all successful newsletters. Podcast content is just the value. You just have to deliver value to people. The way I think about it is you grow if you’re consistently delivering value, consistency plus quality. And so in this case, these folks just wanted great content that would be useful to their audience and they don’t need to swap with you. They’re just like, “Oh, this is great. You’re doing all the work for me, I’m going to be able to share with my audience and they’re going to subscribe to my newsletter. That’s awesome.” So 100%, it’s all about just delivering value to people. We all talk about this, but I’ve tried a lot of growth strategies to grow the newsletter and the podcast, nothing works really except just consistently delivering value over and over and over and over and over. Everything else just pales in comparison to just doing that.
Jason Feifer:
What else does that look like, delivering value? And I could ask that flatly, but instead I’m going to throw in a kind of maybe thought starter, which is in the podcast world, so many podcasts are interview shows, which means that there has to be a guest and in a way being a great guest is bringing value to someone, but it often doesn’t feel like that’s actually the direction of the exchange because the person is always interviewing somebody on the show so that they selected you in some ways is really a gift to the person who is the guest. It’s hard to frame yourself as I am going to bring value by being a great guest on your podcast even if that’s true. It feels different in newsletters because it is literally the production of a piece of writing that either the newsletter writer would’ve had to write themselves or it’s it not like just the mode of production is different there so I’m curious what, in the newsletter space, it looks like to provide value to others outside of writing a guest post for them? Or is it just that?
Lenny Rachitsky:
Yeah.
Jason Feifer:
And you just did a lot of writing inside of other people’s newsletters.
Lenny Rachitsky:
I think it’s really simple. If you think about what’s the jobs to be done for your content, for whatever you’re producing, I think there’s, I think about it from newsletters, what are the jobs that people want their newsletter to do for them? And I don’t know how much folks know about those jobs to be done framework, but basically I think, roughly, people want either just to be entertained, just want to have some fun to read, they want to, advice on making money I think is a big bucket. I think people want advice just to do, live better or work better more effectively. And that’s the bucket I’m in. I think that’s the bucket you’re in. And then maybe there’s just staying for like news, newsletters and podcasts and things like that. Those are really, I think, the four biggest buckets.
So you need to figure out which of these four jobs are you going to do for your audience, and there’s others I think. And then just do it super well. So for me, just I want people to build. I want to help them build better products and grow their products and figure out how to do this. And so I spent all my time just answering really concrete questions people have. What is good retention for a SaaS product? How do you get your first thousand users? How do you hire your first product manager? What is a good activation milestone to track? I just answer those questions very concretely and so that’s just clearly value to people. I’m just doing all this work for them and just giving them the answers. And I charge the newsletters 150 bucks a year.
If you have one of these questions answered a year, that’s, you get like a thousand x return on that and the podcast is similar. I help, I focus on just concrete tech similar to this podcast. I want to help but grow my product, let’s interview the chief product officer at Figma. What did they do and learn to help build Figma into the business it is today. And I stay super focused on what do you actually do? How do you actually write out your specs? How do you prioritize? How do you hire, what do you look for in product managers and things like that.
Jason Feifer:
You described the growth of the newsletter as happening in a couple phases, and then you talked about phase one though, just to be clear, I think a couple of the things you just said there probably happened in later phases like that you were charging $150 a year for it. That probably didn’t happen right out of the gate, right?
Lenny Rachitsky:
No.
Jason Feifer:
And so let me just rewind backwards a little bit and talk about the hyper-specific focus of the newsletter. It is incredibly tactical.
Lenny Rachitsky:
Yeah.
Jason Feifer:
And it is for a very specific audience. How much do you think that that drove that kind of growth? Because a lot of people’s newsletters are maybe a little squishier, I’ll admit mine is a little squishier in that I’m trying to speak to a broader audience set of people who identify as entrepreneurs, some of whom actually are business owners, some of whom are not. And then I’m speaking to the emotional components of them navigating change. I’ve found that to be a hard thing to define. It’s a little harder to explain who the audience is and therefore the content goes broader. And I’ve always wondered if that is a mark against me because it’s harder to explain exactly how this newsletter fits into a hyper-specific audience’s world. Did you think about that when you were launching this and how hyper focus and a narrow lens actually could lead to a greater growth?
Lenny Rachitsky:
Yeah, absolutely. I think it’s really important and really powerful to be focused. I think… I don’t know if this is true, but I think it’s true, the broader you are, the more incredible you have to be for anyone to care. If you’re just writing interesting pontifications on the world, I think you have to be really, really incredibly insightful because there’s so many people doing that. Not to say when you’re super narrow, you can be not great, but I think the barbell is a little lower because that group is like, oh wow, look at this contents for me and this is useful and interesting. Ideally it’s both. Ideally it’s incredibly insightful and interesting and a pretty niche focus. Something I… So I definitely realized I needed to be focused, and I think that’s been really important but you have to not narrow too much because for me, I focus mostly on product management and product building.
But if that’s all I wrote about, I would just like, it’d be so boring and I found that I had, I wanted to focus, basically, I focused on things that I’m excited about, product and growth, and then just career and startup stuff but it’s kind of this anchor tenant of product building product and then what’s adjacent to that growth? Growing the product and then having a career in product and starting companies. So I kind of found this Venn diagram of interests, and I find that it’s important to have a slightly broader than just super focused because you just get so bored just writing about the same thing again and again. But yeah, to your point, people need to know what problem you’re solving. We talked about jobs to be done. People need to think about, okay, I have this problem in building product. Who am I going to go? What am I going to look for? And the more you can just wedge in people’s brain, “Oh, Lenny’s newsletter is really good for helping me with product problems, I’m going to go check that out.” That helps a lot.
Jason Feifer:
What was phase two?
Lenny Rachitsky:
So phase one was the first hundred users, and that was just me. I talked about just writing a couple things on Medium, getting Twitter, tweeting about it. Phase two was this first thousand users, which is the guest posts, I’d say. That’s how I think about it.
Jason Feifer:
Got it. So what was phase three?
Lenny Rachitsky:
So that was about a thousand subscribers. Getting to 10,000 honestly was just every week for nine months, just writing something useful that people found useful. And so that was just it. I got from a thousand to 10,000 just writing every week for nine months, and it grew mostly through.
Jason Feifer:
Just all by itself? It grew organically?
Lenny Rachitsky:
It was word of mouth, and that’s what I find this grows these things. If it’s good, people just share it. I find if your stuff’s not growing, it’s just not useful enough to people and people aren’t excited to share with their friends and colleagues. So it’s all word of mouth and then me tweeting. Every time I publish something, I tweeted about it and tweet a little summary of the post. Something I’ve learned about Twitter is you don’t want to tweet a tease of your post. You don’t want to just give away everything in the tweet, in a tweet thread, just summarize the whole post on Twitter and then link to the post at the end of the thread or towards the top. So I did that, just tweeting the post.
Jason Feifer:
So that sounds counterintuitive because you would think if you’ve given everything away on the platform, what is someone’s incentive to click?
Lenny Rachitsky:
Right, so what I think happens, they follow you and they’re like, “Oh, this guy’s going to have interesting things.” And then you share your post again and again. They’re like, “Okay, let’s go subscribe to this thing.” So I think you think of it, you should think of as a long term investment, just people will find. Lenny has interesting things. I will follow all his things eventually versus like, oh, I need them to tease them to go click into this thing because people are, they’re not going to click anything. They’re just like, all right, whatever, this freaking tweet, I don’t care. Going to move on to the next tweet.
Jason Feifer:
All right. So phase three then is defined by really the market speaking. You are putting out consistently good, relevant content, and you are seeing that people are sharing it organically. That tells you that you’re on the right path and you get to 10,000 subscribers, which is great. So what’s phase four?
Lenny Rachitsky:
So round then is when I started charging, I added a paid plan, and this was actually an interesting point where, so I left Airbnb, I had no job for about a year. Then also COVID hit and Airbnb was in big trouble. I kind of assumed that I would have some value out of my shares after I left Airbnb being there seven years and so I took all this time off assuming there’d be a payoff someday, but COVID… There was a huge scare. Airbnb was on the brink of-
Jason Feifer:
I remember it.
Lenny Rachitsky:
… problems. Yeah, they had to take this billion dollar loan and all kinds of stuff. So I was just like shit, I haven’t had a job in a year. I don’t really… I want to try to avoid getting a job at a startup again. I want to see if I can do this newsletter thing. I called in my project, avoid getting a real job, the newsletter path, and some “Hey, let me just see if I can charge for this thing and make a living doing this and maybe make a hundred thousand a year, maybe someday a little bit more.” So I started charging around that time, around 10,000 subscribers, and it just kept growing. I found actually, once I started charging, growth accelerated because I think people assume there’s more value there that I’m like, “Oh wow, this guy’s charging for this? It must be good even if it’s free.” So people subscribe to the free newsletter at a higher rate as soon as I started charging, which surprised me.
Jason Feifer:
That is so interesting. Wait a second, let’s break that down. So you put a paywall, and how much of the content were you putting behind the paywall?
Lenny Rachitsky:
So I write a post every week. If you pay, you get it every week. If you don’t pay, you get it once a month. So once every four issues is free. It goes to everyone.
Jason Feifer:
So that’s… Right, so that’s a… I mean, that’s pretty significant. If you’re just getting the free version, you’re only getting something from you…
Lenny Rachitsky:
Once a month.
Jason Feifer:
Once a month, that’s not a lot and you’re finding that people, once it’s behind the paywall, see it, perceive it as being of more value and start subscribing to the paid version at a higher rate or the free version at a higher rate. And then they convert from the free version.
Lenny Rachitsky:
The latter. The free version and then what I do is when I publish a paid post, I send a peek to the free list to continue reminding them of how much stuff there is that they’re missing. And there’s definitely downsides to adding paid wall, because 75% of my stuff is hidden, or most of it is hidden and so you have less chance to grow the thing but I think these peeks, where you peek at “Hey, here’s a thing you’re missing” really helps. And then just over time, there’s this analogy someone shared of just like you have these lakes and you have these rivers, and the lake is the free users and the rivers, you’re getting them to be paid.
And so you have this lake that you’re building up, and there’s a lot of value in building up this lake where you have all these people you could pitch over time, and it’s okay if you pitch them later, they’re there. They keep subscribing and you could always upsell them and like, “Hey, you should really subscribe. You’re missing out a lot of good stuff.” So essentially every month I write some, I focus on writing something that a majority of people would find useful, and that often drives a lot of paid subscribers every time I publish one of those.
Jason Feifer:
Were you ever nervous about either being so aggressive with the paywall or feeling like you had to increase the amount that you were producing because you were charging? I mean, $150 a year ain’t nothing. You know, you could subscribe to Entrepreneur magazine for considerably less. So you’re, and you’re producing only once a week. How did you figure out what the right price and value prop was?
Lenny Rachitsky:
Yeah, it was hard. I did feel like I was crazy to charge more than Netflix for four emails a month. And so what I did is I looked at the pricing on Substack, looked at what everyone else was charging. The advice I always got is charge more than you think you should charge. Everyone was like, “Oh, five bucks a month, that sounds really reasonable.” And I’ll just start, which is the minimum I think Substack even allows. So I was pushing myself to charge more than I thought I should charge. And then just roughly I eyeballed what are similar newsletters charging? Still I was like, this is crazy. Who’s going to pay $15 a month for writing… For four emails? So what I did is when I launched, I pitched, if you subscribe, you’ll get an invite to a exclusive community of newsletter subscribers where you can all chat and learn from each other.
So I announced that and I didn’t actually have anything at that point, but about three months in, I launched it because I promised I would and that actually ended up being incredibly successful, maybe the thing I’m most proud of, because it’s this thriving community of really interesting smart people that want to learn and get better and they’re just helping each other, and I’m not in the middle of that. I just get out of the way and let them help each other. And so that came out of just exactly what you said or just felt like this is a lot of money to charge for a couple emails or for four emails. And it ended up being a really good push for me to think a little bit bigger.
Jason Feifer:
So that also feels counterintuitive, I have to say, because I would think and speak just about literally how I thought about it. I’ve thought if people subscribe to my newsletter and they follow me on social and listen to a podcast or whatever, then the relationship is with me. And to the degree that I can create something special beyond the content that I produce, it’s some kind of connection or access to me. The problem with that, of course, is that’s not scalable in any way. And so the thing that I’ve always grappled with is how can I possibly make some scalable version of access to me? I don’t have the answer, which is why I haven’t launched anything. But what I’m really interested in what you’ve done is that you actually did the opposite. You took yourself out of it in a way. I mean, I’m sure that you engage in there in some way, but that’s not the main selling point. It’s not access to Lenny and all the more amazing that you’ve done this because your entire ecosystem is your name.
Lenny Rachitsky:
Yeah.
Jason Feifer:
Again, this is not, this is Lenny’s newsletter, so tell me about that.
Lenny Rachitsky:
Yeah, I think that comes from some imposter syndrome and just a modesty where I just know I don’t have all the answers. There are many smarter people than I. The last thing I want is for people to feel like I’m going to have all the answers for them and so it was just exactly like I said with the community, I’m just like, there are such smart people reading this thing. I feel like if I could just connect them, they’ll find each other and help each other. And I hate the idea that it’s called Lenny’s Newsletter because I don’t want to come across as I’m this beacon of answers. I actually tried to rename it for a while. The only reason I called it this is I was just signing up for Substack with no plan of where it was going, and that was their default recommendation of what to call your newsletter, just your first name and your newsletter.
Jason Feifer:
That’s amazing.
Lenny Rachitsky:
And I couldn’t think of anything better, and I’m just like, God damn, I need a real name for this thing and now it’s too late, and now I’m just leaning into it. But I’m just like, I’m super stuck with it. Like everything’s now Lenny’s blank.
Jason Feifer:
Right. I mean, you are gifted with a name that is familiar but feels a little quirky and friendly. So I feel like Jason’s Newsletter doesn’t have the same ring to it. There’s something about the name Lenny that I think helps.
Lenny Rachitsky:
That’s cool. Never thought about that. Thank you.
Jason Feifer:
Yeah. Oh, or thanks to presumably your parents, whoever selected Lenny, unless it was you.
Lenny Rachitsky:
Yeah, I moved from Russia. They gave me this name, but it, there’s a variation and I simplified it.
Jason Feifer:
So okay. Now we’re describing, if I’m thinking about the phases, we’re describing something that sounds pretty familiar to the newsletter that I see right now. What else? And I know we’re coming up on time here, so just what else are you doing at this point to drive growth aside from just produce great content and have created a community?
Lenny Rachitsky:
So I will say this, I think it’s actually the best time in history to launch a newsletter because… And to grow a newsletter and it’s the easiest time to grow a newsletter because of this one feature that Substack launched recently that has been a huge game changer for me, and I think people are way under appreciating this and it’s this feature where you can recommend other newsletters within Substack. So when someone signs up for me, I recommend 10 other newsletters that I love that you can quickly subscribe to. You just check check boxes and you’re subscribed.
So with that, other newsletters recommend my newsletter. There’s about a thousand other newsletters now that are recommending my newsletter when you sign up for their newsletter, which now leads to, and this is actually the next phase of my growth, is now about 80% of my subscribers come from this one feature because I’m being recommended by their newsletters and so if you write awesome things that people find valuable, newsletters will recommend you and it’ll lead to this kind of trajectory. I have this chart that I shared on Twitter, just like this rock hockey stick that just started as soon as they launched this feature. So I think that’s a really, really important feature in the trajectory of newsletters, and I think people should be more excited about it.
Jason Feifer:
Holy cow. That’s really interesting and also, we had emailed about this before recording this. I’m not on Substack and therefore can’t access that and frustrated hearing the success of it but I wonder if, and I just wonder if you have any insight here, whether or not you’ve done this yourself about reaching people across ecosystems? Because the thing that the success of the Substack recommendation system tells me is that there is not a over saturation of newsletter problems for people, but rather there’s a discovery of newsletter problems for people. People are willing to subscribe to something new, the problem is that they didn’t know what to subscribe to, and so they needed something from a trusted source to be put in front of them. Have you experimented with anything else with working with newsletter writers to trade promotions inside of their newsletters or any other way to utilize the world of newsletters to try to reach audiences outside of your own?
Lenny Rachitsky:
Yeah, I’ve done it all. I’ve tried everything. Nothing does anything except consistency, quality, solving problems for people being, creating value for whatever the problem they have. And then there’s one feature that Substack has, nothing else has made a dent. If you just look at the growth trajectory of my newsletter, and if you look for, I don’t know, if you Google Lenny San Twitter newsletter milestone, you’ll probably find the chart and there’s like the straight line and the blips within the line, just like they’ve come from these random experiments, but they don’t matter in the scheme of things. It just all grows from providing value to people or they’re just like, you’re solving a problem for them, there’s jobs to be done I talked about and doing it again and again and again for years. And then there’s a one feature from Substack that just changes the game.
Jason Feifer:
Hmm. All right, Lenny, finally, I bet a lot of people who are listening are wondering, and you don’t have to give me an exact answer, but how much of money is he making off of this thing? So I mean, if you can share at least roughly, what percentage of your 325,000 and counting followers are actually paying you?
Lenny Rachitsky:
I make significantly more than I made at Airbnb as a senior product manager, stock included, significantly more. I’m not going to share the percentage, because then people can work backwards and figure out the number.
Jason Feifer:
Right, exactly.
Lenny Rachitsky:
And I feel like when…. Yeah, I feel like when-
Jason Feifer:
I was inviting a ballpark, but-
Lenny Rachitsky:
Yeah, yeah. It’s a wild number that I never imagined I could make from just writing a newsletter and then the podcast built on top of that. So it’s pretty bonkers. Highly suggest exploring this path if you’re interested. There are downsides though. No BTO and no 401(k) matching, no time off, no parental leave, none of that but it’s pretty sweet.
Jason Feifer:
Lenny, this is awesome. Congratulations and thanks for walking us through.
Lenny Rachitsky:
Thanks man. Thanks for having me on.