If you've ever looked at how media properties get valued and felt like the numbers didn't add up, you're not wrong. They often don't. At least not if you're only looking at the financial statements.
The spreadsheet stuff matters. But they're not what separates a media company someone will pay a premium for from one that sits on the market for months. The difference lives in a set of less obvious factors that are harder to measure but far more predictive of long-term value.
This letter is about those factors.
Owned vs. rented attention
This is the single biggest divide in media valuation and most people still underweight it.
If your audience reaches you through a platform, an algorithm, a feed, or a recommendation engine, you don't have an audience. You have traffic. Traffic can disappear overnight because someone else controls the dial. We've watched this happen repeatedly with publishers who built enormous reach on popular social media platforms, then watched it evaporate when algorithms shifted. Creators who had millions of views on one platform and couldn't move a fraction of that audience anywhere else.
This is why we're seeing every creator place a newsletter link in their bio. They own that audience.
Email subscribers, paying members, direct app installs are all fundamentally different assets. It's not just more stable. It changes the entire economics of the business. You can price differently. You can launch new products into an audience that already trusts you. You can survive platform shifts that kill your competitors.
When someone is evaluating a media company, the ratio of owned to rented attention is one of the first things that should matter. A company doing $2 million in revenue with 80% of its distribution owned is a categorically different business than one doing $2 million with 80% of its distribution dependent on a platform it doesn't control. The second one isn't really worth $2 million in revenue. It's worth whatever that revenue looks like after the next algorithm change.
The dependency question
Every media company has dependencies. The question is how deep they go and how hard they are to replace.
Some dependencies are operational: a specific CMS, a particular ad network, a tool in the workflow. These are annoying to replace but survivable. Other dependencies are existential: a single writer whose voice is the entire brand, a platform that delivers 90% of traffic, one advertiser that accounts for half of revenue.
The tricky part is that some existential dependencies are also what make a media company valuable in the first place. A publication built around a singular voice can command incredible loyalty and pricing power, but it's also fragile in a way that a more institutional brand isn't. That's not a reason to avoid building around a strong voice. It's a reason to be honest about what it means for the value of the business and to think deliberately about how to reduce that fragility over time without killing the thing that makes it work.
When you're assessing a media property — whether you're building it, buying it, or investing in it — map the dependencies. Not just what they are, but what happens if each one goes away. The companies that are worth the most are the ones where no single dependency can kill them.
Revenue composition
A dollar is not a dollar in media.
A dollar from a single advertising client who could leave next quarter is worth less than a dollar from a diversified set of sponsors. A dollar from sponsorship is worth less than a dollar from subscriptions, because subscriptions are more predictable and harder to lose. A dollar from subscriptions is also worth less than a dollar from a mix of subscriptions: content, paid community, events, B2B, and so on. The circle goes on.
Two newsletters can have the same number of paying subscribers and the same monthly revenue, but if one built its base through its own channels and the other got most of its growth through Substack's discovery engine, those are not the same business. The first one owns its growth. The second one is renting it. If Substack tweaks how recommendations work or deprioritizes a niche, that revenue doesn't have anywhere else to come from. That said, there's a flip side. A newsletter that grows organically through platform discovery has very low acquisition costs, which makes it attractive to a different kind of buyer.
Most media companies know this intellectually but don't act on it until they have to. They find one revenue stream that works and ride it until it stops working. By then, building the next stream is an emergency instead of a strategy.
The revenue composition also signals something deeper about the business: how many different ways it has found to be valuable to its audience. A media company with four revenue streams isn't just more diversified, its audience trusts it in four different contexts. That's a much stronger foundation than one built on a single transaction type, no matter how profitable that single stream is today.
