I assume one of the reasons you’re looking to run an investment newsletter is because it’s so potentially lucrative. Rolling through your head are thoughts of penning your best stock picks at 3 am and watching the subscription revenues roll in while you take your kids to school in the morning — oblivious to the 9 to 5 grind. Or maybe, you’re looking for some extra cash in addition to your day job. Whatever the reason: investment newsletters are hard to produce and monetize but if you are successful, they are well-worth the investment.
So, how lucrative can it be?
So, how lucrative can it be? Well, because most of the larger investment newsletter publishers (like Agora, Phillips and Forbes) are private firms, it’s hard to tell how large each one’s revenues are. Industry rumor has it that Agora is the largest and has revenues in the 100s of millions. There is one publicly-traded firm, Jim Cramer’s TheStreet.com, that may give us a view into their newsletter business.
Thankfully, TheStreet.com has to report its earnings every three months which gives us a glimpse into how many newsletters they are selling. From TheStreet.com’s October 2008 earnings report: TheStreet had $6.6 million in subscription revenues for the quarter, down from $7 million in the previous quarter with monthly annual rates at about 90% and annual renewal rates 65%.
TheStreet’s subscription revenues have been slowly declining for awhile — but, let’s assume the company boasts a $6 million in quarterly run rate in their newsletter business That’s $24 million in subscription revenue per year.
That’s a lot of dough.
But they’ve got Booyah Jim Cramer
True, Jim Cramer is the marketing lifeblood of TheStreet.com. He’s got a global audience and TV and radio shows promoting him and his products. So, you won’t have the same marketing muscle as the former top hedge fund manager. But, you’ve got your own micro-marketing muscle. You’re finding your audience, selling, and maybe even spending on a bit of advertising.
Given the numbers at TheStreet.com and assuming $400/year for a subscription, TheStreet.com is selling something like 60,000 newsletters. Let’s assume you sell your newsletter for $199/year. Can you find 1500 subscribers to your newsletter every year by just giving them knockout information and service?
It’s an uphill battle and a tough slog but why not give it your best shot? Don’t forget us when you’re next up after Cramer on CNBC.
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