Good morning. Let’s sow this wheat, water and care for it for months, harvest it, mill it, make a dough, bake it, and get this bread.

Last week we featured Jade Buffong-Phillips, who is four months into writing 240 Days to Raise, her newsletter about raising funding for her startup, sent weekly to some 120 subscribers.

This week, we’re featuring Martin Crowley, whose newsletter, AI Tool Report, has existed for barely 10 months and already has over 500,000 subscribers and some $100,000 in monthly revenue.

There is such an incredible range of stories to be told across the creator economy. Thank you, sincerely, for following along as we attempt to chronicle them all and learn a few things along the way.

— Francis Zierer, Editor

P.S. We’re experimenting with an extended interview portion in this week’s issue. Please do share your feedback by completing the poll at the bottom of the page. I read every single response.

As a high schooler, Martin Crowley’s parents only allowed him to play video games for half an hour each day. Still, he craved that dopamine rush you get from gamified progression, so he did what any kid would do: he started a YouTube promotion and growth company. Incidentally, this was 2011, the same year YouTube popularized the word “creator” in the way we use it today.

Martin, a gifted systems thinker, quickly figured out how to game the YouTube algorithm and began working with musicians and other YouTubers to help them grow their views and subscriber counts. His fledgling agency, Spark6Media, did $10,000 in revenue in its first month. Back at school, his grades tanked, and he slept through classes; he worked for his clients from 10PM to 3AM every night.

Over four years, Spark6Media brought in some $1.2 million in revenue, with single-month revenue peaking at $40,000. After shutting down the company, Martin became a full-time DFS (Daily Fantasy Sports) player — again leveraging a gift for systems thinking to make a killing online, routinely ranking as one of the top five players in the world. Today, he no longer plays full-time, but it’s still a significant source of his income.

In March 2023, at the height of the GPT-4-release-induced AI hype cycle, Martin became determined to learn more about AI. He was fairly early to and well-versed in the crypto and the NFT spaces; AI was a logical next step.

Like many aspiring newsletterists, Martin was inspired by the multi-million-dollar exit stories shared by the hosts of the My First Million podcast — Sam Parr’s The Hustle and Shaan Puri’s Milk Road. In writing an AI newsletter, he figured he’d have a huge upside (a potentially lucrative exit) and no downside (worst case, become an AI expert).

The chief hurdle blocking a potentially lucrative exit was that, even by March 2023, the AI hype cycle was already well underway. Other media products had already built strong organic followings; why would anyone care about Martin’s AI Tool Report?

Martin’s solution, possible due to his lucrative decade as a professional DFS player, was paid advertising. Again: gifted systems thinker. His investment seems to have paid off, given that AI Tool Report currently boasts over 500,000 subscribers after just over 10 months of existence in a highly saturated market.

We recently spent an hour with Martin discussing:

Read our interview below.

No time to read the rest? Before you go, here are a few quick lessons from Martin and AI Tool Report applicable across niches and platforms.

The following interview has been edited for length and clarity.

Why was last spring the right time for you to start an AI newsletter?

The right time would have been January instead of April, but it was close enough. I think if I had waited another quarter, it would have been too late. I was in the endgame of when launching something like AI Tool Report was still really fruitful.

I thought, I'll just experiment with AI every day and pass on my learnings to my subscribers. Best case, I'll have a business; worst case, I'll learn about AI. The downside was capped, and I knew the upside was substantial, looking at other AI newsletters that had already grown so much.

You started AI Tool Report to learn about AI yourself, but how did you define the potential audience?

It's funny — I started tweeting about AI a bit with my beehiiv link in my profile, and I got two newsletter subscribers over three weeks. It sounds ridiculous, but those two subscribers gave me the confidence to go all in; two people were listening to me.

After those two subscribers, I started playing around more and grew to 100. Then I did the math in my head about what getting a million subscribers would look like, if that was possible, and figured it would be within a couple of years.

From that point, I began testing who my target audience would be and what they responded to the most. I tried a bunch of different landing pages with a bunch of different headlines. "Learn AI in 5 minutes a day" was doing well, so that became my North Star.

Were there any major inflection points in your subscriber growth?

The first two months were rough for subscriber growth because I couldn't get my ad budgets up on Facebook or Twitter. I was still trying to figure out how to properly grow there. Suddenly, one of my ads just started converting at a high rate, and I added over 100,000 subscribers in a month.

Some days, I was adding up to 7,000 subscribers. It was around two months after starting that the numbers started going parabolic.

The newsletter is the central pillar of this business, but you've also launched a few additional ventures. Can you describe the other arms of the business?

My thesis starting out was to get everyone's attention, which we do with the newsletter. Once you have people's attention, you can direct it at whatever else.

We now have AI Tool Report Pro, our premium offering. We've had that for a long time, and it's been pretty successful for us.

We will have an accreditations portion that will launch in the next month, which will help people get up-skilled in using AI to hopefully find a job. We have a job board, which launched mid-February. We have also worked with companies as consultants on how to implement AI into their organization.

The newsletter is an attention platform we can launch different businesses from. Right now, we're trying a lot of things. I would say that 90% of them will likely fail or become only moderate successes, but I do expect one of them to be pretty successful. It's just still being determined which one it will be.

When did you first monetize the newsletter?

I made a mistake when I was starting the newsletter. I had enough income from other things in my life, so I didn't need to monetize — I didn't try to monetize until sometime between 50 and 100,000 subscribers.

I'm not saying that was a mistake because I needed the money — the issue was we didn't have relationships with advertisers. Those are longer-term relationships that you have to build. Our growth was meteoric, but we had no relationships or sales funnel. So, ad sales were slow for the first few months; just in the last five months, we've really nailed down that process.

For beginning creators, it's not really about the initial money you make from ad sales because it will be a smaller amount. But it is good to try and monetize early so that you have the experience and the relationships, so you're hopping on sales calls and learning. Then, you're well-prepared once you're bigger and can charge more.

How do different arms of the business contribute to the bottom line?

AI Tool Report Pro is definitely a minority stake of the overall income, but the recurring income is great and more stable than the ad sales. Ad sales, depending on the economy, are more cyclical. 

We have around 2,000 premium subscribers, so we're somewhere in the $25,000 monthly recurring revenue range. Our other revenue streams have yet to be really active, but the current revenue streams provide the capital to fund these other ventures and work towards our dreams.

Ultimately, I want this to be a large business, and I'm not sure what direction it's going to end up in, but our newsletter business is somewhat capped. I think we will be able to grow to 1 million subscribers this year, but it's hard to increase revenue at an exponential pace.

Have you personally taken a paycheck from the AI Tool Report revenue?

I'm just reinvesting everything. So, I'm still losing money overall, but if I stopped investing so heavily in growth, we could be making money. I believe so much in the long-term growth that taking a paycheck isn’t on the table right now or for the foreseeable future.

You say paid advertising is your biggest growth driver. How does that figure into your overall financials?

Paid ads have become less of an expense lately; we have been focusing on them less because some of the unit economics have gotten worse. The whole AI hype is still crazy, but it was even crazier six months ago.

Getting our first 10,000 subscribers was much easier than going from 500,000 to 510,000 because so many people interested in AI are already subscribed.

We're having to go more and more outside of the easy-to-reach audience. My ad spend has decreased, but spending on hiring and different projects, like the job board, has gone up to counteract the decrease in acquisition spending.

Now, we're focusing on hiring and building as great of a team as possible.

How does AI Tool Report relate to more traditional tech media? Is that your competition?

We have thought about branching out more into that hybrid role — like Morning Brew, where they're writing some of their own stories and curating other stories while still primarily newsletter-focused. It could make sense for AI specifically because there is so much AI news out there; we could hire several reporters and write our own stuff.

But what you see from traditional media is a hard push into newsletters — getting into your inbox each day. Because of that, I think trying to become like them makes less sense. The New York Times, Fortune, and Forbes are all launching newsletters and pushing people towards email.

I am interested in taking more cues from traditional media, but it’s so competitive, and their moving into newsletters makes me feel we’re on the right track.

Traditional media involves specific editorial rules and codes that are only sometimes practiced in new media products. What kind of rules do you set?

The standards are more loose, and I think that's a good thing. Newsletters, I would say, are held to a slightly lower standard of professionalism, which allows you to be a little bit more whimsical and a little bit less serious.

We do make mistakes. We talked about the wrong CEO of a particular company a couple of months ago, and people were not happy. That made us increase our editorial oversight. But because we're not publishing stories that people share too much — it's mostly going into inboxes — I think people give us a lot more leeway.

What’s your best advice for other newsletter creators?

Figure out your competitive advantage to determine what you should focus on. What can you do competitively better than others? For me, that was paid growth.

Some newsletters in the AI industry focused on organic growth, and they crushed it. When I was trying to do just pure organic growth, my reach wasn't anywhere near theirs, so I turned to paid growth. I now have people who help me with paid growth, but initially, it was only me, and I was obsessed with it.

The earlier you can at least know what you're doing in paid growth, the better. That means figuring out your different acquisition costs and what readers actually want from you. Running paid ads helped me determine who my audience is and what they want.

You have to get pretty detailed with it: get a spreadsheet going, record different costs of acquisitions from different sources, different open rates for subscribers from each acquisition source, different click rates, everything. Get detailed and try to figure out who your audience is, what they want, and what channel to attack the most. It does take a while to figure it out, but once you do, you can put a lot of gas on the fire.

I had money to play with at the start, which may not be relatable to some people, but it was part of my competitive advantage. Having cash at hand allowed me to be hyper-focused on paid growth. I tried organic growth hacks like Reddit posting, but it didn't work as well for me, and tactics like that don't compound as well as paid growth.

You can find one little tactic that brings you 100 to 1,000 subscribers, but can you repeat it every day?

Finding repeatable edges is more important than finding one-off tactics. Focus on things that you can do every day. That's the most important thing. I was focused on paid growth 12 hours a day; I'm a super-obsessive person.

One actionable takeaway — it works for Martin; you can apply it to your newsletter today.

Use surveys.

The best time to start using surveys to create a thorough and accurate profile of your audience was when you first started your project. The second best time is now.

The more you know about your audience, the more you can tailor your content to their needs and the more negotiating power you have with potential advertisers.

beehiiv has a poll feature (which we’re using to collect feedback in this very email) as well as a more in-depth survey feature.

Even poll features built into platforms like Twitter/X and Instagram can provide decent audience insights, but you might be better served building a Google Form or Typeform and linking to it from those platforms.

Content we've been thinking about while working on this issue.

Thank you for reading!

On to next week’s issue, featuring a creator who has interviewed hundreds of iconic creators and celebrities herself, pioneered vlogging as a genre, and built one of the original creator-led media brands.

— Francis Zierer, Editor

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