083: A Solo $1 Million Newsletter

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—Whether you're a seasoned entrepreneur, an aspiring startup expert, or simply someone seeking inspiration, Startup Gems is your source for the stories that ignite the flames of innovation.—


—I’m your host, Chris Koerner, and in today's episode, we're diving deep into the dynamic journey of Michael Houck, the mastermind behind Houck's Newsletter and Megaphone. Get ready for a rollercoaster of entrepreneurial wisdom as we dissect the principles that propelled Michael's ventures to success. From starting small and validating quickly to leveraging existing networks and diversifying revenue streams, we're about to uncover the strategic moves that paved the way for Houck's triumph. So, whether you're a seasoned business owner or just kickstarting your entrepreneurial adventure, stay tuned for invaluable lessons and practical tips that can elevate your business game. Let's jump right in!—



—Michael is the founder of Houck's Newsletter, a popular startup advice column with 70 thousand readers, and Megaphone, a managed marketplace for boosting social media presence. His impressive track record includes raising 15 million for his last startup, co-founding a venture fund, and investing in over 50 startups.—

—But let's dive into the nitty-gritty of how Megaphone came to be. It all started with a casual text to friends about the idea of a marketplace where well-known creators amplify their content. The response was immediate – five friends wanted to pay him for it on the same day. That's when Michael knew he was onto something. With a humble beginning using tools he already had, Megaphone quickly evolved into a platform connecting creators and helping them grow.—

—Now, rewind a bit to the origins of Houck's Newsletter. Initially a side project aimed at building Michael's personal brand for his last startup, the newsletter outlived its initial purpose. Michael recognized a gap in the market for modern advice from someone who had recently built a venture-backed company. Investing 10 grand, he kickstarted the newsletter, spending a fraction of it on essential tools.—

—So, how did Megaphone get it’s first customers?—

—Michael took a strategic approach, leveraging his existing network. He started by reaching out to friends for feedback, refined his sales pitch with a broader audience, and even tapped into his paid founder community of around 450 people. Running leed magnets on social media and incorporating Megaphone into his newsletter's welcome sequence helped him attract a steady stream of initial customers.—

—And what about the ongoing marketing strategies?—

—For Megaphone, Michael has kept it close to home, primarily using his own newsletter for promotion. However, he hints at exploring new channels, drawing on his experience at Uber but keeping the details under wraps for now. Meanwhile, for the newsletter, paid channels have become a key driver of new subscribers, including ads on Facebook, Instagram, and Twitter, as well as utilizing SparkLoop for paid recommendations.—

—Let's talk money. How does Michael's business make money?—

—Megaphone operates on tiered subscription pricing, ranging from 49 to 89 dollars per month. Additionally, they take a 20 percent cut of creator earnings. As for the newsletter, revenue streams include ads, subscriptions, upsells to Megaphone, consulting services, and referral income through SparkLoop. Michael shares that they've just hit a significant milestone with their first a hundred grand month, projecting consistent success in the upcoming quarters.—

—As we wrap up, Michael emphasizes the importance of keeping expenses in check to optimize for growth. Currently maintaining low margins, he's focused on scaling the business and achieving sustainable success.—

—Let’s now break down the success story of Michael Houck and his ventures, diving into the principles that fueled the triumph of Houck's Newsletter and Megaphone. So, let's jump right in.—

—Principle 1: Start Small, Validate Quickly—

—Michael's journey began with a simple text to friends pitching the idea of Megaphone. The key here is to start small, validate your concept, and iterate. Any business owner can adopt this principle by launching a minimum viable product to test the waters. Use feedback from a small audience to refine and improve your offering before scaling.—

—Start by reaching out to a small group of your most trusted connections or existing customers. Share your idea, gather their feedback, and make informed adjustments based on their responses. It's a cost-effective way to validate your concept before making significant investments.—

—Principle 2: Leverage Existing Networks—

—Michael strategically leveraged his network to kickstart Megaphone. From friends to a paid founder community, he expanded his reach concentrically. Utilizing existing networks can significantly reduce customer acquisition costs. Business owners can apply this principle by tapping into their current customer base, personal connections, or industry networks to spread the word about their products or services.—

— Identify your existing networks and think about how you can leverage them to promote your business. This could involve reaching out directly to your current customers for feedback, testimonials, or referrals. Networking events, both online and offline, are also excellent opportunities to expand your reach within your industry.—

—Principle 3: Diversify Revenue Streams—

—Both Houck's Newsletter and Megaphone have multiple revenue streams. Megaphone, for instance, operates on tiered subscription pricing and takes a percentage of creator earnings. Houck's Newsletter monetizes through ads, subscriptions, and upsells to Megaphone and consulting services. Diversifying revenue streams can provide stability and resilience for a business. For any business owner, this means exploring various monetization avenues related to their products or services.—

—Take a closer look at your current revenue streams and brainstorm additional ways to generate income. This could involve introducing complementary products or services, exploring partnerships, or creating premium versions of your existing offerings. The key is to ensure that your revenue is not solely reliant on one source.—

—And there you have it, folks! Three principles that contributed to the success of Michael Houck's ventures. Whether you're just starting or looking to scale, consider implementing these principles in your business strategy. —


—Thank you for being part of today's adventure through the world of startups and innovation. Did this episode ignite any fresh perspectives or ideas? Share your reflections and favorite takeaways in a review wherever you’re listening now. Remember to stay curious, continue to forge your own path, and subscribe and follow Startup Gems to be the first to access stories that will fan the flames of your entrepreneurial passion.—