Alex Lieberman: Building A $75 Million Digital Media Empire | The Creator Lab Podcast
According to Alex Lieberman, Morning brew is a daily newsletter that informs and empowers the modern business leader to make better decisions. In a short number of years, Alex and Austin Rief grew morning brew from a dorm room project to a 75 million dollar digital media company.
Alex recently made an appearance on the creator lab podcast to explain how he did it. We summarised the key points below.
‘If you don’t enjoy creating content, then it’s going to be hard for you to build an audience.’
The Audience Funnel Framework
Each segment of the audience funnel represents a different way you can interface with your audience.
• Top of Funnel = Rented
• Middle of Funnel = Owned
• Bottom of Funnel = Monetised
Rented audiences are platforms you don’t own but can build an audience on for free, like Twitter. These platforms have good shareability and discoverability.
Over time you want to ‘own’ an audience rather than rent it, which means shifting that audience to your platforms like an email list or a text message list. Owned audiences are more intimate and give you greater distribution.
The final stage is monetisation. There are many ways to monetise an audience, like creating a product or service for them or giving access to premium content. Only take this final step if you are committed to serving this audience at a high level for a long time.
‘You’ve got to create, respond and engage with others daily and multiple times a day. If you don’t enjoy this, it will be torture.’
The Hub & Spoke Model
Alex thinks about growing an audience in a hub & spoke model – like a wheel on your bike.
Hubs are audience congregation points like a lecture hall at university or your local football stadium that give you access to the spokes of people you want to get in front of.
You don’t want to spend time convincing every spoke to become part of your audience; instead, you want to leverage hubs to get in front of as many spokes as possible.
The way morning brew did this is Alex and Austin would pitch lectures classes for 2 minutes about the morning brew and ask them to sign up.
We’d go into a class. We would give the Brew spiel for two, two or three minutes. We’d say, Hey, if you’re interested in it, we’re going to pass around a sheet of paper, write down your email address, and you can sign up.’
Online communities are great hubs to get involved with. Make sure you’re going after the right audience, though; otherwise, this is a complete waste of your time.
The Media Cycle Framework
Audiences are built with content, and the business model of these content businesses has three segments.
When Morning brew raised money, they immediately hired people for each step of the media funnel. You need people to create great content, people to drive audience growth and people that can help you monetise the attention you attract.
Building a large audience is only half the picture. A large audience does not equal content distribution or monetisation.
You need to build an engaged audience.
How engaged your audience is depends on how niched your content is.
If a creator covers many different topics, then that person might have multiple audiences in one, and people will only engage with specific content types.
• How you build that audience, i.e. your acquisition methods, also matters. For example, lead magnets, podcast appearances or growth hacks. If you build your audience around a particular niche, and that’s how everyone was acquired, the engagement rate will be high.
When someone follows or subscribes to you, it’s almost like a contract you create with them.
They’re only going to acknowledge you when you give them what you’ve agreed to provide them. Sometimes you need to filter out the content you want to post to make sure it’s relevant for the people that followed you based on the contract you have
Generally, it’s better to go specific rather than broad with your content (remember this is only if you want to build an audience)
Your First 1,000 Subscribers
Alex used the Hub & spoke model to grow morning brew to its first ~1,500 subscribers by pitching at lecture halls.
In general, at the beginning, you need to do stuff that doesn’t scale, which he referred to as ‘hand to hand combat.’
You don’t need to build an email list either; you can apply this approach to any type of audience you want to develop.
They chose email because students (their target audience) were already using their emails a lot.
Getting those first few subscribers is tricky, so Alex set up an email notification for every new subscriber just to feel that momentum and get little dopamine hit.
Growing to 10k
After they got to 1k, they set up a very successful ambassador program.
Essentially they pitched influential students to become ambassadors of morning brew and rewarded them for getting the morning brew name out there.
Not much different to influencer marketing today. Good ambassadors are evangelists; they’re usually early adopters that are hard-core engaged.
The Road To 100k
After exhausting their Michigan student audience, they turned to other organic growth methods.
They spent almost no money until they hit the 100k mark, from what I understand.
Cross-promotion with other newsletter letters worked well, especially with small and engaged audiences like CB insights and Dave Peel’s draft.
They could get 100’s of new subscribers from these small and engaged audiences, while cross-promotion with large but unengaged audiences only resulted in 1 or 2 new subscribers. Both organic and paid email swaps worked well.
The only problem is there are only so many small and relevant audiences you can cross-promote with. So you’re constantly climbing the ladder to find the next cross-promotions audiences.
This same approach has worked well for bloggers, podcasters, and other like-channel cross-promotions. Emails lists grow via other email lists, and podcasts grow via different podcast audiences.
They started answering business-related questions on Quora and left a small CTA at the bottom of each answer to join the morning brew. Exact numbers weren’t given, but it’s safe to assume this generated 1000’s subscribers.
Alex is now thinking about how he builds cross-promotion into the content. He gave an example using his founder’s journal podcast with Gary Vee – where he’d ask Gary to create founders logs on the founder log podcast, and then Gary will promote that with his audiences which will drive a lot of growth.
Alex gave an example of internal cross-promotion like Sahil Bloom on Twitter. He always cross-references his content on Twitter, which sucks people into his Twitter rabbit-hole. Every piece of content links to another, and you keep engaging.
• Create content that leads to other content. I.e. at the end of every youtube video or blog post – ‘if you liked this episode, then check out the next one.’
When their audience was large enough, i.e. 50k+, they started getting their content syndicated by large media sites like TechCrunch. If you want to learn how to get your content syndicated, then Nicolas Cole is your guy.
They introduced a referral program at this point as well. Copying a referral marketing case study on Tim Ferriss’s blog by Harry’s Razors – they paid a developer $500 to build a replica for them and put it to work.
Essentially, they leveraged every organic channel they could think of to grow by testing a lot.
Taking Off To 1 Mil
At 100k, they knew they’d found product/market fit and were confident to run ads to acquire subscribers. Paid acquisition started the morning brew hyper-growth period. It took them a year to go from 100k to 1mil.
I should add that this is an almost uniform point of view across large newsletters, i.e. don’t run paid acquisition methods until you’ve achieved significant audience growth via organic methods and 1000’s of people love what you have to offer, i.e. PMF.
They knew they’d found product-market fit when advertisers were willing to spend $1000’s dollars to reach their audience. If people weren’t ready to pay to get in front of their audience, there wasn’t any point in spending on ads as they couldn’t recoup that cost.
For paid acquisition to work, you need to know how much each member of your audience is worth, i.e. LTV, and you can only know that with a lot of data about your audience. You want to acquire new audience members for less than they are worth.
Paid works well with a referral program as referrals make every subscriber worth a little more than one subscriber.
At one point they found a piece of creative art that worked well on Snapchat and Instagram – The creative was a fake text conversation between two people talking about reading the morning brew.
The effectiveness of this creative has burned out due to the law of shitty-click throughs. But if you can come up with a unique approach to your creativity before everyone else copies you, you’ll experience a period of cheap and rapid acquisition.
Another paid tactic the morning brew has found that works well is influencer marketing on Youtube. Target audience or audience match is super important here.
Morning brew is evolving from intuitive growth (what content Austin and Alex liked) to data-driven growth. What people click on or engage informs them what content to create in the future.
Intelligent creators are employing this tactic on Twitter and Instagram. When a post hits and gets a lot of engagement, that creator will create a blog post or a youtube video expanding on the topic, as they already know it will work.
Morning Brew is shifting into personal finance content because they saw that many people were clicking on their personal finance content, and readers were emailing asking for more.
They’re in the process of structuring their data into two categories;
• Audience Engagement – what is our audience engaging with – what content do they want.
• Audience Health – what can we learn about our audience’s appetite for the brew. How often do they open, when do they unsubscribe, why do they unsubscribe, how can they increase their subscriber LTV.
– Alex was just rifting here and giving some examples or pathways that other creators monetise their audiences.
Loss Leader Approach
• Using one too many content as a loss leader
• Provides 1 to some opportunities such as public speaking – good LTV
• This leads to 1 to 1 options, like coaching – great LTV
Audience Building Approach
• Creating content to build an audience
• Publishing books for that audience
• Getting a venture capital partnership position due to audience leverage
Course Building Approach
• Build an audience
• Create courses that problem-solve for your audience
• Leverage relationships that you build from courses for long-term opportunities down the track
The most profitable approach is building long-term equity-like celebs do with alcohol brands or like Mr. Beast has done with Beast Burger.
Course etc.. are a one and done approach where-as these product brands are long-term high-frequency relationships, and you own equity in a business at the end on top of cash flow.
The Three Content Types
Alex started the founder’s journal because he found building a writing habit too difficult.
On the founder’s journal, Alex is trying to figure out how to communicate the intersection between entrepreneurial soft and hard skills. He covers topics ranging from mental health to making good decisions to creating an effective marketing campaign.
Three types of content work well on founders journal podcast;
1. Timely news hooks – content about fresh news items that are getting discussed a lot on socials (short cycle, only valuable for a week or less)
2. Service content – evergreen solve a problem for someone or fulfil someone’s interests/passion – frameworks (long-tail content that continues to provide value | frameworks)
3. Vulnerability content – where you share your feelings or emotions – imposter syndrome is an excellent example of this content; it’s relatable—emotionally provoking.
You can watch the full podcast on Youtube here.
Thanks for reading, I hope you found this useful. If you want to learn more from entrepreneurs like Alex we share the methods they use to build large businesses weekly here -> newsletter.