“Buy Me A Coffee!” No! Save Money!

An often-asked question from my subscribers is whether they want to support me but don’t want to subscribe. They would like to pay for content they like in small amounts—1, 2, 5, or 10 USD or EUR or GBP or …

Substack does not support such a model, despite the fact that I have read dozens of discussions related to this. However, I learned meanwhile that Substack does not prioritize the wishes and needs of the writers.

So the writers helped themselves, and you find, meanwhile, on many Substacks the integration of Buy Me A Coffee-Links to close this gap. This is understandable, but is it smart?

No, using Buy Me A Coffee is anything but smart.

Let’s make a little sidestep here. I have run and organized online businesses for twenty-five years and have learned over time that small retailers have no clue about their payment costs. That probably applies to Substack businesses, too. They get told that the cost of the payment processor is very reasonable and can be neglected.

Really?

Let’s look at the prices we must pay for Stripe here on Substack and elsewhere. It sounds great — 2.9% of the transaction plus $0.30 in the US. Let’s do the math:

• $1 payment: 2.9% → $0.03 + $0.30 → $0.33 → 33.0% fee

• $2 payment: 2.9% → $0.06 + $0.30 → $0.36 → 18.0% fee

• $3 payment: 2.9% → $0.09 + $0.30 → $0.39 → 13.0% fee

• $4 payment: 2.9% → $0.12 + $0.30 → $0.42 → 10.5% fee

• $5 payment: 2.9% → $0.15 + $0.30 → $0.45 → 9.0% fee

• $10 payment: 2.9% → $0.29 + $0.30 → $0.59 → 5.9% fee

On top of this, you pay various surcharges: 1.5% for international cards, fraud prevention, and more charges. My experience with international charges is that you always end up above 5%, sometimes 6%. Plus 30 Cents. So for international charges - and that is much more than you believe — the math looks this way:

• $1 payment: 5.5% → $0.06 + $0.30 → $0.36 → 36.0% fee

• $2 payment: 5.5% → $0.11 + $0.30 → $0.41 → 21.0% fee

• $3 payment: 5.5% → $0.16 + $0.30 → $0.46 → 15.3% fee

• $4 payment: 5.5% → $0.22 + $0.30 → $0.52 → 13.0% fee

• $5 payment: 5.5% → $0.28 + $0.30 → $0.58 → 11.9% fee

• $10 payment: 5.5% → $0.55 + $0.30 → $0.85 → 8.5% fee

For international payments, small transactions always cause costs beyond 10%.

The use of Buy Me a Coffee worsens this because they charge 5% for their “Service.” You can even pay for your donor's credit card fees, so you are ending up with these costs:

• $1 payment: 36.0% fee + 5% → 41.0% for Buy Me A Coffee

• $2 payment: 21.0% fee + 5% → 26.0% for Buy Me A Coffee

• $3 payment: 15.3% fee + 5% → 20.3% for Buy Me A Coffee

• $4 payment: 13.0% fee + 5% → 18.0% for Buy Me A Coffee

• $5 payment: 11.9% fee + 5% → 16.9% for Buy Me A Coffee

• $10 payment: 8.5% fee + 5% → 13.5% for Buy Me A Coffee

So, using Buy Me A Coffee costs up to 41% for small payments—or even more if you cover the credit card charge for your donors.

Does it make sense to do this?

Your decision.

Fun fact:

Stripe owns Buy Me A Coffee. Isn’t it a smart concept to pay double fees to your payment processor?

Some may now say: “I don’t care.”

Ok, have a good one.

This proves that you might never run a successful business; cutting costs is important for every business.

Payment processing fees are a burden for every business. Consider why many restaurants and small businesses charge 2, 3, or 4% for credit card use nowadays: They can't afford these overhead costs anymore. Your Substack is a small business if you want or must generate income from it.

But:

There is good news!

You can avoid many fees and wipe them even down below 1%!

I will explain to you how:

1. You can integrate to your Substack Stripe Payment Links (expensive); see above. I will show you this in Monetization 2.

2. You can integrate to your Substack PayPal (expensive); similar to Stripe. I will show you this in Monetization 3.

3. You can integrate CashApp to your Substack for a 2.75% flat fee or 0% if you use your private CashApp. I will show you this in Monetization 4.

4. If your bank supports Zelle payment, you can use it. Most banks charge no fees. If your bank does not support Zelle, consider opening an account with Zelle payment. Ally is an online bank that accepts Zelle payments. The complete list can be found here. I will show you the integration in Monetization 5.

5. You can integrate Krypto payment into your Substack at zero cost. I will show you how to do this in Monetization 6.

6. You can integrate ACH and SEPA payments into your Substack for 0.5% fees. I will show you the integration in Monetization 7.

7. For all countries not covered by the above payment solutions, I will show you how to integrate every payment solution into your Substack. I will show you the integration in Monetization 8. You are welcome to ask for special integrations in the comments.

SUBSTACK 101 KICKSTART teaches you how to monetize your Substack in many more smart ways than the few possibilities Substack offers.

That’s it!

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This piece covers Robert Malone’s problems with Stripe. Whatever you think about him, this has also happened to many other authors, providers, and small businesses.

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RESOLVED: Stripe, Substack Demand Financial Details from Authors

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