How to Create 3 Monetization Buckets as a Local Media Brand

Ethan Brooks wrote for The Hustle, watched it sell to HubSpot, and then helped Sam Parr start Hampton. Then he left to build a newsletter for one city and nothing else. In this conversation he explains why he never plans to open a second market, how the free, front-end and back-end model works, and why a few thousand readers can be plenty if you sell the right thing.

From The Hustle to Hampton

Ethan's early newsletter work was in marketing. In 2020 he got his first full-time writing job as an editorial writer at The Hustle, which he describes as one of the first big newsletters to prove the model could become a multi-million dollar media company. HubSpot bought it for about $25 million in 2021, and Ethan stayed through the acquisition and for roughly a year after.

Then he went with founder Sam Parr to start Hampton, a peer group for high-growth founders, something like YPO or EO. He was their first content and community hire. Members had to run a company doing at least $3 million a year in revenue, and some had billion dollar exits. Ethan was one of the first people they called when something went wrong.

Success makes the problems bigger, not smaller

What he noticed at Hampton stuck with him. Everyone is chasing the big exit, and then life is supposed to be golden. Ethan says the problems just get harder and more complex. The founders who got through them leaned on family and community.

He realized he had never invested in a local community himself. He grew up moving around and loved to travel, but never put down roots. Media was his way to fix that, and the Austin Business Review started in 2024.

Austin only, on purpose

Plenty of successful local media companies pick a market, grow it, then launch in the next city. Ethan names 6AM City and Axios as examples of that path. The hard part, he says, is finding someone in each new town who cares enough and is good enough to run it. He is not a scaling-systems person. His strength is going very deep on one thing for a long time, so the Austin Business Review will always be Austin only.

His model is the New Yorker. When he finally subscribed, he was surprised that roughly 40% of the content only matters if you live in New York: theater showtimes, restaurants opening and closing, people writing about their favorite neighborhood. It is a local publication that ended up with national and even international significance. Ethan also points out that the New York Times was not seen as a national paper for most of its history. USA Today was the first company to really crack that.

The idea of staying put got a push from Sam Parr. On the day The Hustle's sale was announced, Ethan asked Sam whether he would still sell knowing what it took. Sam said yes, it was a good exit and a good buyer. But if he had already been financially set, he would have run the company for 50 years and given it to his kids. Ethan says that was a light bulb moment. He had never thought about a job as something to do for the rest of his life, and the Austin Business Review is his attempt to prove it can be.

How much money do you actually need?

At Hampton, the team ran a wealth survey of members covering net worth and household spending. Ethan notes the data had a caveat: they did not specify whether spending included a mortgage. Even so, almost regardless of wealth, spending very rarely went over about $20,000 a month, and for people with no money worries it hovered between $10,000 and $20,000.

Work backwards from the top of that range and you get $250,000 a year. That takes about $6 million invested to cover without touching the principal. Ethan says that is far lower than most people expect. Before he saw the data, he would have said he needed about $20 million. A local plumbing company can net you that much over a career.

To exit a business for $20 million you need roughly $10 million to $12 million in yearly revenue, and Ethan could not find a niche he cared about in that range. So his target is $6 million to $10 million invested, which means $250,000 to $500,000 a year in take-home. He is open that he has not cracked $250,000 yet.

The newsletter engine

At The Hustle, Ethan's team spent about a year writing a guide to how multi-million dollar newsletters work. The universal model that came out of it is what he now calls the newsletter engine. Every media company he can think of, from a podcaster to the New York Times, makes money through the same three buckets.

Each bucket does a different job. Free media gets the word out. The front end is built to get people to hand you money once, because after that they are far more likely to do it again. The back end pays for everything. Any one bucket can be a multi-million dollar business alone, but combining them makes the model sturdier. Ethan says that thinking in three buckets beats picking from 50 ways to monetize.

For Ethan, the free bucket is the newsletter itself. It earns some money from ads and events, but not much yet. The back-end product is consulting at $2,500 to $10,000 a month. No advertiser is going to pay $10,000 a month to be in the email, so one reader who becomes a client is worth far more than an ad slot. He adds that the cleanest version of this is a local services company you can promote through the newsletter.

Why front-end products rarely make money

Ethan says it took him years to see this. He interviewed a creator for a project at The Hustle who told him most people break even or lose money on the front end. That made no sense to him, because the paid newsletter he was working on brought in millions of dollars a year with only three or four employees. What he missed was the point: the front-end product pays for the marketing that grows your free list.

Books are the example he uses. To make $150,000 a year from a regular publisher, you earn about $1 to $2 a copy, so you would need to sell around 75,000 copies every year. Most books never sell 1,000 copies in their lifetime. Authors who make a full-time living do it with consulting and speaking. Ethan relays advice from a publisher he knows: build your business so you could give the book away free and still hit your revenue goals.

TJ adds that the dinner punch cards and t-shirts some local publishers sell can bring in money but should not be the reason the business works. Put that revenue into more marketing, grow the audience, and then make your money on ads or a back-end offer.

What one newsletter reader is really worth

From the outside, The Hustle looked like two million readers and millions in revenue. Ethan says that size was built by brute force with paid ad spend. A typical reader of a free newsletter sticks around six months or less unless you really hook them. At typical ad rates, that works out to a few dollars of revenue per reader, or a fraction of a dollar each time they open an email.

Ethan's point is that growth is important, but what matters more is how well you monetize each reader. He also gives a simple way to think about the back end. If an advertiser pays you, it is because they make more money from your audience than you do. If you build a product your audience buys, you keep that upside yourself.

TJ and Ethan agree that most general local media brands have not found a good back-end offer yet. They both point to B2B services, like digital marketing or AI implementation, as the obvious one. TJ also mentions that Best Version Media, a magazine company, recently launched a digital marketing agency for the same reason.

ATX Writing Club

To show what this looks like with a smaller audience, Ethan describes his friend Zach Solomon, who runs ATX Writing Club. Zach has a local newsletter with a few thousand subscribers, probably somewhere in the 3 to 5 thousand range. He does not run ads and has no real front-end offer.

He has two paid products. One is a membership to the writing club at around $1,200 a year. The other is membership to a clubhouse for writers, at roughly $2,000 to $3,000 a year. The business does multiple six figures in revenue, and Ethan says Zach is not working 80-hour weeks. The skill that matters is raising revenue per subscriber, and that takes time to learn.

The era of scale was the exception

Ethan's argument is that the push to scale is a historical anomaly. He used Google's Ngram viewer to point out that the word scale only started showing up in the late 1990s and early 2000s, mostly about cloud infrastructure. It spread as a business idea when companies like Facebook got huge investment and valuations without making money.

Businesses really work when you define a valuable product and sell it profitably to a market you can reach consistently. He expects people to go back to that. A business-savvy plumber is usually richer than a tech founder, he says, and almost every wildly successful media company of the last 100 years started local. Once the fundamentals work, there is no pressure to grow in any direction.

Ethan says we are moving out of the era of big audiences with little money to spend and into one where people want specialists. TJ adds that Alex Hormozi tells people they have barely scratched the surface of their local market.