So You Want to Be a Publisher
On Starting an Indie Publishing Company
Editor’s Note: I wrote a similar article on starting out as an editor in last year’s So You Want to Be an Editor.
I don’t know if anyone besides me and my brother remembers the Quest for Glory video games from the nineties but that’s where I stole today’s title from. The first installment, “So You Want to Be a Hero,” was about a recent graduate of the “Famous Adventurer’s Correspondence School” who finds it more challenging to be a hero than he was lead to believe in school.
This topic came from the latest implosion of a new indie publisher after it came to light that their business practices were unprofessional at best and deceitful at worst. I won’t get into the whole saga because you can read it in detail in “Snakes and Setbacks” on Kayla Morton’s blog. I don’t need to go into the specifics because it’s not this instance I’m writing about—which Kayla has done better than I could, anyway—but rather an ongoing trend of folks (often authors themselves) setting up new publishing companies without having the first idea what they are doing.
I think people start down this road with good intentions most of the time. I’m ever optimistic about the goodness of people. People go into these ventures because they see legitimate problems within the publishing industry, usually from an author’s perspective, and they believe they could do better. I’m not going to name specific companies but here are some things I’ve seen new indie publishers offer:
Pays author royalties of 50%.
Accepts submissions of and signs unfinished works in progress.
Responds to all queries/submissions personally and with feedback, even if they don’t sign the manuscript.
It’s easy to guess where these came from, because these jive with the oft-repeated complaints I hear online about publishing companies and agents: “Publishing a book is easy and free, how does the company get away with taking 85% or 90% of the revenue? What are authors letting them have all that money for?” “I wish I could get a contract for my book based on my concept/outline/synopsis so I would know whether I can make money before I write it.” “It’s flat-out rude that publishers send form rejections, or worse—don’t respond at all! I took time to query, couldn’t they take time to respond personally and at least tell me why they don’t want to sign me?”
Eventually, someone sits down by themself or with a friend or two and says—“Why not? People clearly want this, so why don’t I start a new publishing company that gets this right?”
The slope goes like this:
Best of intentions.
Heartfelt promises lure hopeful authors.
Too much work, can’t deliver on promises.
Silent corner-cutting, hope authors won’t notice.
Oh no, somehow overnight I became a predatory publisher and I’m scamming authors for a living.
I’m not going to tell you why you shouldn’t start a publishing company. I am merely here to share my going-on-twenty-years publishing experience to talk about what it means to start and run a publishing business and what you need to make sure you can do before you hang out your shingle, design your letterhead, cut the ribbon, and open for business.
Value Exchange
The single most important principle in publishing is that there must be an exchange of similar value between author and publisher or else the relationship is necessarily predatory. Most people opening brand-new publishing companies intend to help authors and the last thing they would ever want to do is prey on authors, but this situation plays out again and again—if the publisher is not prepared to offer value in exchange for what the author brings to the table, then they are preying on their authors.
Every author comes to the table with generally the same thing to barter: The copyright to an intellectual property they have created. If you have this, you are an author. If you don’t have it, you’re not an author. The author comes to the table with parts of that copyright (usually reproduction and distribution) on offer for the publishing company to license and make money from. They’re bringing the product. The publisher has to have something of value to exchange for that product.
The ability to make an electronic or print copy of the book available for sale on Amazon is not value equivalent to the intellectual property the author is bringing. This is something any author can do for themself with 10 or 15 minutes of their time. Making the book “available for sale” is not a unique and valuable service the publisher offers.
Further, if a publisher’s offering is limited to making the book available for sale (that is, posting files to Kindle and/or making paperbacks available via print-on-demand), and in turn the publisher intends to receive revenue from the sales, that’s a predatory business model. The publisher is receiving money for the author’s work but providing no additional value beyond what the author created.
What should the publisher bring to the table? I’m going to provide a list below of what publishing companies customarily offer and should be able to offer to authors in exchange for the right to reproduce, distribute, and profit from their intellectual property.
Money
Authors should receive money in exchange for their manuscript. Literally money. Money comes in the form of royalties, that is, a percent of the revenue generated by the book. Not less or after deducting costs of publishing the book. The publishing costs come from the publisher’s share of the revenue. A publishing company that deducts editorial, production, marketing, or other costs from the author’s royalty is a vanity press, meaning one that charges the author money to publish their book. It’s okay to be a vanity press, as long as you’re transparent about that with authors and not masquerading as a traditional publisher.
“Advance” is short for “advance against royalties” and means the author receives money up front, before publication, and that amount is paid back to the publisher out of the author’s royalties before the author begins receive them.
Let’s say an author receives a $1,000 advance (I’m using simple numbers to make the math easy for me) when they sign, and they are contracted to receive a 10% royalty on sales. This means the book must generate $10,000 of revenue before the author begins to receive royalty payments—because they have already received their 10% of the first $10,000 ($1,000) in the form of an advance.
At minimum, the publishing company should offer a monetary royalty to authors. If the publishing company makes money from the sale of books, and none of that money goes to the author of the books, that’s a problem. If the publishing company is not making money from the books—for instance, books aren’t selling—that’s a whole other problem.
Editorial, Production, and Manufacturing
The publisher should provide editorial, production, and manufacturing services at the publisher’s expense for the author’s manuscript. These services include:
Developmental editing
Copyediting
Interior page design
Cover design (and art)
Typesetting
Proofreading
Indexing (for nonfiction)
Printing and binding
XML generation for online publishing (eg, EPUB)
Shipping and warehousing
Not every publisher will offer all of the above and that’s okay. A book that will be available only as an e-book won’t need printing, binding, shipping, or warehousing. It’s not a scam if the publisher doesn’t provide all of the above services. That said, if the publisher isn’t adding value in the form of editorial or production, that’s a big red flag. I hope I don’t need to repeat that if the author is billed or otherwise made to pay for these services, either up front or from their royalty, then the publisher is operating as a vanity press and must be transparent about that.
Another real-life situation (not the specific one referenced above) recently revealed that a publisher—the person who founded the publishing company—intended to save on costs by providing all editorial services herself; that is, she would personally edit each book her company signed. This is not in itself problematic. She made her business stand out by promising expert developmental editing for each manuscript.
However, she ended up signing too many manuscripts to handle and quietly brought on a slew of “unpaid interns” (read: volunteers who believed they were beta reading) to handle the developmental editing; unsurprisingly, the editorial quality quickly declined to noticeably sub-professional levels. Result: The authors did not receive the value they were contractually promised in exchange for their manuscripts.
Marketing, Sales, and Distribution
Any person in the United States can spend an hour googling how to publish a book and then use KDP or Ingram Spark to set that book up for sale. Now it’s available on Amazon.com and it’s available for all major retailers, both brick-and-mortar and online, to carry and sell.
That doesn’t move units, put books on store shelves, run advertisements where readers will see them, or land reviews in major newspapers or book blogs.
Authors rely upon the publishing company to make their books available for sale where readers want to get them. That means the publisher sells books into large book retailers (Barnes and Noble, Books-a-Million), big-box retailers that carry books (WalMart, Target), independent bookstores, and libraries. There are two components to doing this: One is marketing, which drums up awareness of and demand for the book; and the other is sales/distribution, which reaches out to all those retailers and e-tailers and secures book orders.
I admit it’s been a minute since I worked at a distributor so some of these specifics may be out of date. The place I worked was a distribution company for small, independent presses. We provided this service for publishers who were not big enough to have their own staff for this. The small publishers would send book stock to us (or engage us to manage their printing for them) and we would warehouse the books, sell them to retailers, and ship copies to fill orders. This was full-time work for a small company of people.
This is not a quick or easy piece of the publishing process. You don’t just put a title out there in the catalog of books available from Ingram and hope for the best—not if you want to actually sell books. Retailers put their orders in electronically, yes, but we had full-time staff dedicated to leveraging their years- or decades-long relationships with retail book buyers and these guys were on the phone all day, every day, convincing retailers to buy more copies or buy a book they hadn’t already ordered.
If you don’t have a plan to move units: What are you doing opening a publishing company? Moving units is how everyone gets paid.
Publishing Administrivia
This is a frequently overlooked but important part of publishing. Did you know that when you publish a book in the United States, the Library of Congress is legally entitled to receive two copies of it (print copies if the book is available in print)? And that the publisher is required to send them those copies?
Did you know that, while the author innately owns the copyright to anything they create, the copyright must be registered with the Copyright Office of the Library of Congress if you want to sue someone for infringement in court? Who’s filling out and filing the TX forms?
How many ISBNs is your company purchasing to get started—100? 1,000? Do you know how many you need for each title? Who’s requesting cataloging-in-publication data from the Library of Congress? What’s your plan for getting royalty statements to your authors each quarter? Who is in charge of paying the cover designer’s invoice? Who’s sending takedown notices when the company’s books show up on LibGen?
The publisher manages these processes. Do you have the expertise and, candidly, the capital (the money) to manage them? Do you have the personpower to file the forms and the funds to purchase the ISBNs and pay the filing fees? Make sure you have a plan to get these things done.
First Do No Harm
To wrap up, I want to touch on the consequences for authors when they inadvertently choose a publishing company that lets them down.
Let’s take a look at Kayla’s situation, which I referenced above, and which is detailed on her blog. Kayla was offered publication for her novel in writing (email). Following the industry-standard process, Kayla negotiated a two-week deadline to respond to the offer during which she would nudge other agents and publishers who had her query package, so that those other parties would have a chance to compete for her manuscript. Then the publisher who had offered publication withdrew their offer.
In this case, the author did everything right. By nudging agents and publishers with her offer of publication, she let those people know that instead of their normal response time (which might be eight weeks, three months, six months, or more) she needed to have their response within 2 weeks since she had received an offer. This resulted in agents and publishers declining her manuscript when, given more time to evaluate, they might have been interested to offer representation. There’s no way to know that now—due to the offer she received, she closed off potential avenues for publication with other agents and publishers. The withdrawal of the offer therefore harmed her publication prospects, by causing her in turn to withdraw her work from consideration by others.
It may feel like starting a publishing company is a chance to offer more opportunities to prospective authors, but if a publishing company doesn’t have what it takes to provide value to the author in exchange for licensing their manuscript to sell, then that publisher robs authors of opportunity.
That’s not what any of us are in this business to do.
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