Andrea Hurst & Associates

AUTHORNOMICS Interview Series with Ken Shear

By: Andrea Hurst

With a publishing industry that is ever in flux, it can be hard for an aspiring author to figure out what information is relevant and what she needs to do to be successful. Recognizing this, literary agent Andrea Hurst and writer and blogger Katie Flanagan present a series of weekly interviews with publishing industry specialists. The AUTHORNOMICS Series features literary agents, editors, authors, marketing experts and more talking about their opinions on the publishing industry, writing, and what a writer needs to know.

If you have questions for upcoming guests on the AUTHORNOMICS Interview Series, email them to authornomics@andreahurst.com.

Interview with Publisher Kenneth Shear

Ken is the publisher at Booktrope.  He started Booktrope in order to develop a new approach to publishing which would preserve the value offered by the traditional publishing model but organized in a less centralized way with more emphasis on autonomous creative teams.  Ken has previously helped start several companies in other fields (mostly information retrieval and legal support).  He has also practiced law, been a newspaper reporter, and published a book of his own, Unoriginal Misunderstanding (about the early history of the 1st Amendment).

Ken is giving away a free copy of Brian McDonald’s books! Just comment on the post below within the next week, and a lucky random commenter will be chosen Monday, August 29th! See below for the winner of Penny Warner’s novel!

1. You are one of the founders of Booktrope, formerly known as Libertary, a company with a new book publishing business model. Can you talk about what exactly that new model is?

Let me cover a couple of important aspects, including how we organize book creation, how we distribute books, and our online presence.  You can get a more detailed picture of Team Publishing at www.booktropepublishing.com.

We call our model Team Publishing because each book is the project of a creative team, including the author, editor, a designer and a marketing manager, which creates the work and gets the lion’s share of the revenue.  Booktrope provides the platform for the team to organize – the environment for people in various roles to connect with each other, the agreements to work together and the distribution of revenue and reports.  We provide support in the way of getting the book set up for printing and ebook distribution, guidance in marketing, knowledge sharing and book evaluation.

Booktrope is different in other key ways from a traditional publishing house.  For one thing, our standard contract has a limited term of 5 years – not the permanent relinquishment of rights that authors make to a traditional house.  For another, editors, designers and book marketing managers, like authors, are paid out of the revenue from the book (though the author gets the largest share).  So everyone on the team has a direct interest in the success of the book.  In our model, the teams are entirely voluntary.  There’s no assignment of editor or designer or marketing person; rather, the team is formed by people agreeing to work together after they’ve discussed the project.

We also have a different view of book distribution.  Our books are available for sale on most ebook platforms, including Kindle, Nook and iBooks.  Printed copies are available on Amazon and Barnes & Noble’s website, and other online sellers, but, in general, they’re only special order for bookstores.  We do not print large numbers of books and attempt to distribute them to bookstores.  This was at the heart of the book business, traditionally, where even a few years ago you had to print thousands of books and ship them to thousands of bookstores in order to sell them.  Today, for better or worse, Amazon sells more printed books than Barnes and Noble and many times more than all the independent bookstores put together, which have a very small, and shrinking, share of sales of printed books. Ebook sales are larger than printed book sales, a transformation that has happened much faster than anyone predicted even a year ago. The old distribution model doesn’t make sense from our perspective.  We use digital short run technology, which is a variant of print on demand (only the printer sometimes goes ahead and prints some copies in advance if a book has predictable demand).

Nuts and bolts:  The creative team gets 70% of the revenue from the book of which the Author normally gets 35% (half the creative team) and the Book Marketing Manager 24%, editor and designer a smaller share – but, and this is very important in our view, the creative team can allocate the 70% share differently if they agree to.  Most common example of this is editing, which requires very different levels of effort for different books.  When it’s just basic copy editing, the editor’s share is usually lower; when the editor does extensive developmental work, it could be more.  But in most cases, the team goes with the default breakdown, which you can see at www.booktrope.com/teams/financials/.

Finally, I want to emphasize, we’re flexible.  We look at building this new model as a learning experience; of course we make mistakes and we try to learn from them.  So we’re constantly adjusting things.  One of our biggest innovations is a website where we put books we publish up for reading for free.  It’s popular enough that we have several other publishers putting their books on the site too.  Of course there are lots of opinions about free books, but the hard data that we’ve seen shows, having books for free reading on a website causes sales to increase.  We’ve heard arguments against it, but no one has been able to show us actual data that free online reading caused book sales to decline.  In fact the data is so strong that the influential publisher Tim O’Reilly, once a big opponent of free online is now one of its biggest proponents.  But, as much as we believe in free reading as a great marketing tool, there are books where it doesn’t work, so we don’t have a hard and fast rule that everything we publish has to go on the website. Our commitment is to produce high quality books at low overhead, and to distribute more of the revenue to authors and creative teams.

2. How did you come up with this team publishing concept?

I have had a longtime interest in the publishing business and for years people have been talking about the need for new models.  I know many authors who’ve signed up with traditional publishing houses.  Under that model, the author presents her or his manuscript to the publisher and then signs a contract that’s irrevocable and signs over all rights to the publishing house.  Sometimes it works out great, but often, authors are very disappointed. Over time, publishing houses have put more and more effort into promoting books by celebrities and more and more focus on best sellers.  Meanwhile authors get maybe 7 to 10 percent of the books price in a typical deal – meaning if an author sells 10,000 copies of a book for $10 a piece, she or he gets $10,000 – and most printed books don’t sell that well.  Many authors never receive a single check after their advance – even recently, when advances aren’t what they used to be. But bookselling, until recently, was a business that took lots of capital and lots of expertise in the nuts and bolts of book printing, distribution, warehousing and decentralized bookstore sales – there was no practical alternative to the traditional publishing house.

Now, suddenly, we’ve reached the tipping point where ebook sales are surpassing print sales.  Meanwhile, new technologies and the Amazon.com business model have transformed the print book business.  Digital short run publishing and print on demand have made it possible to sell printed books without sinking money into large print runs and without the need to ship to bookstores and keep cartons in a warehouse.  If you exclude the big-box stores, more than half of printed books are now being sold online.  Publishing as a business has undergone an abrupt and radical transformation.

Watching this happening, I realized that there is room for a new kind of publishing business, where we could leverage much lower overhead and much faster production times in order to give creative people more opportunities and more rewards.  In the 1990’s there was a book about programming called The Cathedral and the Bazaar that contrasted the centralized, proprietary way of developing software with the open source method were people could step in and contribute.  I have always connected this in my mind to different styles of business – the cathedral being a traditional company with decision making hierarchies and infrastructure and complex distribution processes, and the bazaar being an environment where people could set up small teams and do small, creative, autonomous projects.  In the business context, think of Ebay or Amazon stores.  I think the bazaar approach is perfect for publishing.  Technology developments and changes in the book business make it possible.  We’ve had dozens of authors, editors, designers and marketing people join us already, and we’re hoping to find more.

3. What are the differences between your services and self-publishing?

The goal of Booktrope Team Publishing is to enhance many of the helpful features of traditional publishing while providing many of the benefits authors can get from self-publishing.  Today self-publishing has become a real alternative for many authors due to services such as CreateSpace, Lightning Source and Lulu, which allow authors to publish and set up distribution for free or very low cost.  But it leaves the author on his or her own when it comes to editorial and design services usually needed to produce an excellent book, and especially, with regard to marketing.  People who are great at self-promotion can be extremely successful self-publishing, but it takes an enormous effort and many authors don’t have the skills or inclination to do what’s necessary to make a book successful from the marketing end.  The Booktrope system permits an author to form a team with a book marketing manager. It’s a more direct relationship than most authors would have with a marketing person in a traditional publishing house and it means the author is not left to his or her own devices when it comes to promoting the book.  But one big way we are not different than either self-publishing or traditional houses – authors need to participate in the marketing of their books.  Team Publishing doesn’t change that – it simply provides support and teamwork to make marketing more effective and less difficult.  Yes, if you’re self-published you can go out and hire a marketing consultant or firm to help you, but in the Booktrope model, the marketing manager is a stakeholder and a real team member.

This does not mean that every single book in our system has four people, including each of the roles.  On some books the roles can overlap.  We want this to be a flexible system.  For example, an author who is very good at design might make their own cover.  We sometimes reprint books in new editions; it may not require a new edit.

Likewise, a problem for self-published authors is obtaining good editorial and design services.  Yes, you can go out and hire your own editor and designer – indeed, services like Createspace and Lulu will sell these to you.  The difference with Booktrope is, authors do not pay upfront for these services –again, everyone on the creative team is a stakeholder who benefits from the success of the book.  In our system, both editors and designers usually get credit for their work in the book, and the team has strong incentives to produce the best work possible.

4. What kind of screening process does Booktrope have for submitted manuscripts?

We do screen manuscripts and indeed, right now, we are not accepting unsolicited submissions, though we do accept recommendations from people who have worked in the system and from agents.  In order for us to publish a book, there need to be team members interested in working on it.  For example, for a new manuscript, we need to find an editor and the author and editor must agree to work together.  We also have an early reader program to help us evaluate books; it will be expanding pretty soon.  Right now we handle selection internally but keep an eye on our website, because we’ll be exposing more of our system on the web as time goes on.

5. Booktrope puts a lot of emphasis on online marketing. What are some of the social media tools all writers should use?

Social media has exploded over the last few years. One kind of support Booktrope provides for both authors and book marketing managers is in educating them on the options, functionality and optimal use of the various technologies. So much is available, and the vast majority of it is free of charge. It would take a book to lay out all of the techniques that are available – indeed, Katherine Sears, our CMO, is putting one together right now.  Here are some basics that we feel most authors should have:

• Their author website (preferably with an active blog)
• A Twitter account that they use, and use well
• Facebook, both personally and professionally
• An updated profile on Amazon Author Central and Goodreads

The other technologies that are options will vary depending on a variety of things such as genre, author platform and specific topical details of the book. For example, a business book would rely more heavily on LinkedIn, which would be inappropriate for a young adult fantasy novel. Part of our own marketing process is to have book managers do a marketing plan when they start work, and keep it updated, and a key part of that plan is an outline of which technologies will be employed, how and by which members of the team.

6. You focus heavily on the ebook format. What was the reasoning behind this?

We put out first books out about two years ago and we were very focused on print.  But things have been changing very fast.  With Amazon now the largest seller of print books, and likely to sell almost twice as many ebooks as print books by the end of the year, you have to recognize that there has been an avalanche effect in readers moving to ebooks.  Who would have thought one year ago that Kindle book sales would actually surpass Amazon print sales?

We all know people who last year insisted physical books were all they’d ever read, and this year they have a Kindle or other ebook reader, and all they buy is ebooks.  The avalanche is only going to go faster as it moves down the mountain.  So to connect with readers, publishers and authors need to understand and get good at building ebook readership.

7. You post your books online at no charge to readers.  What effect does that have on sales?

It increases them, but usually not dramatically.  There are solid studies that demonstrate this which we have referenced on our website, as well as explanations by Neil Gaiman and Cory Doctorow why this works.  (The info is at http://www.booktropepublishing.com/faqs/)  While our books are free to read on the Booktrope site, we don’t support downloading, and it would take a pretty big effort to convert them to a good form for reading on a Kindle or other ebook reader or to print them out.  So there still are good reasons for readers to buy ebooks or printed copies, and our sales reflect that.

8. What are the differences you see when working to get a book published through the ebook format versus print book format?

For us there’s minimal difference.  Once we have a book ready to publish, it’s just a matter of putting it in the right formats for printing and for ebook delivery.  We manage that for our creative teams who have delivered a cover and a finished manuscript.  From that point, it takes us only a few weeks to set the book up for sale whether printed or ebook.  Remember, we do not do big pre-publication print runs.  Using modern technology, books can be printed just about as quickly as they can be pulled from a warehouse.

One big difference is price. Traditional publishers say that ebooks cost almost as much as printed books, because so much of their costs are due to very high overhead.  So, you will hear things like, printing is only 15% of the cost of the book.  But from our perspective, ebooks are actually much less expensive to create for several reasons:

• Physical books not only require printing, but shipping, which adds another 5 percent or so onto the cost.
• You have to do a print run, and then warehouse many of the books.  You have to consider the cost of money, if you’ve paid to print books, until you get paid for them.  We think these factors add another 5 percent.
• In the traditional model, you of course had to print more books than you sold, so that bookstores wouldn’t run out of stock when the book was popular.  So return rates of 30% were pretty typical (and still are).

So, if you count shipping, warehousing, financial costs and returns, suddenly the 15% cost of printing and distributing books is more like 30% of the book’s cost.  And on top of that, the bookstore needed about 55% retail price for its share.  In other words, if you combine the bookstore share and the cost of printing and distribution of printed books, it’s approximately 85% of the retail price.

Therefore, from where we sit, ebook prices should be much lower than printed books.  And on top of the cost difference, there’s another huge pressure on ebook prices.  Virtually all of the public domain books in the world – several million books, including some of the very greatest things ever written – are now available for free as ebooks on every ebook reader. So ebook sales are competing with free availability of some very good books.  (Remarkably, although all these books are available free, publishers also sell ebook editions right along side the free versions – and the books still do sell.)

As a result, for fiction, we often wind up charging $2.99 for an ebook.  Our margins are a little smaller than for printed books – but the good news is, it’s a low enough price to really stimulate sales, assuming there’s been a good marketing effort.  Since there’s virtually no overhead with producing each book, as sales go up, the total revenue does too, and so the low price really can help make a book much more successful financially. But it’s not all about money.  More book sales means more readers which represents a dimension of success in itself.

9. Can you explain more what your book manager does when dealing with your authors?

A book manager will outline strategy, and assist in the tactical aspects of book promotion, but at the end of the day, they cannot *be* the author. The book manager creates a marketing plan, working with the author.  Then both of them execute the plan, with the author taking on much of the activity in many cases, but in a team the book manager helps with scheduling and shaping of the author’s efforts, uses her own social network to enhance the marketing effort and manages other promotions for the book.   The book manager is able to take an objective view of the book, and analyze who wants to read it. They then research the best way to reach that target reader, and work with the author to do so.

For example, let’s say it’s decided that the author will do a blog tour. It would be the book manager’s role to determine which blogs are appropriate, approach the bloggers, and set up the actual blog entry schedule. They would then let the author know what was required i.e. a guest post or interview format, and manage the deadline. But the author would have to actually write the post or interview. Another example might be book club appearances. The book manager would assist in finding the clubs, and approaching them about participation, but the author would be the one to actually perform the Q&A session. That is why we ensure that teams are mutually agreed upon: they have to work closely together for the process to function smoothly. There may be opportunities for cost-effective advertising or developing sales channels; the book manager would identify these and make the case to the author and Booktrope for doing them.  We use simple tracking methods such as email and spreadsheets, to make sure everyone stays on the same page and communicates regularly.

10. What have you found are the best ways for authors to market their book other than online?

Personal appearances, of course.  It actually does not need to be a book reading or book signing.  When people connect with an author, they are very likely to get interested in the author’s books.  Booktrope’s current policy, by the way, is to provide as many print books as the author wants at our cost (which is substantially below wholesale) – any books the author sells through a personal appearance or personal connection, they keep the difference.  We think it’s fair because it gives our authors a way to make some money quickly and it recognizes when they make the effort to sell the book.  It helps us because it seeds the market with some books. The very best way to sell books of course, is to publish something readers appreciate and get people to read it, which leads to word of mouth recommendations, the very most powerful marketing tool. Author appearances with book sales are a great way to start spreading the word.

11. What advice do you have for aspiring writers in this publishing climate?

Carefully evaluate your options because every approach has its pluses and minuses.  You can try traditional publishing – for some people, the recognition and validation of being chosen by a publishing house is worth what you have to give up.  You can try self-publishing where you get pretty much all the revenue from your own book, but you have to do everything yourself and you need to be very good at self-promotion and marketing.  You can try Booktrope, or one of the other new models that’s developing.  Decide what your goals are, and make a list (in your head or on paper) of the pluses and minuses of each.  Remember, publishing is a very social activity, so consider how you’ll be working with people as you prepare the book and after it’s out.  Be open minded and remember, this is a business in flux and it might look very different in just a few years.

12. Do you have any craft books to recommend to writers?

Well, we’ve published some really great books on writer’s craft ourselves.  Several books by Brian McDonald, a real genius when it comes to the craft of storytelling– his books are endorsed by winners of the National Book Award, Edgar Award and Academy Award for writing.  Brian’s books, Invisible Ink and The Golden Theme, are now being taught in college level writing classes.  Brian’s newest book, Freeman, contains one of his own screenplays, and also his breakdown of the storytelling elements that went into it.  We also have published one of Sheila Bender’s books (Writing in a New Convertible with the Top Down) an exploration of the creative process between two writers that is full of helpful insights.

13. Are there any books Booktrope will be publishing soon we should all keep a look out for?

The big news: our CMO , Katherine Sears, is soon coming out with her first book, on how to market books of course.  Co author is Lori Culwell, who wrote a best seller herself and is well known as an innovative and entertaining voice in the publishing world.

Due to the nature of our process, we publish more books than you’d expect from a small startup company, probably at least 25 by the end of the year.  Some highlights, to give you a feeling for the sorts of things we’re publishing:

Lots of new fiction, including several works of romantic suspense by Heather Huffman (a prominent self-published writer who’s moving her work over to Booktrope), a series of fantasy adventures by Chico Kidd (award winning British author), Lori Culwell’s next novel (young adult), and a very exciting new fantasy series by Terry Persun, who is inviting other authors to contribute.  We have several books by first-time authors we’re very excited about, including a wild thriller by Alex Kimmell, the start of a police action series by Mike McNeff (an author who’s lived for decades in the world he’s writing about), and a wonderful romantic young adult novel by Elise Stephens (which won an Amazon award for new writing)

We have interesting non-fiction too – a terrific book exploring the challenges facing stay-at-home moms by a therapist who did it herself, a book on sales techniques by a leading authority on the subject, several memoirs, and we’re working on a book about a very famous actor which will include never before published pictures and letters.  We’ve just published our first book of poetry (Primary Sources by Ann Staley) and we have a few more in the pipeline.

We aren’t a niche publisher – our books range over many genres and subjects.  We’re trying to reinvent the publishing house for the 21^st century by opening it up to creative teams that will produce and market great books of all kinds.

Andrea Hurst has over 25 years experience as a published author, developmental editor for publishers, and skilled literary agent. She works with both major and regional publishing houses, and her client list includes emerging new voices and New York Times best-selling authors. Andrea represents high profile Adult Nonfiction and well crafted fiction. Her clients and their books have appeared on the Oprah Show, Ellen DeGeneres Show, Good Morning America, National Geographic network and in the New York Times.

Katie Flanagan is a fiction major at Northwestern University. She is currently an editor with Booktrope and a reader for Pink Fish Press. In the past, she has interned with Andrea Hurst Literary Management and the Northwest Institute of Literary Arts. Her favorite genre is women’s fiction, but she reads any fiction put in front of her. Check out her blog about the writing life at katieflanagan.wordpress.com and follow her on Twitter at @K_Flanagan.

The winner of Penny Warner’s novel is Colleen Casey! Don’t forget to check out the AUTHORNOMICS Blog Interview Series’s Summer Contest!