Unpacking assumptions about percentages


One of the most oft-repeated arguments that I see in self-publishing is this notion that you should not give a percentage of your work to anyone, ever.

I think this is mostly because Dean Wesley Smith and Kristine Kathryn Rusch–two very intelligent and business-savvy people–have said they think it is a bad idea, and because Dean and Kristine are often smart and intelligent, they are cited as gospel.

This post by Dean is typical of the argument:

We sure aren’t paying anyone who helps us a percentage. And never will. It’s my work. I ain’t giving parts of it away.

Without any sense of irony, Dean ends the post with this:

…[E]ven if in my opinion, they are stuck on giving percentages away to agents. But oh well, it’s their money to give away (if they ever decide to try what they are pushing). Their headache.

I would rather just keep the full 70% to be honest.

Wait, what do you mean, “full 70%”? What? Last I checked, “full” was 100%. What happened to that extra 30%?

Oh. I see. Amazon took it. A percentage. Dang it, Dean, why are you stuck on giving a percentage to Amazon? I thought you weren’t paying a percentage to anyone. It’s your work. How come you’re giving parts of it away?

Now, that’s not quite fair, of course. The answer is obvious: You pay Amazon 30% of the take because if it were not for Amazon, your take would be much, much smaller, and you would weep.

Why Dean doesn’t think this concept is generalizable, I do not know.

Now, don’t get me wrong—I am very jealous of my percentages, and I wouldn’t go around throwing them away willy-nilly. That being said, I can  see how giving someone a percent would make sense.

Let me give you an example: Suppose that it takes 400 hours to write a book and 100 hours to get it ready for publication: incorporating changes from copy edits, finding editors, finding copy-editors, proofs, chasing things down when they don’t get done, getting covers made, getting formatting done. You may snicker and say, “Courtney, those things don’t take 100 hours!” But they did, for me, for Unlocked. (Partially because I was learning how to do things right–hopefully the process will streamline in the future.)

Do you know what it means to do a good job finding an editor? It doesn’t just mean you find any person who hangs out their hat and says “I edit. Pay me.” You need someone who gets your work. Your voice. Who operates in a way that you can work with. Someone who understands what is good about your book and will work with you to make it even better. That’s not easy to find, and you won’t know if someone fits that bill until you pay them money. Sometimes lots of money.

Some people will do sample edits on a few pages (good to see if you’re in line on the voice thing), but some won’t. So instead, you read books that they’ve already edited—or google to see if they’ve written about their style or writing tips—and you try to guess from that whether they would work well with you.

Maybe you find someone who looks awesome, but she’s booked for the next four months solid. (Yes, this is happening.) Maybe you find someone who looks awesome, and it looks like you’ve got a decent fit, but it turns out that you can’t deliver in the timeframe when she would edit because you figure out you need to rewrite 30% of it, and so you miss the mark.

It’s hard work finding a good editor who works well with you, stylistically. Repeat for copy-editors. There are lots of people calling themselves copy editors these days, and when you ask them what style they prefer they say, “huh?” Or they think that “copy editing” is synonymous with “proof reading.”

Not everyone who formats ebooks does a good job. I wouldn’t trust someone who thinks that you should avoid curly quotes altogether (that’s the ridiculous Smashwords fix—everyone else gets “ ”). How can you tell if someone is doing something right? You download copies of their books and then you unzip the epub file and look at the underlying HTML. That’s how.

It’s a lot of work to find people who are doing things right. It’s even more work to figure out how to do it right yourself.

If you hire someone else, you only need to find one person whose competence lies in identifying people who are competent.

So just do the math: if it takes me 400 hours to write a book and 100 hours to get it ready for publication, that means that I could write 25% of another book if I didn’t have to mess around with all that crap. Under those circumstances, it would make sense to pay someone 15%.

Now, you’re saying, “But Courtney, the solution is obvious. Just pay someone a flat fee to act as your liaison to all these people. You don’t need to pay a percent.”

Sure. But what incentive does the liaison have to do a good job, then? If they’re getting a flat fee, how do I know they aren’t just going to have their friends do it to kick a few books their direction?

Salespeople are put on commission all the time. Key employees often get profit sharing points in the business world. These are not weird or odd or unusual business arrangements. There are times when you want to give someone a percent, and you do it because you think that you will get more money than if you pay them a flat fee. This is not hard or weird or wrong. It is, in fact, entirely normal, and it’s mind-boggling to suggest otherwise.

Most importantly, the assumption in Dean/Kris’s writing is that if you pay someone a percent you must pay them a percent forever–but nothing requires that. What if someone set up a business model where you paid them 10% for four years? Or 20% for two years? Or 50% for the first 6 months, and nothing thereafter? All of those are reasonable choices that give the person you are hiring an incentive to maximize income, but which won’t have any impact on your long-term revenue.

There’s one other thing, and I hesitate to mention this, but I’m going to anyway. Much of what I’ve said above is centered on the fact that I think it’s worth spending time and money to do things right. I would rather produce one story that was tightly edited, brilliantly proofed, properly formatted, and professionally packaged than 20 that were not.

This is not Dean’s model. I’m not trying to knock his model; it apparently works very well for him. But, for instance, take a look at his challenge post:

The Challenge:

—To write 100 original short stories in one year….

#1… Please, I know I will make typos and such.  I don’t care and please don’t tell me. Thanks. If you have trouble reading something with a few typos, please don’t read these stories. There is no such thing as a perfect story and I ain’t trying to write one.

And then, on this particular story:

TOTAL HOURS SPENT (Including writing, publishing, and cover and putting it up here and writing this post) just over 6 hours in one day from first word to finished and up.

Which is fine. It is a perfectly fine business plan to write 100 stories in a year, not edit them, and post them. I think it’s a great writing exercise. You’ll make a few bucks on each story every month–after a year, it definitely adds up to a pretty darned good income.

But it is not the only business model. And I think that the fact that Dean works this way colors his view of what’s acceptable. It doesn’t look like he leaves room and time in his schedule for fussing and nitpicking, and if that’s the case, I completely agree with what he says: just hire someone who’s going to get the job done at minimal cost and move on. If something flops, oh well; there’s always something else in the works.

But if you don’t work like Dean, and you do fuss and nitpick, and you can’t afford to have something flop–it might make sense to have a real business partner who helps you make sure that nothing you do truly flops, and it might make sense to pay that person a percent. If your business model is to try and make your pie very big, it makes sense to give someone a piece of the pie so that they maximize your pie. If your business model is to have lots and lots of tiny pies, obviously you’ll see things differently. Your job then is not to make very very big pies, but to produce as many pies as possible, and the only person who can do that is the author.

There are successful writers who do things Dean’s way. There are successful writers who don’t. Never trust anyone who says that the only way to write is to do it their way. Do it your way. And once you know what your way is, your goal is to match your way of doing business with your way of writing. Not all writing styles are equally suited to all business styles.

Personally, I’m not suited to the write-100-stories-and-post-them-that-day kind of thing. More power to the people who can do that. Dean’s probably not suited to my kind of thing, either. It’s okay to write differently, and it’s okay to engage in the practice of business differently, too.

A disclaimer: At present, the only people I am paying a percentage to are my distributors. But I’m not foreclosing the possibility that I’d make a different choice in the future, and I it bugs me when I see people saying that doing so would be “stupid” when they haven’t bothered to unpack the assumptions behind the original dictum.

If you aren’t paying someone a percentage forever, it’s not that bad. And if a person is helping to make a small pie bigger, a percentage just makes sense.

«       »

23 Responses to “Unpacking assumptions about percentages”

  1. Brava. Thanks for another clear explanation of your thoughts on self-publishing, Courtney.

    Much as I adored and wanted to roll around in the story of UNLOCKED (because it was completely zomg lovely and wrenching), I also applaud you for a beautiful job on production. It looked like/read with the same quality as your other books. Hope your pie for your self-published works is ginormous. :)

    ReplyReply
  2. I think paying a percentage can make a lot of sense in certain circumstances.

    When I edited for Cobblestone Press, I was paid 10% of the sales price for each copy sold of each book I edited. (I am still being paid royalties on books I edited, by the way, even though I no longer work for them.) Obviously, this has both an upside and a downside. It means that I am continuing to be paid small amounts for books I edited years ago. That’s a nice revenue stream for me, even if it’s not a significant chunk of change for any given book.

    The downside, however, is that some books I edited have never sold more than a few dozen copies, which means I have never been paid more than a few dollars (at most) for the time I spent editing those books. When you’re paid on a percentage of sales, there’s no guarantee that you will ever make so much as a penny. What if the book never sells a single copy? 10% of nothing is nothing.

    So, when you pay someone a percentage, you are asking them to assume a certain amount of risk. The same risk an author assumes, by the way, when he/she decides to publish without an advance. The potential for income may theoretically be higher (because the royalty percentage paid is higher), but there is also much greater risk that you will earn nothing or next to nothing if there is no MINIMUM payment you can depend on.

    I think if strong editorial is really important to you (it is to me), paying a percentage CAN make sense because it encourages the editor to do the best possible job he/she can to strengthen the story. Good books sell better (or they should, anyway). The greater the editor’s incentive to make the book not just good, but terrific, the better.

    That doesn’t mean you HAVE TO pay a percentage to get great editorial input. I have a friend who edits for Cobblestone, and I trust her abilities and input. She is happy to freelance for me for an upfront amount, and I’m happy to pay her. But if she ever wanted a percentage deal INSTEAD of an upfront payment, I would consider it.

    By the way, the other reason to pay a percentage rather than upfront is precisely because you don’t pay the other person until YOU are paid. That has some clear advantages for authors who don’t have a few hundred dollars to sink upfront into the production of their book. So that is another reasons.

    And 100 short stories a year? Taking an average of 6 hours to produce? With rampant typos? And you want me to PAY for that? Um, no. Not happening.

    ReplyReply
  3. Jackie, for the right editor, I would offer what was essentially an advance/percent mix: a flat fee that would guarantee they wouldn’t be out anything, which would be hers regardless of sales, and a percent (for a time-limited period–a year or two–mostly because I don’t want to be bothered with having to track someone for the rest of our lives). Once the flat fee was earned out, she’d make money.

    I wouldn’t ever ask an editor to risk not making money on a project. That’s not fair to her, to have the entirety of her paycheck depend on my business acumen. What if I die and the book doesn’t get published? She might never see anything. That’s not fair.

    But this would have to be the right editor–someone I really knew I could work with–and it wouldn’t be a *big* percent (10 is probably too high where the risk is alleviated by a flat fee).

    And I don’t even know that I *will* do this, or that any editor would *want* it. But I’m open to the discussion, and I think it’s a perfectly sensible business model.

    ReplyReply
  4. Sam Lee says:

    Courtney, I’m not sure how much of Dean’s blog you’ve read, but he has mentioned before that the percentage-until-cap-reached as an option, and one far better than the percentage-forever option, but that’s not the way most people are going right now.

    As for assumptions about percentages, I’m not sure where you’re confused. Once you indie publish something, for that project, at least, you take on the cost of publishing, distribution or arranging distribution being one of them.

    NY publishers still pay a distribution fee or percentage to get their books out to bookstores and venues and even to readers. That comes out of their share of the take.

    When you indie publish (put up work yourself), you get the writer share and the publisher share. You still pay the distributor fee.

    Agents…sell your story once, and get a share of royalty proceeds for the life of the contract (sometimes for life of copyright!). That’s a long time to pay 15% for a sale.

    (I went on much longer about your post, but I’ve posted the rest at my blog to keep the comments keyed in to your main points re: the respective percentages’ qualitative differences.)

    ReplyReply
  5. My agent is not my salesperson. She is my agent. She acts as a liaison between me and my publisher. She says things that I cannot say to my editor. She yells at them when they screw up. 95% of the work my agent does does for me came after the contract was signed.

    I’m going to guess that I know what agents do better than you do. That’s because I have one–one of the best in the business–and if you have ever heard people say that a bad agent is worse than no agent, it is something that you can’t understand until you have seen a friend with a bad agent have someone systematically destroy their career through incompetence and/or laziness after the contract was signed.

    My agent earned her 15%, and not just because she got me a deal that I would never, ever have gotten on my own. (And of course I’ve seen Dean & Kris’s explanation on this, too. I had editors willing to read my work without an agent. But if you think that I would have been able to get 9 editors to read my book in a few weeks so that I could go to a five house auction, you’re vastly mistaken.)

    As for the rest, I understand you’re explaining to me the difference between a distributor and so forth, but you’re kind of missing the point. Why on earth do you pay a distributor a percent? Because they make the pie bigger than if you just took cash in exchange for ebooks out on your front porch.

    For the same reason, you might pay someone who makes the pie bigger a percent to give them a strong incentive to do the damned best job they could. Giving someone a stake in the outcome invests them in the product in a way that a flat fee does not.

    Sometimes, it makes sense.

    I don’t know why I have to be “confused” simply because I say “I do not think this is a categorical rule.”

    ReplyReply
  6. Hey, Courtney,

    Thought I would clear up a few things about what I am doing. I do have a very good first reader (Hugo Award winning editor) and proofer look over my short stories before I put them up.

    And the short stories are just something I do as a lark, usually late at night, since I write full time for traditional publishers under pen names. (You know, been making my living at writing for 25 years.) And I ghost books as well at times. And have sold over a hundred books now traditionally. The short story challenge is just something I am doing under this name to have some fun this year, and yes make some money.

    And yes, I do give a percentage to Smashwords and Amazon and B&N and also all the bookstores that order books. In fact, to bookstores, WMG Publishing gives a 45% discount free freight if they order enough copies. But when I have help with a cover, I pay a flat fee. Just as when I have help with something wrong at my house, I don’t give a percentage of my house to a carpenter.

    I have had three wonderful agents over my 30 years in this business, all still friends. I have not had an agent in over 7 years and have sold more and made more overseas deals and more Hollywood deals without agents. This world is changing so much, unless a writer is lucky as you are and I was, they would be better off without an agent. Just my opinion. Not right for everyone.

    And I never say my way is the right way. Or the only way. In fact, if you read my blog regularly, you will hear me repeat over and over that my way is not a good way for most writers. I say over and over that every writer must find their own way. And so does Kris.

    What we are angry about more than anything else and trying to change is writers buried in the “I have to…” myths. “I have to have an agent.” Uhh, no you don’t. “I have to write short stories.” Uh, not unless you read and like them. “I have to do indie publishing.” No, not unless you want to. And are fast enough. “I have to write slow to write well.” Uh, maybe, maybe not. Not all writers rewrite and write slow. But some do.

    And the worst one we hate on the myths of “I have to…” is the “I don’t have to know business to be a writer. My agent will handle it.” Well, if you believe that, you will have to be very, very lucky to make it very long.

    So sorry I seemed to have offended you. I would never tell writers to only indie publish because I work in traditional publishing. I would never tell writers they must write 100 stories in a year because most couldn’t if they tried and I’m not sure I’m going to be able to either.

    But I do tell writers they must learn business and stop acting out of myths that are not true anymore.

    Every writer is different, every writer must find their own way. But without business knowledge, as Romance Writers of America push, a writer is doomed eventually. And that I will stand by.

    Cheers
    Dean

    ReplyReply
  7. But I do tell writers they must learn business and stop acting out of myths that are not true anymore.

    I agree with this. I’m not offended by you or anything you’ve said–I just disagree with you on some points. Disagreement means disagreement. It doesn’t mean offense.

    But my gripe is that you’re replacing one myth with another. You say here: “And I never say my way is the right way. Or the only way. In fact, if you read my blog regularly, you will hear me repeat over and over that my way is not a good way for most writers.”

    But you use categorical words like “never.”

    I would have zero disagreement with you if you said, “Look, guys, you have to THINK FOR YOURSELVES about works for you in business, based on who you are as a writer. For me, I will never give a percent to someone else for my self-pubbed work. But it might work for someone else.” But honestly, I haven’t heard you say that. Ever. Instead, when Barry and Joe said it might make sense, you say you won’t.

    But what worries me most is not the substance of what you say–you and Kris are both very intelligent and have thought things through–but that this echo chamber develops around what you say and turns it into gospel. At that point, you’re replacing one myth with another, and that is just as dangerous.

    Come to think of it, the one thing you do say that I do find…I’m not sure “offensive” is the right word, but it does kind of annoy me…is the whole insistence that an editor is a day laborer equivalent to a carpenter.

    I’ve had a shitty editor. I’ve had a good one. I’ve had a boss who edited me to the point of death and taught me more about writing than anyone else had ever done in 30 years.

    A good editor is scary magic wizardry.

    ReplyReply
  8. Courtney, I think you might not know that I have been an editor off and on since 1987. I first helped edit for Pulphouse and also sat in the publisher’s chair. (That was the 5th largest publisher of science fiction/fantasy/horror in the nation for most of a decade. We did co-publishing with Bantam books.)

    I also helped my wife when she was editing The Magazine of Fantasy and Science Fiction. Then I went to work part time as the fiction editor for VB Tech for almost three years, then I worked as an editor for Pocket Books for ten years doing different things including editing a regular anthology in their Star Trek line. All the while writing.

    So sorry my comment offended you about editors. I have been nominated for seven major awards as an editor and my wife won a Hugo as an editor. We know editing. And yes, as a writer, I had a couple pretty bad editors.

    And I had a couple great ones who are still close friends to this day.

    Kris and I, as editors, always either worked salary or flat fee. That’s how editors get paid. Editors NEVER get paid by percentage.

    So I am not insulting a craftsman who is a carpenter by hiring him/her to do a job in my house for a flat fee anymore than I am insulting an editor to do a job editing or copyediting one of my novels for a flat fee.

    I stand by my never. Never will I pay a percentage again to anyone of my work. I will own it from this day forward at 100%. I will pay Amazon a percentage for every book they sell for me, but I will NOT TURN OVER OWNERSHIP of anything I write ever again.

    And that “never” I will stand by.

    Is that correct for all authors? I think it should be, but more than likely it never will be. Giving a percentage of ownership in our property is a weird aspect of this business that has been around far longer than I have.

    So I respect editors, of course, and pay them as all editors are paid, by flat fee. And I respect artists who do covers and pay them the same way New York traditional publishers pay them: Flat Fee. And I respect book designers and pay them in their normal way: Flat fee.

    As I was paid and Kris was paid when we were editors. And not once did that paycheck insult me or did I expect a percentage of an author’s work I edited.

    But I will never give an agent or anyone else a percentage of my property ever again. I will pay a percentage to sell a copy of my property. Sure. But ownership percentage in the overall property??? Nope, NEVER. And I stand by that.

    ReplyReply
  9. And I am glad we do agree about learning business.

    And I do think writers need to think for themselves and learn business. We agree on that as well.

    As I have said many, many, many times. I am not anti-agent or anti-traditional publishing. But I am very much anti-stupid-writer.

    Learn business and then make smart decisions for yourself. And I have zero issue if those smart decisions for you would be a stupid decision for me. No issue at all. If your decision for yourself comes from a place of knowledge about your business.

    And I got zero issue being wrong. I didn’t last this long in this crazy business thinking I always had to be right. (grin) And I am always thankful when someone can use a logical business argument to convince me I am wrong. I honestly love that. (The three years of law school training there. I love a good argument. (grin))

    ReplyReply
  10. That’s how editors get paid. Editors NEVER get paid by percentage.

    But this isn’t true. Many of the digital-first publishers pay their editors by percentage. See Jackie Barbosa’s comment upthread, for instance.

    And more importantly, the fact that editors have not been paid by percentage in the past doesn’t necessarily mean we have to stick to that in the future. Everything is changing, and that means nothing should be safe from reexamination.

    I can think of a handful of business rationales that would justify paying an editor.

    First: one of the things I worry about with hiring an editor is that if I am paying her salary instead of a large company, she might pull her punches instead of risking offending me. I’m her boss now, in a sense. (I’ve talked to a very prominent author in my genre who said that this was the reason she wouldn’t self-publish: she knows she needs an editor to tell her she’s wrong and needs to change, and she doesn’t know if someone she hires will be willing to do that.)

    One way I can invest her in the outcome in a way that might overcome that kind of hesitance is to pay her a percentage, so that if the book doesn’t do as well, it’s her money on the line, not just mine.

    Possibility two: When I eat at a restaurant that I go to often, I overtip. I do that because I know that they’ll remember me. They won’t spit in my food. They’ll fill my water glass early and often. They won’t mind that my husband and I split one entree instead of ordering two (because they know they’ll still get a generous tip).

    Three: If you don’t have a lot of working capital, this is nothing more than the equivalent of hiring an employee with stock options instead of salary. If you have a choice between not hiring an awesome editor at all, and paying someone 10 percent, it may be worth it to pay the 10%.

    Sure, you’ll pay more in the long run. But if you don’t have the capital, you don’t have the capital.

    Now, there are some people I would never pay a percent to–formatters and proofers, for instance, and possibly cover artists. I won’t say that nobody should EVER pay a percentage to these people, though–even though I think it’s probably not for me.

    I guess that my three years of law school left me more willing to say “it depends on circumstances” than you. That beat categorical statements right out of my vocabulary.

    I really do appreciate much of what you say. I have enough friends who have had books ruined by terrible agents who refused to step up to the plate and who screamed at them if they tried to do it themselves. I feel like half my conversations with friends about their agents result in my saying, “Fire her. That’s egregious.” And I’m not talking about dinky issues like taking a few days to answer an e-mail–I mean, not sending in option books when the publisher has been asking for it for over a year. It boggles my mind when someone keeps that agent on.

    ReplyReply
  11. Actually, my advice to friends about agents also tends to run like yours. About half of the people I talk to about agents I am shocked. The other half tend to have pretty good stories and I think they are doing fine with their agent.

    But, of course, as Kris pointed out in her blog this week, I don’t really know what these people signed in way of agency agreements or agency clauses in recent contracts. What people have signed lately in some cases has stunned me flat cold. Giving agents power of attorney and an “interest” in the work is just nuts.

    But I am called extreme. Ahh, well.

    And editors working for a percentage?? Wow. Those editors must really have low self-image or are just starting out. Imagine working for a percentage and the book only sells ten copies a month, which would make the editor only a few cents per month. No self-respecting editor I know would ever do that.

    Thanks for letting me defend myself here. Fun discussion, even though I still honestly don’t understand giving away a percentage of your work when it is not needed.

    And I really want to see how this accounting is going to work down the road. That’s going to be the fun part when a writer has given away a percentage of this and a percentage of that and years go by. I do not envy the accountant in their estate. (grin)

    So I am sticking with NEVER pay a percentage of a copyright. Copyright is a form of property. I have never given away a percentage of my house to anyone working on it. I can see no reason to EVER give a percentage of any copyright away. But, as I said, I’m considered extreme.

    In fact, I’m so extreme and believe in my work enough that I believe if a book agent wants to represent my work, they should pay me a shopping agreement fee like agents and producers do in Hollywood for my work. If an agent thinks they can make money on my work by selling it, put their own money up front for the right to do so and I might consider that. But not on a percentage of the base copyright. Nope. Only for a set fee. No interest in the copyright.

    Yup I am extreme. I value my work and just won’t give it away.

    Cheers
    Dean

    ReplyReply
  12. And editors working for a percentage?? Wow. Those editors must really have low self-image or are just starting out. Imagine working for a percentage and the book only sells ten copies a month, which would make the editor only a few cents per month. No self-respecting editor I know would ever do that.

    You probably haven’t met Maya Banks’ editor–you know, Maya Banks, whose Samhain release was the first book published by digital-first publisher to hit the New York Times e-book list? I bet her editor feels pretty good about her percent.

    In fact, I think you’re a little incoherent on this one. You clearly think that a percentage would be more, at least in cases where the author has reasonable chops. Why would an editor who demands a percentage respect herself less if it makes her more? Clearly a self-respecting editor can refuse work that she thinks wouldn’t earn much.

    It’s also a bit of a fallacy to transform a discussion of business arrangements into a discussion of self-esteem. That makes the entire argument into one huge ad hominem: “I do what I do because I respect myself. Other people might do things differently, but it’s because they have low self esteem.” Come on, Dean. You should respect yourself more than to resort to basic fallacies–and you should respect me enough to know that I’m going to call you on them.

    In fact, I’m so extreme and believe in my work enough that I believe if a book agent wants to represent my work, they should pay me a shopping agreement fee.

    I have just as much hubris as you do. It’s just that my hubris aligns in a different direction. I believe in myself so much that I think that I deserve the absolute best that I can get. I don’t want someone who is an “editor.” I want the Frank Lloyd Wright of editors.

    I didn’t just want an agent; I wanted one of the few agents who represented debut writers in my genre who sold their clients at auction for six figures. I got her. She sold my debut work at auction for six figures.

    I believe in my work so much that I am never, ever going to sell myself short. If I have to hire another proofreader to find one last typo in 90,000 words, I will. I do that because my business model right now is to write the best books I can.

    I spent way more getting my self-published novella to market than anyone would think was reasonable. I also got amazing reviews from some of the most critical romance blogs out there, and consequently hit the top 100 on Amazon in the first three days of my release. Unless tomorrow is drastically worse than any day so far, I’ll break even on those unreasonable expenses at the 9 day mark.

    I would not be selling at this level, this fast, if I hadn’t been utterly relentless about quality. I truly believe that if I believe in myself, and am willing to spend what it takes to maximize quality, my readers will reward me. I want them to know that for them, there’s no such thing as “good enough”–there’s only the best I can do, and I want them to count that they’re always going to get that from me. I’m never going to half-ass. That’s my business model.

    And so I firmly believe that for people like me, it makes sense to remain open to alternate payment arrangements. You pay good people what they are worth. If they’re very very good, they’ll demand more.

    I’m not stupid; I wouldn’t pay a percent to just anyone. But for the Frank Lloyd Wright of editors? If I can get her, yeah, I’ll pay her what she’s worth, and I’ll do it because I intend to be the Frank Lloyd Wright of authors. I value my work, and I’m not going to sell myself short by cheaping out on help.

    ReplyReply
  13. And editors working for a percentage?? Wow. Those editors must really have low self-image or are just starting out. Imagine working for a percentage and the book only sells ten copies a month, which would make the editor only a few cents per month. No self-respecting editor I know would ever do that.

    Hm, I guess no self-respecting author would ever self-publish, then, because if the book only sells ten copies a month, the author will only make a few dollars a month.

    Oh, hm, wait a minute…I’m sure that’s not what you meant.

    ReplyReply
  14. Jackie, if a book could sell to a traditional publisher, my advice is to sell it that way first. Only advice, not good for everyone. If a book can’t sell to New York for many reasons such as just too strange or too much into a small audience, then self-publishing or indie publishing or small publishing might be the best way. Just advice, not a rule. Up to each author.

    And authors can make some nice money selling a few copies a month over ten years. Better than having the book or story sitting in a drawer.

    But Jackie, Courtney, I would love to have you explain to me how the accounting is going to work for you when you give percentages???? Not only next month, but next year, and in ten years or fifty years or after you are dead and your book is still selling.

    Honestly, I want ANYONE to explain how this accounting is going to work for those of you so set on giving percentages of your work away.

    And say the editor dies and the estate of the editor is hateful and demanding? Or say your cover artist wants to sell his percentage to another person? Or say a new company starts up just offering cash to anyone who wants to sell out their percentage of different author’s work for a cash payment. (Remember, when you sell a percentage, it is not yours anymore to control.)

    That’s just a tiny part of the legal problems I can see.

    A CFO of a Fortune 500 company, two accountants, and a university math professor and I have spent many, many, many hours trying to figure out a simple accounting system, data base, or anything that would make keeping accurate track possible for either party, your percentage editor or the author. Not a one of us can come up with anything that works on any scale or for any length of time.

    So please, if you have a magic way of keeping track of all these percentages coming in and cutting checks every month and doing the data entry and so much more for all the percentages, please pass it on to the rest of us. That is an honest request.

    Until that is figured out in a way that both parties to the ownership-sharing contract of the story can trust and verify, I will stand by my stance of not giving percentages of ownership in a work.

    ReplyReply
  15. A CFO of a Fortune 500 company, two accountants, and a university math professor and I have spent many, many, many hours trying to figure out a simple accounting system, data base, or anything that would make keeping accurate track possible for either party, your percentage editor or the author.

    Sorry, Dean. This is the other persistent fallacy you engage in–the argument from authority. It doesn’t really matter that you tell me that Really Important People said some stuff. What matters is why they said it, when they said it, and the context in which they were speaking.

    That’s because Really Important People are sometimes wrong. Linus Pauling got the structure of DNA wrong. Einstein missed the boat on many aspects of quantum physics. It’s not about who does the talking; if you don’t give us the down and dirty details, we can’t evaluate if they were right.

    More to the point, I don’t actually believe that you sat down with a university math professor, two accountants, and a Fortune 500 CFO to try to figure out how a self-published author would go about accounting for a percentage of a work to an editor. Why on earth would you take the time to organize that kind of thing? You’ve already said you respect yourself too much to even consider giving a percentage. Why would you spend time trying to hash out the details? This assertion on your part doesn’t pass the sniff test. You might have talked to them about another problem, but not this one. Don’t even pretend.

    The other reason this doesn’t pass my sniff test is that I know precisely how excited university math professors get about finding elegant solutions to hard problems.

    I actually have several friends who happen to be university math professors–or professors in sufficiently cognate fields so as not to make a difference. The one thing I cannot imagine is posing them a problem and having them say, “No, no, there is no way. Too hard.” Ha! This is just a little matter of applied mathematics. The hard part would be getting them to shut up about solutions. I bet in three hours they could list eighteen different possibilities, and only the first three would involve spherical cows.

    As it is, having spent a good amount of time in a university math department myself, I have a good deal of experience knowing how to solve hard problems. The easiest way is to approximate a hard problem with an easy one.

    So here’s one easy problem that we could solve instead: call the percentage an approximation right from the start, in the contract. For instance, instead of promising her 5% of all proceeds, I could promise her 5.5% of all Amazon proceeds–so we neglect the other parts of the market in favor of a slightly larger share of the Amazon take. She wants verification, she can get notarized copies of my monthly statements from Amazon and/or notarized copies of the 1099s they send me every year. Something like that.

    The approximation doesn’t protect her if Amazon loses market share, but we can protect the accuracy of the approximation by adjusting the percent on a yearly basis by market share, as determined by some objective predetermined third-party. In the event that Amazon ceases to function, we can have fail-safes built into the contract.

    That’s just my first off-the-cuff solution. Is it going to give the exact perfect number? No. But it’s easy to administer, easy to check, and the cost of the deviation from the actual percentage (in either direction) is smaller than administration and verification costs.

    In any event, I also need to point out that you’re totally neglecting this part of my original post:

    Most importantly, the assumption in Dean/Kris’s writing is that if you pay someone a percent you must pay them a percent forever–but nothing requires that.

    That would be another simple solution–giving her a percent for two years, and no longer. You’re still making that assumption, even though I’ve explicitly stated it’s not in play. It’s okay if you want to attack a straw man, but do recognize that misrepresenting someone else’s position is another form of fallacy.

    If you want to engage with the argument, do. If you want to call people names, or hide behind other shadowy unnamed people, you can do that, too. But like I said, engage in fallacious reasoning on my blog, and I will call you out on it.

    ReplyReply
  16. <<>>

    Oh, heck, it never would have occurred to me to organize such a thing, to be flat honest. I’m not that smart. What happened is that these people attended a workshop here. Remember, Kris and I do workshops for professional writers here (see my web site under workshops) and these people, all of them attended one workshop.

    And to be honest, I don’t ask people what they do in the real world. I check out their writing credits when they ask to come to a workshop here, but I never think to ask what they do in the real world. Honestly just never occurs to me. I just treat them all as professional fiction writers.

    So one night, in a week-long workshop, a bunch of us after a meeting got talking about the accounting problems. And I flat said I couldn’t figure out how to do this sort of thing in the accounting side. I can’t figure out a system that would work for me.

    Turns out one of the men there was a CFO of a Fortune 500 company, taking a break working on his writing and getting ready to retire to write. Two others were working accountants, one a good friend so I knew what she did. She’s the comptroller of a major hotel. And it ended up another was a retired math professor. (There were about 15 of us in the room that night.)

    We worked on figuring this accounting problem out. And then over the last six months since that night we have kept in touch doing the same thing. We can all figure out data entry ways of doing this, and actually downloading the spreadsheets from Amazon and Kindle and the rest and converting them and then sorting them. Easy when you know how, but takes time.

    We also worked on both data base ideas and cloud ideas.

    And it works fine for one or ten books, but right now WMG Publishing has 174 different books up and running payments. And with just Kris and my backlist, we could easy go to 700 books up in a couple years. (Advantage of being in the business writing for 25-30 years and always doing short stories.)

    So my request was honest. None of us could come up with a way that isn’t off-the-charts time consuming either in data entry or tracking.

    And sorry you hate that I have been around a long time and done all this and talk from a position of been there, done that.

    I just can’t go back I’m afraid.

    And since you are starting to attack me instead of having a discussion, I think I’ll just go crawl back into my little hole now and let you to it. Sorry that suggesting you not give any part of your rights away makes you so angry.

    Good luck if you decide to go that way. I hope I am proven wrong if you do.

    ReplyReply
  17. And one last point.

    I have said over and over and over on my blog, if you must give a percentage, limit the percentage to only a year or two at most. And then revert everything back to you.

    No issue with that at all if you feel you just must work by percentages. It will save you most of the problems and some of the law suits.

    I do hope I am clear on that. Never give a percentage of your work away, but if you feel you must, limit the time on it at least.

    ReplyReply
  18. Dean: Point to the place where I attacked you rather than your argument. Saying, “you’re using fallacies” is not an attack on you. It is an attack on your argument.

    Until then, this is all more misdirection on your part. You’re not trying to engage in a discussion. You haven’t actually responded to anything I’ve said. You’re mischaracterizing everything I said–and once again, assigning an emotional response to an intellectual argument, rather than engaging with it on an intellectual level. I’ve mentioned potential solutions, and you haven’t said anything about them–all you do is say that I’m getting “angry.”

    You can’t in the same discussion thread say that you want authors to think for themselves, and then say that “been there, done that” is reason enough. You have to have reasons behind been there, done that, or you’re just trading one set of myths for another. There are hundreds of traditional publishers who have been there and done that, and your entire blog is about calling them out.

    You want authors to think? Use reasons, not sound bites, and appeals to authority. I’m not trying to disrespect your experience. But if your experience does not give you the power to explain beyond saying, “I’m right because I’ve been there, done that” you’re not giving me anything useful.

    Oh, and the discussion you had? Like I said, when I get more of the story, it’s pretty clear you didn’t talk about the precise problem being discussed here. You talked about the difficulties of tracking royalties for close to a thousand books, with differing rights situations.

    You didn’t talk about the difficulties for a self-published author with a handful of books thinking about paying an editor a percent. In other words, we revert to what I said in the beginning: what won’t work for you might work for someone else in a different position, and so the categorical statements on percents are not warranted.

    Now, last chance: are you going to engage the argument, or are you going to once again dismiss this as anger and not read what I’m writing?

    ReplyReply
  19. Courtney,

    Well, let me try to address your point as clearly as I can. But please, folks, do not take these comments to mean that I am in any way endorsing any writer giving any percentage of their work away. I am not. It is not needed. That is my position.

    To be clear: I feel that a writer must go out of their way to always save 100% of their work where possible while licensing rights to publishers.

    But if a writer decides to give a percentage to an editor or a cover artist or an agent, here are the problems that will and have come up. (Again, I am talking from experience, but just don’t know how else to frame this. I am connected with a lot of writers. I’ve been working as an editor and writer for over twenty-five years. So you are stuck with my experience, but I will try to keep level if I can. Okay?)

    Accounting tracking… If you only have a few items indie published, this turns out to not be much of a problem because, as you pointed out, the author will get the money first (I hope…Under Joe Konrath’s estributor model, he gives all the money first to an agent and hopes to get his share.)

    If it is the case that you get the money first, then somehow you must go into a spread sheet and divide out the different books and the different percentages with each payment. Kindle money, Apple money, Kobo money, B&N money, and so on. An annoyance every month, but with only five or so books, it is possible. Get up around twenty, even if only three or four books have percentages taken out, you still must divide it all. And dividing that money becomes an issue and a chore. Get up over twenty and it gets crazy and very time-consuming, even if you know spreadsheet or data base programs pretty well.

    My accountant friend set up a system for this on Excel and it broke down in just a short time at about twenty books with problems of sorting and data entry and the problems with the different spread sheets from all the different sources.

    My CFO friend was back a month ago at another workshop and he had worked out a seemingly simple sorting method through Excel, and he walked me through it on a white board with about fifteen other writers watching, and I have yet been able to duplicate it because it was so complex and I’m not great at Excel. But it is working for him with his skills and he has up about 40 indie published books so far. (That gives me hope that somehow this problem has a solution.)

    I am putting out a call on my web site for help with this aspect or at least tracking help tomorrow. Take a look at what I am asking for in help to see if somewhere out there a computer programmer can set this up right for all of us and maybe make a little money in the process. I sure hope so. I would pay good bucks for a decent and easy tracking system on the money.

    Second Major Problem with giving a percentage of the work is what is called undivided interest. You’ve been to law school, you understand this problem. As long as your partner in a book agrees with what you are doing as the author, you are fine. But there have already been cases where there has not been agreement between the parties after a short time.

    Also, over the last ten years, agents have added in agency contracts where the writers are giving away a form of power of attorney as well as an “interest” in the book. (The most recent Trident Agency agreement, Writer’s House agency agreement both do this.)

    It has been ruled in a number of cases that the writer has signed away an ownership right in the work. The current problem with the Vincinansa (sp?) agency is a prime example of how ugly things can get.

    Because of this clause, one agent recently demanded money when the writer had moved on and another agent had sold a second book in the series because the former agent owned a part of the characters and such in the first book. It had to be settled out of court with a pretty large settlement, actually.

    To solve this problem, I would suggest that writers not sign agency contracts with agents and change the agency clauses in contracts to just describing how the money is split and nothing more. This avoids agents having an ownership interest in the work and thus allows writers to walk away if things turn ugly. But just a suggestion, not legal advice.

    Also, the way to get around even the agency 15% is using the growing field of IP attorneys. They charge a flat fee, often with just a few hundred retainer up front and you can pay the balance when your check comes in. They negotiate with editors and have rules and ethics rules unlike agents and don’t and can’t take ownership.

    Short term limitations are a great way of limiting these things in indie publishing as you said. Sunset clauses. Or buyout clauses both work well. So if you must give away a percentage of your work, limit the time.

    If you give a forever percentage, then (in my opinion) you are opening up yourself down the road to a law suit or your heirs to a law suit. Especially if your book and your work is successful. Or at least some sort of buyout down the road.

    Again, this turns really ugly when your book is successful.

    Now directly to your point about using clear details. I have been explaining all this in blog after blog in a number of series over the last two years. My series Killing the Sacred Cows of Publishing deals with a lot of this point-by-point. The full list of those blogs with links are under the tab on my web site. I’ve also done a new series called “Think Like a Publisher” which is up to eleven or twelve long posts. All detailed on all this, helping writers to think for themselves with point-by-point discussion and lots of discussions in the comments.

    So I have been doing as you suggested, doing precise discussions to help writers make decisions for themselves. And as I have said over and over, my career is not a career anyone should strive for. It has worked for me. But if I could go back and make some changes, I sure would.

    Where did you insult me? Start off when you said, “I don’t actually believe you sat down with….” Saying I lied is insulting. Go back and read your own post and imagine someone saying that to you…

    So, now I need to get back to work. Thanks for the discussion.

    ReplyReply
  20. If it is the case that you get the money first, then somehow you must go into a spread sheet and divide out the different books and the different percentages with each payment. Kindle money, Apple money, Kobo money, B&N money, and so on.

    Or you could adopt the approximation I mentioned above, and just count Kindle sales.

    My accountant friend set up a system for this on Excel and it broke down in just a short time at about twenty books with problems of sorting and data entry and the problems with the different spread sheets from all the different sources.

    Right…. Excel is not intended to be a data entry system, and I’m cringing even thinking about it. You don’t want to be talking to an accountant for this problem. You’re talking to the wrong person. You want to be talking to a database engineer. You want to be talking to someone who understands computation, and a retired math professor is unlikely to do so.

    If I seriously had to do this with several hundred books, I would program an SQL database. Any reasonably scalable database (e.g., not MS Access) would work fine. This wouldn’t be hugely hard to do. I’ve programmed harder things in my life. In one of my many former lives, I programmed a database to track student attendance and grades for a small school–maybe several hundred students–and this basically isn’t any harder a problem. But then one of my skill sets is that I actually have worked with massive data sets in my lifetime, which is why I find this prospect undaunting. It’s not that hard.

    Second Major Problem with giving a percentage of the work is what is called undivided interest. You’ve been to law school, you understand this problem. As long as your partner in a book agrees with what you are doing as the author, you are fine. But there have already been cases where there has not been agreement between the parties after a short time.

    Easy enough to contract around this. Publishers do it all the time with authors. This isn’t a real operative concern if the contract is written right. Make it clear the person isn’t a partner, has no right to object to the way the book is published (or not), and spell it out.

    It has been ruled in a number of cases that the writer has signed away an ownership right in the work.

    Can you give me a cite for one of those cases? Giving someone a percentage is not the same as giving them an ownership right in the work. This is particularly true when we’re talking about copyright, where the standard for transfer of copyright ownership is extraordinarily high.

    Incidentally, you do know that there’s no such thing as a forever percentage in copyright law, right? Under 17 U.S.C. section 203, all grants of rights may be terminated by the copyright holder 35 years after the grant of rights. It’s a little more complicated than that, but not much more.

    Now directly to your point about using clear details. I have been explaining all this in blog after blog in a number of series over the last two years.

    But you haven’t actually responded to the specific scenarios I’ve raised. For instance, why not make matters easy by just using Kindle sales as an approximation?

    Saying I lied is insulting.

    What I said–and the part of the paragraph you deleted–was that I did not believe you sat down with these people and said, “An indie published author wants to give an editor a percent of her work. Is this possible to account for it?” I didn’t say you lied–I said that the discussion that you had was unlikely to have been specific to a single self-published author accounting to an editor.

    And I was in fact right about that–you’ve admitted now the discussion was in the context of a publishing business, with multiple authors hundreds and hundreds of books at stake.

    I didn’t accuse you of lying. I didn’t say you had never talked to these people. I said that I didn’t think it likely that the context of your conversation was germane to the precise discussion at hand.

    Is that insulting? I guess I can see how you might be insulted by it. But here’s the kicker…it turns out that I was right. You’ve since admitted that you didn’t talk to these people about a single author self-publishing a few books–and in fact, you now say that the accounting will work for a small number of works.

    In other words, when I said, “I don’t believe you had this conversation in this context,” I was right.

    I don’t think I was saying you were a liar–I think I was saying you didn’t give proper context.

    And you didn’t. Is that an insult? I don’t know, but the shoe fits.

    ReplyReply
  21. Carradee says:

    *watches Courney & Dean circle each other*

    Disclaimer first before I stick my toe in here: I don’t agree with Dean on everything.

    Courtney, as an outside observer, it did sound like you were calling Dean a liar. Dean said point-blank that he was talking about a way to “make keeping accurate track possible for either party, your percentage editor or the author.” —A system that would be necessary for figuring overall editor percentages, though that wouldn’t be the only possibility.

    Your response: “I don’t actually believe that you [… tried] to figure out how a self-published author would go about accounting for a percentage of a work to an editor.”

    That’s saying Dean isn’t being completely honest when he said he had spent hours trying to create such a system. Which is calling him a liar.

    Courtney, I also don’t understand your nitpicking over specifics that he didn’t reply to. Okay, so limiting the royalties to a specific vendor could work—but that wouldn’t change the difficulties in figuring out royalties for overall amounts, which is what I’d understood you and Dean to be discussing.

    Now, ON-TOPIC:

    Personally, I’d rather use a spreadsheet for financials and percentages than a database. I could probably figure out how to do it, though I’d want to make macros to import the pertinent data from different vendors’ spreadsheets. *thinks* That might actually be fun.

    What’s a flat-rate editor’s incentive for doing a good job, you ask? Reputation. When you do a good job, you get repeat business and word-of-mouth. As a freelance writer, it’s not unusual for me to get new clients on client recommendation.

    The 30% to Amazon is a completely different issue. They’re the retailer. Retailers buy from suppliers and resell at markup. Some suppliers have rules that retailers must follow, which limit what retailers can charge. (Kamelion jewelry’s one example.) Publishing has become a rule-limited supplier, and the rule is that the publisher sets the price.

    Paying a percentage to an editor—even for a 2-year duration—is comparable to giving a percentage of sales revenue to the guy who patches the business’s parking lot. It’s necessary, it helps sales, and not everyone can do a good job. In fact, considering the state of road patches where I live, I think most people can’t do a good job patching asphalt.

    I can think of situations where someone might want to make such a contract with the parking lot patcher, but I don’t think many people would take it. It’s a gamble. Not everybody likes gambling.

    More confusion: Kris & Dean say (paraphrase) “Don’t give anyone a percentage for forever. If you’re going to do it, put a time limit.” Which is the selfsame thing you’re saying.

    Also, you’re assuming that because Dean spent 6 hours on the short story doesn’t mean he didn’t get it edited in one of the breaks in those 6 hours. Maybe his beta gave it an edit when Dean was eating dinner, which wouldn’t count towards the 6-hour time frame.

    ReplyReply
  22. Dean, you claim that the accounting for giving a percentage to an editor is such a nightmare, it couldn’t possibly hold up for more than a few books. How, then, do you explain that the small epress I worked for is capable of keeping track of the percentages paid to authors authors and editors (typically 35% for the author and 10% for the editor) for several hundred books sold through multiple retail outlets (all with different net payouts to the publisher) over a period of four years? Not only do they do it, but they send out royalty statements and payments once every month, without fail. Moreover, they are not the only epress that pays multiple authors and editors in just this way.

    Seriously, if this were as difficult as you are making it out to be, how on earth could any publisher calculate and pay royalties based on a percentage of sales to authors? We’ve got publishers out there with THOUSANDS of books to track, across print and digital, across brick and mortar stores and online retailers. How on EARTH do they do it? I mean, their Excel spreadsheets should all have broken down years ago!

    In other words, you’re reaching. It might be more work than YOU want to do, but to claim it is either functionally or logically impossible to do so is plainly false.

    As for the question of what happens after you die, etc.–as Courtney has said, there is NOTHING about paying a percentage that requires you to pay it indefinitely and forever. When you grant your copyright to a publisher, you don’t give them the right to publish and take a percentage of your work FOREVER. At that small digital publisher (where I am also an author), the contracts are limited to a specific period of time, although the author has to right to request a reversion of rights once the term of the contract has expired if he/she wants to pull the work. That’s it.

    So, right now, I am paid a percentage on every book I edited for this publisher that is still available for sale/published by them. If the author’s rights are reverted, I am no longer entitled to my percentage. End of story.

    It’s not hard. Really.

    ReplyReply
  23. Todd Russell says:

    Interesting discussion all around. I couldn’t help wondering throughout the discussion how much time was spent on all sides writing these comments (and the original blog post) and what sort of fiction work could have been created instead?

    Dean might have been able to knock out at least one story, maybe two for his challenge. As for Courtney and Jackie? You might have been able to pen one as well or at least a chapter or three in your respective WIP.

    This is the internet takeaway. It pilfers our writing time.

    ReplyReply

Leave a Reply


Courtney Milan writes historical romance novels like the ones you see to the right. She still remembers bits and pieces from her old lives, where she was (variously) a scientist and a lawyer.

This blog is powered by WordPressentries (RSS) and comments (RSS) • content © Courtney Milan, 2006-2013 • author photo © Jovanka Novakovic | bauwerks.com