The Business Rusch: Bad Decisions and The Midlist Writer
(Changing Times Part Fifteen)
Kristine Kathryn Rusch
Last week, I ended my blog with this happy thought: “Looking in my crystal ball, I worry that the writers who will get scammed, who will lose actual fortunes, won’t be the beginners or the bestsellers. It’ll be the established midlist writer.” As I sat down to write on Wednesday morning, after a trip to Chattanooga, Tennessee which involved a lot of discussions with writers plus a ton of e-mail/questions/reading when I returned, I realized that I needed to change this week’s topic just a tad.
I had planned to call this segment “Scams and the Midlist Writer,” but really, seriously, the problems that midlist writers will have—are having if the truth be told—go beyond scams. The problems come from bad decision-making, and an inability (deliberate or not) to understand the publishing business, particularly the publishing business as it pertains to midlist writers.
If this post is your introduction to the series, please read the previous three posts on midlist writers, starting with this one, which defines the midlist. I’d love it if you go back and read the previous 14 posts, but I know you happened to be pressed for time just like the rest of us, so those three posts (plus the introduction to the entire series) should get you up to speed. I’m assuming, of course, that if you came to this post via someone else’s link, you’re an established writer, and these posts are for you.
As for the rest of you, who have been with me from the beginning of this series (and from The Freelancer’s Survival Guide), supporting me with comments, donations, and e-mails, thanks ever so much. You’re already up to speed and don’t need to think about losing any more time. (She writes with a wry grin, rather astounded at how this mini-series has grown.)
In the past fifty years, a strange business model developed in publishing. Established—and beginning—writers expect to be taken care of. They don’t have to worry their pretty little heads about business. They only need to write. Because artists, you know, are sensitive types, and not suited to business, and will only screw it up.
Two “innovations” in the publishing industry fed this myth: the rise of university creative writing programs which, oddly enough, seem dedicated to proving that you can’t make a living at writing, and the rise of the literary agent. University creative writing programs, taught primarily by PhDs and MFAs who have never even tried to make a living at their chosen profession, have increased 800% since 1975. Every college or university has a creative writing program, teaching wannabe writers to write one story per semester and to revise it to death. No one can make a living at writing by writing one short story every six months, and very few writers—I don’t care who they are—have the skills to both write a story and to revise it properly. Those are two different skills. Usually writers ruin their stories by revision—and I say that as a writer, a woman who has taught writing, and as an award-winning former editor. I can tell stories—and indeed I did at Chattacon last weekend—about writers who nearly lost their first story sale to me when I edited at The Magazine of Fantasy & Science Fiction by their inability to take instruction, and revise only the small thing I asked them to revise.
The writer who goes through those programs and buys into the myths perpetuated by the wannabe-writer professors who teach them almost never have careers. Those writers might sell a short story or two, or even a novel or two, but they never have a long-lived freelance career—perpetuating the myths yet again that a writer can’t make a living in this business. I only know a handful of professional working writers (who support themselves on their writing) who have an advanced degree in English, let alone an MFA or a PhD in Creative Writing. (Most professional writers with advanced degrees have them in business or history or science.)
The reason I’m dwelling on this is because this myth that you can’t make a living coupled with the myth that the artist is sensitive has set the stage for an entire industry: literary agents.
Let me state here and now that there are good, professional literary agents. I have one.
But let me also state that this industry is completely unregulated, and anyone can establish himself as a literary agent simply by proclaiming that he is an agent. Writer J. Steven York has a very funny blog proving just this point. He set up his cat as a literary agent, naming her Bad Agent Sydney to lampoon the lack of regulation in the industry—and was shocked when a handful of writers quite seriously queried this malapropism-using, abusive creature asking her to represent them. (A number of other writers are in on the joke and ask questions just to get her riled—which is easy.)
Agents are the people who handle a writer’s entire career (if the writer lets them) from sales to negotiation to contract to money, and there is no regulation at all. Yet writers sign up with scam agents without vetting them all the time, lose years to crooks, lose sales, lose money, lose careers. These bad agents in particular feed the myth of the “sensitive artist.” I actually had one of those agents (who embezzled from me early in my career—and yes, is still in business) who actually told me not to worry about anything. He’d take care of it. I was too young and too stupid to realize that was a gigantic red flag.
If you want to understand how insidious this can be, look at my husband Dean Wesley Smith’s blog titled Killing The Sacred Cows of Publishing. He has several posts on agents, followed by hundreds (literally) of comments, mostly about scams, bad legitimate agents, and terrible agent practices in this unregulated world. In fact, if you’re a professional writer or you want to be, and you’re not reading his series, you’re doing yourself a disservice. You might not agree with Dean, but he’ll make you think—and that’s something writers, stuck in the myths of publishing, don’t often do.
I’ll be honest here. It’s really, really nice to have someone offer to do the hard work for you. No matter what writers tell you, writing is fun. It can be hard, but it’s not hard the way that fire-fighting or brain surgery is. Writing is a challenge, and writers are airheads primarily because we live in our own little worlds most of the time.
Having someone else to do the business, the work of the real world, is just lovely.
And it’s a fantasy.
No one cares about your business more than you. No one works harder for your business than you do. No one understands what you’re doing better than you do. No one will defend it better than you. I covered this a great deal in The Freelancer’s Survival Guide. Read the sections on employees—or as I define it, people who work for you. Agents belong in that category. You, the writer, do not work for them. They work for you.
Why am I bringing all of this up now? Because writers who believe they need someone to take care of them will make terrible decisions in this brave new world of publishing. Right now, established writers are just beginning to catch a clue that they might be able to earn money from their backlist, but the scammers and those who know how to make a quick buck have already set up shop and are beginning to pluck naïve writers away from their potential earnings.
It makes sense. Remember that in gold rushes of the 19th century, the people who earned the most money weren’t the miners, but the people who supplied the support services. Many of the miners went home broken and poorer than they’d ever been. The people who provided support services got so rich that we’re still familiar with some of their names.
Right now, established writers are standing on the starting line of a brand new gold rush. Unfortunately, writers as a class are stupid about business. Those who understand business have already cut in front of the writers and have set up shop.
So what do I mean exactly? Why am I worried about this?
Here’s the hard truth: for the first time in my lifetime, a midlist writer can make bestseller money without having a bestseller and without writing 6 or 8 or 10 books per year. The rise of e-books, the availability of print-on-demand publishing, and the growing use of internet bookstores like Amazon make it possible to sell backlist titles that could earn a writer tens of thousands, maybe hundreds of thousands, of dollars per year.
The sales numbers on these backlist titles are relatively small when considered from Big Publishing’s point of view, but they’re large from a writer’s point of view. This is what has others—the nonwriters who want to make money off writers—excited.
Let’s look at the numbers one more time. In last week’s post, I did the math and assumed that if a writer with one backlist title sold it for $4.99 she would earn about $3 per book sold (factored over the various sites). So if she sold 1,000 copies of that single backlist title, she would earn $3,000 in that year.
Now imagine if she has 10 backlist titles, all of which sell (on average) 1,000 copies per year. She’s earning $30,000. If she has twenty, she’ll earn $60,000. If she has thirty, like so many of us do, she’ll earn $90,000 per year.
Over ten years, without writing another word, that’s almost one million dollars.
See why the agents, the service providers, and the scammers are excited about this? It’s pretty common for an established midlist writer with a career that spans a decade or more to have published 30 novels, and it’s likely that most of those novels are out of print, which means the writer retains those rights.
So if she does the work herself to get those 30 books into electronic format and print on demand, then she’ll make $90,000 per year if she sells 1,000 copies of each book. Imagine what happens if one book sells 5,000 copies. Or a series sells 10,000. The numbers grow astronomically.
Here’s the problem, however. An established midlist writer already has a career. She probably has books under deadline. She’s already tap-dancing as fast as she can.
If she’s like me, adding a self-publishing business seems impossible without adding another twelve hours into a twenty-four hour day.
So she looks for a shortcut. Here’s where agents are coming in. They’re offering to do the formatting, book design, covers, copy edits, and the actual publishing to put the book into a “package.” Then the agents will publish that book under the agent’s publishing house imprint for anywhere from 15% to 50% of the writer’s earnings—as long as that book is in print.
Which will probably be long past the writer’s lifetime.
In other words, for doing work that will take a few hours or a few days at most, the agent will receive payment for decades. In our hypothetical example above, our writer will pay her agent $9,000 per year for two days’ work. The next year, our writer will pay her agent $9,000 for doing nothing.
Nice income on the part of the agent, particularly if he (like my previous three agents) has about 100 clients. You can do the math on that yourself, I’m sure.
What does that agent do that the writer can’t do? Nothing. Absolutely nothing.
What the agent has done is this: He’s hired an editor, an artist, a book designer, a copy editor, and someone to format the books for a flat fee per project. Some agents have had this system in place for years, and actually have people on salary doing this work.
No writer should ever ever hire an agent to do this work. If your agent decides to go into e-publishing and print-on-demand, fire that agent immediately. I am not kidding about this.
1. Running a publishing company (even if it is disguised as a packaging company) is a conflict of interest for the agent. The writer has hired the agent to be the writer’s advocate with publishing houses. The agent should be on the writer’s side. The moment the agent becomes a publisher, he is no longer on the writer’s side. It is actually in that agent’s best interest not to sell the writer’s next book. It’s better for that agent’s bottom line to publish the book himself.
2. Agencies are struggling to survive. I suspect that in the future, an agent will be irrelevant for the working professional writer because that writer will know enough about business—and have the access (which used to be the reason to hire an agent)—to do the work herself or with the help of an intellectual property attorney.
Agents are smart enough to realize this, so they’re struggling with new models. Mary Kole of the Andrea Brown Literary Agency wrote a long post about this on digital book world that scared the crap out of me. What she suggests in this post is very, very, very good for the agent’s business model and terrible, awful, horrible for any writer who signs on.
If any writer agrees to the models Kole suggests, that writer will guarantee that he will not make a living for the rest of his career—unless he lucks into a bestseller.
The phrase in her blog post that scared me the most? This one: “In fact, I’ll argue that agents should start treating their clients’ business like a tech start-up.”
She then expands on this as if she actually knows what she’s talking about.
Think this through, people. “Tech start-up.” It all sounds well and good. But agents have 50-100 clients. That’s 50-100 tech start-ups.
Anyone who has run a business knows that one start-up takes 24/7 focus. No one can juggle 50-100 start-ups—let alone 50-100 businesses—in a single year. Not and expect to do a good job. Not and expect to do even a half-assed job.
The only reason Kobe and other agents can even suggest this model is because the amount of work they’re proposing to do for their clients is minimal. It will take a few days per book at most. So our writer with the 30 novels will take a little over a month of concentrated effort on the part of the agent so that the agent can then earn money for the rest of the book’s existing copyright. Life + 70 years. Got that?
3. Agents are unregulated. Let me put this in clear terms for you: The mortgage industry, which has screwed and is still screwing millions of homeowners, is regulated. Bernie Madoff and the lesser fish in the financial services pond who stole every penny from their clients were regulated.
Agents are not regulated. There is no oversight committee. There are very few laws on the books that will put away an agent for shady behavior. Agents—just like anyone else—can be charged with embezzlement and fraud, but in those cases, the money is already spent and gone.
So imagine this: A writer signs on with the agent’s book packaging service. The writer agrees to let the agent take 15% of the book’s earnings over the lifetime of that book for putting the book into print-on-demand and into e-books. By doing this, the writer agrees that the agency’s packaging program will put the books online and into the system.
Which means that the earnings reports go to the agent first.
There is no system that guarantees that the agent has to report the earnings accurately to the writer. So if that book earns $3000 in its first year, and the agent is due 15% or $450, there is nothing to stop that agent from reporting to the writer that the book only earned $500. The agent would then pocket the $2500 with minimal chance of ever getting caught—particularly if she is good at fudging paperwork.
The writer, who did not put that book into the system, is not entitled to the earnings reports direct from Kindle or CreateSpace. So there is no way to check to see if the earnings reports from the agent are in any way accurate.
Even if the agent is a good person (note I didn’t say ethical, because he’s moved into this side of the business), there’s nothing to stop his employees from running the same scam. Bookkeepers can and do fudge paperwork, particularly if their employer is trying to keep track of 30 novels from every single one of their 100 clients.
Scared yet? You should be.
Again, any writer who signs up for these programs is foolish at best.
But I watch writer after writer after writer sign up. These writers clearly don’t know business and clearly want someone to take care of them. The writers do not want to learn how to publish their own novels. Or perhaps the writers believe they lack the time.
Agents are at least trying. They’re trying to save their business in an age where they’re becoming irrelevant. They’re doing this with both their own and their clients’ business at heart.
Most everyone else who wants to publish a writer’s work for a set lifetime percentage is a scam artist. Do not ever hire these people. Dean has done a great blog post on the scams that have emerged so far in this new publishing world. When you finish this post, go to this link immediately.
I’m sure more and more scams will show up as time goes on—all because the bulk of established writers want someone to take care of them. My sad prediction is this: these writers will go out of business. They won’t be able to live on the money they’re earning. You’ll see a lot of writers complain over the next five years that they can no longer earn a living, that e-books are a crock, that the changes in publishing hurt writers.
Realize that these writers do not know business and volunteered to get screwed.
So what should the responsible writer do?
She has three recourses:
1. She can go to an established publishing company that is willing to pay her a set royalty rate on her books in exchange for doing the work, maintaining the website, doing the promotion, etc. In this case, at least, the writer is able to see the financial earnings paperwork directly. This is, in my opinion, the worst of all of the options. The writer had better make sure she signs a very good contract with that established publishing company, with an excellent out-of-print clause.
2. She can start her own publishing company or band with others who are doing something similar and pay the salaries of employees just like those agents are doing.
3. She can hire individuals for a flat fee to do the work that makes her cringe (covers, in my case), while she does the rest of the publishing work as well as her writing.
4. She can learn to do the work herself in addition to her writing.
This last, point 4, is the best. The problem most writers have is that they’re in a gigantic hurry to get their backlist up. There is no hurry. This isn’t the produce model of publishing any more. Take the time, write your projects, and get the backlist up slowly. That’s the best.
So…what am I doing? A combination of 2 and 3. I’m lucky enough to have a regional press in my small town that works with me on all of this. The press hopes to grow through my reputation (and Dean’s). I use my old publishing expertise to help the press. We’ve got a fantastic co-publishing arrangement, but I’m still exceedingly hands-on. I’m doing a lot of work—approving cover proofs, going over copy edits, preparing manuscripts for digital layout—all in addition to my own writing.
Dean is doing a combination of 1, 2, and 3, because he has the art background to do many of his own covers. He loves that sort of thing. Me, I can barely handle stick figures.
I know this sounds like a lot of work for those of you who are used to being taken care of. You need to learn everything from copyright to negotiation, from distribution to the way all aspects of the industry works.
But here’s the thing, y’all. It’s your business. You should have learned this stuff years ago. Seriously. The days of having someone take care of you and still earning a living are gone. (See the first midlist post on what’s happening to midlist careers in Big Publishing, then imagine remaining in the publishing field for more than a few years.)
I’m officially kicking you out of the nest. Learn to take care of yourself.
It’s the only way you’ll still be a full-time professional writer in ten years.
Here are two resources to help you survive your fall from the nest: The Copyright Handbook, published by Nolo Press, and my own Freelancer’s Survival Guide, which is free on this website or can be ordered as an e-book or as a print book. Seminars like Kevin J. Anderson’s Superstars or the marketing workshop through the Oregon Writers Network, blogs like mine or Dean’s, will also give you some guidance.
I’m deliberately not plugging some websites that provide freelance services like copyediting because I haven’t vetted them myself. But they exist. If you need help, hire someone who charges either a flat hourly rate or a fee per service. Never ever ever hire someone by promising to pay them a percentage of the book’s earnings.
I know I’m being harsh, but I have your own best interests at heart—and mine too. I love to read, and I suspect this change will silence too many great voices. Don’t be one of them.
“The Business Rusch: Bad Decisions & The Midlist Writer” copyright 2011 by Kristine Kathryn Rusch.