Many years ago when my literary agency, Waterside Productions Inc., was thriving as the epicenter for all books related to the computer revolution, I was asked by my clients and the publishers to whom I was licensing books from top-selling computer book authors and experts why I had not created my own publishing company. Although I was generating millions of dollars in agency fees as a literary agent it seemed obvious that I could generate tens of millions of dollars of additional profits by becoming a book publisher and not just an agent. After all, we represented more than 25 percent of all the bestselling computer books over a period of close to ten years and many of the individual titles were selling millions of copies annually. Didn’t we realize how much money we were leaving on the table?
I did realize how much money I was leaving on the table, but I had learned about book publishing from my father who has started ARCO Publishing in 1936. ARCO was successful but never as large as it could have been. My father loved book publishing and especially making deals and finding new ways to market books. However, I saw firsthand the complications of having many employees, dealing with printers and warehouses, and having to accept returns from bookstores. My father could have had a much bigger company but he turned down opportunities to purchase Kaplan when it was a small company and other companies that would have added revenue but reduced his ability to take time off from work and focus on the casual atmosphere he had created, a lifestyle which included two hour lunches and the ability to leave the office in the middle of the day if he choose to go to a baseball game or other event.
Like him I have never put money as the only priority in running a business. I believe money was his primary priority, but acquiring it was not out of balance with other goals. In my case making money has always been an important priority but not my primary focus. My primary focus has been on working with people and ideas that excite me and allow me to express my own creativity. I found that being an agent rather than publisher allowed me greater diversity and fulfilled my desire to end each day without myriad details needing my attention on each book agented. As a publisher you must constantly monitor the production and marketing of each book you publish. As agent it is really just about negotiating the right deal with the right publisher for each author with relatively little follow-up required once the deal is struck. Really an ideal scenario for someone with my desire and ability to balance fifty or more negotiations at one time but little capacity for or interest in the details of marketing each book once published.
But then along came the ebook revolution, and what is an agent to do? Except for our major proven authors, it is increasingly difficult to negotiate or even land book deals with the major New York houses. Everyone wants proven, low-risk publishing opportunities and no major publisher can afford the luxury of developing new authors. Authors whose books I could place easily five or ten years ago now are passed on by the major houses. Rather than force these authors self-publish I decided two years ago to create Waterfront Digital Press. My concept was to publish ebooks only and see which books created enough buzz so that we might, at a future time, be able to approach large traditional publishers to take over both print and ebook publication. We might not make much money with our ebooks, but we would allow authors to market themselves in a professional manner by introducing them to top PR and marketing services which they, rather than Waterside as publisher, would have to fund. In exchange, we would pay out 70 percent or more of all ebook-generated revenue to our authors. This is the reverse of a standard publishing agreement, but we felt we were really co-publishing with our authors and that they and not us were doing the heavy lifting. The other advantage with ebook publishing is that we would have no inventory and no returns. (more…)