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Discussion Starter · #1 ·
I was talking to my father today about the difference between indie and traditional publishing and we compared possible routes. I thought it would be interesting to post here.

I self-published a 3-book series of contemporary erotic romance novels, each novel 90K+ words. If I had pitched the series to an agent, got an agent, then sold the series to a traditional publisher in April 2013, what might the deal have looked like?

I scanned the deals at Publisher's Marketplace in 2013, the year I self-published my series, for similar deals. I found the following two examples that were signed around the time I published my series. (names have been withdrawn to protect the innocent)

1. "Good deal" for a NYT Bestselling author ($100,000 - $250,000) for a 3-book contemporary erotic romance series for publication in 2015. 2 of the three books are released with one on preorder. Rank is currently between 8000+ and 20K+in the Kindle Store.

2. "Nice deal" for a debut romance author ($0 - $49,000) for a 3-book contemporary erotic romance series. No publication date mentioned but the books were released in late 2014 and the first half of 2015. Current rank ranges from 800K - 1M+ in the Kindle Store.

I am far more likely to have received a deal like the second since I was a non-NYT bestselling author. So, if I HAD received a deal for $49,000 for three books to be published in late 2014 and 2015, what would that mean in terms of money?

From what I have read of typical boilerplate contracts, you get 1/3 at signing, 1/3 when you turn in the manuscript and 1/3 at publication. Since this was for 3 books, that would work out to:

$16,333 per book, so instalments of $5,444 at signing and then $5,444 when the first book was turned in, and $5,444 when the first book was published.

I am not sure if I would get paid 1/3 for all three up front, but if so, that would mean $16,333 at signing of the deal, and then $5,444 for each subsequent instalment upon delivery of the finished manuscripts and on release.

Subtract the agent's fees off that, of course, which means 15% off the top, so those books would be worth: $41,650, with $13,883 for signing and $4,627 for each instalment along the way.

Let's assume that is the case.

I self published my series instead of shopping it around. I released books in April 2013, November 2013 and April 2014. So far, since April 2013, I have sold 140,000+ copies of the series at full price and sale price, but for ease of calculation, let's use 120,000 at full price and 20,000 at 99c on sale. My books sell for $4.99 which gives me a share of $3.44 per unit for full price and .34 per unit for the sale price. That works out to a gross of $412,800 and $6,800 = $419,600 in 2.5 years or $167,840 per year since release.

If I had signed a "Nice Deal" for the series, which is pretty likely for a debut author who was an unknown, I would have made a total of $13,883 for signing in 2013. In 2014, I would have made another $9,254 in 2014 for book 1, which was released in September 2014. Then, I would make another $9,254 in early 2015 for book 2, and $9,254 in late 2015 for book 3.

2013: $13,883
2014: $9,254
2015 $18,508

Now, royalties: I would have to sell enough books to earn back my advance. That means, I would have to sell enough books to earn back my $49,000.

The eBooks sell for $3.99. (These are romance novels so they sell for less than non-romance titles):

The publisher gets a share of the eBook sales. For a book that sells for $3.99, they get 70% or $2.79. The author's share is 25% of net, or $0.70 per unit. Take off the 15% for the agent and the author gets $0.59 per unit. The author would have to sell 83,050 copies to pay back the advance on earnings.

If they sold 120,000 at full price, and 20,000 at 99c like I did, they would get the following:

36,950 net units after advance paid off, which = $21,800.50 net and $0.15 per unit at 99c, which = $2,945.25 for a grand total of $24,745.75 in royalties after the advance was earned back.The trad published author gets $49,000 + $24,745.75 = $73,745.75 over 2.5 years, which works out to $29,498.30 per year.

In summary, two publishing routes, same number of books sold, different release schedule and payment:

Self-published income gross: $419,600 in 2.5 years or $167,840 per year since release, paid monthly, 60-days after the end of the month in which the sale was made.

Trad-published income gross: $73,745.75 over 2.5 years, which works out to $29,498.30 per year, paid in instalments and the royalties probably not even paid out yet, with the final instalment not yet paid out since the final book is not released until later this year.

Currently, the books in my series are all ranked below 13,000 in the Kindle store, compared with this author's books, which are all over 800,000 - 1M.

Of course, this is just a mind game based on a single author / single deal. YMMV. If I have made mistakes in my assumptions, please chime in below. Still, you can see that I make a far better income as a self-published romance author than a trad published debut romance author with a similar series. 

Seems a no-brainer. :)

 

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Congrats! I'd imagine the six-figure trad author would likely have picked up translations/sub-rights that year also, as a deal that size always kicks the foreign scouts into gear. Still, no comparison with your numbers & nothing preventing you selling subrights now or in the future either. Fascinating comparison.
 

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Can't argue with the numbers. The only thing I can think that might change things would be the physical offline sales that might have been achieved by the trad pub route. Whther they would have been sufficient to have altered the options chosen, I don't know, but it is a consideration.
 

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I always hope new authors find these posts. A couple of years ago an author contacted me via Fb asking for a copy of one of my books for a blog tour she was doing on her first book with a vanity publisher.
I encouraged her to check out self publishing. She unfriended me.  :(

Thanks Sela
 

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Discussion Starter · #7 ·
jetmangraham said:
Can't argue with the numbers. The only thing I can think that might change things would be the physical offline sales that might have been achieved by the trad pub route. Whther they would have been sufficient to have altered the options chosen, I don't know, but it is a consideration.
Yes, that is the wildcard, and I have no way of knowing how many print sales there would be from this author's deal that I used as a comparator.

Here's a page that helps you calculate how many copies of each book format an author needs to earn out their advance.

http://www.shawntellemadison.com/book-royalties-calculator/

Using this, and using the $49,000 advance I used above, and 8% share, I get the following figures that I would have to sell to earn out the advance before I made any further royalties off sales:

Mass Market Paperback ($7.99) = 76,658
Trade Paperback ($15.00) = 40,833
Hardback ($24.99) = 22,694

So I would have to sell some combination of eBook and print to earn back my advance before I saw any more royalties.

Now, I have no idea how much a debut romance author might sell in print, whether mass market paperback, trade paperback or hardback. I don't imagine erotic romance debut authors get many hardback print runs, so at most, they might get trade or mass market paperbacks. I have heard that 10,000 books is considered good in terms of debut print book sales, so if that is the case, I guess there wouldn't be much coming from print sales. According to agent Noah Lukeman, most commercial first novels net 5,000 - 10,000 hardcover sales. There is no firm number on what constitutes a success, but it would depend on the advance and the number of print copies sold.

However, the really voracious readers of contemporary erotic romance seem to be eBook readers, so I wonder how big the print market for these books is?

Regardless, I started earning income the day I released the first novel in my series. I sold 5,000 copies that month and so I received the first actual income from that book 60 days later, which worked out to $17,200 income for July 2013. I kept selling month after month and then earned more when I released the other two books in the series over the next 12 months. Had I gone the traditional route, I would not be getting any significant income for perhaps several years after if and when I earned out.

Of course, this assumes that in both scenarios, I sell 140,000 books.
 

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Aside from the numbers - I was in a good critique group some years ago, and during that couple of years, 2 members got traditional deals. I don't know the finances, and their publishers weren't Big 5, but it was a respectable smaller press. When I search Amazon now, the one person still has only the one book she sold then (early 2000s) available. The other has 3, the first one that happened when he was in our group and 2 others that came close on its heels. Nothing recent. I have no idea what happened. Maybe they are still writing and using pen names, but I suspect being published didn't pay well and was far more demanding than it was worth.

My own experience was that just investigating traditional publishing was enough to put me off writing for years. Pretty authoritative sources told me for a first time author and genre books like mine, the advance to expect would be $3,500 - $5,000. At that time in my life it didn't seem like enough to be worth going through the aggravation. I was working full time and devoting my time and energy to breeding and showing horses back then.

However, I keep those figures in mind when evaluating how my own books have done, and even my least popular slowest-selling romance has earned almost double the high-end of that estimate. And my books are all standalones. Well, one is sequel which can be read as a standalone. I have no regrets about not pursuing traditional publishing, but I do regret that I stopped writing entirely for a lot of those years and had only 2.5 completed books when I discovered KDP.
 

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Sela....there are a couple major flaws in your calculations:

1.  You assumed the new author got that $49,000 advance. Probably not. If it's a newbie author, even with a major publisher, she might have been lucky to get $10,000 a book (paid in three installments each...and endlessly delayed, I might add). It might even have been $5,000/$7500/$10,000, or a mere $22,500, or $26,500 less than you credited her. And that's still being generous and optimistic.

2.  You assumed she had a fighting chance of hitting that 140,000 copies sold. Unless she hit huge on that first printing (which might have been as low as 20,000 copies total, even lower) and her publisher went back to print, there's not a snowball's chance she came anywhere close to those 140,000.  I know of several author who regularly had $40 or $50,000 advances PER BOOK and who used to earn out plus who are now seeing initial print runs under 30,000 copies with no chance of going back to print. That's SUCCESSFUL ESTABLISHED authors.

I'm not going to run the figures, but with that kind of print run it would be very hard to earn back even the lower end advances. Ebook sales provide some relief, but you don't see many trad pubbed authors who are blowing anyone out of the water with their esales despite having a minuscule print run in mass market.

Worse, that trad pubbed author is facing some of the same advertising costs you are (self promotion / what are you going to do for us today? thing that even the big 5 dish out to their writers). She doesn't pay for covers, editing, and some ads, but she's still gotta do the Facebook thing or whatever.

In short, your calculations seriously err on the fantasy side when it comes to that trad pubbed author.  Still, she might have made it. I'd hope so. But I'd really, really doubt it.

Bet that makes you feel even worse that you chose the unprestigious down-market self-publishing route, right??  :p
 

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Discussion Starter · #10 ·
My Dog's Servant said:
Sela....there are a couple major flaws in your calculations:

1. You assumed the new author got that $49,000 advance. Probably not. If it's a newbie author, even with a major publisher, she might have been lucky to get $10,000 a book (paid in three installments each...and endlessly delayed, I might add). It might even have been $5,000/$7500/$10,000, or a mere $22,500, or $26,500 less than you credited her. And that's still being generous and optimistic.

2. You assumed she had a fighting chance of hitting that 140,000 copies sold. Unless she hit huge on that first printing (which might have been as low as 20,000 copies total, even lower) and her publisher went back to print, there's not a snowball's chance she came anywhere close to those 140,000. I know of several author who regularly had $40 or $50,000 advances PER BOOK and who used to earn out plus who are now seeing initial print runs under 30,000 copies with no chance of going back to print. That's SUCCESSFUL ESTABLISHED authors.

I'm not going to run the figures, but with that kind of print run it would be very hard to earn back even the lower end advances. Ebook sales provide some relief, but you don't see many trad pubbed authors who are blowing anyone out of the water with their esales despite having a minuscule print run in mass market.

Worse, that trad pubbed author is facing some of the same advertising costs you are (self promotion / what are you going to do for us today? thing that even the big 5 dish out to their writers). She doesn't pay for covers, editing, and some ads, but she's still gotta do the Facebook thing or whatever.

In short, your calculations seriously err on the fantasy side when it comes to that trad pubbed author. Still, she might have made it. I'd hope so. But I'd really, really doubt it.

Bet that makes you feel even worse that you chose the unprestigious down-market self-publishing route, right?? :p
Yes, I seriously feel bad! ;)

That $49,000 was being optimistic but I didn't want to be accused of low-balling the advance. It was likely more along the lines of $15,000 but who knows? I have read that first novels in the romance genre often get $2500 - $5000 as an advance. Still, it might have been $49,000 for 3 books. Regardless, since her books are doing pretty poorly in the Kindle store, I suspect print book sales aren't very good either if they exist. :(

I would love to see my books in a brick and mortar bookstore but that seems more like vanity publishing to me than going self-published route since I would make so little off each sale. It seems that there are very few erotic romance authors with books in bookstores and that a lot of sales seem to be eBooks. In that case, self publishing is probably the best way to go, if you sell reasonably well.
 

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Sela said:
Yes, I seriously feel bad! ;)

That $49,000 was being optimistic but I didn't want to be accused of low-balling the advance. It was likely more along the lines of $15,000 but who knows? I have read that first novels in the romance genre often get $2500 - $5000 as an advance. Still, it might have been $49,000 for 3 books.
That's correct. The deals as listed are for the entire contract, so the advance for each book would've been 49K/3. Which is actually not bad for a debut author these days. But as your post shows, it pales in comparison to what can be earned in self-publishing.

Sela said:
I would love to see my books in a brick and mortar bookstore but that seems more like vanity publishing to me than going self-published route since I would make so little off each sale.
I love this. Traditional publishing is the ultimate vanity publishing. It gives you a great sense of validation, but that feeling doesn't last, and besides, validation doesn't pay the mortgage.
 

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When I see posts like this, it seems such a no-brainer to me. I don't understand why people are willing to bust their a** in both scenarios, and be okay with so much less money, and a higher degree of uncertainty in the trad pub route. I know I've talked to people who are steadfast trad pub - and I think, why?

Am I really just the materialistic weasel?

Because to me, ROI on both time and money is important. Self/indie publishing gives you a better chance of a good ROI.

Thanks for the post, Sela. I want your numbers when I grow up. I always, always enjoy your posts!
 

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And this is exactly why I have decided not to go the traditional route. A $3000 advance (per book) is the best I could hope for in a niche genre (SFR) according to my agent. When you weigh that against the possibilities of indie publishing, getting to keep my rights...there is just no comparison.
 

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Someone on my personal Facebook feed, an old co-worker, asked me if I thought my self-published success would lead to trade book deals. She said: "Wouldn't it be exciting of you could get picked up by a publisher and make real money?" I simply responded that I wasn't interested in that route because there was no way they would offer me enough money as a "new" author to justify it. She didn't get it and I didn't explain about the money I make, but I think a lot of people are stuck in the mindset that there is big money in traditional publishing. Sure, I'm sure she thought I was making peanuts, but she was under the impression that trade published authors -- all of them -- made big bucks. I think a lot of people believe that.
 

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Trad published historical romance is worse, I know someone who just received a $1,500 advance for the romance her agent sold to Harlequin. Although the upside of such a low advance is she should earn out quicker and she bears no production costs. She also gets foot in on romance blogs that won't take self published books so has access to better exposure.

I think in some regards its an even harder choice today than it would have been 2-3 years ago. I feel like I have lost the time I spent in the query trenches and I'm at a disadvantage being so late to take the indie route. While I was trapped in the query hamster wheel going nowhere, others were building their readership and establishing their catalogues. There are fantastic success stories here on the k-boards, but the predominant feature seems to be they are authors who started self publishing 2-3 years ago, at a time when things were taking off, simple marketing efforts reaped larger returns, permafrees still worked and (it seems) the roads were paved with gold.

For brand new authors, with zero audience and no catalogue, it seems such an enormous task to gain any traction or visibility in an overcrowded pool now.
 

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Discussion Starter · #17 ·
AliceWE said:
Trad published historical romance is worse, I know someone who just received a $1,500 advance for the romance her agent sold to Harlequin. Although the upside of such a low advance is she should earn out quicker and she bears no production costs. She also gets foot in on romance blogs that won't take self published books so has access to better exposure.

I think in some regards its an even harder choice today than it would have been 2-3 years ago. I feel like I have lost the time I spent in the query trenches and I'm at a disadvantage being so late to take the indie route. While I was trapped in the query hamster wheel going nowhere, others were building their readership and establishing their catalogues. There are fantastic success stories here on the k-boards, but the predominant feature seems to be they are authors who started self publishing 2-3 years ago, at a time when things were taking off, simple marketing efforts reaped larger returns, permafrees still worked and (it seems) the roads were paved with gold.

For brand new authors, with zero audience and no catalogue, it seems such an enormous task to gain any traction or visibility in an overcrowded pool now.
I was once a brand new author with zero audience and no catalogue. ??? My first year and first series did not make me a whole lot of money. I made a lot of indie mistakes and have the 1 and 2 stars to show it. Still, I had meagre sales but I worked damn hard for ever sale of my first series, so merely publishing in 2012 did not ensure success.

It was my second series, published almost a year after I started (2013) that took off and it still comprises the bulk of all my eBook sales. By then, I did have a small audience. I had sold 2,000 books between June 2012 and April 2013 and I suspect a lot of those readers bought book 1 of my new series and that got Amazon's algorithm attention and my book took off.

My third series did not do as well as my second series but better than my first series. So it really is a matter of the book/series itself. Having an existing audience alone was not enough to propel my new series into the same strata as my second series. :(

Is it harder to get a foothold today? I think it's ALWAYS hard to get a foothold. I think you tend to hear from those of us who are successes and so it may seem like we had it easier back in the golden days of 2012. Some of us did benefit from those golden algorithm days, but I know of new authors who are killing it today and doing much better than I did.

It's hard to make a living as an author, period, regardless of the path you choose.
 

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Sela said:
I think you tend to hear from those of us who are successes and so it may seem like we had it easier back in the golden days of 2012. Some of us did benefit from those golden algorithm days, but I know of new authors who are killing it today and doing much better than I did.
A large part of it is exactly as you said. It feels like there are many who are successful who were at the front of the gold rush and the rest of us are trailing far behind and left with the slim pickings and the methods/approaches those early pioneers say worked for them, simply aren't as effective anymore.

And yes, you do hear of new authors who just kill it. That's one reason I took the plunge and decided to self publish my Regency romance. I know another author who published hers and it went viral and sold 30,000 copies in the first month (150k so far and still counting) and she has zero social media presence and did zero advertising. Mine didn't. It ties me up in knots trying to figure out why her book soared and mine did the turkey dive. The only thing I know for sure is that I need to keep on working and keep on trying. I guess we can't all be hares and some of us are destined to be the ploddy turtles.
 

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AliceWE said:
Trad published historical romance is worse, I know someone who just received a $1,500 advance for the romance her agent sold to Harlequin. Although the upside of such a low advance is she should earn out quicker and she bears no production costs. She also gets foot in on romance blogs that won't take self published books so has access to better exposure.

I think in some regards its an even harder choice today than it would have been 2-3 years ago. I feel like I have lost the time I spent in the query trenches and I'm at a disadvantage being so late to take the indie route. While I was trapped in the query hamster wheel going nowhere, others were building their readership and establishing their catalogues. There are fantastic success stories here on the k-boards, but the predominant feature seems to be they are authors who started self publishing 2-3 years ago, at a time when things were taking off, simple marketing efforts reaped larger returns, permafrees still worked and (it seems) the roads were paved with gold.

For brand new authors, with zero audience and no catalogue, it seems such an enormous task to gain any traction or visibility in an overcrowded pool now.
Golden days in 2012?

*Looks around*

OMG what did I miss? I published in 2011, never saw any gold and am making far more now than I did then.
 

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Patty Jansen said:
I published in 2011, never saw any gold and am making far more now than I did then.
That's fantastic that you are making more money in 2015 than you did in 2011. I'll go out on a limb and say I bet you probably have a catalogue behind you. I doubt you only have 1 book with single digit reviews. This kind of highlights my point, the established authors say, "oh we're making far more money today than we did 2 (3 or 4) years ago" but forget all the things they have done over that period of years. You've published books, built your mailing list, established your fans, tried different approaches. There are those of us *just* starting out, trying to get a foothold, we don't have 4 years of experience and books behind us, we're trying to find our ways with that first book and no following.
 
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