Entangled Publishing

[Tuuli]

In your submission guidelines, you mention you're looking for upper YA. The YA market isn't the same as the regular fiction market. How are you getting the word out to the target audience--teens? Right now, teens aren't huge readers of ebooks. Sales are growing, but I suspect a large part of that is due to the crossover appeal of YA novels with adults.

[michael_b]

Here's the bottom line:

** We pay 40% of cover, regardless of where the book is sold. We think that's generous, and hope other publishers will eventually adopt this model as well.

How are you going to pay 40% of cover from 3rd party distribution? Some of them only give publishers 30%-60% of the cover price. You'll rapidly go into the red paying out 40% cover regardless of what your 3rd Party net is. For instance, ARe--one of the more generous 3rd party distributors, pay 60% of cover price--pays out $3 on a $5 book. That means you author will get $2 per book, regardless. This leaves you $1 to cover operating costs. That's a pretty narrow margin. And that's on a generous 3rd party payout. If the payout is only a net of 30% from 3rd party, then you net $1.50 per book, and you're now running in the red $.50 per title. Granted, you could opt not to deal with the lowball etailers--which is what Shadowfire Press has done--but close margins can lead to disasters for small publishers. I remember a couple going under when their homes got hit by hurricanes and because they were operating on very narrow margins they went under because they couldn't get new computers to replace those lost in the disaster.

I believe another would be publisher--anyone recall their name?--made similar plans to pay a set percentage of cover then realized their mistake and closed down before they even opened.

[Unimportant]

Was that Quartet, michaelb?

[Fae Sutherland]

Was that Quartet, michaelb?

No, Quartet intended to pay on net. Took them a while to actually come out and say so, but they did.

[LeaveMeBroken]

How are you going to pay 40% of cover from 3rd party distribution? Some of them only give publishers 30%-60% of the cover price. You'll rapidly go into the red paying out 40% cover regardless of what your 3rd Party net is. For instance, ARe--one of the more generous 3rd party distributors, pay 60% of cover price--pays out $3 on a $5 book. That means you author will get $2 per book, regardless. This leaves you $1 to cover operating costs. That's a pretty narrow margin. And that's on a generous 3rd party payout. If the payout is only a net of 30% from 3rd party, then you net $1.50 per book, and you're now running in the red $.50 per title. Granted, you could opt not to deal with the lowball etailers--which is what Shadowfire Press has done--but close margins can lead to disasters for small publishers. I remember a couple going under when their homes got hit by hurricanes and because they were operating on very narrow margins they went under because they couldn't get new computers to replace those lost in the disaster.

Hi Michael!

Ack. Well, thankfully our well-fortified places of business allow us to cross hurricanes and tornadoes and many other weather-related natural disasters off our list of Potential Reasons To Go Belly Up.

And you're absolutely right about the lowball e-tailors. We won't be dealing with them initially--at all, in some cases. The distributors we're using pay 60 - 70% of sales. That leaves us 20 - 30% after our authors are paid, which is plenty for our business model.

As I recently explained to an author, profit margins aren't our thing. We're authors, too. Just because we're savvy business people doesn't give us the right to gouge other authors. Our team gets paid, our authors get paid, our expenses get paid, and we're able to put a little away with each sale.

And as our publisher says, there's a vast amount of real estate between keeping the doors open and gold-plating them :-)

[LeaveMeBroken]

In your submission guidelines, you mention you're looking for upper YA. The YA market isn't the same as the regular fiction market. How are you getting the word out to the target audience--teens? Right now, teens aren't huge readers of ebooks. Sales are growing, but I suspect a large part of that is due to the crossover appeal of YA novels with adults.

Hey Tuuli,

Ah, yes. The YA market is my specialty. While teens came out in droves after this last holiday season (hooray for all the parents buying their kids ereaders!), your observations about the crossover audience are still correct. I'm being extremely picky with my YA acquisitions for this very reason. The novels we take on (which will be a small percentage of our overall catalog) must contain strong crossover elements and high concept appeal. If the market shifts in the future, bringing a flood of teen readers with it, we'll compensate accordingly.

Thanks for asking!

[LeaveMeBroken]

Thank you for welcoming Entangled Publishing to AW! I've really enjoyed answering your questions and participating in the discussion.

We wish you the best of luck in your writing careers!

Take care,

Heather Howland
Managing Editor, Entangled Publishing
http://www.entangledpublishing.com

[brainstorm77]

What third party vendor sites will you be selling on?

[literary_lola]

Hi Michael!

As I recently explained to an author, profit margins aren't our thing. We're authors, too. Just because we're savvy business people doesn't give us the right to gouge other authors.

You're new, so it's a lovely thought. But you'll find that those profit margins are what keep your doors open. That is a far cry from "gouging" authors.

[veinglory]

Something needs to pay for this extensive marketing, especially the referenced ads in major magazines?

[jennontheisland]

Hefty startup capital?

[michael_b]

Hefty startup capital?

But once that's gone, then what? Without a reasonable profit margin covering that outlay, you wind up running at a loss. Eventually there's going to be an end to what goes out if what's coming in doesn't at least equal expenditures.

[michael_b]

Hi Michael!

As I recently explained to an author, profit margins aren't our thing. We're authors, too. Just because we're savvy business people doesn't give us the right to gouge other authors. Our team gets paid, our authors get paid, our expenses get paid, and we're able to put a little away with each sale.

And as our publisher says, there's a vast amount of real estate between keeping the doors open and gold-plating them :-)

I seriously doubt the majority of epublishers are 'gold-plating' anything. Making some profit to cover expenses is important, but it's hardly 'gold-plate' to expect to be able to cover things like replacement of needed equipment on a reasonable basis.

As literary_lola mentioned, keeping your doors open, and 'gouging' aren't the same thing either.

If you can manage to stay in business with your business model without discovering you've created a financial black hole for yourselves that's great. But keep in mind a lot of start-up epublishers have the best of intentions, and very many of them have fallen by the wayside because they discovered the cold hard fact of epublishing: it's not as easy as it seems.

Good luck to you and keep us posted on how things are going for Entangled. I'm sure we're all pulling for you to make it.

[veinglory]

But once that's gone, then what? Without a reasonable profit margin covering that outlay, you wind up running at a loss. Eventually there's going to be an end to what goes out if what's coming in doesn't at least equal expenditures.

Which is where Quartet comes in, although at least they realized it before starting up.

[michael_b]

Which is where Quartet comes in, although at least they realized it before starting up.

But they'd still contracted books that were then--I believe--released (edited to add: released as in rights were returned to the authors, not as in books were published), which I'm sure still led to disappointment on the part of the authors.

[nkkingston]

Quartet never released anything, AFAIK, though they had contracted books.

Wasn't there another low-to-mid level epublisher that did the profit sharing thing with its editors? I remember a lot of skepticism in the thread about what kind of quality of editing would result. I don't know if they stuck with it or not in the end, since I think it might be a year or two back now.

[michael_b]

Quartet never released anything, AFAIK, though they had contracted books.

I meant released as in released rights back to the authors involved, not that they'd published anything.

[5bcarnies]

Entangled is not Quartet. I think we are getting a little off track. Every business is different. Each team member brings a new angle. Yes, we've seen pubs come and go, but I remain optimistic.

Heather, after reading this thread and the blog (thank you for the posting the link, btw) I have high hopes for Entangled. You have never strayed in your conviction and kept your answers straight-forward with a great enthusiatic approach. Others have come and been swayed by the blunt curiousity here. So kudos. I wish you all the best luck in the world. And perhaps one day hope we can work together.

[literary_lola]

Do you have a distribution partnership to pitch your physical books to the stores and national accounts?

[para]

Blog post from the marketing director - mentions more about where they see Entangled.
http://thewritersguidetoepublishing....tal-revolution

Interesting that they see themselves as visionaries (Early Adopters). Not sure I would class them as that.

[Larkin]

I'm not signed with this pub, but I know someone who is. I beta read her story, and loved it. I hope this pub does well. Time will tell and all that, but I have to say they 'look good'. The sample covers are eye catching, same with banners and the info/submission website. It will be interesting to see if their online bookstore is just as professional looking.

I know that doesn't mean they can sell books, but it's a start--and better than some of the other epubs I've looked at.

[Erin]

I'm not signed with this pub, but I know someone who is. I beta read her story, and loved it. I hope this pub does well. Time will tell and all that, but I have to say they 'look good'. The sample covers are eye catching, same with banners and the info/submission website. It will be interesting to see if their online bookstore is just as professional looking.

I know that doesn't mean they can sell books, but it's a start--and better than some of the other epubs I've looked at.

I like what I've seen so far, too. Known agents are also submitting & selling to them from the deals I've read on PM.

[Old Hack]

One of the core principles of Entangled is a dedication to authors, not profit margins.

If you don't pay attention to your profit margins you won't be able to pay your authors.

As I recently explained to an author, profit margins aren't our thing.

I find it astonishing that you've said this again. It's such a bad approach to business, and no matter how you arrange your furniture, publishing is a business.

But once that's gone, then what? Without a reasonable profit margin covering that outlay, you wind up running at a loss. Eventually there's going to be an end to what goes out if what's coming in doesn't at least equal expenditures.

I agree, michael_b. I'm very concerned by this; if I were considering submitting to Entangled this one point would be enough to make me run a mile.

I had no idea that self publishing was now referred to as "indie publishing". I had thought self publishing was self publishing, and indie publishing was publishing was publishing with an independent (as opposed to conglomerate) publisher. I guess I'm still living in the last century ;-)

You're right. Some self publishers are now referring to themselves as indie publishers or indie writers: but they're just confusing the issue. Victoria Strauss has blogged about this very nicely at Writer Beware.

[agentpaper]

I don't have a horse in this race, but I've noticed (like Erin) some very reputable agents are selling to this house. I wonder what they know, that we don't.

[Barbara R.]

What does "indie publishing" mean, exactly? I've heard it used to describe small publishing houses, outside of the 7 or so huge conglomerates, that follow the traditional model of paying advances and royalties while bearing all the expense of publishing. But other people seem to use the phrase to describe vanity publishers.

I'm confused.