Show Me The Money

Hedgetrimmer

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I don't know if you guys ever follow any of the book deals being announced in the industry magazines, notably Publishers Weekly and Publishers Marketplace, but the deals are always mentioned in elusive, almost secretive language. Even agents themselves use the terminology on their websites. I suppose revealing exact dollar amounts is akin to disclosing one's salary. Anyway, having done a little research, I came across a breakdown of the cryptic language. Of course none of us even thinks about the money. Simply putting the words to paper and sharing with a wider audience is reward enough. Right? Right? Still, I thought you might be interested in knowing what it all means.

[FONT=&quot]Nice Deal" means under $50K; "Very Nice Deal" means $50K to $100K; "Good Deal" means $100K to $250K; "Significant Deal" means $250K to $500K; and last but by definition not least "Major Deal" means $500K and up.


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Smish

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I went searching for that awhile ago, too. I found the answer on Miss Snark's blog and added it to my "favorites" for easy access in the future. :)

I wish they'd break it down further, though. Lots of "nice deals" are listed, but there's a huge difference between a $5,000 advance and a $50,000 advance. (There's a huge difference in the other categories, too, but I don't expect to ever get an advance higher than $50,000!).

:)Smish
 

Hedgetrimmer

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I used to fantasize about receiving a large advance for a book, but I've lately begun to change my thinking. This is especially so as it pertains to a debut work. If a book doesn't earn out its advance, getting another book published, I've heard, is often pretty hard. Sometimes it even leads to an author having to shop the book to an entirely different publisher.

With that in mind, I'm wondering if a smaller advance might be a better way to go. Doing so not only keeps the author in the publisher's graces, but it also allows the book to stay in print longer while the author finds his audience.
 

MsJudy

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At the SCBWI Golden Gate conference last year (Northern Calif), the panelists had a little debate about this. The editors all agreed with Hedge--small advances are easier to earn out. Stephen Barbara the agent disagreed (diplomatically, of course). His point was that when a publisher gives a larger advance, they have a bigger investment in making that book a success, so they give it more support in terms of marketing.

Of course, I'd just be happy finishing the d*** book and landing an agent. Way too early to worry about the money.
 

Viking Horse

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At the SCBWI Golden Gate conference last year (Northern Calif), the panelists had a little debate about this. The editors all agreed with Hedge--small advances are easier to earn out. Stephen Barbara the agent disagreed (diplomatically, of course). His point was that when a publisher gives a larger advance, they have a bigger investment in making that book a success, so they give it more support in terms of marketing.

I suppose I can see the sense of that - I'd probably pay more attention to a project if I had more riding on it, too.

Of course, I'd just be happy finishing the d*** book and landing an agent. Way too early to worry about the money.

I'm in the same boat. Once I've actually finished something that lands me an agent, then I'll start building up my hopes to impossible levels. :D
 

kellion92

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I have no sense of what an advance should be at all, and this doesn't help. I would consider any deal pretty nice right now.
 

Hedgetrimmer

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At the SCBWI Golden Gate conference last year (Northern Calif), the panelists had a little debate about this. The editors all agreed with Hedge--small advances are easier to earn out. Stephen Barbara the agent disagreed (diplomatically, of course). His point was that when a publisher gives a larger advance, they have a bigger investment in making that book a success, so they give it more support in terms of marketing.

I've heard this before too, and in theory it does make sense. Yet at the same time, it doesn't guarantee the book will earn back the initial investment no matter how much marketing it receives. Still, it doesn't surprise me that an agent would champion a larger advance. That's more upfront money in his pocket even if the advance doesn't earn out. But it's ultimately the writer who suffers, not the agent. An agent with a stable of 20 clients (and a hell of a lot more clamoring at his door) has several other ways of bringing in money. Now, that's not to say agents simply take the advance and run without any care for how the book performs. Of course they want to see the book do well. But remember, a book that doesn't do well reflects on the author not the agent. The agent's job is to sell the book to a publisher. The author's job is to sell the book to an audience. And often that takes time. In this era of immediate gratification, I think it's smarter for new writers to fulfill smaller promises rather than risk a publisher growing impatient and discouraged by a lack of quick returns.
 

kellion92

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In this era of immediate gratification, I think it's smarter for new writers to fulfill smaller promises rather than risk a publisher growing impatient and discouraged by a lack of quick returns.

HT, that definitely makes sense. Should I get multiple offers (I barely dare even write that), I would definitely evaluate each based on the editor's and publisher's commitment to my novel and career, and the advance would be one factor in that big picture. But should I get one offer (and I barely dare write that either), I'm not about to negotiate downward on the advance. These questions are rather hypothetical.
 

Hedgetrimmer

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But should I get one offer (and I barely dare write that either), I'm not about to negotiate downward on the advance.

I hear that. Also, I wonder if large advances place too much stress on writers and cause them to turn in a manuscript that isn't their best work. For example, say Author gets a big advance on a two-book deal with a deadline of turning in the second book two years after the first one is released. The first book isn't doing as well as expected, and so in an effort to get the second book out as soon as possible and start earning his keep, Author ends up rushing and delivering a book that potentially could've been better had he taken more time with it. But like you said, it's all hypothetical. Right now we're simply trying to create the best work we can and hopefully have someone believe in what we're doing.
 

Smish

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I hear that. Also, I wonder if large advances place too much stress on writers and cause them to turn in a manuscript that isn't their best work. For example, say Author gets a big advance on a two-book deal with a deadline of turning in the second book two years after the first one is released. The first book isn't doing as well as expected, and so in an effort to get the second book out as soon as possible and start earning his keep, Author ends up rushing and delivering a book that potentially could've been better had he taken more time with it. But like you said, it's all hypothetical. Right now we're simply trying to create the best work we can and hopefully have someone believe in what we're doing.

Ah, but if the advance is large enough to allow me to quit my day job, most of the stress in my life will disappear. :D
 

MJWare

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I can't imagine working for a year on a novel, then selling it for 5K. I guess that's better than just sitting on a shelf. Plus, it's a first step to building a career.

I agree though, that the publisher doesn't have much to loose with such a small advance. I'd want to know what kind of $$$ they are going to commit to marketing for a deal that small.

Of course, they could waste the marketing money. In my line of work I sometimes go to events where scholastic gives free kids/YA books away to celebrities.

Total waste of $$$ (the fee to give the books out is in the 10-30K range).
 
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Hedgetrimmer

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I can't imagine working for a year on a novel, then selling it for 5K.

You wouldn't be selling the book for $5000. We're only talking about the advance. And a large advance isn't always the most profitable deal for the writer. Let's say you're offered $20,000 as an advance with a 12% royalty but no escalation on the royalties. So, your book comes out and you see no additional money until you've earned back the $20,000. From that point on, for the life of the book, your royalties are set at 12%. However, another option is take a smaller advance, let's say $10,000, with escalating royalties starting at 12% and capping at 15%. After you've earned back the advance, your royalties kick in for X number of books sold at 12%, Y number of books sold and it increases to 13%, Z number of books sold and it moves up to 14%, ZZ numbers sold and you receive royalties of 15% for the life of the book. The latter option may actually benefit the writer more over the long run, especially if it's a book that's far less trendy and has the chance of backlisting well for many, many years.
 
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MJWare

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Sorry, I should have said 5K advance. Honestly, that's peanuts to publishing houses, I'd doubt their commitment at that level.

How can they spend 20k to go to a celebrity events, but only give authors 5k advances??
 

MJWare

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The problem is I've read lots of great books, that don't seem to break-in to the mainstream. While the author does hold the lion's share of the responsibility for a books success (even after publishing). The publisher does have put forth some effort ($$$$) to get it out there into the pubic eye.

I've seen some great books where this just doesn't seem to be happening.

If your book doesn't make more than your 5K advance, then maybe you should have spent more than a year on it...
 

Smish

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Sorry, I should have said 5K advance. Honestly, that's peanuts to publishing houses, I'd doubt their commitment at that level.

How can they spend 20k to go to a celebrity events, but only give authors 5k advances??

The norm for a debut children's author's advance is under $10,000. That's the reality.

It costs the publisher a lot of money to produce and market a novel. And the reality is, the percentage of books that never earn out their advances is very high. Not only is that bad for the publisher, it's bad for the author. Sure, the author got a huge advance, but if your novel doesn't earn out, it may kill your chances of having a second book published.

And if you receive a small advance and your book is successful, you'll earn royalties. You can still make a lot of money on the novel, even if your advance is low.

Low advances are safer for the publisher AND the author.

Would a huge advance be wonderful? Sure. I'd love to be able to write full time. But honestly, for my first novel, I think I'd prefer a smaller advance. I want a career in writing.

John Green has a great blog entry about this, by the way:

http://www.sparksflyup.com/2009/06/really-long-boring-post-about-book.php
 

Hedgetrimmer

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With the economy being the way it is, agents are reporting much smaller advances being offered even for established writers. And that might not be such a bad thing. In a way, it may even level the playing field. Without a huge marketing campaign behind certain select books (which we all know are not always the best books), the responsibility falls on the author to "out-write" the competition and get out there and promote his work. I see this as a more equitable way of letting the reading public decide what deserves attention.
 

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I'm not talking about big advances here.

I just believe that 10k is a reasonable starting point for a first time author. I do see your point, the economy is bad.
You might feel differently if you've seen the way (some of) these companies throw away cash.

The author should be treated as an asset.

We'll just have to agree to disagree (very respectfully).
 

Smish

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I'm not talking about big advances here.

I just believe that 10k is a reasonable starting point for a first time author. I do see your point, the economy is bad.
You might feel differently if you've seen the way (some of) these companies throw away cash.

The author should be treated as an asset.

We'll just have to agree to disagree (very respectfully).

I'm happy to agree to disagree. I'm just not sure what the disagreement is.

No one said writers shouldn't be treated as assets.

We're talking about earning out advances and receiving royalties. A high advance isn't always the best thing for the author. If you want to write one book and only one book, then a huge advance is fabulous, even if you don't earn out (because you don't need to worry about selling a second book). If you want a career in writing, a smaller advance may be better.
 

Pepper

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Wha? YA authors typically get advances under $10k?? For a work that likely took a year of hard work? Am I the only one mortified by this?

I mean, I'm all for sacrificing some of my advance to guarantee pay-out and future publication, but COME ON.

:e2thud:
 

kellion92

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In general, people who make things (writers, factory workers) don't make the lion's share of the money. The people who finance things make the money.