Reformed misogyny peddler Tucker Max has today shared his solution to a problem many writers face: losing royalties on published work. In Huffington Post's blog, Max calls publishing companies "terribly exploitative of authors (paying them a very small royalty on sales)" that are inefficient to boot: They don't "even do a good job maximizing overall revenue from book sales. Publishing companies are like schoolyard bullies that can't even fight well."
For the release of "Hilarity Ensues," Max's third book to land on the New York Times bestseller list, the writer decided to leverage publishing companies only for their distribution power. For all other services, including editing, cover design, layout, printing and marketing, Max hired freelancers. Although a major publisher turned him away at first, Simon and Schuster agreed to the terms and Max reportedly tripled his revenue:
This means I went from just another author with the same royalty deal every author gets -- 15 percent of hardcover price -- to owning my own publishing company and taking 89 percent of net receipts. In practice, the amount of money I made on each hardcover book sold went from about $3.60 to about $12 (before distribution costs). Nothing else really changed.
Max's solution sounds great in theory (and for him, in practice), but the main problem with it that it would work for only 250 other authors--and basically nobody else:
Please be clear: Unless you have a long track record of sales success genre such that you can be reasonably sure of future success, this sort of deal doesn't make sense. You have to pay distribution costs upfront, so unless you know what your sales are going to be, you could lose a lot of money. Realistically, there might only be 250 authors currently publishing in America for whom having their own publishing company with a Big 6 distribution deal makes financial sense, and definitely not more than 500.
So if you're not already famous, hanging out in the "self-publishing ghetto" is "probably the best bet."