If you listen closely to the business sages that infest the waters of Shark Tank, ABC’s popular show where millionaires vie for the chance to invest in entrepreneurs, you’ll learn a few things that could directly apply to the self-publishing journey.
For instance, watch the show long enough and you’ll notice that Kevin O’Leary, affectionately known as Mr. Wonderful, consistently offers royalty share deals to those pitching their ideas. I’ve seen most of the episodes of Shark Tank since it began airing in 2009, and I’ve rarely seen an entrepreneur bite at O’Leary’s shark bait.
Why is that?
Because it’s not tempting.
It gives too much away on the backend of the deal for an indefinite, even infinite, amount of time. Often, the other Sharks offer better deals that leave royalties out of the picture altogether. A typical Shark Tank deal offers the entrepreneur money in exchange for a percentage of their company, somewhere in the realm of 10% to 40%, depending on a number of factors. O’Leary often seeks part of the company plus a royalty-share deal that would net him anywhere between $0.10 to $2 per product sold.
Now let’s translate this to the self-publishing world.
By forgoing the traditional publishing route, you’re essentially saying no to Mr. Wonderful’s not-so-wonderful offer. While traditional publishing has much to offer, it will also require much of you, especially if your book becomes successful. While you can keep up to 70% of your royalties by self-publishing through Amazon, a traditional publisher will likely only give you 12% to 35% of your royalties.[ref]From J.A. Konrath: ” … authors are only making 25%, which translates to 12.5% royalties of the Digital List Price you [traditional publishers] set. Why do you think authors are going to continue accepting 12.5% when they can get 70% by self-pubbing, and also outsell you in units? Your average book price was $7.00, which means $0.88 goes to the author. The average self pubbed book price is $3.25, which means $2.28 goes to the author. Authors make almost three times as much when they self-publish.” — Me, Hugh Howey, and Legacy John on AuthorEarnings.com[/ref]
And, unless your agent manages to amend your contract, your publisher will own your book forever. [ref]Or, the life of the author + 70 years, which might as well be FOR-EV-ER.[/ref]
Regardless of which publishing route you choose, you will have to give up some equity in your company, i.e. you. So, why not give up as little as possible while also reaping the benefits of a publishing partner that can still distribute your books far and wide?
On the other hand, some Shark Tank entrepreneurs do choose Mr. Wonderful. There’s no doubt that he has business connections that many of those entrepreneurs could never make on their own. It’s the same with traditional publishing. If you want to see your book in bookstores, traditional publishing is the way to go.[ref]But when’s the last time you went to a bookstore?[/ref] If you want more marketing placed behind your book, or to enjoy the imprimatur of literary respect because your book’s been accepted by a publisher, maybe you should accept Mr. Wonderful’s deal.
Just know that you might be taking the bait.
What do you think?
Disclosure: I have never been traditionally published, but I’ve considered it, and still think it a viable choice depending on the project and your intended audience. However, the freedom to choose your path when self-publishing is rewarding, although such freedom can also be a self-publisher’s downfall … but that’s fodder for a future post.