Story Grid Publishing

[00:00:00] TG: Hello and welcome to the Story Grid Podcast. This is a show dedicated to helping you become a better writer. I’m your host, Tim Grahl, and I am a struggling writer trying to figure out how to tell a story that works. Joining me shortly is Shawn Coyne. He is the creator of Story Grid, the author of the book Story Grid, and an editor with over 25 years’ experience.

In this episode, Shawn and I continue talking about the state of publishing, the different options inside of publishing, and what it would look like if we created a publishing house that we felt like fixed all the problems that you find in the different versions of publishing right now. And so we continue that conversation. I think you’ll really enjoy the episode.

So let’s jump in and get started.


[00:00:45] TG: So, Shawn, last week we started walking through kind of our discussion about what we’re going to do when it came to publishing The Threshing, and it really became this bigger conversation about the options we have in publishing and it basically, for the most part, it comes down to traditional publishing and self-publishing, which both have a lot of pros and cons. And so this week I was just thinking we could start with a kind of my magic want thing. If we could wave a magic wand and create the perfect publishing situation, what would that look like?

And so let’s just start there. Like you’ve been in publishing a long time. If I asked you like, okay, wave your magic wand and create the perfect publishing situation or publishing house or whatever, what would be kind of the tenants of that thing? What would be, you know, the most important things that you think you would do to make it kind of beat all the cons of the current models?

[00:01:58] SC: Well, the first thing I would do is I would really make a very strong distinction between results driven work and process driven work. So what I mean by that is that traditional publishing and self-publishing, both, they’re results driven, right? And what I mean by that is that they are looking for success. So they define success a number of ways. The first way is, is it a best seller? If it’s a bestseller then they call that title a success and a best seller, we usually think that layman person who’s not in book publishing thinks, “Oh, all bestsellers are profitable,” which isn’t necessarily true.

But so the second sort of results driven would be, “Is it profitable?” And so, you know, you kind of have — those are the two main goals at the end of the process. Let’s make sure that our title becomes a best seller and is profitable. No, bestseller, because there were so many different definitions of bestseller, it’s possible to write a book that’s a very niche product and still have it be a bestseller on Amazon because Amazon they, brilliantly, they keep on adding on new bestseller lists, right? So it encourages people to publish because, you know, they can game the system in such a way that to become the number one book of knitting with cat hair, you know, that kind of thing, right? So the second thing is profitability. So everybody wants to make sure that the title earns back money and drives revenue.

So those are the two main focuses of traditional publishing and self-publishing, even though there are all kinds of people in those institutions who don’t really care so much about that. The corporations and the self-published person really do care about profitability. So that’s a results-driven process. So the process always, you know, is the slave to the result. So what that necessarily means is that a lot of energy, the majority of energy is given to marketing and publishing in such a way that it proves to be profitable. And I’m not saying there’s anything wrong with marketing or profit. So I want to get that right up out front.

So I don’t think there’s anything wrong with marketing or profit. However, I do think that people are missing the forest for the trees here in the the ideal publishing house, in my estimation, would think of the process; the process of helping writers create the best possible story, according to a specific category of story. So it’s more like betting on probability. So the idea that I would have for the magical publishing house is that it would dedicate itself to helping writers find specific genres that have specific markets that are being served by master works in contemporary contender fiction that satisfies those audiences and to help those writers write books in the same vein of those masterworks and contenders.

So basically what you want to do is create the best work possible. So if the publisher focuses on creating the best stories that they possibly can, then the probability of the audience who loves those kinds of stories embracing that story is higher than if it’s just kind of a mediocre story. So it’s sort of a scientific way of looking at concentrating on telling better stories. So that would be the first thing. So when in doubt, this publisher would say, “Hey, is the book good enough yet to publish? Have we tried everything possible to make the book as best as it possibly can be? Have we reached a place of diminishing returns? Can we, with a straight face, say that this book is in the tradition of The Lord of the Rings or, say, Pride and Prejudice or Silence of the Lambs or etcetera, etcetera?” So that the marketing takes a back seat to the actual construction of the story.

So what this means is that the editors of this publishing house would be extremely powerful and that they would really dedicate themselves to helping writers tell the best story that they possibly can, and they would help guide them through all of the different and difficult moments of story craft. So for me, if you were to establish a brand new publisher, they would focus primarily on process. So how can we make this book better? And of course I’m saying this because that’s what the Story Grid methodology is about. It’s about making stories work and once they work, make them even better so that they can be compared to, with a straight face, with the best titles in that particular genre.

So for me as a publisher, that would be my ideal situation where the first question on everybody’s, you know, mouth “How’s that story coming? A walk? Did you solve the third act? How’s the middle build?” Right? So all the energies of this publishing company would be about helping the writer achieve the potential of the story in the highest possible way, Of course, within reason. So once once the book has reached its working ability then, you know, everybody would say, “Hey, we think it’s ready. So let’s put it out in the marketplace and let the marketplace decide.”

So instead of it being, “Well, let’s see if we can, you know, scare up another 30 people to buy this book on Tuesday so that we can make a bestseller list.” Instead, it’s like, “Let’s really trust the process. Let’s really trust that our books are a little bit better than everybody else’s, if not a lot.” Because then you trust the readers. You trust the hard core readers of a specific genre, because guess what they’ll do? They’ll find a book. They will find a book that’s really good, because these hard core readers are scouring the, you know, Amazon to find things that might appeal to them. So that would be number one for me.

[00:10:05] TG: Okay, yeah, it’s interesting, because the example I always think of on that is I remember I think it was Adrian. Who’s the guy that runs Portfolio?

[00:10:16] SC: Adrian Zackheim.

[00:10:06] TG: Yeah, he wrote this blog post, this is years ago now probably 7, 8 years ago, about how, when self-publishing was really starting to pick up steam how — why we need publishers is because basically they’re, you know, holding the beacon of light for literature, right. So they’re the ones that are helping find the best books and put them out into the world and self-publishing is just kind of this cess pool and then somewhere, not too long later, I can’t remember the timeline exactly. But I’ve read about how one of the publishing houses had made this really huge deal with Kim Kardashian to publish a book of her selfies. And I was like, “Wow, it’s really great that the publishing houses are around to keep the beacon of literature going.”

Obviously, it wasn’t Portfolio that published that book, but the point here is exactly what you’re saying, which is, it wasn’t process that was driving the selling of a book of selfies from Kim Kardashian. It was results. It was profit. And so yeah. And then, of course, working in the publishing industry from kind of my outsider point of view is that those times were like, you see the authors that some they come out with three books and their third one seems really phoned in, and you realize like, “Oh, they had a three book deal,” you know? Those kind of things happening.

So I mean, you mentioned in there though, that the editors would have a lot of power. And so I know since you were, you’d played that role for so long as an editor and traditional publishing, how would you change the way that editors were involved in the publishing house?

[00:12:08] SC: Okay, well, this is kind of revolutionary. So I’ll just blurt it all out. Okay, I think — Who said it? Balzac, like every family fortune, begins with a crime. I think that if someone were that sort of pinpoint the place where the value proposition for a particular player and book publishing is absolutely wrong, it would be the editor at a publishing house. And the reason why I say that is that the publishing companies really need editors because — and not just for helping the stories get better once they’re acquired. But actually acquiring the stories in the first place.

And the way editors air trained is the publishers want to find editors who are deeply immersed in specific categories of books, and they read constantly within those categories. So it’s sort of that old experiment I always talk about where the more you’re exposed to a particular phenomena, the better you become it at picking out patterns within that phenomenon. So if a Martian lands and watches 15,000 baseball games, that Martian is eventually going to put together the rules and kind of understand what’s going on in baseball.

So editors are trained because they’re just in love with specific kinds of titles. So they read, read, read, read, read and they’re able to start to intuitively pick out patterns of the stories that are the best. And so once they start reading, you know, potential books to acquire for publication, they start to get good at finding those titles that are the most similar to those patterns that all of the best books in that particular category of stories share. So they become sort of like these, you know, like that story you tell about the people who — the chicken, sexer’s or whatever?

[00:14:20] TG: Yeah, I forgot what — Yeah, where they figure out if the little chicks are male or female.

[00:14:25] SC: Exactly. So this intuitive process is part of being a human being. Anyway, so publishers, they build up these editors and they start picking these titles that start to work. Now the way it works, generally, and now this is a broad generalization. But I did learn this from a very pivotal publishing figure in the past. The way he always evaluated, he was a CEO, and the way he evaluated editors was that they needed to have a really good batting average for the titles that they brought in and their profitability.

So what that meant is they would have to bring in 10 times as much revenue as what they cost the publishing company. So, for example, if you’re an editor and all of your benefits and salary add up to about $100,000 you would have to contribute about a $1,000,000 of revenue to the bottom line, or you started to be kind of a liability. So editors are trained to be concerned about how much revenue they’re bringing into the company, and those who aren’t concerned with it don’t usually last all that long because they haven’t really figured out the bottom line of what they’re supposed to do.

So, anyway, if you look at that, you get a 10 to 1 contribution of value over expense and I always thought, because I was an editor, that this was an outrageous percentage. So what I always thought is that the ideal publishing house would be really up front about the importance of the editor. Because, as I think we’ve shown over the last five years of doing the podcast, a good editor provides, you know, a tremendous amount of value to the writer. So the writer is sort of stumbling around, and a really good editor can help them fix their story to the point where, you know, the audience for that particular genre would enjoy it. So they take a book that is worthless and they work with the writer, and together they add the value necessary to make it valuable.

So not only is the editor serving the corporation, they’re serving the writer, too. Now, in my career, I would do that over and over again, and I would get, you know, a thank you note or maybe a bottle of wine from the writer after their book was a best seller, and I helped them make it a best seller or I get nothing. Same thing with the publisher. They would say, “Hey, good job. You get to keep your job for another year, Shawn.” That was sort of my pat on the back. You can see my resentment and anger sort of starting to —

[00:17:16] TG: Yeah. Yeah, a little bit.

[00:17:118] SC: All right, so I thought to myself, “Well, what would be fair? What is fair for an editor?” If the editor is so powerful that they’re the ones that are choosing the books that are actually being published and the really good editors actually helped those books become even better then what they were when they acquired them, shouldn’t they A) get some credit and B) shouldn’t they get some share in the success of that title? And I think that is fair.

So the ideal publishing house, in my estimation, would give the editor cover credit and it would give them a percentage of the success of the book. And I think 10% of the net revenue would be reasonable and I’m sure a lot of publishers, if they’re hearing me say that, are ready to, you know, jump through the speaker and strangle me. But I truly think that if you encourage editors and you give them pride of work and you give them a piece of the action, you give them some skin in the game, they’re gonna invest themselves even more. Because, you know, one of the things about employees, and this is why I think it’s kind of a broken system is that the way we’re kind of trained as employees is to do the minimum viable amount of work for the maximum amount of pay.

So what that means is that if you’re working 40 hours a week and you can get away with playing Tetris for 23 of those hours and then bang out the other work in 17 hours, that’s what you do. Because you don’t really have skin in the game, meaning you’re not investing your value and seeing a return on that investment. It’s like you get paid the same no matter what. If you do a terrible job, you’ll eventually get fired. But why would you add additional value into your project if you never got any upside from that, other than you know, some meaningless title or a bottle of wine? You wouldn’t. Or you would get frustrated and quit and try and start your own thing.

But my point is that the publishing house, if you’re going to put the quality of the work and the desire to level up the quality of the work from book to book for each author, then by necessity you need to acknowledge the person who is actually in charge of that process. And that’s the editor. So in this publishing house, the editor would get cover credit and the editor would get a share of the profits. So now the added value of having the editor get cover credit is, can’t you foresee in the future of book publishing, when when an editor like, If I were to say to you, “Hey, I know the editor who edited The Silence of the Lambs, Red Dragon, all of these great serial killer thrillers,” and you love serial killer thrillers and I say, “This is the new book that this editor edited, and it’s a serial killer thriller.” Do you think you’d buy it? I think you would, right? Because then the editor can get brand name value, and that helps the publishing house.

So if you can have an editor be a star, then the writers that that editor, you know, works with they can get some extra value by being edited by that editor. Now there are plenty of writers who would say, right now, “Oh, the value that my editor gives me is extraordinary, but they’re just not getting credit for it.” So if you had superstar editors like superstar writers, those editors can actually help the publishing process, and they could get royalties for the successes that they’ve had.

So, you know, my ideal situation is that the publishing company would not “employ” editors. Instead, the editor would be a private LLC, Shawn Coyne LLC, and that editor would sort of work as a consultant with the publisher for a contract, and the contract would be I get cover credit and 10% of the net revenue. That’s perfectly and well defined. So then I would put skin in the game because you would not be paying me a salary. You would be giving me a piece of profit in the future. So if I am over the moon about a book and I come to the publisher and say, “Hey, let’s sign that contract. This book is great,” and the publisher appreciates what that editor brings, then it becomes a really nice partnership, as opposed to employer-employee, which doesn’t really work so well.

So that would be the second thing in my magic wand publishing house. The process would be number one, and the person in control of the process would be number two and they would be given a lot of power, they would be given credit, and they would be given share of the revenue.

[00:23:02] TG: Okay, so I want to go back to this process thing, this process versus results. Because if I go all the way back to before the podcast started and I picked up my copy of Story Grid, you know, we didn’t know each other and I read it, and the thing that really stood out to me was this idea that there was a process to writing a story that was better and there was a way of looking at a story to tell, you know, where it was broken and where it needed fixing, right? That’s basically what story grid is.

And so what I love about this is you can use story grid and all the different lenses it brings to the table to look at a story and tell whether or not it works and if it doesn’t work, where it needs to be fixed. Or if it does work, where it still could be made better. And so we’ve talked a lot about just you and I talking and also on the podcast about this idea of a meritocracy when it comes to work of, like, the work shouldn’t be judged based on who you know, where you’ve worked before, who your agent is.

[00:24:11] SC: What school you went to.

[00:24:13] TG: Yeah. Yeah, any of that. Like the work should be judged on the work. So whether you have bestsellers in your background or this is your first novel, every book has to meet the same criteria. And so when you talk about the process, of course, you know, learning story grid, all of that makes you a better writer. But it’s a really kind of pretty idea of like, “Oh, you know, we can base it on the work.” But how would you actually do that in a publishing scenario? Like, how would you pick books in a magic wand scenario of of a publishing house?

[00:24:48] SC: Okay okay. Yes, one of the most frustrating things that people have with publishers today, and I’m talking about traditional publishing, is they never, ever tell you how they choose the titles. And the reason why they don’t tell you is because they’re relying upon really good pickers of, I don’t want to belittle it, but they’re relying on trained chicken sexers, right? They’re relying on people who —

[00:25:21] TG: Good job not belittling it.

[00:25:22] SC: Yeah, yeah. But they’re relying on people who have a very, very good trained system of intuitive pattern recognition. So they’re implicitly good at picking out probably, I’d say the average batting average for a traditional publisher is somewhere around — they hit probably about 270, meaning 27% of the titles that they publish our profitable. Now that means they’re wrong 63% of the time. But the 27%, the ones that they do pick, some of those titles become extraordinarily profitable. So it makes up for all the bad choices, right? And traditionally, only 40% of titles in all of the publishers releases actually break even.

So what they’re in the business of doing is finding hits. So they want to find hits no matter what. That’s why a publisher wanted to publish Kim Kardashian’s selfies because she has a built in audience, right? She has six million followers or however many followers and they were doing a algorithmic equation and saying, “If she has six million people who pay attention to her, maybe 0.05% of those will by herself e book for $45, which will equate to,” I’m just making up the number, “50,000 units at $45.” And there you have it. Now you have a business. So you can figure out, you know, what that value of that selfie book would be generically and probably pretty accurately.

Now that is the algorithmic way of choosing titles. But they don’t want to tell you about the algorithmic way of choosing titles, because if everybody knows the formula, then it reduces their ability to, you know, exploit it. So that’s one reason they don’t tell you why they publish Kim Kardashian because they don’t want other people to know their formula. And B) it doesn’t sound all that great that a publisher, the reason why they’re publishing a book is just for profit. So that’s one of the things I don’t like about publishing is just a complete hypocrisy of it, is that they say one thing and do another.

Now I really like Adrian Zackheim. I think he’s a terrific publisher and probably most of the publishers he stands by his “I shine a light into the great dark corners of the world and find the best books.” But I don’t think that’s true of the global corporation that he works for. It just doesn’t make any sense for that.

All right, so how is it that we would be able to make books better? What is the methodology? So story grid methodology is nothing if not specific. So we have all kinds of tools that we use to make books better. So the way we would define quality and meritocracy would be based upon how well the title the work was living up to the standards of the story grid methodology is its beginning hook working? Does the middle build progressively complicate? Does it pay off in a surprising, inevitable way? Now we have all kinds of tools that story grid to evaluate that quality, and our editors know those tools, right? So they actually take people through the process, the exact process that I took you through from a guy who had never written a novel to one whose novels about to be published.

So, you know, we’ve got sort of the proof in the methodology. So our reason why for publishing a title will be easy to establish because all we’ll have to do is show the story grid spreadsheets showed the story grid foolscap pages and be able to share that with people interested in story grid titles. So if anybody ever asked a question, “Well, how does Story Grid published their books?” We would be like, “Oh, here’s the book on why we chose to publish this and you can go look at the spreadsheet of this actual work of fiction on our website. So you can see how we determine that this book works.”

Now, are we going to be infallible? No, but I think what we will do is we’ll increase the probability of telling a better story applying the methodology. And the other great thing is that the longer we apply the methodology and the more times we do it, the better and the more honed we can make the methodology. So this happens all the time. Like at Story Grid Live, every presentation by a Story Grid certified editor I learned something new that tweaked the methodology in such a way that made my original sort of global blob of methodology tighter and more tightly focused.

So, you know, for me, a publisher’s process is its raison d’être. It’s what it’s all about. So when publishers say things like, “We publish books that we like.” Well, that’s kind of interesting, but how do I know that you’re gonna like this? Well, that’s up to me, isn’t it? So it sort of gives people this “I now deem you worthy” kind of power that I don’t think is good for people. And I don’t think it’s good for the publisher either because, I don’t want to get into the morality of it, but I think if you have a publisher that has a methodology, has a very specific reason why it’s publishing what its publishing then that would be good. I think that would be a good thing for people who are confused, people who don’t understand why Random House publishes what it does. Well, they could go to a Story Grid publishing company and if they had that question, there would be thousands and thousands of examples of why and how it does it.

So I like that because the process then becomes the whole thing. The process, the editorial process, the process by which we take work stories and work with the writer to make them better until they reach a place where they’re publishable. And once they’re publishable, we publish them, even if you don’t have a good author photo, even if you live in Saskatchewan and our 3,000 miles away from a bookstore. If this story works and if the story abides the story good methodology than the publishing company, the Story Grid publishing company will publish the book. Never say, I mean, we certainly wouldn’t want to publish things that were strict pornography or, I mean, there are some limitations that if I were running the house and I will be that we would have like if you could hurt somebody by publishing this book or, you know, just standard moral ideas.

But anyway, the process has to be clearly defined by the publisher, and the process is emblematic of the work that the editors do. So you’ll see what’s happening here is that this sort of ideal publishing house would have one global value that would be reflected in each stage of the process. So the value that the work is the most important Okay, cool. Well, that would be emblematic of the editor, because the editor would be working to make the work the best it could possibly be. And then the second level would be the methodology that that the editor is using and that methodology is dedicated to making stories work. It’s not dedicated to making stories sell. It’s dedicated to making stories work.

So we can’t guarantee the results, nor can any publisher that by going through the Story Grid methodology, the book will become a bestseller. How could we guarantee that? All we can guarantee is that we will put our best foot forward to make the story work, and if the story works to take it up a notch to make it a little bit better. That’s what I mean when I talk about process as opposed to results.

[00:34:31] TG: Yeah, and just as somebody again, who’s been more on the outside of things, and you dealt with a lot of authors that are trying to figure out how to get their book published, like the amount of just obscurity and opaqueness to the process is maddening. You know, like the fact that people are still asking, “How do I get an agent? Or how do I pitch a book? Or how do I How do I know if I can get a publisher to pick up my book?” And it’s this constant, opaque process.

To me, even if — one is I like the fact that we’re betting as we’re doing this with Story Grid Publishing, we’re betting on ourselves, right? So we’re betting that A) Story Grid makes stories better and B) better stories sell better over time. So if we’re wrong, that’s fine. But at least we’re like, you know, upfront about what we’re trying to do. And the other thing is just like even if we’re wrong, at least it’s clear. You know, at least it’s like, “This is how we do things so we don’t care who you are or how you’re coming about it. But, you know, this is how we do things. It’s very open, and there’s no kind of like magical, fairy dust that you can sprinkle on anything to get through the system.”

And so as we talked about this, this was one of my favorite points was like just being up front with how things go. Because so much of it is opaque and it’s opaque for some of the reasons you talked about. I think it’s opaque because there’s just so much fear driven in it too. Like I have a good friend of mine, she had this book and met with publishers, met with editors at a well-known business book publishing house, perfect publishing house for her book, and they told her they loved the book idea, they love what she had written so far, but her platform wasn’t big enough. So they didn’t publish it because she couldn’t do the marketing for it.

And, you know, it’s that kind of stuff that it’s like that’s a weird — one is she couldn’t tell you exactly why the people liked her book in the first place and then, you know, going into it with like, “Oh, so this has nothing to do with my book and whether it’s good or not, it has everything to do with all of this other stuff that has nothing to do with writing.” And so, yeah, I love the idea of just having a very public, straightforward way of choosing the titles, to me is a must for anything that’s going to try to be different in this space.

[00:37:08] SC: Yeah. It’s, again, it’s explaining why you’re doing something. And the other thing to remember is that this is an experiment, right? Like this new kind of way of trying the publishing is an experiment. So to believe that you’re going to revolutionize an industry that’s been around for 500 years is kind of, its hubris, right? It makes you look ridiculous. What I think is interesting about trying this is that in the olden days, and it’s only like, let’s see, it’s probably — I started Rugged Land Publishing and 1999. No, 2000 and the barriers to entry to start a book publishing company back then were seven figures. You know, you needed that kind of capital just to get started.

So in order to start an experimental publishing house today, those barriers to entry are not that high. So do not put yourself in a place where, “Oh well, if this doesn’t work in the first three months, we’re sunk. But to think of it as a long term project. Like, “What would it be like if there were a publishing house that had 100 titles that explained exactly why they became published in the first place and then of those 100, you know, a couple of them became pretty popular.” That would be a big win, right? As long as there was enough revenue to keep the engine moving along.

So that’s the other thing about a publisher that, you know, the ideal situation is the publisher is almost invisible. It’s not about the publisher so much as it is about the publisher just keeping the engine moving, using a process that makes the stories better. That people can come to that publishing house, understand how they’re working, aspire to that and then hopefully achieve the standard of the publisher, get the publication together, and then the revenue would be generated, and it would be split in an equitable way that made sense.

So that’s the other thing, I think the ideal publisher today should recognize somewhere between the world of self-publishing and traditional publishing is that the revenue splits need to be more straightforward. There needs to be a very simple formula for the splitting of whatever money results. So the publisher has to take on the risk of releasing the book and it never working, it never selling that. See, that’s another problem is that a lot of people talk about working in terms of results. A story can work editorially and not sell. Now, nobody likes that truth, but it’s just truth. Some Sometimes things just don’t work out. That’s just the way it is.

[00:40:34] TG: Well sometimes it takes a long time.

[00:40:35] SC: That’s true. So to have it available is, you know, the first thing you have to take, you know, take care of. So worrying about the book not selling in its first three months is not really giving it much of a chance. Now let me let me just switch pathways. Oh, let me get back to this, you know, the the publisher should recognize equitable splits that re transparent and easy to understand. I think the writer should get 50% of net profit, the editor should get 10% of net profit and the publisher should get 40%. And that’s because the publisher is the machinery that enables the writer and the editor to work together.

Now the publisher needs the revenue in order to bring that opportunity, you know, for those two forces to come together. But once the title has been successful, then the author and the editor should fairly get a big portion of the money that’s generated. Now, of course, you know the cover, the copy editing all those expenses need to be covered first before anybody gets a penny. But after the book is in the black and is profitable, then they should be equitable splits that makes sense, that aren’t based upon arbitrary retail cover price in this market will be this royalty. Like the contracts in book publishing are so ridiculously complex because it was a 500 year process by which new definitions of royalty splits kept coming up and up and up.

But I think if you just like, get a big pot and you fill it with all the revenue that comes in for that particular title, you take out third party expenses like paying an equitable fee to the copy editor to the cover designer, et cetera, et cetera. And then whatever’s left is split in an equitable manner. That just makes sense and it’s transparent, and nobody gets all nervous about having toe audit, you know, sales that were done and deep discount in Portugal, you know?

[00:42:56] TG: Yeah, yeah, and I want to stop here and talk about a little bit too from, again from my perspective, because there’s all this weird stuff. That, like you said, it’s kind of I always think of it as chaff. Like it’s this stuff that’s created as the thing grows that then everybody’s kind of stuck with. But the craziest ones to me are, or one of them is that and it’s I don’t know if it’s in the standard — I think it’s in the standard contract with authors now? You can correct me. That basically, if any time in the future somebody has offered a better royalty rate, it back dates to them and all of their previous books. Is that correct? It’s something like that?

[00:43:42] SC: You’re talking about the most favored nation clause in high-level contracts. So the most favored nation clause means that if somebody like John Grisham signs a contract and he agrees to a specific kind of royalty, that in the future, if that publisher tries to lure Stephen King over and they give him a better royalty, that John Grisham won’t be — he’ll get the same, you know, royalty is as Stephen King.

[00:44:15] TG: Yeah, and then it becomes basically backdated. So they’ll owe him a ton of money for all the royalties he wasn’t paid, right?

[00:44:24] SC: So writers think that they’re gaining, they’re getting a big win by getting a most favored nation clause. But actually, what it does is it just keeps the royalties at the same rate, right? Right. Because then the publisher, when Stephen King wants to come over, they go, “Well, we can’t give you a better rate than we give John Grisham because if we do, then you know all of these contracts that we’ve given most favored nation would have to be revised, and that would cost us another $25 million.” And so then he’s like, “Oh, okay, I see what you mean. I’ll take the same standard, you know, rate that you’re giving everyone else.”

So the a lot of the clauses in contracts seem like they’re for the writers advantage, but they actually solidify and make all of this esoteric and archaic stuff that has been generated over 500 years. It just makes it more and more stiff. So defining profit becomes almost like a PhD thesis. So if anybody ever wanted to audit the books of their title at a publishing house, they can do that, but it takes a lot of time.

[00:45:33] TG: But they have to pay for it.

[00:45:35] SC: Yeah, they have to pay for it and it takes a long time to actually come to the conclusion. Then you would have to hire your own forensic auditor and then, by the time it’s all done, it’s usually maybe the publisher has withheld an extra 1% or 2%. Or oftentimes, they’ve even paid more than what they had to. So then this discourages people from auditing. Anyway.

[00:46:02] Tg: Yeah, well and I want to get back to like —  So what that causes is, let’s say they’re trying to lure Stephen King over. They’re like, “Well, we can’t give you a better royalty rate, but we’re going to give you this insane advance that you’re never gonna turn out as a way to give you a higher royalty rate, because then we can pay you more.”

[00:46:25] SC: Right.

[00:46:26] TG: And so, again, it becomes like with the money it’s so weird because, you know, there are — there’s different rates for digital, versus print, versus audio and then selling the rights for and like, all of this stuff becomes super super murky. And I have literally never talked to an author that has traditionally published that understands how they get paid. It’s always on this kind of random, six month cycle where they get a check or they don’t get a check because they haven’t earned out yet. And it’s so confusing that from, again, from my experience, even the editors don’t really understand it. And so —

[00:47:05] SC: Well, why do you think that would be? I mean, in addition to protecting, you know, the coffers of the publishers it also allows for third-party professionals to get involved, right? So everybody has to hire a lawyer. Everybody has to have an agent protecting their interest. And so all those professionals get in that system, and so you could spend seven or eight months — and this has happened — negotiating the actual contract, which is from a boilerplate. And so the writer ends up having to pay the agent who has to pay that. And so you’ve got all of this stuff in the middle that is keeping the editor and the writer from doing their work. It’s distracting from the core, you know, love of publishing to begin with, which is the story.

So the publishing house that can eliminate all of that mishigas in the best possible way, right off the bat, right up front. And believe me, this publishing house, the Story Grid publishing house, this isn’t gonna be for everybody. It’s gonna be for a very small number of people, those number of people who are sick of all of this mishigas with contracts, all this ridiculous definitions of royalties and they’re like, “You know what? I just want a simple statement. It tells me how much money came in, how much was taken out, and what the splits are.”

And yet I most writers would be like, “That’d be great if the editor got a percentage.” They want the editor to be compensated. They want what’s best for the editor, and I think a publisher that works with editors in such a way that they treat them like grown ups with skin in the game, that’s only going to make the stories better because the editor is going to then say to themselves, “Jeez, you know, if I go through a couple more rounds on this manuscript, I can really take it up a couple of notches and the the better the story is, the better the chances of it selling better, which increases my share of revenue.” So they’re actually investing their value in taking the chance that they could be returned in value in the future.

Now, if a, you know, I would love to see editors become as wealthy as writers because if you’re an editor and you spread your work over, say you edit 12 books a year and you do that for 10 years and 25 of those books become very large bestsellers, hey, you’ve got revenue and income for the rest of your life because you’re getting a share of the success of those titles over the long term. So editors themselves could become freelance, you know, superstars, and they would be like, “Hey, I’ve got a book and I’m going to offer it to Story Grid Publishing for this percentage,” as opposed to not getting anything at, you know, another publishing company.

So just all of this boils down to all this talk of money, it just boils down to transparency. Like, “Here’s how the business is working. We’re not trying to put any curtains up. We’re not trying to hide anything. We think this is fair. This is what we believe is fair and this is what we’re sticking to. 50% to the writer, 10% to the editor, 40% to the publishing house, the end. And we will show you how much it costs for all of the things that we’re taking out of the pot.” And you will see the publisher earns that 40%. They earn it in spades. And the reason why is that a lot of books just don’t sell. And so the publisher has to swallow and eat the expenses of creating the covers and and the copy editing and all that. So the publisher actually earns their money.

The other thing that I think a really great publisher needs is to, and I’m sure you can talk to this more than I can Tim, But I think a publisher needs to bring an audience, right? They need rain a market to their writers, as opposed to saying, “Hey, we’re gonna publish your book, but you have to go out, you have to build your platform, you have to make it worth our while to publish your book,” just like they said to your friend. Because that’s algorithmic publishing. That’s saying, “Well, Tim Grahl has 100,000 followers.” It’s just what I said about Kim Kardashian. If we do the math and 0.05% or 5% buy Tim’s book who subscribe to his thing, then that’s going to throw out this much revenue, and then it becomes like a financial arbitrage. They want to buy a valuable product at 1/2 its price and sell it at two times its price, and then they get to take what’s in left over.

So a publishing company should not be in the business of arbitrage. That’s what I mean. Because that’s a financial service is thing. We’re not about. Arbitrage were about making stories better and if the stories become better than, perhaps, you know, the percentage of those titles that are better will sell better than the ones that aren’t so good. That’s everything that we’re betting on is the probability of success for a title that’s a better written story than something else.

[00:52:54] TG: Yeah, and so two things I want to say: One, going back to the money, I think the one thing that is interesting too of the way that of splitting it that way is it future proofs everything. So, no matter how money comes in from the book, whether it’s an audio book, it’s a Kindle book, it’s an ePub, it’s, you know, it’s sold directly to the reader or whether it’s a print book or whether it’s something we haven’t even thought of yet in the future, it’s very straightforward how the money is divvied up. So it’s never hard to figure out what to do with the money once it comes in.

But as far as the platform stuff, I mean, you know, I’ve been doing book marketing. I have been a consultant for over 10 years and teaching it and all that kind of stuff, and it’s always been in my mind that this shouldn’t be the author’s responsibility, because it’s such a different skillset than writing a book. Like learning how to do marketing is a totally different thing than writing a book, obviously, and yet there’s this position that writers are put in where they’re responsible for 100% of the marketing of their book and also to even get a publishing deal they have to have already done a ton of marketing to show that they then can do future marketing.

And so it just becomes this really burdensome thing for people. I’ve met writers who love it, who do it well, who do it naturally, and it’s easy for them. But the vast majority of writers, it is a huge undertaking and huge chore that, again, is a different skillset. It would be like, you know, if I wanted to learn how to paint and people said, “But first you have to learn how to fly a plane,” and it’s like, “Well, why? That makes no sense.” But it’s two completely different skillsets.

So that is where I think and long ago, you know, traditional publishing abdicated the connection to the readers. They gave it completely over to the bookstores and do not see it as their responsibility to build a following. I’ve had several conversations with different imprints at the major publishing houses about basically beginning to build their own following because they have all the same tools that authors do. They have blog’s, they have podcasts, they have email lists, they have all this stuff and, like you could build an audience for your books that you’re publishing and then that would be an added benefit to your authors because you could help them sell books and also, you know, to you, because then you would sell more books and across the board they do not see it is their responsibility to do that.

And so I feel like a publishing house, and we’ve talked about this before, like a publishing house should bring readers to the table. That doesn’t mean the author can’t or shouldn’t promote their own book. But it does mean that where we feel like that’s our job and we have skin in that game as well of trying to bring a group of readers to the table for each new book that will at least give it a try. Right? That’s what we’ve always talked about is like the goal is to just get 10,000 people to crack open the first page of the book.

And so from the beginning, you know, we were thinking like we need to build our own audience even before we’re thinking about doing a publishing house or anything like this, it was always like what I believe, you know, when I talked to authors is like when you own the platform you have, you own the power, you are able to make decisions. I was listening to Joe Rogan, and he talked about how, when he did Fear Factor, I think back in the 90s or early 2000s, he made “fuck you money”, right? So it was like he made enough money where anybody that tried to get him to do anything he didn’t want to do, he just said, “Fuck you.” Like he didn’t need it. And I feel like having a platform gives us the “fuck you power” of like, “We don’t have to do something we don’t want to do. We don’t have to publish,” — and the the same thing with, because even when you described what you had to do with Rugged House, you tied yourself —

[00:57:10] SC: Rugged Land.

[00:57:11] TG: Yeah, rugged Land that you tied yourself to that same revenue beast of you had to have results for your investors. And so, and we’re gonna talk more about this in the next couple weeks. But, you know, putting ourselves in a position where we’re not tied to the results where we can it then puts it, and we have our own platform, puts us in that kind of publishing “fuck you” space where it’s like, “You know, we fully intend that people are going to get angry with us because we’re doing things this way. Ah, that writers are going to get angry with us because we’re doing this way. But for us, it’s like, this is the way it should be. And we’re putting ourselves in a position where we can actually hold those values. So that’s — I’m excited, you know, as we look at each of these things. That’s what makes me excited as we get to start with, “How should this be? Okay, we’re going to do it that way.”

[00:58:05] SC: Yeah. I mean, that other — I just have one small comment. I know we’re running a little late, but once more comment about the notion of why publishers don’t have a platform and why they’re not developing it, and I can understand why they’re not doing it. Because every time they publish a new book, it’s a brand new thing. Because all the books are different. There’s no structural functional organization behind each and every title that they publish. They can’t say what the Kim Kardashian Selfie book has to do with the latest book from a National Book Award winning writer. They don’t have anything in common. Each book has to be sold separately and individually.

Now, the thing about the Story Grid publishing paradigm is that there is a structural, functional organization of every single title, no matter if it’s nonfiction or fiction. And that is the story grid methodology. So you can always go back and say, “Look, all of our titles follow this methodology So every single title that we published shares the structural functional organization of Story Grid. So that’s a real bonus, because when you could, you could build a platform on something like that because someone who’s interested in Story Grid, you know, they might be interested in reading different kinds of books that both apply the story good tools.

So it’s really important to to stand for something and to mean something and that’s really what a publisher in the new paradigm can actually establish. You can actually stand for something you could have meaning. You can tell readers why you’re doing what you’re doing in a very specific way, and I think that’s the really sweet spot in between, you know, the tyrannical order of traditional publishing and the chaos of self-publishing is a publisher that stands for something it has meaning behind it.


[1:00:23.8] TG: Thanks for listening to this episode of The Story Grid Podcast. For everything Story Grid related, check out storygrid.com. Make sure you pick up a copy of the book and sign up for the newsletter so you don’t miss anything happening in the Story Grid universe. If you’d like to check out the show notes for this episode or any past episodes, all of that can be found at storygrid.com/podcast. If you would like to reach out to us, you can find us on Twitter @storygrid. Lastly, if you would like to support the show, you can do that by telling another author about the show and by visiting us on iTunes and leaving a rating and review.

Thanks for subscribing and being a part of our work here at Story Grid. We will see you next week.



The Book

Is this your first crack at writing and finishing your book? Are you lost on how to tackle this project? This is the place to start.

First Time Writer

Is this your first crack at writing and finishing your book? Are you lost on how to tackle this project? This is the place to start.


Is this your first crack at writing and finishing your book? Are you lost on how to tackle this project? This is the place to start.