how publishers decide on a book advance
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You ever read something that just kind of rambles around endlessly without any respect for your time or level of interest?
Check out Josh Bernoff’s Writing Without Bullshit: Boost Your Career by Saying What You Mean, out this week. It’s intended for business writing, but many of the lessons I took from it apply to writing writing.
Josh delves deeply into emails, social media, and other business-specific use cases, but at heart WWB is about writing dangerously. Writing that draws blood and makes no apologies. Think Jeffrey Katzenberg’s now-legendary internal memo as head of Disney’s film studios in 1991. Think Jerry Maguire’s mission statement for Sports Management International. It’s about saying something real! Except for that second one. (But it was real in the context of the film—point still made!)
Anyway, valuable book, put your copy on your writing shelf next to your Clark, your Zinsser, and your King.
People often ask me how traditional publishing works. Not as in “how does this antiquated circus continue to function?” but as in “what’s the nitty-gritty path from ‘manuscript someone slaved over for years’ to ‘hardcover book languishing spine-out in the back corner of a Barnes & Noble’?”
I blithely use words like “advance” and “agent” and “editor” in conversation. Nobody from outside the industry ever really knows what I’m talking about. Since that’s not unusual for me, I don’t pay much attention to the blank stares. There’s no denying, however, that book publishing remains opaque, even to that tiny slice of the American public that reads books. (Don’t ask me how tiny. You don’t want to know. I’ll give you a hint. More people still use LiveJournal.)
So, a quick lesson. The success and career trajectory of a book editor rides on the success of her P&Ls. A P&L, or profit-and-loss statement, is created for every book an editor acquires, beginning at the proposal stage.
Here’s how it works: in order to bid on a book proposal, you must first estimate the advance you can safely offer by filling out a blank P&L template in Excel. To do that, you have to figure out what kind of book it is. Don’t worry, the publishing industry has you covered.
“Alright, we’ve got a memoir here from someone under thirty. Hand me form #1. OK, let’s see. After getting her/his MFA from Iowa, she/he traveled around [INSERT LOCATION(S) IN INDIA AND SOUTHEAST ASIA ONLY] and it taught her/him a lesson about [INSERT SOME COMBINATION OF PRIVILEGE, POVERTY, CLIMATE CHANGE, A GLOBAL SHORTAGE OF TRAVEL BLOGGER/LIFE COACHES THAT MUST BE REMEDIED…SOMEHOW, A KID IN A VILLAGE WHO WAS PRACTICALLY MACGYVER]. Also, she/he hooked up with a chill dude on the train.”
In case you’re curious, a stack of these forms is handed out to every assistant editor. (There are plenty more in the supply cabinet, because they go quickly.) Form #1 covers most nonfiction book proposals. Form #2 covers the rest:
“She/he survived [INSERT LIFE-THREATENING DISEASE]. The world must know! Then she/he hooked up with a dude on a train.”
There’s something very important I forgot to mention. Don’t combine the forms. It would be bad.
Try to imagine all life as you know it stopping instantaneously and every molecule in your body exploding at the speed of light.
So, the P&L. You compare the proposed book to some published books, make some guesses on how many copies it might sell based on the sales of those comparable titles, and then plug the number into the P&L, along with the price, page length, and other pertinent numbers. The P&L then tells you what you ought to offer, what you shouldn’t offer, and what you absolutely, positively cannot offer.
The P&L, as all editors know, is lies. Lies, damn lies, and trim size. It’s nothing but the finance department’s (doomed) attempt to protect itself from the whims of 24-year-old English majors deciding on five- and six-figure business investments because their mom’s Fire Island house happened to be next door to the publisher’s.
(Don’t worry. Most of these Ivy League yokels give up on a publishing career after two or three years and go work on Wall Street instead. Hence, 2008. Did you really think you understood the housing crisis because you read The Big Short? That book was nothing but thinly-veiled propaganda funded by Big Publishing to obscure its role in flooding the big banks with former editorial assistants. Blame that hack Michael Lewis and the corporate shills at W.W. Norton.)
Anyway, what really happens is the editor decides on an advance that “sounds good.” How is that determined? Well, it’s based almost entirely on how icy or tan the agent is. You ever wonder why literary agents get 15 percent? This is why.
Here’s the deal: all literary agents are either icy, or tan. The more icy (or tan) the agent, the bigger the advance needs to be. The editor feels small and wants to feel big, understand? That number has to fill the hole inside, the hole that formed over lunch with that agent last week when all the editor could think was, “Jesus, this agent is really, really icy/tan. She/he hasn’t made eye contact since we sat down/looks like George Hamilton accidentally fell asleep while sunning himself on the back of the Hubble. I have no value as a human being.”
So, a big number. To make the P&L work, the editor fetches another critical publishing tool from the supply cabinet:
To write a Shakespeare play, you need an infinite amount of these. To plug random numbers into a P&L until it justifies the advance you want to offer, a couple dozen will do.
Years later, once the book has been out for a while, another P&L is generated based on its actual sales. This tells the company how well the editor did so it can modify her title with a slightly different adjective in front of “editor”: assistant, associate, adjunct, equilateral, isosceles, etc.
Of course, by this point the original editor is a few miles downtown, juggling tranches with some quants and lighting cigars on the burning Dumpster fire of the American economy.
Now I feel like I’ve been Writing With Bullshit. If you really want to know how a P&L is supposed to work, well, you’re already way ahead of most editors. Read this like I did and you will know more than most people working in the industry, especially the ones making decisions in all those big seven-figure auctions. It’s actually true!