The pros and cons of Authors Equity (maybe)

Madeline McIntosh and Don Weisberg, who have served as CEO of Penguin Random House US and Macmillan, respectively, have joined forces with Nina von Moltke, most recently president and director of strategic development at PRH US, to form a new publishing company, Authors Equity. As its name implies, the publisher will operate outside of traditional publishing business models, offering no advances but paying authors a high percentage of a book’s profits—a model used by some other types of hybrid publishers.

Three Publishing Veterans Form a New House, Authors Equity by Jim Milliot

I’m blissfully unaware of most publishing industry drama these days, so I’m always intrigued when something peeks over the walls I’ve set up and manages to catch my attention anyway. I saw the Authors Equity announcement in PW a couple of weeks ago and thought it was pretty unremarkable, but since then, it’s popping up everywhere, generating a surprising range of thought pieces.

I don’t have any insider knowledge and don’t run in the same circles as the main executives behind book publishing’s newest shiny — but I have a blog and opinions and it’s an in-between week for the newsletter, so let’s go!

Call It By Its Name

Authors Equity is arguably only noteworthy at all because of the high-powered, ex-Big 5 executives and bestselling authors behind it. Remove them from the equation and you just have another hybrid publisher — seemingly one of the steadiest growing but least interesting (to me) segments of the publishing industry. Basically, it’s assisted self-publishing for authors with the money, platform, and/or ego to justify the illusion of DIY, but also want the validation of being aligned with a reputable and/or disruptive brand.

Authors Equity is a collaborative publishing company reshaping the relationship between author and publisher. We’ve taken the best elements of traditional publishing and combined them with a fresh approach to help authors succeed in today’s market.

Unlike the more concrete definitions of traditional publishing (all money flows to the author) and self-publishing (the author handles, and pays for, everything), hybrid publishing is much more loosely defined. Similar to traditional publishers and DIY services, though, hybrid publishers can run the gamut from borderline scams to legitimate businesses — primarily separated by how they market themselves, the specific services they offer, how much they charge for them, and what outcomes they can actually deliver.

The IBPA updated their [unenforceable and voluntary] “criteria” for hybrid publishers in 2022, with input from several hybrid publishers, that serves mostly as a basic checklist to evaluate a hybrid publisher’s operations (rather than their legitimacy), leaving plenty of room for opacity. Effectively: a polite caveat emptor about an important segment of their membership.

The one advantage Authors Equity arguably has over most hybrid publishing operations is its experienced, reputable leadership. McIntosh, Weisberg, and von Moltke aren’t bitter authors spurned by traditional publishers out to prove the industry failed to recognize their genius; they’re seasoned veterans with very public resumes that command confidence, and more importantly, public investment from successful authors who run in similar circles.

Collaboration with Freelancers?

Interestingly, the biggest complaint I’ve seen about Authors Equity isn’t about its premature hype based solely on its executives and investors’ connections, and a vaguely “disruptive” business model — arguably the most apt Silicon Valley analogy to be made — but its use of “bespoke teams” that are assembled for each book, rather than a dedicated staff of editors, marketers, designers, etc.

Usually, when a publisher assigns a team to work on a book, they have to work within the bounds of who’s already on their staff.  In our model, we build customized teams for each book, and we can draw from a much more diverse base of experts across different fields, inside and outside our industry. It’s easier this way to ensure the team possesses the perfect blend of skills and perspectives to connect the book with its ideal audience.

A Q&A with Authors Equity CEO Madeline McIntosh by Jeff O’Neal

First of all, traditional publishers have been using freelancers for editing, marketing, and design for years as those full-time roles have been steadily cut through layoffs and attrition to satisfy the never-ending demand for profit growth — but somehow never fewer, better books. The steady output of traditionally published books and the professionalization of self-publishing (DIY and assisted) is partly thanks to the ever-growing ranks of freelancers, many of whom are earning more and are happier with their workloads than when they were employees of a single publisher.

Comparing Authors Equity’s approach to the gig economy is disingenuous, but apparently great for clicks.

Touting individualized plans for each book and author, with the flexibility to create ad hoc teams that align with the author’s goals rather than vice versa, isn’t quite as innovative an approach as it might seem, especially when you consider who Authors Equity’s likely target audience is for services. (Hint: look at their list of investors.)

This new model may not work for authors who rely on advances to support themselves while writing, including midlist trade nonfiction and literary fiction authors whose books may take years to write and who provide a great contribution to the accumulated canon of knowledge and literature. Yet innovative new models that recognize that authors deserve the greater part of earnings from their books are to be applauded and will pave the way for other new models. For authors able to self-finance their book projects or those with an established audience willing to help fund their books, Authors Equity provides an enticing alternative path to mainstream publication and distribution. 

Authors Equity: A New Profit-Sharing Publishing Model by The Authors Guild

I don’t always agree with The Authors Guild’s approach to advocacy, but they’ve nailed Authors Equity’s appeal and, more importantly, who isn’t their target audience. When you connect the founding trio back to the underlying reason Penguin Random House’s attempted acquisition of Simon & Schuster failed — market share for bestsellers — the picture becomes pretty clear.

Most successful authors actually have a lot of sway with their traditional publishers, able to cherry pick the teams they work with, including hiring on external partners to replace or complement internal staff they don’t like. Debut and midlist authors are the ones who get stuck with overworked staff who can’t give them dedicated attention, and that’s not who Authors Equity is going to be collaborating with because a) they won’t be able to afford their services, and b) they don’t sell at a level that fits Authors Equity’s model.

Maybe.

The truth is, we don’t know any specifics about Authors Equity’s model beyond a press release, a few vague interviews, and a range of hot takes. Their website has very little information, and they don’t currently even meet several of IBPA’s minimal Hybrid Publisher Criteria.

My two cents: Beyond simply being a new hybrid publisher with reputable executives, Authors Equity reminds me mostly of Harper Studio (profit sharing, no returns, more collaboration) and the first iteration of Open Road Media (no inventory, exploiting gaps in the traditional market). The former spectacularly bombed, while the latter seized a moment before aggressively (and successfully) pivoting towards a service model.

It will be interesting to see where Authors Equity ends up, but until they announce their first few titles and The Authors Guild gets a look at their contracts, they’re just another startup attempting to carve out a slice of the bestseller market. And, as the DOJ vs. PRH trial famously taught us, publishing is random, and many of its top executives don’t actually have a clue.


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