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6-figure deals for debut novelists

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I'm astonished by the number of 6-figure deals for debut novelists. This doesn't make sense to me, unless it is the fact that most of the deals seem to involve the first books of trilogies or longer series.

Is there any hope for a big deal for a stand-alone novel, assuming that the book itself is a big deal and that the author has other major works in progress?

Thanks,

Gatz
#1 - February 26, 2015, 08:18 PM
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This* has happened to a few people on these boards, but the examples I can think of were all several years ago (i.e., before the big economic slump of 2008). It's possible there have been more since, but I no longer subscribe to Publishers' Marketplace, so I don't know about current conditions.

* a 6-figure deal for one debut novel

So it is possible, but it is probably rare. And perhaps even more rare currently. 
#2 - February 26, 2015, 10:01 PM
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Thanks, Barbara. I saw one on PW yesterday and have seen a number of them lately.
#3 - February 27, 2015, 04:08 AM
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Yes, I'm pretty sure six figures is for the series, and may include bonuses, etc. Literaticat wrote a blog post about those "announcements," too, where she shared her take on the situation. Essentially, some of them are true, and some of the announcements are embellished a bit.
#4 - February 27, 2015, 04:59 AM
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I did a bit of rough math for myself a while back that put these "big deals" into sobering perspective for me.

Let's say the 6-figure deal is for $100,000. Let's say you're only in the 10% income tax bracket (but depending how your money is paid out, and your other income, you may now go up a bracket). Also, you almost certainly didn't get this deal without an agent (don't misunderstand me; a good agent is worth every penny). Okay, subtract 25.3% for taxes. This is the lowest possible 10% tax bracket plus the 15.3% self-employment tax you pay because you pay both the employee and employer's portion. For ease of arithmetic, just use 25%. You're now down to $75K. Subtract your agent's 15%. You're at $60K. You *probably* have to write two books to fulfill this contract, so you're at $30K per book. With all the writing, researching, revising multiple times, revising again for your agent, revising again for your editor, and all the related promotional activities (for which you're getting nothing extra and probably spending some of the advance money to boot), would it be fair to say each book roughly represents two years of full-time work? Congratulations: you're working full-time for about $15,000 a year. The good news is that this is your net, not gross, and there'll be more if you earn out. The bad news is it's lower than $15K if you are in a higher than 10% tax bracket (and you may now be higher, never mind that your yearly "salary" in itself doesn't really justify that higher bracket), if you have to write 3 or more books to fulfill the contract, and if you subtract the .3% taxes that I ignored.

This is why writers aren't rich. Even 6 figures isn't serious money until you start to get "up there."

Thinking about it another way, the latest median household income figure (U.S) that I could find is $51,939. So half of all households hit "6 figures" in less than two years. We don't find that especially remarkable, and for most of them certainly something less than opulent.

Don't get me wrong: Were I to get one of these deals I'd be thrilled and would celebrate like crazy! But I wouldn't be wealthy, even though my long-lost cousins would assume so.   
#5 - February 27, 2015, 09:06 AM
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Thank you for that excellent breakdown, Marcia. Really puts a 6-figure deal in perspective.   
#6 - February 27, 2015, 09:21 AM
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Thanks, Marcia. I second what MGHiggins said.
#7 - February 27, 2015, 09:25 AM
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Marcia, that's an excellent math lesson! We should be praying for 7-figure deals :grin

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#8 - February 27, 2015, 01:32 PM
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We should be praying for 7-figure deals :grin

There you go!  :dr
#9 - February 27, 2015, 03:32 PM
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Also, I would think that as a first time author, it is far better to earn out on a smaller advance, then make royalties, than it is to have a massive advance that hangs out in the red on your editor's P&Ls for too long. You are more likely to get follow-up work when you earn out, and in this industry, having more books with your name on them equates more shelf space equates more eyes on them equates your 5th, 8th, 50th book doing better than your first or even third may ever do.

Always think long term. Just like any industry, you have to work your way from the bottom of the ladder on up. Most of those six-figure deals are for series, which also means the author is locked in for those first few books. So if your first book TAKES OFF, it doesn't affect your advance, royalties, subsidiary rights, etc on the follow-up books in the same series. GENERALLY. Some people work in sliding scales and bonuses for a well-performing book.

The few exceptions where somebody got upper six-figures for one book are freaks of nature with no rhyme or reason or special "formula" to mimic. In fact, trying to mimic that author's "formula" is a guarantee it won't happen, because lightning never strike the same place twice!
#10 - February 27, 2015, 05:14 PM
« Last Edit: February 27, 2015, 05:30 PM by R. LaFille »

If you want to counter the starry-eyed view of the Big Debut Deal, you might read this post on Jessica Spotswood's blog, which talks about how she scored a Big Debut Deal but then her sales numbers didn't meet her publisher's expectations: http://www.jessicaspotswood.com/blog/2013/12/29/2013-a-learning-year-managing-expectations/
(Although I'm happy to hear that she has recently gotten a deal for two new YA books! Also, her debut trilogy actually make for really fun reading.)

Getting a six-figure deal isn't everything. Longevity is more important, and it can follow from any kind of beginning.
#11 - February 27, 2015, 07:04 PM
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Thanks for that rundown Marcia. This is my expression when trying to do math.  :crazy  LOL!  I like Vijaya's idea, 7 figure deals!!  :aah
#12 - February 27, 2015, 09:31 PM

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WOW. That is a really great breakdown. I knew taxes and things would take a cut, but it's pretty amazing to think it ends up being that small of a cut when all is said and done.
#13 - February 27, 2015, 09:42 PM

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Whizbee thanks for sharing that link. Getting a book deal is only the first step in a long list of challenges, and this post illustrates the expectations and pressures when a publisher goes all out.
#14 - February 28, 2015, 05:28 AM
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Marcia, that's an excellent math lesson! We should be praying for 7-figure deals :grin

Vijaya

You're so funny!   :applause
#15 - February 28, 2015, 06:17 AM
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#16 - February 28, 2015, 06:18 AM
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Let's say the 6-figure deal is for $100,000. Let's say you're only in the 10% income tax bracket (but depending how your money is paid out, and your other income, you may now go up a bracket). Also, you almost certainly didn't get this deal without an agent (don't misunderstand me; a good agent is worth every penny). Okay, subtract 25.3% for taxes. This is the lowest possible 10% tax bracket plus the 15.3% self-employment tax you pay because you pay both the employee and employer's portion. For ease of arithmetic, just use 25%. You're now down to $75K. Subtract your agent's 15%. You're at $60K. You *probably* have to write two books to fulfill this contract, so you're at $30K per book. With all the writing, researching, revising multiple times, revising again for your agent, revising again for your editor, and all the related promotional activities (for which you're getting nothing extra and probably spending some of the advance money to boot), would it be fair to say each book roughly represents two years of full-time work? Congratulations: you're working full-time for about $15,000 a year. The good news is that this is your net, not gross, and there'll be more if you earn out. The bad news is it's lower than $15K if you are in a higher than 10% tax bracket (and you may now be higher, never mind that your yearly "salary" in itself doesn't really justify that higher bracket), if you have to write 3 or more books to fulfill the contract, and if you subtract the .3% taxes that I ignored.

All this, plus the fact that most book deals are structured so you get the payments split into 2 or 3 parts. So 1 part on signing, 1 part delivery, and sometimes 1 (often smaller) part on publication. So if we sold it today, using your tax example of 25% and assuming all worked according to schedule in a perfect world, your example deal would look something like this:

March 2015: Make the deal! Yay!  2 books, $100,000! Welcome to the six-figure club! :D

April/May 2015: (If you're lucky) - Get contracts, negotiate!

June 2015: PAYMENT - on-signing, 20k each book, 40k total - minus 15% for agent, 25% for taxes: $24,000 total

November/December 2015: Book 1 Due (for publication Winter 2017)

January 2016: PAYMENT - Delivery and acceptance book 1, 20k - minus 15% for agent, 25% for taxes: $12,000 total

November/December 2016: Book 2 Due (for publication Winter 2018)

January 2017: PAYMENT -  - Delivery and acceptance book 2, 20k - minus 15% for agent, 25% for taxes: $12,000 total

February 2017: Book 1 Publication

March 2017: PAYMENT - On-Pub Book 1, 10k - minus 15% and 25%, $6,000 total

February 2018: Book 2 Publication

March 2018: PAYMENT - On-Pub Book 2, 10k - minus 15% and 25%, $6,000 total

So your 60k is spread out over the course of four years, and probably at least one of those years you get... not much. $24k in 2015, $12k in 2016, $18k in 2017, $6k in 2018.

I mean, you know, that's not NOTHING, it's a great deal for most kids books... but it's not exactly "bathe in champagne" time.

#17 - February 28, 2015, 08:04 AM
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Yeah! Like this recent seven-figure deal...

And that seven-figure deal was split between two authors over four books ... and they have to pay the illustrator too (illustrator was named, but the illustrator's deal was not part of that announcement). So, even a seven-figure deal won't necessarily make you rich. Curious to know what kind of deal the illustrator got.
#18 - February 28, 2015, 09:06 AM
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And that seven-figure deal was split between two authors over four books ... and they have to pay the illustrator too (illustrator was named, but the illustrator's deal was not part of that announcement). So, even a seven-figure deal won't necessarily make you rich. Curious to know what kind of deal the illustrator got.

And... those guys are big name, and in the case of Mac at least, best-selling and award-winning. It's not like they are Debuts from Nowheresville.
#19 - February 28, 2015, 09:11 AM
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Those are great breakdowns, Jennifer and Marcia. Thank you. And given that most of us have spouses with income that pushes us into a higher than 25% tax bracket, the takehome is even smaller. When I was single, self-employed, and not making all that much money a year, my taxes were more than 30% of my income, but I live in an income tax state as well.
#20 - February 28, 2015, 09:52 AM

So, Stephanie, I guess I'll have to start hoping for an 8-figure deal.  :dr

Literaticat, thanks for the terrific breakdown!
#21 - February 28, 2015, 10:06 AM
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Or, lots and lots of five figure deals! ^_~

Goes to show, there is no "get rich quick" scheme in publishing either. :)
#22 - February 28, 2015, 11:23 AM

^ :yup R. LaFille--exactly! Time to pick up production.  :writing3

But I guess I'll have to break it to my husband that we won't be millionaires anytime soon. :)
#23 - February 28, 2015, 12:08 PM
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This is one of the reasons I enjoy work-for-hire projects! Pay varies widely but I've never done it just for the $$$. There's always an element of love.
TEE is actually my 45th book.
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#24 - February 28, 2015, 12:21 PM
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Some of the six figure debut authors may only be debuting in children's writing. They have sales records in other markets. Sometimes the wording on that aspect isn't very clear.
#25 - March 02, 2015, 09:14 AM

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That's great information. Thanks, literaticat! Could you also please give a breakdown for the kind of advances a new author might normally get for different genres like PB, Chapter Books, MG, and YA?
#26 - March 02, 2015, 09:55 AM

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 Crystal, she did that in her blog post about the topic: http://literaticat.blogspot.com/search?updated-max=2015-03-02T09:39:00-08:00
#27 - March 02, 2015, 10:02 AM
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Crystal, I just asked an agent two weeks ago what the semi-standard advance is for new authors right now, and in picture books, she quoted $12,000-$15,000 (which, wow, that hasn't changed in at least ten years). But this varies WILDLY, plus being then split between author and illustrator. For small, boutique publishers, think more $2,000-$5,000. It really depends how much the publisher wants your book AND if they think they can do a big marketing push for it. And how big the publisher is!

Personally, I would rather negotiate higher royalties in exchange for a smaller advance. There are so so so many ways to negotiate a contract, that the optons are limitless. All you have to do is ask. Twice sometimes. I've had lawyers strike out my first round of changes just as a matter of course the first time around. I'm pretty sure they are trained to ALWAYS say "no" the first go-around.

I used to run an adult literary company as publisher, worked in HarperCollins for a while (in Children's, Mass Market, and Digital Rights), and have had two graphic novels and a tutorial illustration book published. And experienced in print, design, and  freelance illustration (you could say I'm nomadic...). So speaking only from my own experiences.
#28 - March 02, 2015, 10:11 AM

Another good thing to negotiate in exchange for smaller advances is on your rights. In my boutique publishing company, we had small advances but high royalties and extremely high splits on subsidiary rights as well as a clearly defined clause on return of rights should the book go out of print. It made our authors feel comfortable we weren't going to sit on a dead book eternally. It is THEIR baby after all, and on temporary loan. I have known authors who have taken the rights back on a "dead" book, turned around and republished it themselves, and while none of them got rich, they made enough to have another source of income.

The advance should not be the end-all-be-all.

And for heavens sake, NEVER sign a contract without SOME sort of entertainment lawyer going over it (if you don't have an agent, that is). Publishers can be sneaky.

I also happened to date an entertainment lawyer for several years and took classes in copyright, negotiation, and contracts. Find a local college. They usually offer coarses. Or if you're in NYC, there's the Volunteer Lawyers for the Arts: http://www.vlany.org Some of their classes are FREE. *^-^*
#29 - March 02, 2015, 10:27 AM

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Wow Guys, this is waay interesting stuff. I have never seen it the money side of writing books set out so well in easy to understand terms. Thank you soo much.

It's no wonder people say you need to have a number of books published and in circulation to make decent money that one book won't cut it.

Thanks again!   :bewildered
#30 - March 03, 2015, 04:46 AM
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