A few weeks ago, I had a great conversation with Todd Sattersten, who wrote Every Book Is A Startup. He’s also the CEO of BizBookLab and former president of 800CEOREAD. His thoughts on books as startups, revolutionary, and speaks to the heart of the Net Minds Way.
Tim: What motivated you to write Every Book Is A Start Up?
Todd: I wanted to translate the concepts around The Lean Start Up and bring them into publishing. Because in many ways, some of those things that people like author Eric Ries is talking about, are things that the publishing industry has been doing for a long time. This includes Minimum Viable Publishing and the search for product-market-fit.
Tim: Talk about your introduction to the Lean methodology of making things.
Todd: I’m an ex manufacturing guy so I worked in operations in the ‘90s for GE and there are a lot of different ways people talked about it then. It wasn’t so much Toyota Production System then, it was demand flow technology, and it was Six Sigma.
Tim: Steven Covey Sr. once told me, “A great business book is a presentation given a thousand times.” This speaks to your Minimal Viable Product point of view.
Todd: Yes, I think that the idea of the Minimal Viable Product (MVP) in publishing has existed for a long time. How many articles do we see in New York Times Magazine, or Wired, or Vanity Fair that, two years later, end up as a book?
This idea that we have an incubator system in publishing, it’s generally called the magazine industry and now what we’re finding is that there’s lots of other places that ideas are incubating. They’re incubating on Twitter, they’re incubating on blogs. There are You Tube videos that are now getting turned into books. So I think that we’ve always had an incubator system.
Tim: If a book is a start up, it has the ability to create spinoff products, right? A great novel can spin off a movie or a video game. A great business book spins off a training program or a speech for the lecture circuit…
Todd: I think when you think about a book, what’s great about it is the fact that it generally takes an author, and a small team with little equipment, and it just takes time. When you go to making an album, or making a movie, the number of people and resources it takes is much great. That’s why you have to sell so many copies of the product just to recover your outlay. The threshold for making a book profitable is so low that I think they’re normally the perfect place to start.
Tim: Todd, this is such an insight. Books are to media what cloud computing is to information technology! So you are inferring that the idea is the start up, and the book is the Minimum Viable Product?
Todd: Yeah. I think the reason we’re seeing the proliferation of books is that there’s so many ways to distribute now at low to no cost. It’s much harder in movie production. The fact is, that we’re hundreds of thousands of books annually. You’re not seeing that order of magnitude kind of growth in other media formats.
Tim: A start up uses equity as a tool. It allows them to build things with less capital. Equity or profit sharing is a currency and it not only keeps people on board but sometimes gets them super engaged. Do you think that authors should use equity as a tool?
Todd: Yes! But before I answer the question directly, think about how broken the system is for the author. When you look at the distribution model of traditional publishing, it’s very similar to really late stage almost investment banking, where you are selling essentially 80-90% of your book to a commercial banker and they are going to give you some return back on that. While they are taking some risks, what you have left as an author is so small, it distorts your motivation around making that book successful. When you then look at the individuals inside the organization, they’re not really motivated either. It’s just another book that they have acquired and that is a book on their list.
I think in particular with books, we should compensate individuals who have played an important role in the book, whether that’s an editor, or publicist. I think there are three forms of capital that make every book successful. You need financial capital, but I think there are also cases where you don’t actually need that much. You need intellectual capital; I think we’ve talked about that a number of times in this call already. If the idea is not good to start with and you don’t have good support, it’s not going to work. The third thing and this is usually the one that authors most lack, is social capital. I think when you involve those other people in equity format around the success of that book, that you better engage their social capital in making that book successful. Having that critical mass of engaged people to start with is incredibly important.
Tim: In the Silicon Valley, there’s a theory about start ups and that is you never fund a solopreneuer. If you can’t find a co-founder, you are not a start up. Talk to me about that. Because authors think they can do it by themselves.
Todd: My first angle on it is I’m not aware of any artistic endeavor that is done by a single individual.
Tim: Yes, But that’s the ethos now in self-publishing though. Authors are conned into thinking that, at best, you need a proof reader at the end of the process.
Todd: A music artist needs a producer and a writer needs an editor. You want an editor to work with you up front, whether you call them a structural editor or whatever. You need a copy editor, then you need a proof reader. You need someone to visually represent your book. You don’t go get your cousin’s cousin to do it. These are all aspects of publishing that actually make up the chasm between self-publishing and publishing. Because it still exists.
Solo entrepreneurs or solo writers who decide to start a publishing project hinder their ability to be successful because they don’t have a set of people around them to help make their book successful.
Conclusion: Your idea for a book is a startup, and the best way to launch it is via Group Publishing. As an editorial, design or marketing talent, you will do your best work when you are cut into the book’s long term profits. We can all benefit from Todd’s point-of-view, in that there’s no industry that can be as lean as publishing.
Tim is a bestselling author and former Yahoo! executive with a mission to disrupt the traditional publishing and self-publishing industries and share knowledge with authors looking to publish and market high-quality books.Follow @sanderssays