Crowdfunding A Novel – Turning A Profit Before You Publish

Regular readers will know that I always stress the importance of a professional package.

This means only publishing your best work and having a great cover, neat formatting, proper editing, and an enticing blurb.

Some of that stuff you can do on your own, some (usually covers and editing) you have to pay for. And good work doesn’t come cheap.

I also try and remind people that we aren’t just competing against other self-publishers, but against the very best books from traditional publishers.

When you take this professional approach, it’s important to recoup your costs as quickly as possible. Then every sale after that is pure profit.

One of the competitive advantages that publishers have is the ability to take advance orders on Amazon. Not only can they make significant sales before the book is even released, they can also generate that all-important buzz.

What if I told you there was a way for indie authors to do something similar? What if I told you there was a way you could turn a profit on your book before you released it?

Below, I have copied a guest column I wrote for IndieReader earlier in the week. If you have already read that, scroll down to the end for additional resources, an update on my own project, and some exciting news about an indie author tearing up the charts.

I must get some bad news out of the way first. I’m sorry to say that, for a variety of unavoidable reasons, the release of A Storm Hits Valparaíso had to be pushed back to late December. On the plus side, this is now firm, and will definitely be coming out then. My sincere apologies to anyone that was looking forward to it.

***

This article originally appeared on IndieReader.com on October 24, 2011.

There are a lot of great things about being an indie writer, but one of the advantages of a publishing deal is money up front. Another is that you don’t have to pay anything to get published. Editing, covers, proofing, formatting – it’s all taken care of. But now, through crowdfunding, indie writers are covering their costs in advance and generating extra interest in their work.

You may have heard of Kickstarter - the main crowdfunding site. If not, you should check it out; it’s really cool.

The way it works is simple. Artists propose projects – movies, comics, novels, and documentaries – and seek financial support to produce them. In return, the funders receive rewards based on their level of contribution (from a copy of the book or movie to magazine subscriptions, special editions, unique artwork, or an invitation to the premiere).

Crowdfunding allows artists to receive financial backing for their projects without sacrificing their rights or royalties and enables them to work without commercial interference.

Writers have used websites like Kickstarter to cover editing costs, pay for hardcover print runs, commission cover art, release limited editions, and create audiobooks.

Rather than a begging bowl being passed around, the rewards can be quite tantalizing, representing a bargain for those pledging. While some projects are unsuccessful in hitting their targets (and those who pledged are never charged), the slickest presentations with the most creative rewards are often oversubscribed, sometimes hugely.

And it’s not just for newer writers or those without significant audiences, just recently Neil Gaiman and musician Amanda Palmer raised more than $130,000 (despite only seeking $20,000) to fund and record a five-show tour (much of that in just 48 hours).

I was considering a crowdfunding project for some time, hoping Kickstarter would change their US-only policy. Then, last month, I got an email from a friend in a band, inviting me to participate in crowdfunding their album release through a new Irish site called Fundit.

Their project was successful – raising $4,000 – and they’re having the launch party for the album next week (to which funders are invited).

This got me thinking about a project of my own: funding the publication of a novel I’m releasing in December, generating advance interest, and coming up with some fun rewards to entice pledges.

My project went live today, and you can see it here. To add an element of drama to proceedings, if I don’t get pledges equaling or exceeding my target within 28 days, I get nothing. That might be my favorite bit.

I love the whole concept of crowdfunding; it could be a really cool way for writers to substitute the advance. Think about it. You are essentially taking pre-orders for your book and using that money to pay for its production.

For indie writers who would love a special piece of commissioned art to make their epic fantasy stand out from the crowd, or a great copy-editor, or to fund a Spanish translation, or to convert a story into a graphic novel, crowdfunding could be the answer.

Aside from generating advance sales and interest in your project, you will be creating a level of engagement with your readers, building an audience through involving them in the very act of creation.

And best of all? You don’t have to fork over any rights or royalties in return.

From analyzing the best projects on Kickstarter and talking to writers who have been successful with it, the presentation and the rewards are crucial. The presentation is what will sell the idea to people and the rewards need to be enticing enough for them to pledge. You need to ensure you are adding value.

This is where you can get really creative. I’ve seen bands promising private gigs for fans, authors inviting readers to a book launch, artists offering original drawings, and filmmakers giving executive producer slots to those who have always dreamed of seeing their name in lights.

This could be fun and I might pull it off. If I do, my book will break even before I release it. Then every sale I make is profit.

Of course, I could fall short. That’s also possible. But I’ve got nothing to lose; if the project doesn’t get funded, all I will have is a little egg on my face. And anyway, I’ve been waiting for an opportunity to test my patented face-egg remover.

If you want to check out my project over the next four weeks to see how I’m doing, then keep an eye on this page. My progress will be represented graphically – by a handy bar – showing the total value of the pledges received beside the time I have left, which will tick inexorably downward.

I will, of course, report back on the whole thing. Egg or no egg.

***

I wrote that post just as I launched my own project, unsure how it would go. As you can see from my project page on Fundit, it has started very well. I’ve taken in 650 Euro (over US$900) and I have three weeks left to hit my target of 1,500 Euro (around US$2,000).

I’m pretty confident I will do that (and very grateful to everyone who has contributed), although I’m also aware of the pattern of these crowdfunding projects. They tend to attract a lot of pledges at the start, then it tapers off in the middle, before there is a rush at the end to try and cross the finish line (because if you don’t hit your target, you get nothing).

Fundit doesn’t have all the bells and whistles (yet) of the more established Kickstarter operation, but the team running the site provide an excellent service – quick, knowledgeable, and helpful. While submitting projects is restricted to Irish artists, importantly for me, they accept pledges from anyone with a credit card.

If you are interested in participating in this experiment, pop on over to my project page where you can read all about it. For the click-lazy, I’ll give you a quick run-down.

I’m seeking 1,500 Euro (approx. $2,000) which will cover editing costs for A Storm Hits Valparaíso, typesetting the print version, and maybe a little promo if I get more than that.

The various pledges start at 5 Euro (the minimum), which will get you a copy of the e-book in all major formats (including PDF) two days in advance of its official release. Rewards for higher pledges include e-book bundles, a personal thank you in the acknowledgements, paperback editions shipped to your door, and even the excitement of having a character in one of my upcoming short stories named after you (or a friend whom you wish to immortalize).

If you want to check out my project or see how I’m doing, then go here. Don’t forget those enticing rewards; I mean, who doesn’t want to star in a story where I could have you: chased by a pack of wild dogs; forced into two-day bender in Zihuatanejo at gunpoint; chloroformed, gagged, and bundled into the back of 1977 Triumph Spitfire; or, perhaps most exciting of all, wistfully gazing into the mirror, regretting your life as a failed hand model.

***

If anyone wants to read more about how to run an effective crowdfunding campaign, I recommend the following resources:

1. A guest post from an indie author who ran a successful campaign.

2. An excellent podcast from Mur Lafferty on her project which was way oversubscribed. She also talks about the common mistakes people make and how to avoid them. This podcast also has a superb, intelligent interview with Daniel H. Wilson, author of Robopocalypse, which is worth the listen alone.

3. This site has some really top tips for Kickstarter projects. It’s nominally about game design projects, but a lot of this advice is transferable.

4. Kickstarter is restricted to those in the US, and Fundit is for Irish artists only. However, IndieGoGo is open to anyone across the world.

If you have any more crowdfunding resources, or if you would like to share your own experiences, have at it in the comments.

***

Before I go, I would just like to give a shout out to regular blog reader and rising indie star Shéa MacLeod. She self-published her first novel Kissed By Darkness at the very end of June this year. And in the time it has taken me to get completely bogged down in the “final pass” on my own book, she has released two more.

Her productivity is bearing fruit. This month she sold well over 3,000 e-books (not at 99c either), and the last time I checked the lead title in her series it was at #666 (spooky) in the overall Kindle store – a phenomenal performance in the space of four months.

Keep your eye on Shéa, she’s only getting started.

About davidgaughran

David Gaughran is an Irish writer, living in Prague, and author of Mercenary, A Storm Hits Valparaiso, Let's Get Digital, Let's Get Visible and this here blog thing.
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56 Responses to Crowdfunding A Novel – Turning A Profit Before You Publish

  1. Terrific post, David. Thanks for sharing the skinny on crowdfunding. Now…off to check your Fundit page.

  2. Very interesting post, David.

    I looked and your fundit page, but I don’t see what the investors receive. From your post it seems that they get to “appear” in your book. Is that right?

    Suzanne

    • Hi Suzanne,

      There is a range of rewards (depending on the amount pledged) including copies of the e-book, e-book bundles, a mention in the acknowledgments, paperbacks shipped to your door, and a character bearing your name appearing in an upcoming short story.

      One of the drawbacks to the site I’m using (Fundit) as opposed to Kickstarter, is that I can’t change anything after the project goes live. I was hoping to add more rewards once I saw what was popular, but I can’t. Lesson learned for next time. Fundit also has a 5 Euro minimum pledge, and I think it’s only a dollar on Kickstarter. I think that’s because they don’t accept PayPal, just credit cards.

      Dave

  3. stunoss says:

    As per useful an extremely interesting and really helpful article David. Hadn’t heard of fundit or crowdfunding but its such a great idea. Thanks for writing this article. A pleasure to read.

    Stu Noss
    http://www.solqushorts.com

    http://jardinsoli.wordpress.com/

    http://lifeonthesuburbanfringe.wordpress.com/

  4. Hey David!

    Kickstarter is an AWESOME site — all kinds of neat projects finding their way to life on there.

    One small correction:

    “One of the competitive advantages that publishers have is the ability to take advance orders on Amazon. Not only can they take in significant money before the book is even released…”

    Publishers don’t get paid for those preorders until at least 30 to 60 days AFTER Amazon has shipped the books. Retailers and distributors are on “net terms” which means you send them the product and they have a month or two to sell the product and then pay you for it. They can also, of course, just return the product for a full credit and never pay you a penny, which means you’re actually out money since you paid to ship the book (often both ways if you’re a smaller publisher).

    Brian

    • Hi Brian,

      I wasn’t aware of that, and I’m happy to correct. One question: how does it work with e-books?

      Dave

      • No worries, it takes a while to pick up on all of this stuff. I know you want to get it right! :)

        For eBooks, in my experience, Amazon and B&N pays publisher on the same schedule of 30 or 60 days after the sale.

        Brian

      • Thanks. I corrected the piece to say:

        One of the competitive advantages that publishers have is the ability to take advance orders on Amazon. Not only can they make significant sales before the book is even released, they can also generate that all-important buzz.

        It doesn’t change the point I was making, so it’s all good. But thank you!

      • And it IS a really valid point! Preorders are kind of like putting orders “in the bank.” They’re just building up and building up and then BOOM, on the day of publication you have a landslide of sales right out of the gate. :)

        Brian

      • Yeah. Amazon pitched it perfectly with Barry Eisler’s latest which sold insane amounts in the first couple of weeks. They have access to all the data from publishers doing the same, and obviously know the optimum time to place a pre-order page up (which surprisingly, was only a week or two before release). They have the numbers, there must be something to it.

  5. This is a great idea! I might just have to give kickstarter a whirl for my next book!

  6. Okay Its’ very tempting to see my own name as a character…. IN fact all your rewards are just about exactly what I would have though of myself (and I loved the clause on what might happen if your name is used, I giggled).

    Anyway that’s so super cool!
    Now to figure out how much I might have to spend on that sort of thing…
    (I think I’m going to need a budget.)

    :} Cathryn Leigh

  7. Thanks for the mention Dave (fangirl moment).

    I just recently heard of crowdfunding. Fascinating stuff. Fingers crossed for you!

  8. MGalloway says:

    Great post. I heard of Kickstarter through a tech radio show a few weeks back…but I never heard of it being used for books. This could open up a lot of creative possibilities. It’s kind of like having a bunch of mini venture-capitalists behind a project…without having to put them all on a board of directors.

  9. E Hunter says:

    Good luck with your project! I’ll be really curious to track your progress. It’s an interesting idea, though something you would have to have a fairly established fan-base for, don’t you think? I’m not sure this would work for most first time authors, but it’s particularly interesting for future projects, sequels, spin-off novels, things like that.

    Thanks for posting about this. Very interesting!

    E

    • I think the guest post I linked to above was from a first-time novelist, can’t remember for sure. So it’s doable. And, I suppose, this is my first novel, although I have released other stuff and built up a bit of a profile. But yes, the more established fan-base you have, the more chance you have of being successful, and for trying even more ambitious stuff. I’ve seen writers to offset print runs to bring out limited edition hardback editions – really beautiful books, but you need to have an order of, say, 500 or more to make it viable.

      There was a graphic novelist who got a lot of press recently who was offering their print, foreign, and movie rights on Kickstarter – before it got pulled, as I believe it was against their ToS. More here: http://publishingperspectives.com/2011/10/alex-de-campi-uses-kickstarter-to-sell-rights/

      • E Hunter says:

        It’s a fascinating idea with a lot of possibilities. I just included the link to this article in my blog post for Friday. I think this is a great development in a consumer-driven market.

  10. Pingback: Friday Publishing Links « Spare some prose.

  11. Joan Reeves says:

    Hey, David, I love Kickstarter. Always checking out the latest projects. My husband has thought of posting his vineyard project there. I hadn’t thought of using them for my ebooks, but I may have to think on this a bit. Great post–as usual.

    Best wishes,
    Joan Reeves

  12. Good luck with this, Dave.

    The lack of comparable initiatives in the UK is quite depressing – or maybe they exist and we have yet to hear about them?

    As a new micro-press we’re looking at the possibilities for supporting authors in a not dissimilar way, although with the more traditional (and probably more alluring?) reward of actual money. For 2012 we hope to identify some of our client authors that readers will feel worth investing in and risk a few pounds/dollars/euros/yuan for a fixed and relatively lucrative return if that author sells at various predetermined volumes (giving investors good cause to do some promo of their own).

    The funds would be used to pay for advanced ebook features suited to the next generation of e-readers (which will increasingly be beyond DIY means), and to maximize promotion and distribution.

    The eventual release of the Harry Potter ebooks will be far, far more than just a digital text version of the print book, that’s for sure. JK Rowling has the resources to make the Potter ebooks magical, and magical they will be. Anything less would be folly.

    Great for Harry Potter fans. But raising expectations for *all* YA and children’s books to a level few indie authors will be able to compete with. As new ebook software develops and the b&w Kindle becomes obsolete – when everyone is reading on a fancy tablet that can do the impossible – the advantage will be handed back to the trad publishers who can easily afford the expertise required.

    • Hi Mark,

      There probably is some comparable UK site that just isn’t well known (or known to me, I should say), but http://www.indiegogo.com/ is open to anyone, worldwide, as far as I’m aware.

      It will be interesting to see what you have planned next. I’m not quite sure where you find the time!

      As for Pottermore, I read some accounts that everything isn’t rosy over there. The beta testers (i.e. superfans) are becoming more and more frustrated with problems and delays. It appears that the interactive experience isn’t playing nice with so many people trying to use it simultaneously.

      In any event, I’m not so sure it will raise those expectations like you fear. The interactive experience is separate from the e-books themselves (it’s based in the HP world, but when they do get around to selling the e-books, they will be separate, i.e. standard e-books, although I would imagine they are looking at apps and the like on top of that), and I think people will be able to differentiate. The beta testers all refer to Pottermore as a site or a game, not an interactive book as such.

      You are right that if enhanced e-books become popular, that will spell difficulties for self-publishers. Without deep pockets, they will struggle to come up with the investment necessary to add music, video, interactive, or gaming elements to their stories. I can see publishers teaming up with gaming companies, and all sorts.

      However, I think straight, narrative text will remain more popular. I can’t see all these bells-and-whistles providing a more immersive experience. In fact, I think they will yank you out of the narrative. I think if people want movies, games, or videos, they won’t be buying books. And this interactive, storyline-led multimedia experiences already exist. They’re called games. Why would I want an enhanced ebook when I can get a PlayStation 3 or XBox?

      Although, when the next generation of children grow up, all bets are off. This toddler, for example, thinks a magazine is a broken iPad:

      • Red Tash says:

        I am a Potter super fan, and your reports are correct. Pottermore is beautiful and will be lovely with all the backstory to come, but even Rowling/Sony’s resources did not handle the beta even slightly well. I don’t even log in anymore. I would love to get in there and post a pic of Hermione’s Time Turner necklace that I got for my birthday today (yes, I am 12), but it’s not worth the frustration. For now, the crowd-sourced, advertising-sponsored fansites like Leaky Cauldron or Mugglenet are still the way wizards are connecting. Pottermore is a beautiful, broken website.

        Also, to Mark, nice to see you again!

      • Love that video! The shape of things to come…

        On the HP digital books, if they were going to be straight-forward digital editions they would have been churned out in time for Xmas. Rowling is a huge money-making machine. She wouldn’t pass up an opportunity like this without good reason.

        My guess is the ebooks will have numerous links back to Pottermore and god knows what other extras usable on the advanced ereaders, that would be meaningless on the old Kindles.

        I agree straight narrative text will be the reading preference, for current generations at least, but the new ereaders will have ways of making all the extras unobtrusive options. Thinking beyond the KindleFire your own book is a case in point. Images, video, background research, maps, etc, and all the South Americana blog material could all be included as extras without in any way detracting from the narrative for those who want to just read the book. But readily available to bring up for anyone who wants to at the click of a button.

        I suspect for historic fiction this will become the norm very quickly, and for other genres variations on the same will follow. I could envisage a future release of Sugar & Spice with background material on the research behind the story and various added-value additions despite the sombre storyline.

        For fantasy writers the opportunities are boundless. I think the line between game, video and book will quickly blur over the next few years, certainly for children’s and fantasy works, and increasingly for other genres.

        @ Red Tash – Oi! Stop moonlighting in the comments here at LGD and come over to MWi and do a guest post sometime!

  13. You’ve got my gears turning now, Dave. Dangerous thing. I might look at this for the first Urban Midgard novel.

  14. I like this idea, David. Definitely has egg in face potential, but I might be willing to do a little duck and shuffle to get book three out! Thanks for the info!

  15. Kip de Moll says:

    Great work, David,
    I’ll check out your site. I’m a few days into a Kickstarter campaign to raise funds for the companion CD to my book. http://www.kickstarter.com/projects/1707807469/zen-and-the-art-of-a-midlife-crisis. We wish each other luck! I appreciate all that you’re doing.

  16. Red Tash says:

    I am so glad you posted this. I want to publish This Brilliant Darkness as a graphic novel, and affording the hundreds of dollars per page for illustration has forced me to put that idea on the backburner. I may have someone to partner with (cross your fingers), otherwise it’ll be Kickstarter for me. And, frankly, I know how much effort that push will be, so that’d have to be some time in the future. *After* I’ve finished some more books, or at least when I’ve got a readership your size. You are so smart to leverage yours this way. I’m in full support, and hope to send you a few $.

    Re: pre-orders, there are indies who do it, but they’ve got to generate their own buzz. It would be nice to have a way to squeeze into Amazon’s buzz loop. There are services, but I choked at the prices.

    Re: Shea, she is great and deserves the success, undoubtedly. She raises the GPA avg. of our class and that’s good for all of us who are self-pubbing. But do not beat yourself up too much about Valparaiso vs. her prolific Autumn of 2011. She is writing a much different kind of book than you are. TBD gave me headaches, as well. That’s why my next book is so much simpler. But you know this stuff!

    Oh, why is novel-writing so hard? If I didn’t enjoy it so much, I’d go back to the paper.

    • Thanks, Red, and you are spot on. My genre is one I adore, but just happens to be uber popular, which does make it easier to sell than some genres. It also doesn’t take nearly the kind of research and time that an historical takes. Not even close.

      I’d also like to give some props where they are due. Because I listened to people like Dave and Joe Konrath, I made sure from the get go that everything was done right so my books would be almost indistinguishable from those pubbed by the Big 6. That has helped tremendously.

      Dave, I’ve no doubt you are gonna rock the charts with Valparaiso. Give ‘em hell. ;-)

    • “Why is novel-writing so hard?”

      Because if it wasn’t, there is no way we could get as much enjoyment out of doing it.

      :} Catrhyn Leigh

  17. I’ve been checking out projects on Kickstarter for a while now, not just the writing or publishing but projects, but all different kinds. I get all sorts of ideas just seeing what people are doing. I’ve seen some projects that had very good videos to go along with them, and by good, I mean ones that pulled me in and made me really check out their project, go their website, etc. I’m not saying that you have to spend a lot of money on a video. I just think the video really needs to tie in to the project.

  18. David, as you know, I am doing a Kickstarter program but so far, I have only reached 5% of my goal. *Sigh*. I have 25 days left and I am positive some more more money will flow in. If it doesn’t, I very well might think about doing my “own” crowdfunding on my website to see if I am anymore successful. I still think this is a brilliant idea but perhaps Kickstarter wasn’t the right company for me to try my experiment. That is the great part about life though: you live and you learn. Even if I don’t raise my $950, I have had a blast doing this project. Thank you for the inspiration, David.

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  20. I have exceeded my crowdfunding target ($2,000) with 12 days to go. Awesome!

    Thanks to everyone who participated and helped to spread the word.

    Dave

    • That’s fantastic, David. I love this idea and it comes just a couple of days after seeing something similar that was reported on a news program. The site is http://www.unbound.co.uk/ and it allows authors to pitch their idea via a video. Alas, it is only for published authors (traditional presumably) or first time authors via a literary agent.

      I’m definitely going to give this a try for the second book in my Psychic Knights series.

      One question. How are the raised funds seen by the tax man?

      Paul

      • Hi Paul,

        I’ve heard of unbound, and it’s interesting, but don’t they take like 50%? I remember hearing of some downside (other than the success rate of the projects not being really high and it not being open to all).

        Re. tax, I have to sit down with my accountant and figure it out. My uneducated guess is that it’s not straightforward and I’m not sure exactly how it’s classified. I’m also not sure how much can be written off given that there will be some expenses involved in fulfilling some of the rewards (i.e. buying and shipping paperbacks from Createspace) and all of the money raised is being reinvested in the sense that it’s all being spent on publishing expenses: editing, typesetting, and promotion.

        If there are any issues worth sharing, any areas of concern, or any (legal) way of setting it up that minimizes tax expenses, I’ll post about it. However, my situation may be very different from someone in the UK or the US where the rules and reporting requirements and so on could well be very different.

  21. aricmitchell says:

    Hi Dave,

    I’ve been following your comments on Joe Konrath’s site for quite some time. Recently, after your guest post, I picked up “Let’s Get Digital” on my Nook Color, and I read the entire thing in one day. Fantastic information. I don’t know how you do what you do without having a fat Big 6 contract, but your attitude alone, along with your extremely thoughtful and level-headed manner, will have me picking up your first novel when it comes out. And this blog post was awesome. Already the little wheels inside my head are turning. My only problem is this: why does it take you to point this stuff out before it ever occurs to me!? Your foresight is both aggravating and appreciated.

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  31. I totally am loving this website :D going to have to add this to my bookmarks.

  32. Pingback: The Ultimate Advance – Crowdfunding Your Next Book «

  33. This design is steller! You definitely know how to keep a reader amused.
    Between your wit and your videos, I was almost moved to start my own blog (well, almost.
    ..HaHa!) Fantastic job. I really loved what you had
    to say, and more than that, how you presented it. Too cool!

  34. Anyone else love how much the spammers compliment us lowly bloggers in the comments section of our blogs? :)

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