In this episode of Inside Scoop, host Paula Rizzo interviews publishing expert Jane Friedman to demystify the business side of being an author. The conversation begins with the premise that writing a book is fundamentally a business venture, requiring the same strategic thinking as any other enterprise. They discuss pervasive myths about author earnings, revealing that 98% of books never sell more than 5,000 copies and that most authors do not earn a living from royalties alone. The pandemic’s dual impact—record sales growth alongside supply‑chain challenges—has led to a hybrid model of virtual and in‑person events. Friedman outlines how authors can diversify income through speaking, consulting, online courses, patronage platforms like Patreon, and leveraging books as marketing tools. The dialogue contrasts traditional publishing, self‑publishing, and Amazon imprints, emphasizing that the right path depends on an author’s goals, platform, and tolerance for risk. Practical advice is offered on setting up a separate business entity, bookkeeping, and using tools such as Wave or Xero. Resources such as newsletters (free every other week, paid industry‑focused edition), query classes, and the Women’s Media Group are highlighted as ongoing support for writers. Throughout, the tone remains conversational and supportive, aiming to equip both aspiring and established authors with actionable business knowledge.
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Hey there, welcome to Inside Scoop. I'm Paula Rizzo. Today we're talking about books. Are you an author? Raise your hand. Uh, do you want to be an author? Raise your hand. If you fall into either of these categories, I have a secret for you. You are a business owner. Yes. Running a book is like running a business. It's— they're two in one and the same. So we're going to talk about it today because not everybody thinks of it that way. And I know this, you know, as an author. I have two books about productivity, Listful Thinking and Listful Living. Those are my, my two books. My passion— it was a passion project that turned into a business, uh, unbeknownst to me, of course. But it, it's the thing that you do need to be thinking about if you want to write a book. It is a business, and it's It's great to write for fun, but if you want to be a professional author, then you really have to have some business know-how. And I have a great guest today who I'll bring on in just a moment to give us all the ins and outs of this. And don't worry if you're an author and you're like, "Hey, I didn't master this yet." It's cool. We're going to tell you all, all of what you need to know in just a minute. But first, I have a free resource for you that I think will be helpful for you to get your message out into the world in any capacity. You know, in media, we talk about media. My background is as a television producer, of course. But media now is anything. Right? Any kind of media you want to do. This show is a form of media. So if you want to do your own podcast, you want to do your own videos, I have a checklist to become a go-to media expert, uh, where I share all kinds of tips and tricks on video and presence and how to get out there in a bigger way. If you go to paularizzo.com/checklist, and there's a QR code there. We're very, very high tech on this show now. So if you check out that QR code, you can just click it. If you're watching this on your phone and you're like, how am I supposed to do this? Screenshot of this right now, and then you can go back into your camera roll, and then you can click on it from there. Uh, that is the way around it. We made sure to find out for you because I had questions too. I was like, how does this work exactly? But you're all hooked up. Uh, I'm also a LinkedIn Learning instructor, and so I have several courses all about how to get things done and how to be more productive and efficient. So there's a QR code for that too, but you could also go to linkedinlearning.com. That's just one of the 6 courses that I have on LinkedIn that you can check out right now. And I want to hear from you throughout this broadcast, whether you're watching live right now or you're watching the replay. Leave your questions below. We're going to be checking this out, so put this in the chat box below. Let us know what your questions are, or tag a friend. Tag someone who you think might benefit from this conversation, someone who maybe has been talking about a book that they've been wanting to write for a really long time. Well, this is the conversation that they need to be in on. And without further ado, I want to bring on my guest Jane Friedman is an author, a publishing industry expert. Thank you so much for being here, Jane.
My pleasure, Paula.
And you literally wrote the book The Business of Being an Author.
Yes, I did.
So you know more than anyone else that this is an actual thing. Why do people get this wrong?
Well, there are a lot of myths surrounding the writing and publishing world, um, But I think largely there is a taboo around discussing the money, and a lot of authors don't like to talk about often how little they were paid or how little they sold. And so there's this just a very, uh, difficult curtain that comes down. It's hard to pierce through that veil.
Hmm, that's interesting. That's a, you know, it's perspective, right? And so, you know, in the entrepreneurial world, I found Uh, people love to talk about money. They love to talk about how much they charge. They love to talk about how much they made. They love to, you know, corporate America, not so much. And also authors, not so much. So it's, it's sort of like a cultural thing.
Oh, very much. I see authors on Twitter complain frequently that someone asked them how their book is doing, like in terms of copies sold or financially, and they're very offended. They feel like it's like inquiring about someone's salary.
Yes, yes. And what is the truth the, the actual, like, what means a book is doing well as far as how many books are sold every year? Uh, you know, do you have any stats on that as far as, like, you know, most books sell, what is it, like 250 books total or something crazy?
Well, the big statistic that was shared recently in The New York Times was that 98% of books published don't sell more than 5,000 copies ever. So yeah, ever. So that I think puts it Uh, but that's— those are the facts. That puts it in stark relief for you.
Yeah, for sure. And, and the pandemic has happened, and it had a huge impact on every industry, but particularly the book industry. So how are things different now for authors and for writers than, than ever before?
Well, it's a story of paradoxes because sales have never been better. In fact, the industry grew 10% in sales in 2021, um, since we've been tracking sales in the industry, which actually hasn't been that long. Um, I think it— if you go back to the 2005 is when we started looking at this methodically. Um, 2021 is the best year on record since we started looking. However, if you take a look at the publishers and what they're investing into marketing or what they're investing into their midlist, you know, you hear a lot of disappointing stories. So, you know, the profits aren't necessarily being evenly distributed. Then the other issue that's paradoxical here is that as we're seeing these increased sales, we have supply chain issues, right?
You're not getting there.
Yeah, so this isn't unique to publishing. Um, there were actually serious issues with supply chain before the pandemic related to paper supply and printers and all that was just exacerbated by the pandemic. So books are getting pushed back, costs are increasing pretty significantly, and you know, that is currently playing out. I don't have a lot of answers about what's gonna happen.
Yeah, yeah. It's interesting though, you know, I mean, one of the things that came out of this is a lot of virtual events, which I love, and I've always loved virtual events. Obviously I love video and I've been doing this for a very long time. And when my second book, Listful Living, came out in 2019, I did a virtual launch I mean, I did an in-person launch too, but like I did a virtual launch because I was like, hey, this is a fun tool and it's a great way to have people who are not in New York City, if that's where I was doing it, to be a part of it. And so I have long loved the virtual event. The book industry, I mean, I think they embraced it, but now they're going back to in-person again.
Yeah, I mean, there's— it depends on which way you look. There are a lot of different attitudes towards this. I would say that right now I'm seeing a hybrid model for maybe the majority. There's a mix of in-person and virtual. And I think we'll probably continue to see that because some people were just so, so grateful for the accessibility of online events. You know, these are people that might not have been able to leave home because they're caretaking or because of health reasons or because, you know, they didn't have the money to go out or travel or go to conferences or events. So I think you're going to see bookstores, publishers, and authors continue to do a mix. But I know everyone is very eager to get back in bookstores and, and, you know, having contact with readers.
Yeah, for sure. I mean, and that's where the magic happens in the bookstore, where you get to see, oh, I like that book. Oh, look at that cover. You know, you don't get to do that when we're, we're just doing it here, you know, on Zoom or whatever it is. What about the business model? Here for authors? Because, you know, a lot of people think like, oh, it's, it's, you know, that you think of the struggling author or the person who has that book that they always wanted to write and they never did. But what is the reality? Like, what could it look like, or what should it look like for an author?
Well, the truth is most authors don't make a living on book sales alone unless they get some kind of amazing advance. And even then, you know, advances are split into 3 or 4 parts, and the agent takes 15%, and then there's the taxes. So you're not usually left with a living wage even if you get a really impressive of advance. Um, even if your book sells really well, you know, you're getting a royalty off of that, and sometimes the royalties are less than what authors might expect. So, you know, your average $25 or $30 book, an author might be earning $2 or $3 off that. That's just ballpark. I'm not saying it, you know, it could be lower, it could be higher. So you have to sell a lot of books, you know, and that's after you earn out your advance. And I would say 70 to 80% of books don't earn out the advance.
Wow, that is a huge number.
Yeah.
Wow, that's something for, for people to think about too, you know. If you're a first-time author and you're, you're looking for a book deal and you really want to get your book out there and you're waiting and waiting and waiting for that huge advance, think about it because you're gonna have to earn that out. Maybe you get a smaller advance and you earn it out faster.
Yes, yes. I, you know, there are a lot of different strategies there. Agents certainly like the larger advance because it means a commitment from the publisher to you know, see books sell in order to earn, recoup that investment. Um, there's no right or wrong strategy, uh, but I would say that it's great when you can earn out, and it tends to make the publisher, you know, more eager to work with you on the next book for sure.
And that's, that's the whole thing. It's a partnership here, you know, and, and to be able to have a sustainable long-term career as an author, it should not be one and done. Uh, you know, there are a lot of people out there teaching courses and things about, you know, how to use the book to, to, to do multiple, multiple multiple things, you know, speaking and things, and that's great. It will get your, your foot in the door for those things. Um, but if you do want to create a career, uh, and make money from your work, you know, what, what advice do you have for, for writers?
I would say it differs a lot between nonfiction and fiction. Nonfiction writers usually have a lot more options, um, or it's easier to make, uh, that connection between book and then some other profitable side business, whether that's speaking or consulting or offering online classes conferences. Sometimes the book becomes the business card to get the great clients, or, you know, um, business— just any sort of business opportunity.
Sure.
For fiction writers, often you have to be more creative. It often involves reader engagement or knowing who your readers are, patronage. So there are lots of ways now to have patrons, like literally Patreon. It's right there in the name. Oh yes, getting readers to pledge every month to support your work in exchange for accessibility or you know, chats with you, the author, or other perks. Um, there's something called now the creator economy, which is nice in, in one regard, in that you see all of these social media sites and other platforms trying to find ways to reward people monetarily for being active on their platforms. So that's, that's the good part. But, you know, these companies aren't altruistic, right? And, and it's shifting sands. They're always changing the rules around, but Nevertheless, whether it's YouTube or Instagram or Twitter or Facebook or any other number of sites, there are ways to make your activity pay off. And this is like, I'm just talking about like ground level. There are of course other advanced strategies.
Yeah, for sure. And I mean, there's the offshoot of the book. I mean, you and I have both done this in our careers. We have online courses that we teach, we speak, I do a lot of consulting and things like that. Have used the book, uh, to be able to then leverage other parts of our, our businesses and, and our careers. You know, people don't always think of what else after that. Like, what will you do with the readers that you have? Like, they read the book, cool, and then what? What's next for them? What else can you give them? So that might be a good exercise for people to sort of think through as they're thinking about writing a book.
Yes, I think every author has a demand curve And so you want to think about populating that demand curve at every possible point. So on one end of the demand curve, there'll be lots of people who are very willing to take something you offer for free or for 99 cents or for a few bucks, like an ebook. And then at the other extreme of the demand curve, you've got the private dinners and lunches and retreats and things where people want that access and that time with you for whatever reason.
Wonderful. Well, we have a super fan in the audience, Ms. AJ Harper, a friend of mine and yours. And she is thrilled. She's also been on this show before, so check back to the old archives to find her, uh, to her episode. But she says, so glad, love Jane Paula, so glad you're having her on. I refer many of my students to her query classes. And yes, you teach many classes, uh, query classes, uh, how to write a proposal. I have been a student of your class. I told you this earlier, uh, I took a class on how to, how to write a proposal A query letter, it is called, right? A query letter for fiction. Since I do have non-fiction books, I'm now learning the ropes of, of, you know, what fiction means and how you do that. And Jane has been an amazing instructor. So if, uh, we're gonna show you how to, to get in touch with, with Jane, uh, to get on her email list. Actually, uh, Ali, can we pull that up? Ali is my producer in the back, uh, background. Um, that is— there's a QR code for this, uh, so if you can get on, on Jane's newsletter is a fantastic newsletter that she sends out. Uh, is it once a— every other week? Once a month? How often?
Uh, yeah, every other week.
Every other week. Yes, I'm on this list every other week, and she tells you all about the different classes that she has, uh, which have been very, very helpful. And she has guest instructors and people who teach other pieces of the, you know, book and writing industry, uh, that is, is just, just really great. So get on the list for sure. Uh, and AJ, thank you for watching behind the scenes there. Appreciate that for sure. Uh, and I want to talk a little bit about fiction fiction? Because, you know, we mentioned non-fiction, and it is very easy for non-fiction authors to then leverage the books and get the speaking. And, you know, but fiction authors might not want to do that. So what is the— if you're not, you know, Dan Brown and you're not making money off these books, what do you do?
Well, it depends on where you think your strengths lie. The, the fallback for many fiction writers and poets and memoirists has been teaching, you know, teaching what they know, teaching the craft, um, like in MFA programs or more informally through community centers. So there's the teaching piece. Some are very talented editors, copy editors, copywriters, and so you'll see a lot of authors put out their shingle as a service provider for other authors because they just excel at this thing that they do, and then they can help others. And I mentioned patronage. I think there are some authors who are quite good at giving like access to short stories or works that they're working on in between the bigger projects, and then they give their, their ardent fans, you know, access to that before anyone else. So that's another thing to think about, especially if you're a very prolific writer and you— maybe you're not, um, maybe your publisher can't use all of the material that you're generating, but maybe your readers would love to have it and they're willing to pay for it.
Interesting. That's a good, that's a good move. I like that. Uh, let's talk a little bit about self-publishing versus traditional publishing, you know, I get this question a lot from media training clients. I work with lots of authors. I love working with, you know, authors at any stage of their career, but I really love the first-time authors because I feel like I can, I can give so much, impart so much wisdom from my own publishing journey. And also, you know, those that I've seen of others, uh, you know, because sometimes people think, oh, I'm gonna get a publisher, my life is made, they are going to do everything for me, it's going to be awesome, I'm going to pitch to the media, I'm gonna be on the Today Show, this is going to be great. And then that doesn't exactly happen, and people people get a little upset and they think, oh, I should have self-published, that's so much better. Yes and no. Do you have the platform for that? Where are you gonna— you know, there's a lot of things on either side of this. What's your take?
There is no single right path. It's gonna differ by author and also by project. So I'm someone who has both self-published and traditionally published, and I think I chose the right path, fortunately, for each book. I had different goals with each book. And so you really have to be thinking about what is it that you're trying to accomplish with the project? Is it something where you are trying to leverage the publisher's distribution and validation of the project and their— maybe their ability to get national media attention if they put the effort in, um, and you're going to use that to help make you big— look bigger than you've ever looked before? Um, or is it something that you're going to be selling at the back of the room, or you want to use it as part of your business and it's going to complement classes you're teaching, or, you know, and you don't really need a book sitting in Barnes Noble. It's something that you're using, uh, let's say more internally. So there, you know, these are just two very small examples. I would say the tougher questions come into play when you're, let's say, writing mainstream fiction, uh, literary fiction, where it's really tough to self-publish some of that and get an audience until you've got multiple books out. So One of the mistakes I see people making is they'll self-publish their novel. Sometimes it's a memoir, and it won't go that well because it's book number one, and it almost never goes that well for book number one if you're self-published. And they just don't have the patience to continue down that path for more than a couple books until they're like, I'm done, right? Time to find an agent or a traditional publisher who actually knows how to market this.
Yes, yes. Well, that's true. I mean, and also, you know, for fiction, it's like, unless unless the endgame is, oh, you want this to be a Netflix show, or you want this to be, you know, because that, that could be a whole other, uh, avenue, you know, films, film rights and things like that. Uh, it's harder to do, obviously, but, you know, the industry, as I know, you know, I've been doing a lot of research into this, you know, for TV and for films, they're looking for things that are already published, that are already out there in the world and already have shown that people love it, and they will turn that into something, you know, great on, on TV or in film. So, uh, but that's another, that's another way to to, right?
Oh sure, yeah. I— there has never been more intellectual property and publishing picked up than in the last few years because of the surge in streaming and everyone's, you know, trying to build up their library of original content. It's also true on the audio side. So audio originals and podcasts, you know, you've got Audible and Spotify and, um, oh gosh, I'm blanking now on, on the other companies, but you've got a lot of people competing against one another for audio content. So um, that's another avenue too.
There is a lot of places to put your, your, your stuff and repurpose it. And, you know, different audiences— people learn things differently, people hear things differently. So there's definitely a lot of opportunities out there. Uh, you and I are both members of a wonderful, uh, organization called Women's Media Group, and it started here in New York City. And I've been a member for many years. I mean, I think 10 years. I've served on the board. It's been a wonderful, wonderful part of of my life, uh, and you are a newer member, so welcome. Uh, and we do have a member, uh, who has a question, so I'm going to bring that up. It's from Carol Honig, who is a Women's Media Group member, long-term member, and also she had a wonderful book shop, uh, on Long Island for many years that has since closed. And I did a book signing there for my first book, Listful Thinking. So thank you again, Carol, it was lovely. So here's her question. Uh, she does wear many hats in the publishing world, but her main love is being a novelist, which is where she makes the least of her money. She says, if my agent cannot get a traditional book deal, which is being considered by one right now, he suggested pitching to one of the imprints from Amazon that offer advances. Oh, that's interesting. I didn't even know about that. Uh, I pretty much begged him not to since I'm a big proponent of brick-and-mortar bookstores. I mean, she owned one. Of course she is, right? Uh, would it be foolish to turn down the possibility if he cannot get me a traditional publisher? What do you say?
I wouldn't say it's foolish because I think if your values don't align with Amazon's, um, and some, you know, I think that's probably true with so many authors, you know, you feel a little uncomfortable, um, giving them business when you know what they're doing to the greater literary and publishing community, especially independent bookstores. That said, I find that Amazon really understands how to market and promote books to readers in a way that traditional publishers still can't. Um, so what's going to happen is likely, um, you're just going to see an amazing amount of customer reviews and uptake because of Amazon's power, like through its various programs, through Kindle Unlimited, through Amazon Prime. You're just going to see probably an increase in the exposure for the book that you publish for them, which hopefully if you have other novels traditionally published, there's going to be this effect where you see those get more attention. Um, you know, I think where it can become challenging is I've heard it's tough for authors who have moved to Amazon publishing to move back to another publisher because, you know, Amazon tends to sell at lower price points for digital editions. And so traditional publishers can just be, well, like, it's very different to sell you now because now people are trained to pay their whatever whatever it is for Amazon ebooks, rather than our $10 or $12 for an ebook. So that's, that's maybe the one— like, I don't know if I'd call it a warning, but if you're hoping to go back, you might find that traditional publishers don't see the Amazon success in the same way, even if you've sold more copies than you ever did prior.
Hmm, interesting. Very good, uh, excellent insights there. But you might love it, Carol, who knows?
I should say that almost uniformly authors say they got better treatment from Amazon than from their traditional publisher. Like responses, um, careful editorial and design work. So I can say that you'll probably be treated well even if you don't like the company's practices otherwise.
Yes, exactly. Can you, can you bury that deep down, Carol? I don't know, I don't know. Uh, but she says, Carol says, it was wonderful. Uh, thank you for this. Uh, thanks, Jane. Wonderful, fantastic. Uh, that is great perspective because there's, there's now so many more ways to publish and so many more ways to partner with people, and there's a hybrid model model that some people do as well. So you have the backing of a big publisher, but it's a self-published model. There's a lot of ways to do this. There's a lot of ways to get your content out into the world. And if you're watching and you have questions, leave the questions below. We will get to those. And Jane, I want to ask about particulars. So you've got a book. Let's say you've got a book deal. What do you do? Do you just open a different bank account? What should you do to start your business of this book?
So what I would recommend is having separate accounting and bookkeeping and finances and accounts, etc., whatever needs to be done to separate the personal from whatever your author career, whatever is happening on that side, even if you feel like you're not earning enough to make it worthwhile. It's just so much cleaner at tax time. Now, you don't have to establish an LLC. You can remain a sole proprietor. That's the decision on that's going to vary state to state and with your others. You know, everyone's situation is very personal in this regard. So, but I do think, um, even just having a different, um, not using your social but using an EIN, I think is very useful. Um, having a business credit card, tracking your expenses. I like using Wave for this if you're allergic to QuickBooks, like, or Quicken or whatever it is, like I am. I like using Wave to help help track everything. If anyone is listening to this is still using Excel to track income and expenses, please stop. Please stop hurting yourself.
It is a struggle. It's awful. I did it for a long time too. I use Xero. It's X-E-R-O, Xero. And I did, as soon as I got that first book, I said, "You know what? I need to separate this in my mind too." Because that's a really good way to sort of step into being an author and saying, "Hey, this is a real thing on its own." own, separate from everything else that I'm doing. You know, at the time I was a full-time TV producer, and so I wanted to sort of have its own life and its own, own world. And I did, uh, I did create a business around it, uh, you know, and now that's the business that I'm doing. So, you know, it worked out for me that it ended up becoming my full-time gig, uh, but yeah, having that mindset of just having things separate was really helpful, especially in the beginning, uh, and it also helps you track it better to say, hey, is this actually, you know, what, what is happening over here? You know, what's going on? Uh, so that That's definitely helpful. Well, Jane, this has been awesome. And I so appreciate your time and your insights. And I want to direct people again to your newsletter if they're not on it. You can use our QR code right there. And again, if you're watching this on your phone, you can take a screenshot of this and then go back into your camera roll, and then you'll be able to click on that QR code. But if you could share a little bit about the things that you do share, and I know you also have a paid newsletter as well. So if you want to talk about that a little bit.
Sure, the free newsletter is by far my most popular, and I share digital tools and resources in each issue. So it's like 4 tools, um, because I just— I am— I nerd out on all of this stuff, and so I'm always finding new things that I want to talk about. And there are some other bits and pieces in there. I start with a usually a personal anecdote of some kind and then reader suggestions. Then I have a paid newsletter that's very much like industry, uh, industry wonk stuff. So if you love hearing about how authorship has changed during the pandemic, you'll love this newsletter. I talk a lot about how, you know, marketing and publicity strategies at traditional publishers and for self-publishers, trends in the market, that sort of thing.
Fantastic. Well, wonderful. Well, thank you. I hope everybody gets on there. I know somebody who's going to— AJ Harper, she's a big fan. Again, she says, thanks, Jane, we haven't met, but I'm a big supporter of yours. And thanks, Paula, you always have great Yes, thank you, thank you, thank you, AJ. Thank you, Jane. To be continued. I'm sure we'll have much more to talk about in the days and years to come, for sure.
Yes, thank you.
Yes, of course. Uh, and to all of you, thank you for watching. Leave any comments, questions below if you're watching the replay. We will get to you for sure. Uh, send this to your friends who you think might need some of this info. And again, if you go to my website, you can check out my checklist to become a go-to media expert. If you go to paularizzo.com/checklist, or you can use the QR code because we're very cool like that now. This is our new thing. We love QR codes. You know, we're just, we're very hip and savvy on this show. So thank you for watching, and I look forward to seeing you next time.
