Pub Rants

A Very Nice Literary Agent Indulges in Polite Rants About Queries, Writers, and the Publishing Industry

Category: What Makes A Good Agent – Article Series

Gone Hollywood

I used to dream about about this town (Supertramp anyone?), but now I just wish I could have a month free from tackling a film or TV contract. And yes, I realize I’m whining about a good problem to have.

This summer I did seven book-to-film deals. (I’d like to clarify here that NLA does not represent screenplays or screenwriters. We only sell the film/TV rights to projects for which we have also sold the print/digital rights to a publishing house. I definitely do not want a stream of screenplay queries after this article goes live.)

Film/TV contracts tend to be 40 to 50 pages long and often require many rounds of negotiation before the contract is final and ready to sign. Studios hate to give in on requests because the biggest issue in Hollywood is that every contract sets precedent for the next—and neither side wants to get stuck with a deal term that will later come back to haunt.

So film/TV deals are quite sexy (for the author), but the time investment for the literary agent is significant. Most literary agents work with a film co-agent to shop and place film/TV rights, but I’ve negotiated and closed deals sans co-agent in conjunction with my entertainment attorney.

All this to say that even if a film co-agent is on board, it is actually the literary agent’s job to negotiate the heck out of the author’s reserved-rights clause in a Hollywood contract. Who better understands the publishing agreement than the original agent who brokered the publishing deal? I speak from experience: there are lots of changes that can be made in a Hollywood contract, and if your agent is not getting significant changes, author beware. You might want to engage an experienced entertainment attorney to act on your behalf during the contract negotiation.

The Anatomy of a Reserved-Rights Clause in a Film/TV Contract

Now let’s chat about the anatomy of a reserved-rights clause in a Hollywood contract. (There’s no way to tackle every aspect of a Hollywood deal in one article, so I see a series in my future!) The first thing that should be included in this clause (which, by the way, spells out which rights the author gets to keep, i.e., which rights are not being granted to the studio upon signing of the contract) is, rather hilariously, a hot-button topic during negotiations. I’m talking about novelization rights.

Think about it. The novel already exists because this is a book-to-film or book-to-TV deal! Yet the studios always try to get the right of novelization to the movie. As we all know, whether we like it or not, a film can vary greatly from the original novel on which it was based.

So just how can a studio novelize a film when the novel already exists, and they, in fact, based their production on that novel?

The answer is simple. They can’t. Novelization must be a right reserved to the author. Some studios literally won’t allow that, so we have to do an odd workaround—we have to “freeze” novelization rights so neither the author nor the studio can pursue. (Side note: this does not impact the original novel the author wrote, as that is already in existence.)

Yep. If you are thinking that is pretty ludicrous, I’m in total agreement with you. But that’s Hollywood.

Next month, I’ll chat about reserving all publishing rights in this important clause and the one publishing right we’ll actually allow as it’s good for the author and the studio.

Creative Commons Photo Credit: Eva Luedin


5 Qs Authors Don’t Ask but Should When an Agent Offers Rep

In the last two weeks, we at NLA have offered representation to seven authors, most of whom received multiple offers. All agents are aggressively seeking new talent right now! It’s awesome to talk to savvy authors who have a list of good questions prepared for their initial conversations with prospective agents, questions like:

• What is your communication style?
• How would you describe your dream client?
• What is your editorial vision for my work?
• What would your submission strategy for this work be if you took it on?
• What happens if my project doesn’t sell?
• Are you open to me writing in different genres?
• Can I chat with a current client?

All these are questions you should ask; you definitely want your agent to be a good personality match and share your vision for your career. But you also want that agent to be your best advocate and protect your business interests in the publishing industry. With that in mind, here are five key questions authors should also be asking, but in general I never hear:

1) What is the average duration of a contract negotiation at your agency? At NLA, average time is three or four months, as we’ll stand firm on key clauses until a compromise is reached. We don’t rush it. If a publishing house has recently revamped its boilerplate contract, then that timeframe can more than double, as we’ll have to negotiate the boilerplate contract first, and then negotiate your specific deal.

2) Will I be involved in seeing the original offer and then the final offer from the Publisher? NLA always shares with our clients the details of the first offer and what we negotiated to create the final offer. Clients are always invited to participate in the process and weigh in.

3) Will I have a chance to review the original contract from the publisher as well as all the requested changes documentation, and then the master redline of the final contract I’ll be signing? Can you walk me through any contract clause that I might not understand? At NLA, we share all this documentation, whether clients want to read it or not, so that clients are 100% confident that their deal and contract have been fully negotiated. And I’ve spent many an hour on the phone or Skype, combing through contract particulars with clients to make sure they’re completely comfortable with what they’re signing. Most agencies simply forward on the final contract for signatures, and that’s it.

4) Do you regularly audit royalty statements? How much money has the agency recovered by doing so? At NLA, we’ve recovered hundreds of thousands of dollars over the years for our authors because we regularly catch errors when auditing their royalty statements. And we catch errors in almost every accounting period—that’s how frequently it happens.

5) How many non-agent support staff are at your agency? This is important, as it’s very hard for an agent to do all of the above, and do it well, without significant assistance from non-agent support staff. At NLA, we have three agents and a team of six in-house non-agent support staff to protect our clients. Most agencies have a lot of agents and very little, if any, support staff. The agents are expected to be independent silos and handle all of the above plus all agenting duties. It’s not possible to juggle all that without letting stuff fall through the cracks.

Bonus question to ask if you are feeling bold: What percentage of your clients make their living solely from writing? If you ask me this question, I can truthfully say that 95% of my clients earn their living as authors—meaning they earn enough money to support themselves without a secondary job or support from a partner.

Back in the crazy days of the late 2000s, there was a popular agent, active on social media, who landed a lot of clients, posted some sexy six-figure deals, and then disappeared. I ended up taking on a former client of this now defunct agent/agency and realized, to my horror, that the author had been signing boilerplate contracts with no negotiated changes. The agent hadn’t negotiated a thing! The author was new to the business and had no way of knowing the agent wasn’t doing the job. Even though that agent looked hot from the outside, s/he had actually done very little to protect the client’s interests.

You can make sure that doesn’t happen to you. This is your career. Ask the above 5 Qs. After all, these aren’t the sexy tasks, but they do affect an author’s bottom line. Don’t feel uncomfortable or worry that you might insult the agent. If an agent becomes defensive when asked legitimate questions, then chances are that agent isn’t right for you.

Stay smart, savvy, and shrewd. Check out my “What Makes a Good Agent” article series on Pub Rants. You are your own best advocate.

Creative Commons Photo Credit: Chris Potter


Backspace’s Karen Dionne Tells You The Best Way to Leave Your Agent

 

For many authors, the thought of voluntarily ending their relationship with their literary agent can be heartbreaking—especially if their agent search was long and difficult, or if they genuinely like their agent. But like a marriage, sometimes what initially looked like an ideal pairing turns out otherwise.

Perhaps you’ve read Kristin’s “What Makes a Good Agent” article series in this newsletter and decided your agent doesn’t measure up. Or possibly you’ve known for some time that the relationship wasn’t working and have concluded it’s time to move on.

Assuming you’ve done everything you can to address the issues with your agent, what’s the next step?

How to Leave Your Agent

First, review your agency agreement. Most contracts specify that the relationship can be terminated by either party with 30 days’ notice.

Unless your agency agreement says otherwise, terminating your relationship by email is fine as long as the agent confirms receipt. If you choose to send your agent a letter via certified mail, it’s a good idea to email him or her in advance to let them know the letter is on the way.

If your agent has submitted your book to publishers, you’ll need to ask for a list of every publishing house he or she submitted your book to. Your agent owes you this information, as well as the status of each of those submissions if any are still pending. Understand that according to most agency agreements, your previous agent will be entitled to receive compensation for sales they made while you were under contract with them, even though you are no longer working together.

As with any professional relationship, take the high road. Feelings and emotions are involved, but don’t get caught up in the emotional aspects of the situation. You may have legitimate grievances. Your agent may be understandably upset. It’s important to stay calm and professional. Be polite and amicable. Thank your agent for all the hard work they did reading and submitting your work without compensation, and move on.

When to Start Looking for a New Agent

Most agents advise terminating your current relationship before looking for another agent. Some authors are understandably nervous about breaking up with their agent before they have another. However, keep in mind that publishing is a small world. If you decide to send out feelers before ending your relationship with your agent, odds are good your current agent will find out.

True story: Agent X and Agent Y, who worked at a different agency, were friends and often referred potential clients to one another. One day, an author looking for a new agent wrote to Agent X. Agent X read the pitch letter and went online to learn more about the author’s book deals—which is how Agent X learned that Agent Y was the author’s agent.

Assuming Agent Y had referred the client, Agent X wrote a quick note to thank him for the referral. Half an hour later, Agent X got an angry email from the author saying he hadn’t yet spoken to Agent Y, and now that agent had fired him. Naturally Agent X was no longer interested in working with this author either.

Once you and your agent have parted ways, your next objective is to find an agent who will be a better fit. It helps to write down what you feel you need in an agent. One you have a list of prospective agents, try to talk to some of their clients if at all possible to ask about the agent’s management and communication style as well as your other concerns. There’s no point in leaving one agent only to fall into the same kind of relationship with the next.

Above all, don’t feel guilty for ending a partnership that isn’t working. This may be difficult if you and your agent are on good terms, but remember: In the publishing world, enthusiasm is incredibly important. Authors need an agent who loves their work, and who believes the author might be the next big thing. If this isn’t the case for you, leaving your agent might be the best decision you ever make.

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Karen Dionne is an internationally published thriller author, co-founder of the online writers discussion forum Backspace, and organizer of the Salt Cay Writers Retreat and the Neverending Online Backspace Writers Conference. She is represented by Jeff Kleinman of Folio Literary Management. 

Photo Credit: woodleywonderworks


Because Agents Are Human Too – Part 3

This month’s topic is the hardest to quantify, because when an agent offers representation, it will be difficult for a writer to ascertain his or her financial viability. This is often knowledge that doesn’t become apparent until after a business partnership has been established.

Regardless, it’s still worth saying: Good Agents are financially stable as agency entities as well as in their personal lives. 

First, let’s discuss why this is important. For those who are new to the publishing industry, keep in mind that money always flows to the author, not away. So, an agent earns her living by being paid a 15% commission (slightly different percentages for foreign and dramatic rights) on advances and royalties for projects sold. In other words, a book is sold to a publisher, the publisher sends a check to the agent, the agent takes her 15% commission based on the gross amount and then passes the other 85% through to the author.

Pretty simple. So why is it important for an agent to be financially stable in both her business life and her personal life? Because you don’t want your agent making fast, split-second decisions about your career, what deals you should accept or not accept, based on the fact that she might really need her 15% commission that month to pay her bills—either for personal debt or for the agency. Same is true when the contract comes in. You don’t really want an agent who will “rush” through a deal-points negotiation or a contract just to get it signed so that she can receive her commission faster.

That’s never going to be in your best interest.

Is it possible to identify the financial stability of an individual agent? In the initial stages of forming a representation partnership, probably not. But here are some thoughts to keep in mind:

*  Does an established agent, in the business for five years or more, still take on a lot of clients? That can be a sign that her current client list does not generate enough money to support her or her agency.

An established, good agent with solid financial stability takes on only select clients in any given year. Agents who need the money often take on a lot of clients so there is more front-end money (advances) coming in rather than back-end monies (revenue generated through royalties). Evaluate an agent’s sales track record and assess how likely the money generated by those sales creates financial viability for the agent.

Are all the deals for small or no advances? Do larger deals that have sold at auction for six figures balance out the smaller deals? Have enough clients on the agent’s list been successful enough to potentially earn back-end royalties to support the agent or agency?

Even when NLA was in its infancy and the budget was tight and small, I was very selective in offering representation. I had a five-year business plan and a business loan to make sure agency expenses were covered as I slowly built up my client list. Good agents don’t jump into agenting on a wing and a prayer. Good agents are savvy entrepreneurs with a plan.

* Does an agent close a deal quickly and then process the contract equally as fast? See my previous Fearless Negotiation article on this topic, as this might be a red flag.

* Does the agent talk about money in oblique or negative ways? There are certain expenses that are just part of being in business as an agent (i.e., paying for one’s own health insurance if an independent contractor under a larger agency umbrella). Does the agent kvetch or consider it a “hardship” to cover these types of expenses? Often that will come out in casual conversation and could be a sign of financial instability.

* Is the agent an independent contractor affiliated with the agency? If so, then that agent has to cover all their own expenses outside of the agency umbrella. Does that agent attend major events like Book Expo or Book Fairs, even when they have to foot the bill themselves? Or does that agent only attend conferences that reimburse travel, hotel, and meal expenses?

* Does the agent balk at footing extra, necessary costs—such as a consultation with an attorney for special situations or issues?

* Does an agent talk with a long-term perspective? Agenting is hard, and lots of new agents come to the business with wide-eyed optimism and then don’t last beyond two or three years. If an agent is committed to the career regardless of the finances associated with it, that will come through in casual conversation.

Keep in mind, this is not a get-rich-quick career. An agent needs to be in for the long haul to make it a success.

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General Summary about the Article Series: Just as the title suggests, because agents are also human beings, they are going to embody both good and bad traits found in human nature. No one is perfect. And as some authors have discovered, some agents are more imperfect than others!

Your job as an author is to objectively recognize those human attributes or failings in your agent and decide whether they impact your career. Hopefully they don’t. To this end, Karen Dionne of Backspace and I have put together a whole list of topics to tackle for “Because Agents Are Human Too.”

Photo Credit: Rich


Because Agents Are Human Too – Article 2

 

August’s topic might be the most controversial. At the very least, I imagine opinions will vary widely, and I welcome any conversation this might spark.

For an agent to be successful, she has to build trust with editors. Editors have very little free time, so they have to trust that what an agent submits to them will be worth reading. To that end, agents build relationships with editors to create that trust. Publishing, in this sense, isn’t the same as selling widgets. It’s rather an intimate industry.

And there is a narrow balance beam an agent has to walk between creating a good relationship with the editor and advocating for the author client.

With this in mind: Good Agents are friendly with editors but not friends with editors.

This is a very important distinction. It’s OK to be friendly in a professional relationship, but being friends poses a potential conflict of interest that might affect the agent’s ability to represent a client.

Quite simply it comes down to this. If an agent has to address a complicated or difficult issue with an editor (an issue that might lead to a split between the author and the publisher), whose side does the agent need to be on? The client’s of course.

But if an agent is good friends with an editor, the agent might not be willing to jeopardize that friendship to be the author’s champion.

At the very least, the agent might hesitate, and that is a real concern. If your agent has committed to representing you, he or she should never put personal priorities over yours.

Even though 95% of the time, it’s peaches and cream with the publisher and author, and a chummy editor relationship won’t be an issue, there will always be that other 5% where a big issue arises. It’s inevitable during a writer’s career.

As a lot of agents and editors are based in New York, where professional functions provide many opportunities for socializing, the line can blur more often than not. That’s something to keep in mind, and one reason being based outside the Big Apple can actually work in an agent’s favor—geographic distance helps create the “friendly with” versus “friends with” dynamic.

Even if an agent strongly believes she can wear two hats and be in agent mode rather than friend mode when the situation calls for it, keep in mind that agents are humans too and, therefore, fallible when it comes to managing the many types of relationships they maintain in their professional and personal lives.

The best agents, even those in New York, are mindful and respect the boundary between “friendly” and “friends.”

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Summary of article series: Just as the title suggests, because agents are also human beings, they are going to embody both good and bad traits found in human nature. No one is perfect. And as some authors have discovered, some agents are more imperfect than others!

Your job as an author is to objectively recognize those human attributes or failings in your agent and decide whether they impact your career. Hopefully they don’t. To this end, Karen Dionne of Backspace and I have put together a whole list of topics to tackle for “Because Agents Are Human Too.”

Photo Credit: Tinou Bao


Because Agents Are Human – Article 1

Just as the title suggests, because agents are also human beings, they are going to embody both good and bad traits found in human nature. No one is perfect. And as some authors have discovered, some agents are more imperfect than others!

Your job as an author is to objectively recognize those human attributes or failings in your agent and decide whether they impact your career. Hopefully they don’t.

To this end, Karen Dionne of Backspace and I have put together a whole list of topics to tackle for “Because Agents Are Human Too.”

Topic 1: Because they are human, good agents keep their client lists small and manageable.

The trick is to define what is considered small and manageable. This question is asked at conferences all the time, and the truth is that the answer is going to vary widely depending on the agent and the agent’s situation.

Some things to keep in mind:

*Is the agent part of a larger organization/agency that supplies a lot of support staff in terms of auditing royalty statements, reviewing contracts, accounting, etc.? Or, if he or she is with a smaller, less corporate agency, how many non-agent personnel does the agency employ?

Many agencies employ a lot of agents but very few support staff. It’s typical in this industry that agents are one-man bands. They handle all the business elements listed above, and even if they’re associated with a larger agency, they still operate as the sole proprietors of their client lists. To be blunt, doing agenting well requires far more work than one person can handle in an eight- or ten-hour day—which means a lot of agents aren’t doing things like auditing royalty statements and thoroughly negotiating contracts.

More support staff = more clients an individual agent can manage successfully.

Here’s a good rule of thumb: If your agent has a lot of support in place, a larger client roster is not really a concern. If they don’t, then know that a larger client list is pretty difficult to manage, and more than likely, some business aspects are going to fall through the cracks.

Some possible red flags:

*Some agents operate on what we call the “shotgun” approach. They take on a bunch of clients, throw a lot of stuff out on submission, and see what sticks. These agents will have a lot of clients on their rosters.

*A high number of small- or no-advance deals could indicate that an agent is operating on the shotgun approach.

*Agents who are already established (five+ years as an agent) should have developed strong financial security with their current client roster. Be on the lookout for agents who suddenly take on a lot of clients all at once or during a short period of time. It could mean their current client list isn’t supporting their business.

*Be aware of agents who have high rate of client turnover, or who do a lot of one-time deals for authors but few subsequent deals.

For me, a small client list means fewer than 50 clients. My list is currently at 32.

Other agents may easily have a comfort level at 60 or 70 clients.

The real question here is, as an author, what is your comfort level regarding how many other clients your agent represents?


Article 5: Good Agents Audit Royalty Statements

 

Over the last decade, I really wish I had tracked how much money NLA has recovered by carefully auditing our royalty statements every accounting period. Because of some big errors found a couple of years ago, it’s probably to the tune of over $600,000 recovered at this point, and it wouldn’t surprise me if that total was actually more. Even now, nary an accounting period goes by that we don’t recover at least $500 to $3,000 owed to a client.

On rare occasions, we have even found errors in the Publisher’s favor—and yes, we do notify them to highlight the correction. Luckily, those have only amounted to several hundred dollars at any given time. And to be clear, Publishers aren’t being nefarious or deliberately cheating the author (with the exception of a few publishers, which will remain unnamed).

Most errors we catch are human errors. In other words, the Publisher’s in-house royalty management staff simply keyed incorrect information into their accounting system. Also, “accounting departments” at some mid-sized publishers and small presses are staffed by English majors. Mistakes will be made.

These mistakes need to be found and corrected and the monies paid to the author client. Here is the jaw-dropping fact: A good percentage of agents do not audit their clients’ royalty statements.

Let me repeat that. Even though authors hire literary agents to guide their careers and most importantly, manage their business publishing interests (royalties being a huge component of this), many agents do not actively audit or even read client royalty statements. This leaves authors to fend for themselves regarding reading and understanding their statements.

So for me, good literary agents audit royalty statements. When I was newer to this business, I did the time-consuming auditing and analysis myself, every accounting period, and shared my comments with my client. Every accounting period. I even hired a professional book royalty auditor to mentor and read behind me to assess my competence and capability. Then I hired and trained our amazing Contracts & Royalties Manager Angie Hodapp to handle this at NLA.

And Angie took it to a level that leaves me in awe every accounting period. I imagine our clients are often in awe as well when every six months, she sends a detailed letter with my comments as well as her analysis of the statement and what questions we had to track down and if extra monies are owed.

A lot of the larger agencies will have staff in-house to handle this (or I hope they do….I don’t actually know as I’ve not worked in a big agency), but I’m willing to guess that most of the smaller, boutique agencies don’t. This means that the author relies on his/her agent to analyze the statements.

So ask yourself. Is your agent doing this? If you don’t know, ask. It’s part of the agenting job. Recently, Angie has been giving workshops at local writing conferences to teach authors how to audit their own royalty statements. Even if your agent does this on your behalf, it’s not a bad idea to also be checking them. Human errors can happen on our end as well!

So with her permission, and worth its weight in gold, a handy list.

How to Audit Your Own Royalty Statements by Angie Hodapp

Keep an excel spreadsheet for each title, and add the following when each statement arrives:

• Track copies sold and royalty rates applied to each edition. Do the percentages match the contract?

• If you have a royalty escalator, make sure you’re watching units sold so you can see if the escalator is triggered at the right time.

• Track royalty earnings for each edition. Add them all up and subtract them from the advance. Make sure your math matches the math on the statement.

• Check for continuity from the last statement’s bottom line (ending balance) to the current statement’s starting balance.

• If the royalty is based on net receipts, then make sure the net amount received by Publisher is reported on the statement, along with number of copies sold. Do the division. How much is the publisher claiming to have received for each unit? Is it a reasonable amount based on the retail price?

• Look at the number of copies reported sold as “high discount” or “over discount” or “special sales.” Publishers love to sell most copies under these terms, which means smaller royalties for you. Make sure your contract limits the number of copies publishers can sell under these terms!

• Watch reserves. Your contract should specify how much the publisher can hold in reserves, and for how many accounting periods after initial publication. You can ask the publisher to release reserves once returns taper off. That’s more money passing through to you, or applying toward your advance.

• Watch returns. Publishers adjust reserves up and down from period to period based on actual and projected returns.

• Watch subrights licenses. Know the terms of all subrights deals, which may include audio, large print, book club (either a stock-buy or a special printing), or other special editions.

• Watch and track foreign right deals. If your publisher holds world rights and is actively selling your work into foreign territories, ask them each accounting period to give you:

—Details of any new foreign-rights deals, including: advance, royalties split, term of license, publication date or planned publication date, and reporting schedule. (Note that most, but not all, foreign publishers report annually, not bi-annually.)

—Copies of the licensing agreements. Even if they’re in languages you don’t understand, it’s within your best interests to have such things in your physical records.

—Note that foreign monies can take from a year to 18 months to pass through the publisher’s subrights department and show up on your statements.

If you want a more in-depth royalty statement auditing experience, join Angie for her upcoming Royalty Statements Auditing Workshop, scheduled for July 30, 2015.  This Webinar is open to the first twenty attendees to sign up.

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The genesis: In January 2015, Backspace co-founder Karen Dionne and I had a conversation in which she mentioned that writers sometimes want representation so badly they are willing to sign with an average or even a below-average agent. Trust me, not all agents are equal. I replied, “Well, writers don’t know what they don’t know.”

In that moment, a lightbulb went on for both of us. Writers don’t know what a good agent does. How could you if (1) you’ve never experienced it and (2) you’ve only ever had one agent and no way to assess just how strong he or she might be at the job?

Thus, this series of articles was born.

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Archive:

February 2015 Newsletter – Article #1: Agent As Savvy Business Manager

March 2015 Newsletter – Article #2: Commanding Authority: An Agent’s Negotiation Edge.

April 2015 Newsletter – Article #3: Fearless Negotiation: An Agent’s Most Important Role for an Author

May 2015 Newsletter – Article #4: Negotiation Tactics of Good Agents


Article 5: Authors – Are You Auditing Your Royalty Statements? by Karen Dionne

 

After I read Kristin’s June article in her “What Makes a Good Agent” series and learned that publishers’ royalty statements sometimes contain significant errors, I took an informal survey. I wanted to know how many of my author friends’ agents audit their statements, and how many of these authors also audit their own.

The authors are split between midlist authors and bestsellers. Almost all said they read their royalty statements carefully. But nearly half don’t audit their statements—mainly because they don’t know how.

Two of the 15 authors were reasonably certain their agents audited their royalty statements before sending them on, while only 3 of the 15 reported their agent took the initiative to help them understand them—suggesting this is a conversation agents and authors should be having more frequently.

Here are the questions and results:

  1. Does your agent actively audit royalty statements?

YES – 2

I THINK SO – 5

NO – 8

 

  1. Do you audit and/or read your own statements? 

YES – 6

READ ONLY – 7

NO – 2

 

  1. Do you know how? 

YES – 6

SOMEWHAT – 3

NO – 6

 

  1. Has your agent ever walked you through a statement? 

YES – 3

ON REQUEST – 2

NO – 10

Royalty statements are difficult to understand. Some of the authors who responded admit they “never learned how to read a royalty statement,”or they “read them, but have a hard time understanding what everything means.”

One author I surveyed believes auditing is the agent’s responsibility. “I don’t audit. That’s her job. If I had to, I’d get an accountant to do it. But I figure that’s why I have an agent. She would walk me through it if I wanted, but that’s one less piece of business I have to do.”

Others take a more active role. “I read my statements multiple times. First, just to review them and make sure everything looks right and complete. Then I go through them page by page and compare to the last statement to see if there is something wonky (good or bad), then I write up a memo to my agent with any questions or concerns, or if there is something odd. We then discuss.”

“I noticed in my last statement, there were line items for Returns for a couple of books that had been released years ago. That seemed illogical, so I asked my agent, and she passed the question on to my editor. Also, I know that a number of my books have been released as audio books as much as a year ago, but I have seen no accounting for sales of those. So I asked my agent, and she asked my editor. Nobody has explained it yet, but I have done payment estimates based on the statements, and our calculations match.” Not surprisingly, this last author adds, “Not only do I know how to read the statements, friends often ask me to interpret theirs.”

Sometimes authors who audit their statements find mistakes. “I once found a $700.00 error on my royalty statement from my publisher that I noticed after scouring the numbers. My publisher apologized and said it was obviously an error and quickly corrected it, but would he have noticed if I hadn’t looked carefully?”

“For two consecutive royalty periods, I had statements passed on to me from a publisher that had gone through the agency’s business department and past my agent that had a glaring error on the first page. Each time, it amounted to an error in my favor of mid four figures. One year the amount totaled approximately $11,000. This was not something anyone should have missed, and certainly not twice. The agent/agency did not catch the error, even after it happened the first time. I did, both times.”

“It’s important for authors to know that even if you have a representative you trust, nothing replaces arming yourself with all the knowledge you can,” my author friend Lauren Baratz-Logsted wisely says, who not coincidentally, zealously reads and audits her royalty statements. Thanks to Kristin’s article and her contract manager’s generous how-to, I’ll be doing the same.

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Karen Dionne is an internationally published thriller author, co-founder of the online writers discussion forum Backspace, and organizer of the Salt Cay Writers Retreat and the Neverending Online Backspace Writers ConferenceShe is represented by Jeff Kleinman of Folio Literary Management. 


Article 4: Negotiation Tactics of Good Agents

As featured in our April newsletter, an agent’s most important skill is the ability to negotiate well on behalf of the author client. Authors hire agents to protect their business interests in publishing. This is why a literary agent has a job.

Simply put, good agents do good deals on behalf of their authors.

So let’s discuss what I mean by “good” in terms of a deal and how that can be defined. Most writers might assume I’m talking about the level of the advance—as if how the negotiated amount is the only barometer of a decent deal. In reality I’m talking about every facet of the deal offer and the fairness and equability of the final contract the author signs.

Think of publishing as like a marriage or long-term relationship. It begins in love and happiness and for a lot of authors, the love affair lasts their whole career. But there is always the possibility of it ending in conflict and, in some cases, animosity. The point of the contract is to take the emotion out of the relationship and to clearly spell out the expectations of each party. This is why it’s imperative for an agent to negotiate a good deal and the best terms in a contract.

So just what are the negotiating tactics of good agents?

* Good Agents negotiate the advance.

A Publisher’s opening offer is not the highest advance the publisher is actually willing to give. Good agents know and understand this. It’s a bartering tool, the first give-and-take for what an agent is willing to grant and for what the publisher is willing to give in exchange. There are a ton of strategies involved here. This is just to spotlight one tactic.

* Good Agents only grant rights that are commensurate with the advance level being offered. 

If the advance is low, the agent will restrict the rights being offered to a publisher. A negotiation tool for getting a higher advance may be the willingness to offer World English or World rights in exchange for more monies up front.

Cliff notes for the types of publishing grants:

North American rights = publisher only has the grant of rights to sell the title in the US, Canada, and US territories such as the Philippines.

World English rights = publisher only has the grant of rights to sell the title in the English language around the world, including UK, Australia, New Zealand.

World rights = publisher has the grant of rights to sell the title in the English language around the world as well as to sell the licenses to have the title translated into other languages.

* Good Agents only sell World English or World rights if the subrights splits are standard. Otherwise, good agents restrict the deal to North American.

Standard splits, as defined by the Big 5 publishers, are 80% to author/20% to publisher for the UK and 75% to author/25% to publisher for translation. Some publishers (usually the smaller ones) only want to offer a 50/50 split, which is significantly less advantageous to the author than if his or her agent reserved World rights to license separately in each territory. (Remember: the author would then have to pay the agent commission on top of not receiving the standard 75% or 80% split. That’s definitely a reduction to the author’s bottom line.) I’ve also seen 60/40 (in author’s favor) offered.

* Good Agents don’t sell the publisher world translation rights or audio without reversion clauses.

If the publisher does not exploit or actively pursue the rights, the author is stuck and cannot earn money on the licensing of these potentially lucrative rights. Since part of an agent’s job is to help authors earn a living from writing, unexploited rights is untapped money potential. Publishers love “warehousing” rights just in case, but reversion clauses force publishers to actively try and license those rights or lose the ability to do so.

* Good Agents only sell rights or do deals with publishing houses that offer standard royalties or the equivalent (if royalties are based on net, which is the case for a lot of smaller publishers).

* Good Agents pre-negotiate “tricky” contract clauses in the deal memo stage so as to completely eliminate the issue at contract stage.

A favorite publishing house tactic, once the offer is accepted and contract generated, is to reply with “that should have been negotiated during the deal memo stage” as a way to say “no” to a requested change. To avoid this, actual clause language often has to be negotiated upfront with the editor during the deal negotiation. (“Tricky” clauses include the non-compete clause, the option on next book clause, the out-of-print clause, and many more).

It’s an icky strategy, as it’s not fair to the editor, who is often placed in an awkward situation. After all, they know deal points, not contract language. Sadly, this is becoming more and more standard.

* Good Agents have deal memo boilerplates that are unique to each house (and these deal memos are two, sometimes three pages long) 

Rather than use the publisher-generated deal points, which usually only cover the basics in an eight-point list and nothing else. Agency-generated deal memos cover all the tricky bits for that specific publisher, since contracts vary greatly from house to house.

* Good Agents have the editor confirm deal points memo via email before officially closing the deal.

This just came up for me recently where a deal was closed and went to contract stage, but the contracts department didn’t input the royalty escalator agreed upon during the deal negotiation. Because I had the final deal memo along with the editor’s confirmation email, it ended up being a simple non-issue, and the contract was changed. Without that confirmation, the author might have been stuck with lesser royalty structure.

Good agents could write a book on how to actively negotiate a publishing deal and contract. There are so many facets this series of articles can only touch on the highlights.

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The genesis: In January 2015, Backspace co-founder Karen Dionne and I had a conversation in which she mentioned that writers sometimes want representation so badly they are willing to sign with an average or even a below-average agent. Trust me, not all agents are equal. I replied, “Well, writers don’t know what they don’t know.”

In that moment, a lightbulb went on for both of us. Writers don’t know what a good agent does. How could you if (1) you’ve never experienced it and (2) you’ve only ever had one agent and no way to assess just how strong he or she might be at the job?

Thus, this series of articles was born.

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Archive:

February 2015 Newsletter – Article #1: Agent As Savvy Business Manager

March 2015 Newsletter – Article #2: Commanding Authority: An Agent’s Negotiation Edge.

April 2015 Newsletter – Article #3: Fearless Negotiation: An Agent’s Most Important Role for an Author


Article 4: A Story of Three Authors (A Cautionary Tale) by Karen Dionne

In a perfect world, every literary agent would be a fearless negotiator, working tirelessly to get the best possible book deals for his or her clients. But the world isn’t perfect. And sometimes an author’s career goes off the rails because their agent doesn’t have the knowledge, skills, or tenacity necessary to negotiate well on the author’s behalf.

Author #1 had a six-figure offer from a major publisher for the first three books of his self-published middle-grade series. He also had no agent. The publisher recommended several, and the author signed with one. Sadly, the agent did not negotiate better contract terms. This meant the author now had to give the agent 15% of the exact same six-figure deal he’d set up himself.

The author hoped the agent would earn his commission going forward by advocating for the book during the publishing process. But in time, the author realized his agent wasn’t doing anything he wasn’t already doing himself. He terminated the relationship and negotiated the next three-book deal without an agent.

As the time neared for the next contract, this author still felt he could get a better deal if a savvy agent negotiated on his behalf. He interviewed carefully and signed with an agent with an excellent reputation who was also a fan of the author’s work. The agent soon learned what the publisher hadn’t yet told the author: sales were soft, and there wasn’t going to be a third offer.

The agent pitched a new series, but the publisher wasn’t interested. Neither were the other publishers the agent submitted to because of the author’s declining sales record. He and the agent parted ways, and the author’s dream of supporting his family with his writing was over.

This author is convinced the outcome would have been different if his first agent had been a tougher negotiator—not only in regard to the size of the advance, but also in the thousand-and-one ways his agent could have run interference with the publisher to ensure that the author’s books got the in-house attention they needed and deserved. This agent may have been afraid to rock the boat, but it was the author’s ship that sank.

Author #2 was with an agent who always sold world and film rights to the publisher. Every client, every deal, without exception. Not every agency has its own foreign-rights department, nor does every agency partner with a foreign-rights co-agent in order to fully serve their clients.

In time, the author realized they had a problem. This author’s books were doing very well in the territories where they were available, but the publisher’s foreign-rights department had only sold them into a handful, and nothing was happening with film. When the author discussed the situation with their editor, the editor recommended the author get another agent—even though this meant the editor would have to work with an agent who was a tougher negotiator.

Not only did the new agent sell the film option for the author’s latest book, but the agent also made sure it was a “complete” offer, meaning that a producer, director, and screenwriter were committed to the project before recommending the deal. Previous film offers that didn’t have all these components in place were rejected because this agent was a tough negotiator who wasn’t afraid to hold the line.

Author #3’s agent got him a two-book deal with a well-known mass-market-paperback publisher. The contract included joint accounting. If you’ve been reading Kristin’s “Think Like an Agent” article series, you know that joint accounting can have negative consequences, as this author was about to find out.

When his first book published, it sold reasonably well. Meanwhile, the author was busy writing the second. To his surprise, the publisher rejected the book. The author wrote another, which the publisher also rejected. The author wrote a third book, which the publisher rejected when the book was half finished.

Are you keeping count? Two-and-a-half books written over who knows how many years in a valiant effort to deliver the second book of his contract. Meanwhile, because these two contracted-for books were irrevocably linked due to joint accounting, even though the first book was selling well, during all that time, the author didn’t see another dime.

If you’re wondering where the author’s agent was through all of this, so was I. Why didn’t the agent run interference with the publisher? Why was this author forced to spend years writing multiple books without getting paid for them? Surely there was something a savvy agent could have done.

The author wrote a fourth book, which the publisher finally accepted, only to drop the book after Borders went bankrupt. Eventually the author got the rights back to his books and self-published these novels along with the ones his publisher had rejected. All of his books have been very well received by readers, and the author is now with a small publisher with an excellent reputation. Most important, the author feels that his career is finally on track.

Admittedly, much of what determines the success or failure of an author’s career is beyond the author’s and the agent’s control. But holding out for an agent who is a fearless negotiator can be the author’s best defense in a challenging, uncertain business.

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Karen Dionne is an internationally published thriller author, co-founder of the online writers discussion forum Backspace, and organizer of the Salt Cay Writers Retreat and the Neverending Online Backspace Writers ConferenceShe is represented by Jeff Kleinman of Folio Literary Management. This panel discussion along with the full Backspace Writers Conference video archives are available exclusively to Backspace subscribers and online conference registrants. 


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