Pub Rants

By Danielle Burby

In this column, we discuss everything authors should know when it comes to landing an agent and navigating the complexities of the publishing industry. You know how to query and what to ask when an agent offers you representation, but here’s a slightly more sensitive topic: commissions.

Agenting is a sales job, which means your agent doesn’t get paid for their work on your book until you get paid. An agent takes on a project and invests their time, energy, and resources with the hope that the project will sell to a publisher. If the project doesn’t sell, the agent doesn’t doesn’t get paid. (If an agent ever asks you to pay a fee for their services, walk away. They are not a real agent.) The industry standard commission rate is 15% for domestic sales (with slightly different rates for various ancillary rights). Once a book has sold and the contract is fully executed, the publisher schedules an EFT or writes a check to the agency, and the agency retains 15% and sends the author a check for the remaining 85%. It may never occur to an author to wonder what happens to the 15% commission they just paid.

There’s no true industry standard in the arrangement between agents and agencies surrounding that 15% commission. Every agency has a slightly different way of approaching this matter, but a general rule of thumb is that the agent gets some of the money and the agency gets some of the money. Essentially, you are paying the agent directly for his or her work and you are also paying the agency to continue growing, investing in support staff, and providing you with the proper services.

Possible splits:

• A very typical split between agent and agency is 50% of the commission (or, in other words, 7.5% of the entire deal). For example, if your book sells for $50,000, the total 15% commission payment is $7,500. It is reasonable to expect that $3,750 of that will go to your agent.
• Many agents have built-in escalators (much like authors), incentivizing them to hit certain sales goals by bumping up commission percentages.
• Your agent may get a higher percentage of the split (60%-70%) if the agency he or she works for doesn’t provide office space or support staff.
• It is rare, but not unheard of, for agencies to pay their employees below 50% of that 15% commission.

Different ways of paying agents:

• Commission only. Agents on a commission-only arrangement are paid when their authors get paid. Payments here are intermittent. Many commission-only agents work side jobs until they are able to build their list to a point where they have a steady, comfortable income.
• Salary for services to agency plus commission. Many agents build their client lists while simultaneously serving in salaried support-staff roles for an agency (assistant work, subsidiary rights work, etc.) until they are financially ready to switch over to commission only.
• Draw. A draw is an advance on future earnings, much like publishing houses pay to authors. Agents on a draw are paid a fixed amount of money annually that they are then expected to match (and hopefully surpass) in sales. Once they have earned back the draw, they begin to receive commissions. This provides an agent with a level of financial security and stability, allowing them to agent full time, though some agents are hesitant to accept a draw because the stakes are higher if sales goals aren’t met.
• Salary. Some agencies pay agents a salary in exchange for the entire commission. In this case, agents often make a very comfortable salary and receive an annual bonus if they hit very high sales goals.

Ultimately, it is an agent’s right to keep his or her financial agreement with an employer private, and I wouldn’t recommend asking about it on The Call or in conversation. That said, arming yourself with an awareness that these different arrangements are out there is important for you as an author. And, knowing them, you may be able to read between the lines to figure out how it works for your agent.

This is important because, the truth is, how your agent is paid does impact you. If your agent isn’t receiving appropriate commission percentages, he or she may change agencies. If an agency isn’t investing their own percentage in support staff and company growth (and therefore more services for you), it is something to be aware of because, chances are, your agent is doing extra work. In the first several years of agenting, the money comes in slowly, unpredictably, and often in small sums. If an agent is just starting out and is being paid commission only, it can be very difficult for that agent to pay the rent and bills. Publishing is a very tough business with a high burnout rate. The way agencies pay their agents absolutely contributes to an agent’s ability to stick it out.

Every agent has to build from somewhere, but some agencies offer their employees more support in that arena than others. While your agent has no control over this and shouldn’t be penalized for, say, not being in a position to work full time, it is something you want to think about. Consider it in the same way you’d weigh whether you want an editorial agent, a boutique agency, or an agent with a large vs. small client list. As always, the more you know about the way publishing works, the better!