Wednesday, August 20, 2014

Inc. Magazine Names Smashwords to Inc. 5000 List of America's Fastest Growing Companies

Inc. Magazine today named Smashwords to its 2014 list of America's Fastest-Growing Privately-Held Companies.

Smashwords landed at #122 in a field of 5,000 companies within the Inc. 5000, and was named the #1 fastest-growing media company and the #3 fastest-growing San Jose Metro area company.

Inc. Magazine bases its ratings on three-year revenue growth.  With audited revenue of $706,000 in 2010 and $22 million in 2013, Smashwords showed 3,019% growth.

Credit for this achievement goes first and foremost to Smashwords authors and publishers.  Nearly 100,000 indie authors and small independent presses today utilize Smashwords as their ebook publishing and distribution platform.  We provide you to tools, and you publish amazing books that bring reading pleasure to millions of readers.  It's because you entrusted your books to Smashwords that we've been able to share in a small piece of your success.

The rise of Smashwords is the story of the rise of self publishing.  Self published authors now have the freedom and capability to publish with complete pride and professionalism.  The stigma that once haunted self-published authors is quickly melting away as Smashwords authors and publishers set the standard for ebook publishing best practices.  You are the pioneers who will lead book publishing to a better, more democratic future.  You are the future of publishing.

I've been singing the same tune for six and half years.  It's great to see authors embracing their new-found freedom, believing in themselves and serving readers with high-quality, low-cost ebooks.  It's great to see how the rise of indie ebooks has fulfilled the dreams and changed the lives of so many Smashwords authors.

This milestone also wouldn't have been possible without the hard work of my team at Smashwords.  From vetting to service to finance and engineering and marketing, every Smashwords team member comes to work with the single-minded purpose to serve writers.  We're here to provide you a competitive advantage in the marketplace. We exist for you.

We realize that every Smashwords author works with us by choice.  We're thankful you choose to do business with us. We strive to reciprocate by giving you full access to our ever-growing and ever-improving suite of tools that connect you with readers.  We offer these tools without cost and without exclusivity. 

When you choose to fully distribute with Smashwords, you're directly supporting our ability to invest in the development of new tools, new distribution and new capabilities to help you reach more readers.  As long as you work with us, we're here to work with you.

The Smashwords business has been profitable for over three years, and we've managed to maintain this profitability while reinvesting in the business to give you competitive advantage. This is a low margin business, which means we must make difficult decisions every day to prioritize our resources.  It means we cannot and should not try to be all things to all people.  We're focused on the logistics of connecting ebooks with readers.  When prioritizing resources, we ask, "what will give our authors the greatest aggregate benefit?"

How We Got Here

I'm often asked how we got here, wherever here is.  I suppose here today is the milestone we're celebrating.  Smashwords is an Inc. 500 company.

As most Smashwords authors know, I was inspired to start Smashwords after my wife and I wrote a novel together.  Despite representation from a top tier literary agency, publishers were unwilling to take a chance on it.  The experience led me to realize that publishers held too much power, because they alone decided which writers graduated to become published authors.  They decided which manuscripts became books, and they decided what readers could read.  My vision for Smashwords was to turn everything upside down and give all the power to writers and readers.  Give writers the freedom to publish what they want, and give readers the freedom to read what they want.

Although only in my wildest dreams did I dream Smashwords would reach such a milestone, I never expected it.  In fact, I knew the odds were stacked against us.  I thought the business would most likely fail.  In the darkest days early on - those days when on a good day we were earning only $1.00 a day in commission - the thing that kept me going was my belief that the world needed a Smashwords.  I had faith that if I could give all writers a chance, and few of them would break out and change everything for all writers.

We've traveled a lot of ground in six and half years.  We've overcome numerous roadblocks, experienced our fair share of growing pains, made our fair share of mistakes and took a lot of bullets.  We've also received a lot of love, and that sustains us more than anything.  We've had the good fortune to work with amazing authors and amazing retailer business partners.

The business has been entirely self-funded without the assistance or interference of venture capitalists or outside investors.  This has given us the freedom to build a business around some very simple if not unconventional principles which guide how we manage the business.  I'll share them now for the first time.

Smashwords Business Principles 

  1. Every writer is special, and holds the potential to contribute something worthwhile to the culture of books.
  2. Every writer should have the freedom to publish at no cost. 
  3. The worth of a writer's book cannot be measured by sales alone.
  4. The money should flow from reader to author.  We only earn commission if we help authors sell books.  We believe this aligns every fiber of our business - every motivation, every decision and every action - with the best interests of our authors and publishers.
  5. We serve our authors and publishers by working to enable a diverse and vibrant global ecosystem of multiple ebook retailing channels.
  6. We believe it's in every author's best long term interest that we promote broad and diversified distribution.
  7. We believe in the value of a great distributor. We believe distributors will become more important in the future, not less so.  A good distributor provides efficient digital logistics for the benefit of authors, publishers, retailers and readers alike.
  8. We constantly strive to become a better distributor.
  9. We believe that authors who leverage the full benefits of a distributor will be more successful over the long term than those who do not.  Distributors help authors spend more time writing and less time on distribution.  It's about time management.  Time is every writer's most precious asset.
  10. We believe past success is no guarantee of future success.  Success must be earned.  The moment we stop innovating and adding value to the publishing and distribution experience of our authors and readers, we lose our right to exist.
  11. Innovation is messy. We promise we will blaze new trails and take prudent risks.
  12. We will always strive to work in the best interest of our writers. 
  13. We will make mistakes and we will learn from our mistakes.
  14. We will help and encourage our retailer partners to improve their businesses for the benefit of our authors, publishers and their readers.  We also appreciate when our retail partners do the same of us.
  15. Our development will be guided by our authors, publishers and retailers.
  16. If we add more value than we earn in commissions, we have a future that is without limit, because the talent, creativity and capability of our authors is without limit.
  17. Our authors and publishers are not our customers.  They are our partners, our clients.  We do not sell them anything, we service them. We will not accept money from them. We will not employ salespeople and we will not sell publishing packages.
  18. We believe the future of publishing is bright because books are important to the future of mankind. As long as writers have a chance to publish, readers will want to read.
  19. We are in a relationship with you, the author, publisher, reader and retailer.  We will be honest in all our dealings with you.  The ebook business is entirely dependent upon trust.  When trust is deserved and reciprocated, great things can happen.
  20. We will never forget that we serve at the pleasure of our authors, publishers and retailers.

Where to From Here

Smashwords and the indie community we serve are in the same boat. We've built a great business, but I don't expect the torrid growth to continue.  As I predicted in my 2014 projections, the ebook market has slowed and sales are likely to be lower this year than last.

Prior to starting Smashwords in 2008, I spent almost 20 years doing PR  and strategic communications consulting for venture-backed Silicon Valley tech companies. Working in tech, you come to expect cyclical swings of boom and bust followed by boom again.  The survivors of the shakeouts emerge stronger and more vibrant than ever.  A shakeout is coming, not just for the ebook industry but for authors as well.  Things will get tougher from here.

Ebooks never go out of print. There's a glut of high-quality reading material out there.  The growth of in the number of ebooks published and forever immortal on digital shelves will probably outpace the growth in reader eyeballs, and therefore the capacity of readers to consume this content.  In other words, every one of us will face more competition in the future.  The average book in the future will sell fewer copies, not more.  The easy days are behind all of us.

Yet more books will be read than ever before.  The opportunity is there for all of us.

I thrive on challenge.  The new business realities don't change how we run the business.  It's an environment where author production (the number of titles published each year) and author quality will be the key determinants of success.  If you're an author, it's about time management.  How will you increase your production, quality, discoverability and desirability?  How will you increase your capacity to serve your readers?

For Smashwords, it's about innovation.  We will continue focusing on innovation.  We'll build new tools and capabilities that give our authors an advantage in the marketplace.  It's not only a business strategy, it's a Darwinian necessity.  Every one of us, whether we're a retailer, a distributor, a publisher or an author, must add value to the reader's experience otherwise we fail to live our dream.  The spoils will go to those who innovate, adopt and pioneer best practices, and who persevere through the darkest days.  If you're an author - even a New York Times bestselling author - you've had those dark days where you wondered if you had the will to carry on.

Think back to our early days at Smashwords when were were taking in only $1.00 a day yet losing thousands of dollars a month.  We kept going because we had this crazy idea that the world needed a Smashwords.  Well, your readers need you.  Serve them.  Your best work is ahead of you if you persevere.  I hope you invite Smashwords to join you for the ride!

Saturday, August 2, 2014

How to Do Box Sets at Smashwords for Audience Building, Charity and Profit

If you haven't yet planned a box set, now is the time to start planning for one.  This post will show you how.

The two most common types of box set are single-author and multi-author.

For a single-author box set, an author might combine all the books in a series, or might combine the series starters of multiple series, or might simply combine all their standalone titles into a single collection.  Smashwords author Anne Marie Novark, for example, created a single-author First in a Series Box Set featuring four of her full-length romance series starters for the value-price of only $2.99.  Smart.

For a multi-author box set, multiple authors, usually in the same genre or category, collaborate to publish multiple full-length books or complete short stories in a value-priced bundle.

Several Smashwords authors have joined together to publish limited-time charity box sets.  One recent Smashwords box set, A Sweet Life, was orchestrated by author Brenda Novak and featured fourteen New York Times bestsellers.  In one month, the box set earned nearly $30,000 for diabetes research from sales across the Smashwords network, and more from other channels.  Amazing.

Another more recent fundraiser example is Star Crossed, orchestrated by author Amy Miles, where thirteen bestselling YA Smashwords fantasy authors - including Amy Miles, Amy A. Bartol, Chanda Hahn, Ella James, Jocelyn Stover, Quinn Loftis, Rebecca Ethington, Shelly Crane, and Wendy Owens - are raising money for a St. Louis-based autism charity. Star Crossed releases August 18 and is available now for preorder at iBooks and will be available soon at Barnes & Noble and Kobo.

Box sets are usually value-priced, meaning the box set costs the reader less than purchasing all the books individually.

The ebook format is uniquely suited to box sets in a way that print is not.  The Star Crossed box set of full-length fantasy novels comprises 1.2 million words, a length that in print might span an entire length of a bookshelf.  In ebook form, it's a single convenient and lightweight download.

A Closer Look at Multi-Author Box Sets

Multi-author box sets represent an especially great sales, marketing and audience-building opportunity for authors.  For the remainder of this post, I'll focus on multi-author box sets (many of the tips apply to single-author box sets as well).

The magic of a multi-author box set is that each author promotes the box set to their respective fan base.  It's a great opportunity for fans of one author to discover similarly great authors in the same genre or category.  The audience reach is amplified dramatically via the aggregated promotional effort of all participating authors.  If each participating author has thousands of readers subscribed to their private mailing lists, and thousands of fans following them on Twitter and Facebook, you can quickly begin to appreciate the power of amplified collaborative marketing.

Here's how to set up a multi-author box set at Smashwords:

  1. Choose your collaborators and focus - Choose collaborators who write for the same target reader you write for.  For example, if you write New Adult romance, collaborate with fellow NA romance authors.  If you write YA fantasy, collaborate with your favorite YA fantasy authors.  Themes are great too.  For example, a multi-author box set of Halloween-themed horror novels is a great idea if you write Halloween-themed fiction (get it on preorder now!). Select your collaborators carefully.  You're going to recommend this box set and your fellow authors to your fans, which means your trusted reputation with your fans is on the line if you partner with authors that won't satisfy your readers.
  2. Work out your business terms - Decide amongst yourselves who will upload the book, and how you plan to price the book and split the proceeds. Smashwords cannot split the proceeds, so this will be the responsibility of the author or publisher who uploads the box set.  Some Smashwords authors doing charity box sets have set up new, standalone Smashwords accounts for the sole purpose of simplifying accounting.
  3. Create your cover image - As instructed in the Smashwords Style Guide, Smashwords cannot accept cover images that are pseudo-3d (the cover image is a digital rendition of a three dimensional physical box).  The reason is that iBooks will not accept these because they correctly believe that a small number of customers might think they're actually purchasing a physical box set, which they are not.  All authors should be listed on the ebook cover image. Click here to learn more about Smashwords cover requirements.
  4. Format with a linked Table of Contents - You'll combine the multiple books into a single ebook file.  Although not a requirement, I recommend that you create a linked Table of Contents for the box set.  This way, each author's book can be listed in the table of contents and easily visible in the ebook file's NCX navigation (the NCX is what generates the "Table of Contents" items you see on your iPad, iPhone, Kindle, Nook or other device or e-reading app).  It's a good idea to list the books in the ToC as "Book Title by Author Name" without the "quotes" and then underneath each title listing create another link to a section below each author's book labeled "About Author Name" in which you provide a short bio following each author's book.  You can also list and link to other author-specific sections, such as "Other books by Author Name" or "Connect with Author Name." To learn how to add navigation to a Smashwords ebook, see Step 20 in the Style Guide, and don't miss my blog post and video, How to Add Navigation to a Smashwords Ebook.  You'll find some additional tips in the blog post on box set navigation.  If you watch the video you'll learn how incredibly easy it is to upgrade all your Smashwords books with enhanced navigation.
  5. List the box set as a preorder - A preorder allows the collaborating authors to promote the box set to their respective fan bases for weeks or months in advance of release of the book.  Smashwords distributes preorders to iBooks, Barnes & Noble and Kobo, and each retailer credits all accumulated preoders toward the book's first-day unit sales, which causes the book to spike in the bestseller lists, which causes the book to become more visible and more desirable to readers.  More visibility + more desire = more sales!  Click here to learn about Smashwords preorders.
  6. Upload - Once the book is formatted to the Smashwords Style Guide, upload it as you normally would from the Smashwords "Publish" page, and then download the .epub file to confirm the formatting looks great and the navigation works as expected.  If you need to make any corrections or updates, click to Dashboard: Upload New Version to upload the new file.  The person who updates the book will be the controlling user.
  7. Special tip for the book title - I think it's a good idea to mention the word "box set" in the book's title, and also the number of contributing authors, and if it's a charity box set mention that as well. Such a title quickly communicates to the browsing reader it's a box set, the theme and why they should care. For example, in the metadata, the title for Star Crossed is listed as Star Crossed (Thirteen-Book Charity Box Set for Autism).  The title metadata for A Sweet Life was A Sweet Life Boxed Set (Fourteen Contemporary Romances by Bestselling Authors to Benefit Diabetes Research).
  8. Special tips for the book description - It's a good idea to list all the books and authors in the book description.  This will improve discoverability at retailers, and will also help make the book more desirable to readers.  Do not mention price in the description.  It's okay to mention the bundle is "value-priced," but don't write something like, "A $79.00 value, yours for just $.99!"  Prices are never allowed in book descriptions because Smashwords books are distributed to global retailers and sold in multiple currencies.  For a customer who purchases in Euros or Yen or Pounds, a USD price is confusing and inaccurate.  Anytime you confuse a prospective reader, you create friction, and friction causes them to click away and you lose them.  If the box set is raising money for charity, avoid writing in the description, "All proceeds go to charity," because that's not exactly accurate since the retailer is not donating their proceeds.  It's more accurate to write, "The authors will donate their proceeds from the sale of this box set to XYZ charity."
  9. Giving multiple authors credit in the "written by" metadata - Upon upload, the only author credited in the "written by" metadata in the book listing will be the author who uploaded the book. That's not good, because you want all the authors credited in the metadata, and retailers want to see all the authors credited on the cover image should also be credited in the metadata as well.  To give all authors credit in the metadata, click the "support" link at the bottom of any Smashwords web page to contact our support team.  Provide us a direct hyperlink to the author profile page of each contributing author and we'll link them up with the book.  If the author doesn't yet have a Smashwords account, please ask them to create one.  It's free!  Another option:  If you've upgraded your account to Publisher status, you can create "ghost" accounts for each contributing author.  This option is only recommended for publishers because once you upgrade your account to publisher status, it's a permanent change.  Note that we'll link all the authors at Smashwords but our retailers may not be able to link all the names.  This is why it's important to place the author names in the book description as well.
Good luck, and have fun!