Writing is not a business

I recently read Rich Dad, Poor Dad by Robert Kiyosaki. It’s a fantastic book, not only because it gives you a basic education on financial literacy, but because it gives you a solid foundation for making money in general. It’s one of those books that really deserves its bestseller status.

About midway through reading it, I realized that I’ve been thinking all wrong about my writing. Everyone always says that if you want to write professionally, you should treat your writing as a business. But that’s not entirely correct.

Writing is not a business, it is an investment. Publishing is a business.

The basic argument of Rich Dad, Poor Dad goes like this: if you want to be wealthy, don’t work for money—make your money work for you. How? By owning more assets than liabilities. An asset is something that puts money in your pocket. A liability is something that takes it away.

When you write a book, you are creating an asset. A book is an intellectual property that generates money. Dean Wesley Smith compares it to a piece of pie in a magical bakery, where you can cut infinite pieces for your customers. With online publishing through ebooks and print-on-demand, that’s not a bad analogy.

If I were to cease all of my publishing activities right now, including all marketing and promotion whatsoever, my books would still generate income. It probably wouldn’t be a lot, but it would still be something. Even starting from zero, with a single book on Amazon under a totally unknown name, over time it will generate a small trickle of income.

A book is an asset. Writing is how you create that asset. Publishing is how you service that asset to make it more profitable.

As an indie writer, I am my own publisher. The business that I own is a publishing business, not a writing business. It’s a subtle but important distinction. I could still create books if I weren’t my own publisher, but at that point I’d be a contractor, not a small business owner.

Writers are not paid by the hour. As an indie, I’m still earning money on work I did ten years ago, and I fully expect to continue earning income on that work for the rest of my life. That’s because writing is an investment. Not a job. Not even a business. An investment.

Which is not to say that the publishing aspect—or in other words, the business aspect—is less important. Quite the contrary. A rental property is an asset, but it won’t make any money unless you find renters and take care of the upkeep. Similarly, a prime plot of farmland is an asset, but it won’t make any money unless you work it.

So how do you “work” your books? By publishing them, of course. Publishing is your business. This includes marketing, promotion, branding, and the like. Publishing is the business that makes your assets—your investments—profitable.

 

The implications of this are really interesting. For example, suppose you have a book that doesn’t sell very well, or that gets a bunch of negative reviews. Does that make you a failed writer? Does it spell doom for your career? It’s easy to think so if you think of writing as your business.

But when you think of writing as an investment, everyone changes. Got a book that tanked? That’s okay, it’s just that book. Every investor gets it wrong every once in a while. Learn from the mistake and pick a better investment next time.

If all your books are tanking, is that a sign that you’re just not cut out for this writing thing? Possibly… or it could just be that you need to work on your publishing. Even the richest farmland needs to be tilled, and fertilized, and watered properly. Perhaps you just need to learn how to market better, or brand your books better, or do a better job of finding and connecting with your readers.

On the flipside, suppose you have a book that used to do well, but now it isn’t selling as well as you would like. You’ve clearly done a good job of marketing it in the past, but what can you do now? Market it even harder? Or recognize that this is just a normal part of the investment cycle and go out to develop a new asset?

If writing is your business, then the success or failure of your books is a direct reflection of yourself as a writer. With that kind of mindset, it’s easy to fall into some traps. On the one extreme are those who believe that publishing well is secondary to writing a good book, and that therefore they should devote the bulk of their time and energy to writing. On the other extreme are those who seek validation so hard that they put all of their effort into the publishing aspect and neglect the writing. The truth is NOT somewhere in the middle, because both extremes grow out of a faulty premise: that writing is your business.

This is the Fugio cent. It was commissioned by the Continental Congress before the ratification of the Constitution, and designed by Benjamin Franklin. Fugio means “I fly,” referring to the sundial, which represents time. Taken with the inscription below, it is a reminder that we can all leave the world a better place by doing our best in whatever line of work we choose to pursue.

For many of us, writing is more than just a hobby, or a job, or even a career. It is a vocation. It is our calling. And yet, we live in a commercial world, where the price of a thing is often conflated with its value. How, then, can we best fulfill our calling as writers? By ignoring the demands of the market? By fancying that our books are simply unappreciated by those of inferior tastes? Or by losing sight of our calling for that lucre that will perish with us?

Benjamin Franklin’s message is that we can best fulfill our calling by pursuing excellence in every aspect of it. That includes the commercial aspect as well as the artistic, the practical as well as the spiritual. When we truly learn how to excel, we will see that there is no contradiction between the two sides.

Writing is our calling. Publishing is our business. Our books are investments, many of which may very well outlive us. By understanding this, I firmly believe that we can mind our business as well as Franklin admonished us, and truly fulfill our calling.

A fascinating journey of discovery

I had a really fascinating experience last year that has turned into something of a journey of discovery. It’s still ongoing, and I’m sure it will affect my writing in years to come.

It started with family history. Long time readers of this blog will know that I’ve been interested in family history for some time. My sister is a professional genealogist who specializes in Czech records (she keeps a blog here), and I got started by helping her.

In the United States, the census records are only useful to about 1850. Before that, you have to get into land records, probates and wills, and local courthouse type stuff to really go anywhere. But in the Czech lands, the Catholic Church has kept meticulous parish records going back to the 15th and 16th centuries. They’re handwritten in old German and totally unindexed, but the books are all digitized and available online.

As I worked on this research with my sister, I started to wonder: how far back can we push these lines? What are the limits?

The Czech lands were part of the Holy Roman Empire, under the Austrian Habsbugs. In the 15th century, the Hussite Wars shook things up quite a bit, and that’s about as far back as the Catholic parish records go. But the noble genealogies were very well kept, and go back quite a bit further. If one of your lines connects to the nobility (which is very possible, given how many bastard children were running around), you can push back really far.

But past the 8th century, things start to get sketchy. Most of the nobility in Europe are descended from the barbarian tribes who invaded the Roman Empire: the Goths, the Franks, the Vandals, etc. Same thing with the Slavs and the Byzantine Empire, though the Byzantines held out much better than the Western Roman Empire (it was the Turks, not the barbarians, who eventually did them in).

The trouble is that when these barbarians took over, they tried to establish their legitimacy by fabricating genealogies. Plenty of royal European lines go back all the way to Adam and Eve, but how reliable is that really? As rulers of Christian lands, of course they would try to connect themselves to famous characters from the Bible.

The Dark Ages might not be as dark as we think they are, but in terms of records and record-keeping, they certainly are. The largest and most civilized empire in the world had just collapsed, with barbarians running amok in the countryside and the Persians threatening the last vestiges of the empire in the east. Very few historians have documented this era, and it was a huge dark spot in my own understanding of the world.

So I set out to study it. I scoured Wikipedia, subscribed to the Western Civ podcast, and listened to the entire History of Rome by Mike Duncan (excellent podcast, by the way). The Roman Empire had dominated Europe right up to the early middle ages, and I wanted to learn why it had fallen.

That led to a journey of discovery all in itself. Roman history is a fascinating subject in its own right, and the four or five centuries from the Punic Wars through the reign of Marcus Aurelius are very well documented. Rome faced a lot of challenges, and even a few existential threats, but for more than a thousand years they dominated the known world.

So why did they fall?

The more I studied about the Romans, the heavier this question weighed on me. I learned about Diocletian and the Tetrarchy, the crisis of the third century, and Constantine the Great—a period of Roman history that was much less familiar to me. And then things started to click.

My Czech ancestors were serfs. They emmigrated to Texas shortly after the last vestiges of serfdom were abolished in 1848. Under serfdom, they were little better than slaves. The land they lived and worked on was owned by the Hukvaldy Estate, and they were bound to it by feudal law.

When Diocletian became Augustus, the Roman Empire was reeling from half a dozen existential crises, including an economic collapse. The money was so worthless, most of the empire had resorted to a barter economy. Diocletian established a system of exchange where people could pay their taxes with trade goods rather than money. However, the only way for that system to work was 1) for everyone to take the profession of their parents, and 2) for no one to move without Imperial permission. Otherwise, you might have too many pig farmers in one province and not enough blacksmiths in another.

In other words, the system of feudal serfdom that my ancestors labored under had its roots in the reforms of Diocletian. But it went much deeper than just one man. Diocletian reforms were necessary because the Roman economy had collapsed, and the economy had collapsed because for more than a hundred years, the Empire had been in massive debt, and had serviced its debts by devaluing its currency.

Sound familiar?

The Roman Empire fell because of deficit spending, government debt, and currency devaluation over the course of several generations. In 1913, the United States established the Federal Reserve, beginning our own process of currency devaluation. Our national debt has doubled every eight years since 2000, when the stock market peaked as measured in gold. Right now, our debt-to-GDP is 104%. One hundred four percent.

And that’s just our sovereign debt. Our household debt is north of $12 trillion, or another 73% of our GDP. The largest portion of that is student loans, which cannot be resolved through bankruptcy.

Seven out of ten Americans have less than $1,000 in savings.

Half of Americans would have to beg, borrow, or steal if slapped with an unexpected $400 expense.

Twenty percent of American households do not have a single person that is working.

Fully one-third of America is in debt collections, meaning that they have an unpaid debt more than 180 days past due.

Is it any wonder that the middle class is shrinking? We’re following the same path that Rome followed, except where they merely walked, we’re running headlong. With our modern communications, the pace of life is so fast that I suspect we’re completing the cycle in a fraction of the time.

And then you realize that what passes for money these days isn’t “money” at all, but government paper backed by government debt. What happens when we default? What happens when the credit markets freeze up and contagion spreads across the global economy? What happens when you wake up one morning, only to find that all the ATMs are down, the banks are all closed, and everyone’s accounts are all frozen?

So what started as an interest in family history took me down a rabbit hole where I learned all about how Rome fell, and how we’re following in the footsteps of Rome. It led to a keen interest in monetary policy and our global monetary system. It also gave me a new hobby: coin hunting.

The Romans devalued their currency by melting down the old gold and silver coins, and minting new ones mixed with copper. Over time, the melt value of the coins went down, and that’s exactly what’s happening to our US currency now.

Before 1965, dimes and quarters were made from 90% silver. After, they were made from copper with a thin nickel coating. Nickels have always been made from a 75/25 copper-nickel alloy, however, and pennies were all 95% copper until 1982. Right now, the melt value of a US penny is actually 1.8¢. At the height of the “jobless recovery” it was closer to 4¢.

Now, it’s illegal to melt down pennies because they are currently legal tender. However, as the currency continues to inflate, the penny will become even more worthless, eventually reaching the point where it doesn’t make sense to make anymore. Right now, the material cost alone of each zinc penny is 70% of the face value. Canada has already discontinued minting pennies, and we aren’t far behind.

I started dabbling in copper hoarding. But as I went through lots of pennies, I started coming across some really old ones. Which got me to wondering if maybe the numismatic value of some of these coins eventually might be more than their melt value. After all, when everyone’s melted down their copper pennies, a complete collection of Lincoln cents is going to be something special.

So I started building a collection of Lincoln cents. Then I got into state quarters, first as a cool Christmas gift for one of my nephews, then for myself. Then I got into Jefferson nickels, and started finding silver.

Right now, I have a complete set of Lincoln Memorial cents. They’re all from circulation, and some of them are pretty beat up, but there are a few really nice ones in there too. My wheat cents collection is much less complete, but the coolest piece is a 1909 VDB in very fine condition, with all the wheat berries still showing. That’s a $10-$15 penny that I found in a normal coin roll.

It’s a fun hobby, and it comes around full circle to what got me started down this rabbit hole in the first place. Each one of these coins is a small piece of history. That 1909 VDB is more than a hundred years old. I’ve got coins that my parents and grandparents would have used, and a penny for every year of my father’s and mother’s lives. With a bit of luck and a lot of patience, I’ll be able to find a penny for every year of my grandparents’ lives as well.

So yeah, it’s been a fascinating journey of discovery, and it’s still ongoing too. I just got started with Roosevelt dimes, and I’m catching up on Mike Duncan’s Revolutions podcast, which is just as interesting as his History of Rome. Turns out that the French Revolution also happened because of deficit spending and a runaway government debt. Surprise, surprise.

Life is a giant rabbit hole when you’re curious about everything!

Arrrgh Smashwords!

So I go to upload “From the Ice Incarnate” to Smashwords as a free give away, and this is what I see. Arrgh!  Why do I have to wait??  Why can’t my book be up nowww…?

Okay, seriously, it’s not that big of a deal.  I’ll just have to wait until tomorrow to start spamming everyone sharing it.  And unlike last week, I’m going to be more open about the fact that I’m giving this story away for free.

I decided last week to put up “Decision LZ1527” and “Memoirs of a Snowflake” for free on Smashwords, mostly to see if I could get Amazon to price match.  So far it hasn’t worked, but it has given me some very interesting insight into the minds of ebook buyers.

The results aren’t scientific, of course, but so far it’s confirmed what I’ve heard elsewhere: that there’s a HUGE difference between people willing to pay more than $1 for an ebook, and people who will grab anything because it’s free.  So far, 62 people have downloaded “Decision LZ1527,” 33 people have downloaded “Memoirs of a Snowflake,” but only 2 people this week downloaded the free sample of Genesis Earth–and no one has bought a copy.

Of course, this is only after one week.  Perhaps the people who downloaded the free stories are just taking a long time to read them.  Perhaps they just can’t afford to buy many ebooks right now, but because they read and enjoyed my stories, they’ll check it out when they have more time/money.  Maybe some of them will run across my ebooks years later and remember “oh hey, that’s the guy with that crazy sci fi dating story” and check me out then.  Or maybe they’re all cheapskates who only read stuff they can get for free.  I don’t know.

But I don’t think it’s the last one.  A friend from my apartment complex walked up to me today and told me he’d read and enjoyed my story.  It was pretty cool.  That’s what I’m really after at this point: exposure and readers.  So I think it’s a good idea to give at least some stuff away for free, even if it doesn’t push people to buy your other books in the short term.

Speaking of which, I’ve tried out something else new: raising the price of Genesis Earth from $2.99 to $3.85.  Why in the heck would I do that?  Mostly because of value perception; I want people to know that I have confidence that my book is worth at least #3.85, that I believe they’ll feel it was worth what they paid for.  The kind of books I want to write are the kind that people will want to read twice, and I want to see if changing the price to reflect that will build the kind of readership that is looking for that sort of thing.

I might be totally wrong, of course, but hey it’s worth a shot.  I’ve sold two copies so far this month, so at least it hasn’t totally killed sales.  I’ll probably keep it at that price for at least a couple of weeks, just to see what happens.

But I can tell you one thing I don’t think I’ll ever do: price a novel higher than $5.  I’ve always thought that $6.99 and $7.99 for a paperback is a little steep, even if the book completely changes my life.  That’s not something you can put a dollar value on, and even if you could, why would you want to charge that much?  If your book was so deep and meaningful, wouldn’t you want to give it away for free?

So yeah, I’m trying to suck my readers dry, only to find a business model that works.  And if you think $3.85 is too steep, please let me know.  I’d like to give my books away for free, but at the same time, I want to eat without spending my life as a wage slave.

In the meantime, if you haven’t already, check out my free stories!

…WHUT

So this morning when I was getting ready for church, I realized that I couldn’t find my Kindle.  Anywhere.  Remembering that I’d left it at a Quark event in my apartment’s lobby, I started frantically calling people and knocking doors.  Unfortunately, no one had seen it.

A few hours later, after combing every place I could have possibly left it at least four or five times, I have to admit it’s completely lost.  I have a very good idea when and where I lost it, so the only remaining possibility is that someone picked it up.  The aggravating thing is waiting to see whether they return it, or whether they decide to run off with it.  ARRRRGH!

The amazing thing is how attached I’ve become to that device in the last month since I first got it.  I’m not a particularly voracious reader, but right up until I lost it I was carrying that thing around everywhere.  It’s so amazingly convenient–instead of lugging books around, I can read almost anything I want on a device that fits in my back pocket.  And the interconnectivity is really cool, too, although if I end up having to replace it, I’ll probably go with the more expensive 3g version, since hunting for wireless is a major pain.

But yeah…it’s lost, and I can’t currently afford to replace it.  I’m saving up for Worldcon 2011, so finances are tight; I’ll probably have to work this temp job through most of August just to be able to go.

However, all is not lost.  Yesterday, Genesis Earth got a stunning review on a book blogger / fellow indie writer’s blog.  My favorite part:

This is space opera of the highest caliber.  There are grand, sweeping ideas, the discovery of a new world, first contact with an alien species, an examination of the nature of humanity, the nature of the human mind.  Yet it’s always a personal story.  No matter how epic the backdrop, you are always reading about engaging, fully-realized characters.

It certainly qualifies as an adventure story, and keeps you wondering what will happen next.  Yet it’s also much more.  Genesis Earth will broaden your mind even as it delights your inner ten-year-old.  It has a kick-ass premise, executed with enviable skill, full of thought-provoking ideas couched in a thoroughly-entertaining story that’s just plain fun to read.

I kid you not, I stood up and did a little dance when I read that.  Someday, I’ll probably have a wife who will secretly videotape a moment like that and embarrass me by posting it to youtube or something…hehe.  Anyhow, the whole review is awesome, so check it out!

In other news, I finally got around to publishing Genesis Earth on the Nook: you can find it here.  And I don’t know whether I mentioned this or not, but I’ve also published it to smashwords, so if you live outside the US/UK and want to avoid the nasty $2+ surcharge that Amazon tags onto its international sales, you can find it there.

As far as the epublishing goals I set at the beginning of the week, I’ve accomplished all of them except the blog tour index and the 3+ guest posts…better get on top of that.  This week, here is what I want to accomplish:

  • Publish the short stories to smashwords for $0 and get Amazon to price match (since giving them out for free will *hopefully* drive readers to my novels).
  • Figure out how how the Kindle book forums work.
  • Query artists/illustrators for Bringing Stella Home cover art.
  • Send out Genesis Earth to another 5 review sites.
  • Write another 3 guest posts for the Genesis Earth blog tour.
  • Put up the index for the blog tour.

Oh, and one more thing…FIND MY &$%! KINDLE!!!

<< sigh >>

A year later

So a year ago, I came back to Utah after a terrible internship experience, with no idea where I was going to live, how I was going to support myself, or what I was going to do with my life.  I was leaving the cloistered halls of academia and venturing for the first time out into the “real world.”

Now, a year later, I can honestly say that even though there have been ups and downs, overall it’s been a great experience.  I’ve learned a ton, both about myself and this “real world” business, and I’ve changed in some surprising ways.

How, you may ask?  Well, let’s see…

1) I never want to be salaried.

This was probably the most surprising thing I learned.  Even if my writing career never takes off, I would rather work for myself and own the value I create than work for someone else and have them own me. Even if it means not knowing where my next paycheck is coming from, I’d rather have the control, the independence, and the satisfaction of working for myself doing what I love.

Sometimes I wonder if we’ve unwittingly become a nation of wage slaves.  So many people work at jobs they hate, only to have the illusion of financial security.  Well, that’s not me, and it’s never going to be me.  I’d rather work for myself and love it than spend the rest of my life counting down the days to my next vacation, or the years to my retirement.  I’m a smart, resourceful guy; I’m sure I can figure things out.

Which brings me to the next point…

2) The idea of being an entrepreneur excites me.

Writing is not just an art, it’s a business, and the more I research the business aspect of it–or indeed, business in general–the more excited I’ve become.  Leaving academia has helped me get in touch with my entrepreneurial side, and surprisingly it’s a lot stronger than I’d thought it would be.

As a writer, I see myself as a self-employed small business owner who creates intellectual properties and licenses the rights to publishers, film makers, game designers, etc.  With ebooks, now I can sell my work directly to readers, and you have no idea how excited that makes me.  It’s not just because of all the hype surrounding Amanda Hocking or Joe Konrath–it goes much deeper into who I am.  All things being equal, I’d rather be an indie author because I see myself as an entrepreneur.

Those are probably the two biggest things I’ve learned.  I can probably summarize the others with a simple list:

  • It’s not possible to work two careers and focus all your effort on only one.  If you really want to be a writer, get a job, but focus on the writing.
  • Temp and part time jobs are much better for balancing creative pursuits, even though they offer less security (which may be an illusion anyway).
  • It takes a long time to naturally grow a blog readership, but once you hit a certain point, it grows very fast.  I assume it’s the same with books and stories.
  • Social media, when used correctly, can work magic.
  • Cheap/free headphones can sometimes work remarkably well.
  • Budgeting is not hard.  Neither are taxes (if you’re poor).
  • Never turn down a job because you think you might get a different one.
  • A creative career won’t give you security, but you can still make it work.

So, looking back, would I change anything?  Not really.  I kind of wish I’d applied earlier to teach English in Korea, but if I had, I’d have started in February, and I wouldn’t have been in a good position to take advantage of the ongoing ebook revolution.  In fact, I might not have even noticed it until I got back to the states.

My plans for now are to focus on my writing over the summer, leave in August to teach English abroad (probably in Korea, though I’m toying around with other places), spend a year or two traveling and earning money to live off of until the writing takes off.

And marriage and family…who knows?  That’s an adventure that still lies beyond my ability to foresee.  One thing is for sure, though; I’d better avoid getting trapped in any comfort zones if I want to make progress on that front.  In terms of work and career, the past year has definitely not been a comfort zone, but it’s also helped me to see what I want to do with my life–more than college, even.

The future is uncertain, but that’s what makes it so awesome.  Even if my writing career never gives me a “secure” source of income, I’m more confident now than ever that I can make it work.  Until then, I’ll be writing.