On Deals

Q. What, exactly, is at the foundation of ‘a book deal’?

A. When a literary agent licenses a project (sells it) or projects (sells them) to a publishing house, this transaction (the Word .docx manuscript for the novel or non-fiction proposal in exchange for the financial advance, money paid upfront for the right to publish and distribute the content in any given territory or sets of territories) is considered a ‘deal.’

Once the deal is negotiated and the book sold, the financial advance must be ‘earned out’ (enough book copies sold to return to the publisher the money paid upfront) before the author ever earns royalties. Money that isn’t earned out, however, never needs to be returned to the publisher, unless the contract so stipulates it (depending on the circumstances); it is paid out in its chosen proportion as an intentional investment in the project, and an intrinsic endorsement of its quality and potential.

It is industry standard that the agency takes a 15% cut on any of the earnings involved, from advance to royalties, for base or domestic sales.

With some variance, this cut is anywhere from 15-25% on the negotiation of international/foreign and subsidiary rights, pending the use of a secondary agent or other, diverse factors; there exists a greater scope of difference on this secondary cut than there is in the preceding, domestic one.

It is also industry standard that an agent takes no money from an author until a deal is made; all the hours involved in preparation will, thus, go unpaid until this deal confirmation. A model like this one helps protect against financial abuse of the author, on one hand, and respects the entrepreneurial dimension to agenting, on the other. It is the case, however, that most agents will not seriously engage deeper developmental or editorial work until the agency agreement is confirmed, to protect the agent also from being abused in time — and, in a far more positive, brilliant way, to commit the agent and writer to conceptual collaboration and business partnership.

In multi-book deals, the author and publisher may agree on terms for book projects that have yet to be developed, or are negotiated based on just a proposal for fiction projects (a partial manuscript with a synopsis, rather than the entire book). The same goes for authors with a ‘backlist’ (a history of successfully published titles).

It is also the case that, in some models, an author may not be paid an upfront financial advance but will earn money just on a royalty structure alone; while more rare, this model is not necessarily less beneficial or profitable to the author and, by extension, his/her agent, given that the royalty structure may be and often is different across different deals.

How are deals announced? And how are those announcements structured?

Deals made by literary agents on behalf of their authors are reported on the database PublishersMarketplace. Not all agents report deals, and not all deals are reported. On the most part, however, this is the most comprehensive database of publishing negotiations available.

[Note: Publishing is a slow business. One of my writers and I (and the same may go for other agents) may spend time to prepare a manuscript for submission; it is not atypical for me to sign genius writers who need some tightening with their craft. Following preparation, submission windows can be months’ long, given that editors receive many submissions from agents, need to read entire proposals and manuscripts, and need to walk through the entirety of a multi-tiered acquisitions process before an offer is extended. This acquisitions process often includes getting second reads and reader reports, a profit-and-loss (P&L) and sales analysis, and vision-casting for the marketing and publicity capacity and potential at any individual imprint.

On the other hand, sometimes, given the right circumstances, an editor may read even overnight or during the day — and an acquisitions process can be pushed forward. It may be, but is not necessarily, a reflection on the quality and potential of the manuscript — sometimes it’s as simple as the perfect agent-editor mix, with an editor who has nothing else on their plate.

Once an offer is made and extended, the contract negotiation window can take weeks to months. The deal involved may be announced either once confirmed or once the contract is fully signed, pending the publisher’s preference. Once deals are announced, approximately 9-24 months might pass before the book is published and available for purchase. During this window of time, the publishing house works to lay out the manuscript for its published aesthetic, design a cover, determine a marketing/publicity plan, prepare bookstores for the book’s publication, and more.

After a deal announcement, the title may and the content of a book will change during its editorial window, prior to publication: In the case of novels and memoirs, editors provide editorial feedback immediately, edits are made, and the novels go into copyediting and final production. In the case of non-fiction projects, the manuscript must first be completed in full, once the proposal is accepted/purchased; editors tend to be intimately involved in the final development stages here, per the academic-styled argument that justifies the book’s development and placement.]

Deal announcements will include, with some degree of variance, the following information (note that, if a deal doesn’t include a certain detail, it doesn’t mean that the detail isn’t ‘present’ or ‘important’ — there are many reasons for publishers and agents to not disclose all details in public, at any given time):

the author of the book;
some descriptor about the author’s expertise and/or his/her history of publications, where applicable;
the title of the book sold;
the description of the book sold;
the editor who acquires the book;
the imprint for which the book is acquired;
the number of books involved in the book deal (deals can be negotiated for single or multiple titles, pending the circumstances; it is usually the case that only the first is completed, where fiction is involved, and it is rare for non-fiction to sell in multiple-book deals);
the particular form of the submission or sale, where applicable:
- exclusive submission: an agent sends the project to only one editor/imprint — usually on a very limited timeline, such as 2-3 weeks, before the project goes out wider — and the imprint chooses to buy it, which is indicative of the relationship the agent has with this editor and/or a strong degree of certainty that the editor would be interested in the project and the imprint will be able to extend an offer proportionate to the value of the project, given the lack of editorial competition; -OR-
- at auction: an editor/imprint makes an/the first offer, additional imprints follow with offers and interest, and the imprints proceed to bid on the project (in different formats) until the agent and author select the best offer, for the winning imprint to take the project (side note: just because an auction isn’t reported doesn’t mean that one didn’t happen, and just because an auction didn’t happen doesn’t mean that multiple houses weren’t interested — there are other, more informal ways of mediating the interest of multiple imprints); -OR-
- in a pre-empt: when an auction is set-up, one editor/imprint can provide, prior to the formal start of the auction day/time, such a high or quality offer that the auction never actually unfolds; if an imprint ‘wins’ the auction in this way, it is considered a pre-empt(ive) offer to/win before the auction itself
the financial advance for the book(s) (the advance will be paid out according to a complex payout schedule that includes, for example, a cut at contract signing, another at manuscript delivery, and a final cut upon publication, all per individual book; where multiple books are purchased, the advance will be split across multiple books, and a sizable advance for three books — as one example — might then be paid out in full over several years);
the intended publication date/season;
the agent who negotiated the deal;
the agency for which this agent works; and/or
the territory(ies) to which rights for any given project are licensed.

Potential (Base) Territories: There is always diversity in these options (technically, every individual territory can be included in or excluded from a contract), but these are the standard territory frameworks within which agents place projects —

World [domestic (USA & Canada) English, worldwide English, & international/translation rights are licensed to the domestic publisher; the publisher manages all secondary placements in international territories via its own internal foreign rights department, where one exists]; -OR-
World English [domestic & worldwide English rights are licensed to the domestic publisher, often with some variance in the UK/New Zealand/Australia territories; international/translation rights are retained by the agent in order to manage at the agency level, often with the support of a foreign rights agent & licensing agencies in foreign territories]; -OR-
North America [domestic English rights are licensed to the domestic publisher, while worldwide English & international/translation rights are retained by the agent in order to manage at the agency level, often with the support of a foreign rights agent & licensing agencies in foreign territories]

Additional Territories & Subsidiary Rights: International/Translation (almost every country around the world has domestic, translated publication outlets, though not all are viable marketplaces for projects placed domestically, and the degree to which any given project can or will sell in any territory is subject to the individual territory’s economy; see one listing of the potential territories here); Audio; Film/TV; Electronic; Anthology/Serial Rights; and more

Records of Financial Advances: Not all publishers and agents elect to break financial advance information, for a diversity of reasons, but where included, the financial information is included according to this legend, available on PublishersMarketplace —