In Praise of Passive Income (or, the Beauty of Royalties)

BeachWisdomCoverThere’s nothing like sorting through the mail and finding an unexpected check. Twice a year, in October and in March, I find a 9″ x 12″ envelope in the mailbox from Andrews-McMeel Publishing. Inside is the sales statement for the last six months for  a little book called “Beach Wisdom: Life Lessons from the Ocean,” — and the prize inside — a royalty check.

I got the idea for Beach Wisdom sitting on the beach drinking beer with some girlfriends. I scribbled some notes down in my ever-present spiral notebook, probably without any discernible break in the conversation. There was nothing particularly earth shaking about it.

At the time, I was casting about for ways to make money from writing that didn’t depend on billable hours. In advertising, you generally are paid for the hours it takes to complete a project. In publishing, I realized, there was the potential for doing the work once, and then getting paid for that same work, over and over again. I did some research and discovered that gift books, those little books you see at the register, with tasty looking covers and lots of pictures inside, represented the fastest growing segment of the industry, and that Andrews McMeel was by far the biggest fish in that pond.

Thus began our kitchen table book meetings. I had talked an old friend, my former art director partner at another ad agency, into teaming up, and we’d meet one morning a week and hash out ideas for gift books. Finally, we submitted ten book ideas, “Beach Wisdom,” being one of them, to Andrews-McMeel.

Initially, they were interested in four or five of the ideas, and finally offered us publishing contracts and advance royalty payments for two: “Beach Wisdom” and “Tiny Monsters,” which was a collection of black and white photos of kids in costume with funny lines for each one.

Tiny Monsters died an early death. It never sold enough for us to earn out our advance. (Although the cool thing about publishing is that you get to keep your full advance even if the book bombs.)

I’ve published two more books since those first two. On each of the last two books, I lavished tons of money and time and energy promoting and publicizing. For “How to Run Your Business Like a Girl,” I spent about a year doing book signings, press kits, media interviews and speaking engagements. I was online, I was in print, I was on the radio and even on TV a couple of times. For “Hell Yes! Two Little Words for a Simpler, Happier Life,” I again hired a publicist, produced press kits and tip sheets and all sorts of promotional materials, blogged about it, asked  other bloggers to blog about it, even asked my FaceBook buddies to help promote it.

Neither of those other two books will ever make a dime beyond my advance. It’s not the fault of the books. Either one of them is a stronger book, in my opinion, than “Beach Wisdom.”  It’s not the fault of the promotion. We did a gracious plenty to get those books off the ground. Both received some great reviews and nice media attention.

You just never know what’s going to pop. For some reason, “Beach Wisdom” continues to sell when the others have not enjoyed the same shelf life. “Beach Wisdom” has now sold over 30,000 copies — compared to something under 10,000 for the others. Who knew?

The lesson here is to keep offering the world all your best ideas. The more ideas you can bring to life, the better the chance you have of one of them becoming the thing that pops. And when one of your favorite projects doesn’t take root the way you’d hoped, don’t take it too personally. Just keep those new ideas coming.

Most people with a runaway bestseller — or the hottest iPhone app, or the startup that becomes an Amazon or a Starbucks — have also had plenty of ideas that never caught fire, and others that never may have sparked but never burst into flame.  It’s impossible to know ahead of time.

Regardless, getting paid over and over again for something you did years ago never gets old. It’s always a nice surprise to get that check. Makes me want to celebrate with a beer on the beach.


2 responses to “In Praise of Passive Income (or, the Beauty of Royalties)

  1. i agree keep the ideas flowing and always try new ideas. good business parctice

    • Sometimes the hard part is deciding which ideas to pursue and which not to. I once had an executive coach who kept saying I needed to quit scattering my energy on so many projects. He convinced me to abandon two ideas — both of which I later resurrected. One was a book that easily found a publisher. The other was the Start Your Own Company deck of Starter Cards, which ended up offering an interesting new road professionally. But, he’s right. You can’t pursue every single idea you have.

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