Jeremy Greenfield: Smashwords is now working with over 100,000 titles from about 40,000 authors and publishers. Yet you only have 13 employees right now. How is Smashwords going to expand?
Mark Coker: The level of [e-book] uploads has increased dramatically over the last year. In April, we had our first month of over 9,000 new titles added to Smashwords. We’ve been increasing every month. By the end of the year, we’ll be doing more than 10,000 new titles every single month, and that’s a super-conservative estimate. We now have four years experience doing this and our growth is organic, driven by word of mouth. We don’t do any marketing.
We’re expanding our vetting team. Our vetting team opens up and manually looks at every single book uploaded to Smashwords to check that the book meets formatting requirements of retailers, to make sure that it’s legal content and to make sure it’s original content. They’re looking to enforce all the requirements of the Smashwords style guide. We’re at three or four people currently.
We’ll continue to add to our vetting team, to our support team and to our technical team throughout the year.
JG: You said that you’ve been profitable for two years now. Can you give an indication of just how profitable?
MC: Growth has been fantastic. We’re selling millions of dollars worth of books every year. Our profitability is healthy and growing. We monitor our profitability very carefully because we’re completely self-funded.
We’re a private company, so we don’t disclose specific profitability or revenue numbers.
We are a corporation and I’m the majority shareholder. The other equity holders are employees. We’re preparing to do a stock option plan for all of our employees.
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JG: Speaking of your authors, what’s the biggest challenge facing indie authors who want to publish and distribute e-books today?
MC: The biggest challenge is self-restraint. Publishing tools, like Smashwords make it fast, free and easy for any writer anywhere in the world to publish. But we don’t make it easy to write a great book. Many writers, intoxicated by the freedom to self-publish, will often release their book before it’s ready to be released.
The biggest challenge faced by self-published authors, it’s not marketing, it’s not discoverability, it’s adopting the best practices of the very best publishers. It’s about becoming a professional publisher.
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JG: Should the established publishers be worried about this? At the Digital Book World Conference in January, we learned that indie authors took an estimated $100 million from publishers last year – sounds like a lot, but it’s a very small percentage of the overall trade book business.
MC: Authors are starting to ask two very dangerous questions from the standpoint of publishers:
What can the publisher do that I can’t do for myself? They’re saying, “I can publish myself and distribute myself and hire my own editors.” The distribution of e-books is now open to all.
And, will it actually harm my ability to reach readers if I work with a large publisher? They’re saying, “That large publisher is going to price my book too high, so they’re going to price me out of the market. If my publisher insists on pricing my book $9.99 and higher, I’m going to get beat by all the other authors who are priced lower.”
In publishers’ favor, every single book is a unique product, and price isn’t the only consideration for consumers.
But these questions set up publishers to be in a precarious situation.
The secret is now out on how to become a professional publisher. That knowledge is now freely available on main street.