Publishing/Writing: Insights, News, Intrigue


Need Funds to Write/Publish a Book? More on Crowd-Funding


I have previously posted on the crowd-funding or crowdsourcing phenomenon on both The Writers Welcome Blog and more recently on this blog

 A commenter to one of the above posts (that appeared on one of my Linkedin groups) said he did not want to give up any writers’ rights to use the Kickstarter crowd-funding site. To answer his concern, users of any of these crowdsourcing sites do not give up any copyrights.

Crowdsourcing sites usually charge between 3 to 5 percent of the successful amount funded. This is how they make their money.

RocketHub, Kickstarter, PledgeMusic, Funding4Learning, ArtistShare, FundRazr are just a few of the hundreds of these type sites that are popping up worldwide.

About 450 crowd-funding sites raised 1.5 billion dollars last year. 

“The gradual success of many projects has validated this as a real option, a real way to make things,” says Yancey Strickler, co-founder of Kickstarter. “The Internet is incredible for harnessing organizational power.”

More details such as how to apply, how much they cost, etc. are provided by Roger Yu, USA TODAY:

Need cash? Ask a crowd

While studying abroad in Ghana in 2006, Meghan Sebold often roamed local textile markets and marveled at the surplus of colorfully patterned fabrics that were left unwanted.

After she returned home to San Francisco, her thoughts kept drifting back to the faint but enduring idea of producing a clothing line that used textiles and talent from the West African country. She had few concrete plans on how to start a business — and even less money.

Then, a chance encounter at a seminar in New York with the founders of start-up RocketHub, a crowd-funding website, stirred her hopes. At the urging and guidance of Brian Meece and Vladimir Vukicevic, Sebold wrote at length about the business idea on, accompanied by a video, and asked for direct financial contributions from family, friends, and friends of friends.

Her modest goal of raising $4,000 was achieved in about two weeks. Her first set of dresses, funded by the donations and made in Ghana with local labor, sold out online and at local pop-up stores. “It gives you more credibility than saying ‘Hey, Uncle, can you lend me $20?'”

Entrepreneurs and dreamers such as Sebold are flocking to crowd funding, an emerging field of finance that, by using the Internet as an efficient middleman, often manages to be both more intimate and more high-tech than traditional means of raising seed money. The idea has existed for years but is receiving renewed attention now that social media, online networks and payment technologies increasingly strip away legal, psychological and logistical barriers for money solicitations.

RocketHub, Kickstarter, PledgeMusic, Funding4Learning, ArtistShare, FundRazr and hundreds of other sites call on individuals to pool their money, by way of the Internet, and support others’ artistic, educational and business efforts, as well as charities and disaster relief. Some sites, like Kiva, specialize in small loans.

“The gradual success of many projects has validated this as a real option, a real way to make things,” says Yancey Strickler, co-founder of Kickstarter. “The Internet is incredible for harnessing organizational power.”

While they get a sense of fulfillment at seeing the campaigns they support continue, donors typically receive neither a stake nor artistic/operational input. That could eventually change. President Obama recently signed a law, the Jumpstart Our Business Startups (JOBS) Act, that would allow individuals to buy equity stakes in companies via crowd-funding sites under certain rules, likely effective next year.

A few dollars here and a couple of hundred bucks there can add up quickly. About $1.5 billion was raised in 2011 by about 450 crowd-sourcing Internet sites worldwide, says a report by, a site tracking the industry. That’s expected to double this year, the report forecasts.

“This expands on the angel investor model” in which a wealthy individual puts up money in return for equity, says David Rubenstein, partner at accounting firm WeiserMazars. “There is some good to this. This will ultimately result in growth of companies and additional jobs.”

The business is also good for those who operate successful crowd-funding sites. They make money by taking a percentage of the money raised — typically about 3% to 5% — and a per-transaction fee.

Kickstarter, one of the largest crowd-funding sites, has so far counted $200 million of pledged contributions, though not all were given to fund seekers. Fund seekers on Kickstarter get their hands on the money only if they can meet their goal. If a campaign fails, money is returned to donors. About 20,000 Kickstarter campaigns have met the goal, or about 44% of all campaigns.

Rival RocketHub sees about 1,000 campaigns a month launched on its site, Meece says. RocketHub allows campaign creators to keep the funds they raise even if they fall short of the goal.

Many campaigns, such as for Sebold’s Ghana-inspired dresses, are quirky, artistic or creative, but modest in their financial goal. Successful Kickstarter campaigns average about $5,000 in funds raised. “Kickstarter changes the question of funding from ‘Is this a good investment?’ to ‘Do I want this to exist?’ And that’s a much lower bar,” Strickler says.

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Funding for New Publishing Concepts

Publishing venture capital

In the new tech age investors initially looked to technology as a scalable asset, but content appears to be making a comeback.

King content, in my opinion, has never gone away and should have always been considered as key in any publishing investment decision.
Why? Simply because content is what it’s all about. Content is the heart and soul of any written creation that powers demand. The technology that delivers this content will always be in a state of flux and anything ‘new’ (tech gadgets) will always create interest at first — but, it is the actual content that will power interest in the long term 🙂 
Interesting thinking and resources from Publishing Perspectives by Sophie Rochester:

Show Me the Money: Finding Cash for Your Publishing Start-up

When it comes to getting your business off the ground, in addition to vision and a solid business plan, you need one thing above all: money. At O’Reilly’s Tools of Change for Publishing conference last week, a panel representing very distinct viewpoints — from that of CEO to venture capitalist — came together to discuss the issue as part of the panel: “Start-ups to Publishing Companies Ripe for Expansion: What Are Investors in the Publishing Sector Looking For?”

Thad McIlroy, Principal of The Future of Publishing, has been arranging VC financing for start-ups for two decades, specializing mostly with publishing tools and some SaaS (software as a service) companies. McIlroy kicked off the discussion with a sobering account of his experience of publishing investments – in the last two to three years he’s worked with a couple of pure publishing companies looking for VC funding and he feels it’s a very tough market. McIlroy explained that there are lots of companies looking for funding without success and believes that publishing is not a fertile ground for VCs, because publishing is not generally profitable. “You’re going to have to fight for the investment dollars and you may need to give up a lot more than you want to, to get that money”

Speaking not only as an investor, but also as someone who has sought investment, Christophe Maire, founder and CEO of, begged to differ. Maire is bemused as to why there isn’t currently more interest from investors in this area. An active investor in the Berlin technology scene, Maire has been involved in the build-up of Brands4Friends, Plista, Barcoo, Readmill, Appaware, Amen, and Soundcloud, where he sits on the board. Maire believes that more investor attention should be paid to the publishing sector – especially the e-book market. Sectors such as the music industry, he feels, get a disproportionate amount of attention from investors.

This sentiment was echoed by Henrik Werdelin, Managing Partner at product innovation studio Prehype, saying that perhaps when presented with an ebook-related company that this somehow doesn’t have the same “sexiness” as something like a music-related project. Werdelin also dismisses the notion that when presented with a potential investment that vertical industries are particularly relevant at all — that is to say, that they would look more at whether a new product or service resolves a specific problem around user experience than to which industry it is set to serve.

Brian Rich, CEO of Catalyst, a growth private equity fund, is generally more optimistic about publishing investments. Rich distinguishes himself from VCs, and underlines that Catalyst is really looking for proven business models, namely lead generation, content and subscription businesses. Catalyst recently invested in two successful publishing businesses, including one bought from Reed/Elsevier a few years ago, which has been transformed into a majority digital business after what Rich calls “a lot of hard work.”

The Pathway to Securing Investment

Valla Vakili, co-founder and CEO of Small Demons, a content discovery platform, represents a company that has successfully managed to attract plenty of seed funding to date. Although the platform could be positioned as industry-agnostic (as it covers books, music, film, etc), Vakili is adamant that the company is a “narrative-first enterprise” and is not afraid to put it firmly in the publishing camp. Vakili explains that first-level meetings with investors aren’t easy, there are a lot of questions which, at first, are hard to answer – but in time responses to these potential investor questions improved, and with that the funding started to come in.

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