Transcription
In this video, we're gonna talk about why you might need an author business of your own, aka a publishing company of your own, and also some reasons why you might not need one. And then, once we talk about that and decide what's right for you, we'll also talk about how to set up a publishing company, aka author business of your own. Alright guys, we have a lot to cover today because we're gonna talk about all things author business, including things like how to start a publishing company, why you might need to start a publishing company, why you might not need to start a publishing company, and then things like ISBN numbers, barcodes, copyright, which print-on-demand companies you might need to have a publishing company to use, and of course, make sure you stay until the end because after we talk about the whys of everything and why you need these things or if you need them, we're also going to talk about how to do them, and I'm going to give you some practical steps. So let's dive right in.
Okay, the first thing that I want to say before anything else is that you 100% do not need a publishing company. I know it's a little bit weird for me to say that in a video where I'm like teaching you how to get one, but I just want to be really upfront and honest with you guys that there are a lot of people who don't actually need one. There are also a lot of people who do, and there's different reasons for that. So I just really think it's important that I say to you that you do not actually have to have a publishing company to be self-published. If you're going to create a publishing company, my best advice is to just know why you're doing it; like know your specific reasons. Don't just do it because everybody else is doing it. Don't just spend all the money just because you think you have to. Know your reasons and know if it's right for you.
This video was requested by one of my patrons over on Patreon, Rin, and she said that she'd love to hear more about starting a business and taxes. I heard a while ago that people made businesses because you had to be one to use IngramSpark, but that you don't have to be one now to use it. I'm curious to explore the other reasons why someone might create a business and if it's more about taxes, like are there services out there other than IngramSpark that are beneficial to publishing that you can't use unless your business? So we're gonna talk about that, Ren, and I really appreciate that question.
The first and most obvious reason is for tax purposes. So it can be helpful to have a business that's separate from your personal finances, and it can be a tax write-off up to a certain point; usually when you start actually making money, it's no longer good for a write-off. Another reason is legitimacy. So I don't mean like lying to people and saying that you have a publisher; it's more that I mean it allows you to use companies like IngramSpark, for example, as a company, which can open up opportunities to get your book into bookstores, which we'll talk about as well. To answer Ren's question earlier, I have yet to find another company like IngramSpark where you have to have an imprint, which is like another word for a publishing company, to work with. Another company of everything else that I've done author career-wise, I could have done as an individual. The only thing that I know of is IngramSpark, and actually, as far as I can tell, it is a myth that you don't need to be an imprint, aka a publishing company, to work with IngramSpark. Whoever's saying that—I've heard that rumor perpetuated for a while now—I have not found that to be the case. If you go on the IngramSpark website, there is a section as you upload a book where you have to put in the imprint name, which is just another term for a publishing company, and so these are required boxes on IngramSpark. I don't know who is saying that they get around these; I do not think that there's actually a workaround to get around these. Maybe if you put in like your personal name, but I don't think that's really like legal. So just letting you guys know that that rumor is false; that currently, as of filming this video, you still have to be a publishing company to use IngramSpark. But everywhere else that I've done work with people like cover designers, editors—I don't know what else could you work with—like I suppose PR companies, I'm trying to think of just anything else, like YouTube, Patreon, everything that I do, I could do personally. I'm thinking, I'm looking at my little calendar, and I think the only thing maybe is when I sell books at BookCon, maybe it's better to be a publishing company, but I'm pretty confident that you could do that personally as well, and all book signings could be personal.
To sum up the reasons that I've seen people create publishing companies are: number one, of course, taxes; number two, legitimacy; and number three, for using print-on-demand companies like IngramSpark. Now I know that if I were you watching this, that wouldn't be enough information for me, so let's dig a little bit deeper into each of these things. So for taxes, our tax guy told me that I could do my writing under personal taxes, but since I also have income from other areas like Patreon and YouTube and writing events and my website and book trailers and signed copies and so on, I felt that I personally wanted to make it separate from my personal income and expenses and just have a business income and expenses, like all on its own as separate for taxes and treat it as an actual business because I am a full-time writer and it is my actual business. So that's how I wanted to handle it. I emphasize that that's how I wanted to handle it because everybody is so different and you need to do what's right for you. Typically, before you your book is published, you don't really make as much, so you can totally stay as like a personal income for a long time, actually, depending on how long it takes the ball to get rolling for income to start coming in under your author business. When you start making more money, that's typically when you will want to separate personal versus business, so that is a really good indicator. But let's be honest, taxes are really tricky, so I just want you to know that you're hearing this like secondhand from somebody who is not a tax professional. So I'm gonna stop there and just say maybe don't stress about this until you're starting to make like a more serious income or you're getting closer to your actual publishing date for your first book; that would be when I would start to worry about this and like take a look into it and actually talk to a tax professional. But when you are ready to publish and you are going to start making money, then it's kind of a different story.
So let's talk about the legitimacy side and specifically using IngramSpark and all the stuff that goes with that. Like I mentioned in the beginning, when you upload a book to IngramSpark, you do have to have your own ISBN numbers, and you do have to have your own imprint, which is another word for a publishing company. Quick sidenote, in case you're watching this and you're brand new: an ISBN number, I think stands for International Standard Book Number or something like that; you can Google it, but it's just something that you have to have on your book to sell your book. So I'm just going to do a little comparison, little side-by-side here. So KDP, Kindle Direct Publishing, is like the biggest print-on-demand company owned by Amazon, and KDP does not require an imprint because they are willing to be your imprint, aka your publishing company, and so they also do not require you to purchase ISBN numbers; they will give you free ISBN numbers. And then, on the flipside, IngramSpark requires you to be a publishing company; they expect you to be like a professional, like a business when you work with them; they also expect you to provide your own ISBN numbers, which can get expensive, and we'll talk about that too.
My advice when it comes to IngramSpark is going to be a little bit controversial, but don't use them unless you have to. They are the most difficult company I've worked with by far. They're less user-friendly, they're less intuitive, they just because they, you know, expect you to be a business, they just kind of expect you to just know how to use things, and their website is just complicated in general. I do have a video on how to upload to IngramSpark; I will link that below if you want to watch that and kind of get it like a visual of how different it is and slightly confusing. And then I also do have a video on how to upload to KDP if you're curious about that; I will link that below as well. Just like broad big picture, I just want you guys to know, they're a massive pain to work with. I call them the devil company, like affectionately, but also in loathing. I've had some bad experiences with them personally, but there's also just some more broad reasons that they're a little more difficult. Like number one, it's really easy as a debut author to not upload your book correctly, and they have an uploading fee every single time you upload. So initially, when you upload your book, it's $50, while on KDP it's free. And then also, if you make any errors, it's $25 for every time you have to re-upload your book and like fix issues, and on KDP it's free. So you can see right there the first problem. And so if you're a brand new author, it's so easy to make mistakes. So, for example, if you try to upload to IngramSpark first and there's an error, then you have, you know, you pay $50, so you're gonna pay another 25 to fix that error, but maybe there's another mistake, so you pay another 25; you can already see how this is snowballing. And then, you know, maybe you upload it correctly, but you found like an error during proofreading, and so you have to upload again to fix those errors or change something that you want to change, and that's another 25. So it can just keep going and going. There are some codes that you can get that will make the uploading free, such as if you participate in NaNoWriMo and you win; I believe almost every NaNoWriMo they give you a code to upload to IngramSpark for free, which is awesome, but you could waste that like that, and suddenly you're like, "Oh no, there's an error; I gotta upload again," and so it can be a problem. So my first advice, if you are going to use them, is upload everything on KDP first. Get your book figured out on KDP, get it pretty much final, wait till the final, final, final, and then you can use IngramSpark. But that's not why I call them the devil company, though; there are other reasons. One that you might encounter is that when you call their help center, pretty much always at about 15 minutes and like 30-something seconds and to hang up on you. So either you're waiting for like an hour plus or you get hung up on every single time you call. And so I don't know, just another random bit of warning that if you do work with them, just use the callback feature; it'll save you a lot of frustration.
But if you guys really want to know my personal experience, let's see if I can sum this up in a really short story. When I published my debut novel, Evelyn's Number, I ordered over a hundred copies for my release day to send out to people who had ordered them from me, and IngramSpark kind of last-minute was like, "Oh, I'm sorry, it's going to take another three weeks to send that out to you because of the holiday rush," and I was like, "Excuse me, my release day is…" Anyway, long story short, it was like, "No, no, no, no, no, you can't do that to me; I need to send them out on release day, not three weeks later," and that's really bad business. So I cancelled my order with them; no problem. I went with KDP or CreateSpace at the time; Amazon is awesome. And then I'm looking at my credit card, and the thousand-plus dollars that I paid for that order that was cancelled, it's still in my credit card months later. So I called them up, and they're like, "Oh, no, we don't see that; we don't see that charge." Oh, I was like, "Excuse me, it's right there on my credit card that you took the money out and, you know, put it back; you need to get it back." "I'm sorry, we don't see that; you know, we gave it back to you." And so finally, after threatening them and calling my credit card company to have them threaten them, they found the lost receipt for over a thousand dollars. So again, personally, I am NOT a fan of IngramSpark, and yet I still use it for most of my books, not all of them, but most of them, and I'm gonna explain why.
The first reason that I use IngramSpark is because they make their books returnable, which is a feature that KDP doesn't have, and I haven't found it on any other print-on-demand companies, although it could be out there. But IngramSpark allows bookstores to send books back, and to me, it's returnable. So this is something you have to have if you do a book signing at Barnes & Noble, which I have done two of those, and I want to do them again in the future. However, before you go, "Okay, so if I want to do book signings, I have to use IngramSpark," I don't think that's the case because number one, this is just Barnes & Noble that requires that returnable feature; I think that other indie bookstores would be more than happy to work with you, and if they don't want to buy your book directly, they could work with you to put your book on consignment or just let you come in for a book signing where you bring your own books. So it's not keeping you from all book signings, first of all. Second of all, Barnes & Noble now has their Nook Press, and so I—it's very possible that if you publish through Barnes & Noble Nook Press, that because it's their company, they might have a returnable feature, and they might buy your books—I haven't used them yet, but that's something that's worth looking into. But all that said, even if you do want to go through IngramSpark so that you can get into Barnes & Noble, it's still a lot of money to put into something that's only potential; it's not guaranteed because Barnes & Noble is extremely picky about the authors that they let in. I think that a lot of the reason that I was able to do a signing at Barnes & Noble is because I actually worked at that Barnes & Noble and they knew me by name. So it's not guaranteed; just because you use IngramSpark and you have that returnable feature doesn't make it guaranteed that you'll even get a Barnes & Noble book signing. So my opinion, it's a lot to spend four hundred-plus dollars on something that's not guaranteed. And when I say four hundred plus, I'm talking about creating the publishing company, buying the ISBN numbers, and the uploading fees to IngramSpark, plus maybe the uploading fees, the re-uploading fees for the errors; that's a lot of money to spend on something like that. Just something to consider.
And then the second reason that people use IngramSpark is for hardcovers. I have never personally made a hardcover version of my book; I only do paperback and ebook, and I don't really have plans to make any hardcovers currently because it's just so much more expensive, not only for me but also for the reader. So it's just not that on my radar at all. But if this is important to you and if you really do want hardcovers of your book, then IngramSpark does have this option while KDP does not. But again, there's a lot of other print-on-demand companies out there, and I mean a lot, so do your research maybe and like see if there's anything else out there if you want a hardcover of your book. If anybody watching this knows of another place where you can get hardcovers, definitely leave it in the comments for the rest of us; we would really appreciate that.
And the third reason that people use IngramSpark, or at least I do, is for paperback pre-orders. Unfortunately, KDP doesn't currently offer paperback pre-orders; they only do ebook pre-orders, at least at the time that I'm filming this video. It's actually on my to-do list to look into other print-on-demand companies like Barnes & Noble Nook Press, Lulu, Kobo, the Apple publishing company, and all those other companies to see if anybody else does paperback pre-orders. But right now, since I do have a publishing house and I do have ISBN numbers and I do know how to work with IngramSpark, it's just easier for me to continue to do my pre-orders through IngramSpark, so that's what I'm currently doing. But again, you don't have to do this just because everybody else does this. I know authors who only do ebook pre-orders because typically you actually make more money off a book as an author anyway. And I also know other authors, like for example, the New York Times bestselling author Alessandro Torre, who doesn't do pre-orders at all; she just does something called a launch page where she has people sign up for her email list to get an email alert on release day, and she doesn't do any pre-orders. The truth is, as long as you communicate with your readers and you let them know what to expect, they're gonna be totally fine with whatever you choose to do.
So in the end, this is a very personal decision; pretty much all of these things are actually, and so everybody is gonna be so, so different. So once again, just want to encourage you to do what's right for you and don't be afraid to start out spending less money and just experimenting with the free things. I am not going to tell you what to do because everybody is so, so different. So all I will say is that number one, you don't have to decide right now; like this is not a like, "I have to be all under my publishing house or I have to be all under my personal name." You can do whatever you want, and if you change your mind, you can change your mind; like it's not the end of the world. So if you want to start out and just do your personal taxes without a business for the first couple years and then start a business, awesome. And you can also republish your books as second editions under your new publishing house if you decide to do that in the future. If not, it's not set in stone; it's not the end of the world. I just want to take the weight off your shoulders for all of those of you who are thinking, "I have to decide right now," you really don't; you're gonna be just fine. And I will say, like if you are making a lot of money off your books, then it's probably helpful just for tax purposes, and it can also, again, be helpful if you want to use IngramSpark. But if you're not sure about either of those things, then start out on KDP and just try the free route first. Because number two, my other second advice is that I am a really big advocate of not wasting money and not throwing away your money on things that aren't going to bring you any value or have any return on investment. I'm just a really big advocate of being debt-free in general, and that's really important to my husband and I to be debt-free, and so I just never spend money with my business that I don't have. That's just my ultimate goal in my personal opinion, but again, you gotta do you. Okay, so that's why you might need a publishing company or why you might not need one. Now let's talk about the how side of things, like how to actually set it up, how to choose a name, how to do ISBN numbers and how many, how to do copyright, how to do taxes, how to do all the author business stuff.
The first step to creating a publishing company is to actually create a publishing company. So you're going to go to your state's Secretary of State website, and they will have different options for choosing an LLC, which is what I have, or an S corp, or there's a lot of different options, and you'll need to do your research on which one is the right one for your business. And so I have like an individual LLC, and you're going to actually go through the steps to first of all figure out the name for your business. So they'll have a place where you can test out the name ideas that you have, where like I have Grace House Press, so I put in Grace House Press to see if anybody else had this name already. And then once you are ready to create your business, you'll go through the steps that they have there; it's pretty self-explanatory; it's really not that hard; you just need to read everything. So set aside time to read and thoroughly understand what you're applying for, and then register your business, and you pay—in Minnesota it was a hundred and fifty dollars to set up a publishing company, but in other states I've heard it's a lot cheaper, and then in other states I've heard it's a lot more expensive. So every state is going to be different.
The second step, once you have an actual publishing company set up and registered with your state, is to go and set up a bank account. So go to your personal bank, or you could do a totally different bank if you want to keep that super separate, and set up a business bank account and a business credit card. And the reason to do this is to keep your personal and your business expenses and income completely separate; they shouldn't touch at all; it's crucial for your taxes, let's just put it that way. I didn't do this my first couple years, and so when I came around to tax season, it was an absolute nightmare just trying to differentiate like which expense was a business and which was personal and go through an entire year of that. Now granted, I did print everything, so that's my little extra tidbit of advice to you is print everything; keep a record of all income and all expenses that you spend. So just make sure that if you were ever audited, you can very clearly just give the IRS your business expenses and income. Make sure that it is very well-defined, very clear; take time, maybe every quarter or so, to just go over your taxes so that you don't have to do it all at the end of the year. This is just personal advice to go through, and it also helps you see your ROI, your return on investment, because you can see where are you actually making money. A lot of things aren't actually covered; like if you go out to coffee to write your book, that's not covered; other certain meals and traveling expenses and things like that aren't always covered. So if you're ever in doubt, talk to a tax professional or don't count it because you just want to be sure that if the IRS ever did audit you, you're not gonna have to explain, you know, why this Netflix movie was totally for the business; you get the idea. Number three is to make a note somewhere, maybe in your phone or your calendar or with your tax professional, to update your business every year so that it continues to be your business. Number four is to get a business logo, and this is 100% optional; this is just for fun and if you want to do it. The only advice I really have here, besides maybe hire somebody to do it instead of trying to do it yourself unless you're super good at graphic design, make sure that you have the rights to this artwork, whether it's original artwork like by you or by somebody who's giving you the rights or it's like a public domain type of artwork that is okay for you to use and you have the right to use it. This is my business logo right here for Grace House Press; it is actually a necklace that I got off of Etsy, and I had the person on Etsy sign an authorization of use form that said I have the right to use this as my business logo, and it was also on the cover of my book originally. And then I also had my friend and cover designer at the time sign an authorization of use that it was also my right to use that logo, so she—they basically signed it over to me.
That it was my logo, number five, is also optional. And that is to purchase ISBN numbers. That's obviously if you're going to be using a company like IngramSpark, or if, for some reason, you want to go through Katie P but use your own ISBN numbers and, you know, pay money for no reason. So that, in the U.S., is something you can get through the website Bowker. I will link that below. But you have three options currently on their website: you can purchase one ISBN for one hundred and twenty-five dollars, or ten ISBNs for two hundred and ninety-five dollars, or a hundred ISBN numbers for five hundred and seventy-five dollars. So obviously, it is very expensive, which I think I mentioned already.
Personally, I would recommend against doing the one barcode unless you literally are never ever ever gonna publish again, because it just seems kind of silly to buy one at a time when you could get ten and be set for a while, which is what I did. And then, you know, maybe this next time around, once I've used up my ten—which I think at this point I have—I might buy a hundred, or I might continue to buy ten. I haven't decided yet. Um, but it's one of those things where the most obvious is that one by itself is probably not going to be enough for you, especially because, in a lot of cases, like on IngramSpark, your ebook will also need an ISBN. So if you were to publish, say, on IngramSpark a hardcover, paperback, and an ebook, you need a different ISBN for all three versions of those and for an audiobook. So you will very quickly go through these ISBN numbers, especially if you're publishing frequently.
Another random bit of advice for ISBN numbers is that if you do purchase them, make sure you actually go onto Bowker's website and update which book they belong to as you publish, so that it's actually registered belonging to that ISBN number.
I think we're on number six now, which is barcodes. Um, not only is this optional, but I would actually say don't buy barcodes. Like, the Bowker website does offer them, but on KDP and IngramSpark they give you a barcode. And I don't know why you would buy a barcode. If there is a reason to buy them that I'm not aware of, go ahead and comment below and let us know. But at this point, I will recommend against buying a barcode.
All right, that leads to number seven, I think, which is copyrights. Do I need to copyright multiple times? No. Don't copyright your book until the end; otherwise, you're throwing away your money. Under the U.S. copyright laws, at least, your work is your own the moment that you write it. So filing a copyright with the government is just filing it—like, it's just that extra legal protection, but it's still your work; like, it's not changing. So don't spend fifty-five dollars like for every draft; that's just crazy. Oh, and then I've had people ask me, you know, "I copyrighted it in the beginning, but then I changed it. Do I need to copyright again?" Well, yeah, if you changed it a lot, all those changes aren't filed. So again, it's just filing—like, don't do it if you don't need to.
Um, I know a lot of authors who actually don't complete the filing step at all. And I personally like to do it, just as it gives me that measure of comfort, that security of, like, if anything ever did happen, I filed my work; it's clearly mine. But you can do things like email copies to yourself, and that has a timestamp. It doesn't hold up in court as well, but how often do you see authors go to court, if you know what I mean? So copyright at the end, if you're gonna copyright at all. Somebody did tell me that you can actually, if you have a series, you can take that whole series as a whole and copyright that by itself, like all in one, at the end of your series when you're done. I think I'll probably still do book by book, just for, again, personal, like, comfort and feeling good about it. But it is fifty-five dollars every time you file a copyright, so just be aware of that.
I will link in the final steps to publishing playlist that this video is under. I'll link that playlist below, and within that is a video on how to do a copyright by Alessandra Torre, and I'm just gonna let her teach you guys, 'cause she says it pretty well.
All right, here's a really brief summary for anybody who's like taking notes and just wants to write it down: You're going to go to your Secretary of State website. You're going to find the business that's right for you and choose that. You're going to give that business a name. You're going to go through and file it and pay for it, so that you officially have a company. Then you're going to make them a note somewhere that can remind you to go and update that and, like, pay for it every year to make sure you keep that business. After that, you're going to go get a bank account and make sure that everything you do is now going through that bank account and that business credit card—that is all business-related and nothing else. You're gonna print everything for taxes, no matter what—just print it, baby—and, like, save it somewhere for each year. And you're going to potentially get a business logo if you want. You can buy ISBN numbers if you want, and you can now upload to IngramSpark if you want. So there you go. That is how to create a publishing company.
Let me know if you guys have questions. If there's something I forgot to cover, it's a really big topic, so I wouldn't be surprised if I completely, you know, miss something, and I apologize if that's the case. Oh my gosh, I just looked at the calendar for when this video is coming out, and you guys, as of publishing this video, I'm going to be at BookCon. Like, I'm there right now as you're watching this. I will be in booth 3026 selling books with Mandy, and I will have some BookCon exclusive freebies for everybody who's there. So come find us there; come hang out with Mandy and I; we'd love to meet you and hang out if you happen to be in the New York area.
I'm probably freaking out—like, I'm freaking out now, so I assume that I will be freaking out then. And then, by the time this video comes out, *Grow Your Author Platform* will also be out in the world. That's part of the *Marketing for Authors* series; it goes along with *How Your Book Sells Itself*. So both of those books will be out in the world as of the time that this video is released. Oh my gosh, that's so crazy; it's officially a series now, not just one book. And also, last but not least, you can also pre-order *The Stolen Kingdom*, which is my first book in my fantasy series, coming out this August of 2019. What year is it? And oh my gosh, you guys, I'm so excited; I'm freaking out because I literally, as of filming this, just set up pre-orders secretly like yesterday, so I'm waiting for those to kick in and take effect, and I'm very nervous that people aren't going to pre-order. So if you're interested in this book at all, please save me from a heart attack and pre-order it. All the links are below. I will definitely have, probably, some giveaways—definitely, probably, yeah—I will definitely have some giveaways in the future that have to do with pre-orders, so save your information if you do pre-order and definitely, like, let people know that you're getting this book; spread the word because I'm very excited. And if you're interested in getting an email alert on release day, or just want to check out more of what the book is about, I have a launch page below as well in my website, so you can go check out those things to know more of what the book is about.
If you are like the one person that's still watching this video and you stuck with me through till the end, thank you so much. I really appreciate you. Comment below to let me know that you're still here, so I give you some love. That's all I have for you guys today, so let me know that you liked this content by giving it a thumbs up, and definitely subscribe if you haven't already. That little bell next to the subscribe button will let you know whenever I have new videos, so ring it, and I will talk to you guys again very soon. [Music]