June 1, 2018
Meet the hedge fund manager who’s going to blow up the publishing industry by paying authors half the, uh, profits on their books
by Simon Reichley
Jonathan De Montfort has a totally crazy idea: what if you paid authors… wait for it… to write books? Insane, right?
Maybe, but De Montfort, an Englishman who spent several years at Goldman Sachs and recently founded his own hedge fund, De Montfort Capital, is going for it. According to a profile by Katherine Cowdrey in the Bookseller, De Montfort has recently created a publishing company, in addition to his hedge fund, called (can you guess?) De Montfort Literature (DML). The plan? Pay authors a regular salary of £2,000 (about $2,500) a month to write books, mostly fiction, which DML will then publish in the (mostly) traditional manner.
De Montfort tells Cowdrey:
“I looked at the way that it [the publishing industry] worked and it’s what I call ‘the literary lottery’. It’s this strange idea that, ok, you bear all of the [upfront] cost and all of the time and the effort of writing a novel, and then you send it to the agent, and hopefully they’re going to see it, and hopefully, when they send it on to the publisher, the publisher is going to have a look at it, and so on.
“Imagine if Google operated that way; it said ‘Software engineers of the world, we want to build this fantastic system. We’d like you to send us in source code — just randomly. Come up with random ideas or else what you think we want; we’re not going to tell you what we want, we just assume that you know.’ And it’s like that, [publishers] say, ‘If we like what you’ve written, and we can monetise it, then we’ll pay you.’ That is an absolutely insane way to do business, in my view.
See! I’m not crazy, you’re crazy! You’re all crazy! That’s a real selling attitude!
Anyways, this seems pretty good, at first blush, particularly for first time writers, or those uncomfortable having an agent or a traditional editor. But—predictably—taking the ethos of the technology and banking sectors and applying it to publishing leads to some rather unsettling methodologies.
According to De Montfort, the company would initially open up ten salaried writer positions. Applicants for those positions will be subjected to “a rigorous selection process” including “psychometric testing using an algorithm to establish if candidates are suited to the writer’s life,” which is a pretty frightening way to hire anyone, much less evaluate the talent and commitment of the writer, a notoriously mercurial creature.
If hired, authors will receive their salary, plus fifty percent of profits. Yes, profits.
This is the part where anyone with a modicum of business sense would start laughing uproariously. Profits? On books?! Get the fuck outta here. While there are certainly profits to be had, if I were an author I wouldn’t want to get paid a percentage of them. Gimme net, any day of the week. At the very least you’re not opening yourself up to the potential incompetence of the first time publisher you’re working with. Plus they’re harder to lie about.
That’s not even the worst of it. Nicola Solomon of the Society of Authors expressed grave concerns over DML’s insistence on filing for joint copyright (!!!) — not only on the work itself but on the author’s “ideas” (!!!!!) and a brutal non-compete clause, totally unheard of in respectable publishing.
Sure, $30,000 a year is probably more than a lot of writers will make on residuals, but the whole package seems dangerously Faustian. Solomon probably put it best: “We always advise all writers to look a gift horse in the mouth and, on closer inspection, this one has some rotten teeth.”
Simon Reichley is the rights and operations manager at Melville House.