I frequently say that people who really know accounting and finance don't care what to count, analyze, fund, etc. I obviously include myself into this group - not to toot my own horn, but simply because my career has proved that I am actually able to successfully plunge into any type of business, any industry.
The essential prerequisite for this level of expertise is an extensive fundamental knowledge combined with a propensity for applying general principles to specific situations. There is also a very special knack that plays a crucial role in the making of universal financial experts: a natural ability to convert everything into monetary units.
I do it almost automatically, almost with everything, sometimes to a fault. However, my reverence for creative endeavors prevents me from crudely slapping price tags onto them. It's only somewhat recently, as a result of certain developments in my own life, that I became curios about various numerical aspects of arts and entertainment.
Of course, some numbers are commonly known. The others are easily derived through general financial acumen and cultural intuition. But I must say, some of my findings turned out to be simply bewildering.
I. Books
The PEN Award recipient Grady Tripp (Michael Douglas's character in Wonder Boys)said that the only reason the University's Chancellor fell in love with him was because "she was a junkie for the printed word. Lucky for me," he continued, "I manufactured her drug of choice."
I have to say that if there were such a thing as Arts Addictions Anonymous, I would probably end up, together with the Chancellor, in the "books group." (After that they would move me to the Theater and Cinema rehabs.) The question is, how many other people would be there with us? Here are a few sad numbers about my first love - the written words.
According to various publishing specialists, if an advance of $3,000 is paid to a book's author, the life-time sale of 10,000 copies is considered to be a success. Most debut literary story collections sell no more than 2,000 hard-cover copies. For the first literary novel this number falls into the range between 3,000 and 7,000.
An average professional-interest book sells about 5,000 copies in its lifetime. This includes e-Books (which, as you know, can be easily stolen). If the author hires, naturally at his own expense, a book agent and a PR firm, the sales may go up as high as 12-13 thousand copies.
Just for the sake of the statistical integrity, let me remind you that the population of this country is 315 million.
Now, here come the dollars. This is derived from my own first-hand experience: an author's royalties range anywhere between $1-$4 per sold book. So, if your book has sold 5,000 copies, you can hope to generate somewhere between $5,000 and $20,000. Astonishing, isn't it? We are talking about the payoff on the multi-months (sometimes years) struggle.
This explains why 99% of American authors have day jobs. Most literary writers with respectable names teach creative writing classes in Universities. One of my idols, the late Kurt Vonnegut, taught at the University of Iowa Writers' Workshop (the most prestigious post-graduate program in the country) practically until he died. Many authors write for magazines (and I am not talking about just The Atlantic or The New Yorker). Of course, less known fiction and non-fiction writers also teach, research, consult, hold executive positions, etc., etc.
It also explains why so many literary awards come with the words Fellowship or Grant at the end. It signifies that the author was provided with sufficient funds to sustain her or him through the writing of the next masterpiece.
Of course, there are bestsellers. It is said that in order for a book to get on the bestselling list, it must sell at least 7,000 copies a week (in any category). So, if you see that a book stayed on The New York Times Bestsellers list for, let's say 20 weeks, it means that it has sold at least 140,000 copies. Now, we are talking about different kind of money - about $500,000 in royalties from a single title. Of course, if you had an agent who hooked you up with the right publisher, 10% of that goes to him.
Unfortunately, it is quite rare that a true literary novel or a scientifically brilliant non-fiction becomes a bestseller. With the exception of a few (Kurt Vonnegut again, John Updike, John Irving, Muriel Spark, Alice Munro, Norman Mailer, Jennifer Egan, Johnathan Franzen), most contemporary writers (royalty-free old classics are not the subject of this post), whose work measures up to my standards of quality, never see their names on the bestselling lists.
It's the thrillers, the soft-porn romances (the Fifty Shades of Grey trilogy still occupies the top three spots), the vampire stories, the heroic fantasies, and the chick-lit opuses that top the charts of fictional hits. Children and young-adult adventures are distributed by bucketloads through schools and city libraries.
Most popular non-fiction titles are memoirs, biographies and autobiographies, self-help books that promise to remake and happify you by the time you turn the last page, cook books, chronicles of staggering financial rises and downfalls.
And then there are mega-sellers - books that appeal to armies of readers, generating multi-million-dollar revenues for their authors and publishers. Among the most recent fortune-making printed commodities are the Harry Potter series (over 500 million copies world-wide and counting), Twilight series (over 120 million copies), Diary of a Wimpy Kid series (75 million copies), The Hunger Games series (50 million) [all young-adult books, by the way]; The Da Vinci Code (80 million) [a pseudo historical thriller with a feminist twist]; The Purpose Driven Life (30 million) [a 40-days spiritual journey manual for finding God]; The Girl with the Dragon Tattoo (30 million) [sexual deviance thriller with even stronger feminist twist].
Note that all fictional books on the mega list were also turned into movies, thus multiplying their author's wealth. To be fair, I must say that it doesn't happen only to low-brow mass-market hits. High quality literary books are frequently adapted (at much smaller prices, of course) for the silver screen as well (the aforementioned Wonder Boys, Brokeback Mountain, 25th Hour, Fight Club, Forrest Gump, The Color Purple, Stand by Me, Schindler's List, The English Patient, to name a few). It's another way for a good writer to earn a little bit of extra money.
We will return to movies later in this series.