Betting Big on Literary Newcomers

Big advances kill houses. That's the way it's been, and that's the way it's going to be. But in an increasing winner take-all, buyers won't care. They need the win and they'll lose their shirts trying to get it.

The success of The Windup Girl killed Night Shade Books, because it upped their advances in an attempt to replicate its success.

You can see the same thing happening with the studio summer blockbusters. Everyone appears to be voting to bet-it-all, with losses almost crushing the studios.

I'm not sure what the moral here is except, don't do it. Don't buy into it. Big bets don't make big wins. Wins make wins. And fate is fickle as to where they come from.

This seems closely related to PG's essay Black Swan farming: "there is probably at most one company in each YC batch that will have a significant effect on our returns, and the rest are just a cost of doing business"

It seems that for the publishers as well, rather than betting big on a few predicted winners, they could bet small on a large number of authors with big potential in the best case.