Night Shade Books: What went wrong?

Last August I got an email from Jason Williams, publisher and majority owner of Night Shade Books. He said he’d been paying attention to Staffer’s Book Review and he wanted to pick my brain about the direction Night Shade was heading. My thoughts ranged from:

  1. Wow — someone in publishing cares what I think (to. . .)
  2. Why the hell does anyone in publishing care what I think?

Little did I know that the mere existence of this email was a sign that Night Shade Books was seriously dysfunctional. Williams and I went on to have a lengthy email exchange and several phone calls over the following week. These talks resulted in me doing a very slight amount of consulting for him. I’m not going to reveal too many details from these exchanges, but a few might dribble out here and there as some of them aid in the telling of a good story.

Let me rewind a minute and talk about why Night Shade is important and anyone cares whether they live or die. Bear with me; because I have to cover some basic publishing info. . .

Everyone knows about the Big Six: Hachette, HarperCollins, Macmillan, Penguin, Random House, and Simon & Schuster — soon to be the Big Five with the Penguin/Random merger. Although all the major New York houses publish some science fiction and or fantasy, the only true science fiction and fantasy publishers are Harper Voyager, Ballantine/Del Rey (part of Random House), and DAW and Ace (part of Penguin), Orbit (part of Hachette in the US and the Little, Brown group in the UK), and Tom Doherty Associates, LLC (Tor/Forge, part of Macmillan).

That may seem like a lot of places to be published, but the big houses’ needs for original science fiction and fantasy are limited, especially for new authors. Many of the slots on their lists are taken up by established bestselling authors and profitable tie-ins.

Below the big houses are: Baen (independent but distributed by Simon & Schuster) and smaller publishers (Pyr and Angry Robot) with relationships to larger independents. Then there are the pure independents with national distribution. Those actively publishing new titles in 2012 (numbers are approximate): Night Shade Books (37 new titles published in 2012, 33 of which were novels), Prime Books (21, only three of which were novels), ChiZine Publications (a Canadian publisher which receives some support from the Canada Council of Arts and/or the Ontario Arts Council; 18, 11 of which were novels), Small Beer Press (eight, two of which were novels), and Tachyon Publications (eight, three novels). There are, of course, also limited edition publishers (i.e. Subterranean Press) and print on demand publishers, but those are entirely different business models.

All that goes to show how important Night Shade has been to the marketplace, particularly for debut authors and edgier, more financially risky titles.

The obvious question becomes, how does Night Shade make that work as a business? How do they thread the needle that no one else seems to be able to thread? Unfortunately, the last few years revealed that they can’t and didn’t.

To get as far as they did, Night Shade had to have some bestselling books, which they did. Examples include Paolo Bacigalupi’s The Windup Girl and John Joseph Adams’ collection The Living Dead. Usually that’s a good thing, but big success can result in cash flow difficulties. There have been times when Night Shade owed authors (or editors) six-figure royalty payments. Allegedly, legal action had to be threatened in order for those royalties to be paid. Good business practices, if applied, result in these problems being overcome and success begetting success—or at least stability. That did not happen. Instead there seemed to be mismanagement or, at least, questionable management choices, which I can speculate on, but would tread into rumors and innuendo rather quickly.

Long story short: Paying those big royalties led to shortfalls elsewhere, leading to delayed payments for less successful authors.

This failure to pay led the Science Fiction Writers of America (SFWA) to put Night Shade on probation twice, with the last time under the mandate: Get your house in order or you’re done. To that end, news broke last night that SFWA officially delisted Night Shade as an approved publisher for SFWA membership. Night Shade owners Jeremy Lassen and Williams responses to these situations have always been less than conciliatory:

In fourteen years, we’ve never stiffed anyone. We’ve been late, sure. But we’ve never stiffed anyone. You get paid whether Borders goes bankrupt. You get paid whether the adorable little independent bookstores you hold so dear stiff us regularly on invoices, and then demand more books. You get paid when the wholesalers take eight months to cut a check, and three days before they cut that check, they return everything in inventory, deduct it from the check, and then reorder it after the check goes out. You get paid when B&N forgets to put out orders for books that were in the warehouse six weeks prior to ship date.

Of course, it’s everyone else, and never Night Shade. This might be true, what do I know? The reality is THAT’S THE BOOK BUSINESS. Williams has been in it since 1998 or so. He was certainly aware of how long it takes to get paid, the hassles of distribution, and that you have to constantly stay on top of things like books that don’t make it to the shelves. Borders went under — it was expected for several years and most publishers and distributors did what they could to plan for it and minimize the financial pain. Most importantly: Unsold books get returned and the publisher doesn’t get paid for them, and in a bad month it ends up being a net loss.

Some small presses actually anticipate these losses, and still manage to pay their bills using a time honored tradition of not spending more money than you have. Something Night Shade has seemingly never been very good at.

Thankfully over the last fourteen years, Night Shade sold a lot of books. According to 2011 Bookscan numbers, they sold just over 75,000, which of course doesn’t take into account things like library sales, non-standard stores, and does not count digital sales at all. This is a publisher with million dollar gross revenues. This should be the story of an independent publisher finding success in a difficult market.

Instead, as someone who has followed Night Shade for years said, “In the end. I just don’t want people saying ‘Oh, I’m so sorry. For a great small press to go under like that due to evil distributors and Borders’ collapse—tsk, tsk.’  I want it recognized that they ran the business into the ground.”

I’ve talked to a dozen people who have done business with Night Shade, and this is not an uncommon perspective. How then did we get here?

The apparent truth is that Jason Williams and his partner, Jeremy Lassen, aren’t business people. They’re fans. Lovers of science fiction and fantasy. Lassen has a keen eye for talent and Williams is a stereotypical salesman. Unfortunately, there isn’t anything resembling a MBA or other real business experience between them. Nor does it appear that fifteen years in publishing brought much enlightenment.

Furthermore, things like deadlines and schedules haven’t been part of the Night Shade business plan for quite a while. In the summer of 2009, they got far behind schedule. [According to sources: When you schedule a book, your distributor then sells that book (based on your publication date) to bookstores. Delay the book and the initial order may be cut or cancelled altogether. Delay it again, and, well . . .] To their credit, Night Shade caught up — by publishing sixteen books in one month. For Tor/Forge that might be a ho-hum couple of weeks, but for Night Shade was akin to trying to flush an entire roll of toilet paper. If Barnes and Noble was the toilet, it overflowed and Night Shade was left wet and holding a lot of soggy paper.

Further demonstrating scheduling difficulties, I’ve learned that multiple 2012 titles went to press under less than ideal circumstances — meaning barely edited. At least one book, bought on speculation, required “triage editing for continuity” after advanced review copies shipped and reviewers flagged concerns. It was then copy edited by a fast freelancer at the eleventh hour. In some cases, editorial notes weren’t delivered to the authors until days hours before the book was to go to press. Amid all of this Night Shade was cancelling contracts, returning books to authors, and negotiating rights reversions.

Another mistimed choice involved switching distributors in 2012. Publishers do this for various reasons and nothing negative should be said about it. However, changing distributors results in at least some negative effect on cash flow usually for a matter of several months. It also impacts, at least briefly, retail orders. Perhaps this was a wise decision. Perhaps not. I don’t know. I do know that it must have added to the financial strain.

This brings me back to where this article began — an email from Jason Williams. During our conversations I learned about a lot of the problems I describe above, all of which I’ve confirmed from subsequent sources. Williams was extremely dissatisfied with how Night Shade was running and was looking for an outsider’s perspective. Given that I seemed to grok Night Shade’s editorial decisions, he thought I could provide some insight. The conversation was far-reaching and touched on editorial direction, publicity problems, and the general challenges of running a publishing house in this climate. Most of my feedback was in regards to publicity and how I believed Night Shade was consistently dropping the ball in engaging the online community with its books.

During this time I learned Night Shade, or at least its owner, had almost no knowledge of how to get books in people’s hands outside of traditional booksellers. He asked me for names of other people like me who might be interested in helping on a part time freelance basis with editorial comments, and, more forcefully, developing the kind of publicity network that Orbit, Angry Robot, and other progressive publishers have developed in the virtual space. Williams went on to contact some of those individuals, even tentatively offering an opportunity to one of them.

Meanwhile, he sent me two manuscripts, ostensibly asking me to help him provide some editorial oversight to an operation he felt was running out of control. I read both manuscripts and provided notes, confirming the quality of one of the novels and utterly condemning the other (I would note that one of the novels has been published, with the other slated to be published this spring). Shortly after this exchange, Williams went dark, dropping contact with me, and the individuals I’d suggested he reach out to.

I bring all this up for the same reason I’ve aired some of their laughable business practices. Night Shade, throughout its existence, consistently exhibited the kind of behavior that fundamentally precluded them from ever finding success. To my knowledge Williams never consulted people running other independent presses. Instead, he opted to seek my advice – a relatively new blogger whose most illustrative credentials were calling God’s War amazing and Pillars of Hercules a piece of shit. I have no experience in the publishing business, nor have I ever studied it.

In preparation for this piece I reached out to several Night Shade authors, most of whom preferred to remain anonymous. But Liz Williams, an outspoken author stated publicly:

“All I am going to say on the Night Shade buyout is that if you are in the industry and don’t know what I think about it already, you’ve been living on Mars. I did not like being poster girl for the ‘NS sucks’ vanguard, but given what they have done to so many fellow writers, I’ll live with that, despite a concomitant degree of abuse from my former publishers. I hope both of them are thinking of going into more suitable professions. As to what that might be, I think I’ll remain silent.”

Which brings us to recent events. On April 2, Jeremy Lassen tweeted:

My exciting news is that Night Shade is being bought by a larger publishing company! NS authors are recieving [sic] formal notification now.

First, it soon became obvious that Night Shade had not been sold; its assets were being tentatively acquired under very specific terms. Second, the company seeking to acquire the rights to Night Shade’s titles and potentially their brand is Skyhorse Publishing. Skyhorse is a mostly non-fiction publisher. According to Publishers Weekly in January of 2012:

Skyhorse Publishing has announced an unusual program under which it will pay cash to acquire the backlist of publishers with cash flow problems. Skyhorse sees the program as a way to help struggling publishers deal with cash flow issues while adding more titles t Skyhorse’s list. Price will be determined by a title’s average net sales for the current year and the prior three years. Interested publishers would be required to assign the original author contract for each individual title over to Skyhorse and would immediately receive payment.

So, there is a great deal of interest in exactly what is happening with Night Shade and to its authors. It’s not my place to comment on the deal being offered, nor does it have any bearing in the overall story of Night Shade—except to say that, sadly, it may be at last, a businesslike decision; the best Night Shade can do for itself under the circumstances. However, the following, from Williams’ letter to a Night Shade author, has been publicly posted:

As you probably know, Night Shade Books has had a difficult time after the demise of Borders. We have reached a point where our current liabilities exceed our assets, and it is clear that, with our current contracts, sales, and financial position, we cannot continue to operate as an independent publisher. If we filed for Chapter 7 bankruptcy, or liquidation, the rights to your books could be entangled in the courts for years as could past or current unpaid royalties or advances. However, we have found an alternative, which will result in authors getting paid everything they are due as well as finding a future home for their books, subject to the terms and conditions stated in this letter.

Provided that a sufficient number of Night Shade authors agree to certain changes to their contracts with Night Shade, Skyhorse Publishing, Inc. and Start Publishing, LLC have agreed to acquire all Night Shade Books assets. To be clear, this is an acquisition of assets, not a purchase of the company as a whole. The revenue received from the sale would go towards paying off the debts of the company. If you sign below, and a sufficient number of other Night Shade authors and other creditors also agree to these terms, you will receive full payment to bring all royalties and overdue advances current.

Neither solution presented seems to have the authors’ best interests at heart . . . sale to an unfamiliar publisher with no knowledge of the genre or the possibility of bankruptcy where the rights to their own books might languish for years. That’s too bad.

I’m going to speculate for a moment, if no one minds. In all the conversations I had leading up to this article I feel like I’ve gleaned a solid picture of things. Night Shade was composed from the very beginning of talented people with a passion for good fiction. Business, though, always seemed to be an afterthought. It seems to me that Night Shade was too often concerned with looking like a success without actually putting in the work to be successful.

The 2011 Debut Author program in hindsight, which I’ve so lauded, looks like a desperate attempt to find the next Paolo Bacigalupi. Riding the high of finding that next amazing voice in the field pushed out all other factors. I was excited by it too, and in my opinion they found several voices at least that good. But, they paid too much for them, with advances approaching $10,000 for a single book, rates at least in the ballpark of the major New York houses. For a small, independent publisher with a history of troublesome financial management, it was too much to bear.

As one former Night Shade author who preferred to remain anonymous said, “it seems to me that the debut author program was a good idea; they just took it too far. It may have been their death knell, but it didn’t have to be. They were publishing choice pieces of work from some well known authors and editors. If they had continued to mix that approach while folding in new authors in a more cautious manner, perhaps we wouldn’t be having this conversation.”

Nevertheless, here we are. Over the last three years I’ve come to know a lot of Night Shade authors, particularly those that Lassen and Williams took a chance on by publishing their first novels. They are a committed, talented, and deserving group of men and women. I very much hope that not only will I see future works from them, but that their backlist titles and contracts for forthcoming books, currently in Night Shade’s shadow, are well published. They’re very much worth reading.

[Additional note that's come to light after the report: It's come to my attention that there are actually two publishing companies involved in acquired the rights to Night Shade's titles. Start Publishing and Sky Horse, with Skyhorse taking print, and Start ePublishing taking the eBooks. Authors are facing having their rights split apart, and going to two different companies (who are working together, but who have no strong brand/history).]

Written by Justin Landon

Justin Landon

Justin Landon is the Overlord of Staffer’s Book Review. When he’s not writing things of dubious value to the world, he’s at the gym or being a dad. You can follow him on a multitude of social media, which is strongly suggested lest you miss out on vital information that could someday save your life.