DEVELOPED BY

DIGITAL BOOK WORLD&

PUBLISHERS LAUNCH CONFERENCES

Publishing Start-Up Survey

SUMMARY RESULTS PRESENTED BY

MIKE SHATZKINFOUNDER & CEO, THE IDEA LOGICAL

COMPANY

TUESDAY, JANUARY 14 , 2014

Publishing Start-Up Survey Respondents

36.8%

63.2%

Do you work for an established publisher or a publishing technology company/start-up?

Publisher

Start-up/technology company

Publishing Start-Up Survey Respondents

43 publishing start-ups From 8 countries Including 10 start-up publishers Diverse range of types and sizes

25 traditional book publishers From 8 countries Staff tasked with meeting with and evaluating start-

up propositions

• Respondents include self-funded and bootstrapped operations through to three rounds of investment totaling near $8m

• Total full-time employees range from 1 to 150• Started as early as 2002 and several slated to

launch in 2014• Average age of over 2 years old

First, the start-ups…

Geographic distribution of start-ups

Respondents came primarily from the US, but also from the UK, Germany,

Canada, South Africa, Israel,

Russia, and Japan

Causing disruption

ReadersPublishers

RetailersAuthors

LibrariesAgents

AggregatorsOther

0.0% 20.0% 40.0% 60.0% 80.0% 100.0%

74% of start-ups surveyed consider themselves “disruptive” to one or more of the players in the

traditional book publishing value chain:

Greatest challenges start-ups face

“We've been doing this a while. We've done more than people know. To get anywhere you have to execute ferociously to drive revenue. It's a tremendous amount of work. That often gets overlooked – it's a lot of work.”

“It’s a lot of work.”

Greatest challenges start-ups face

Working within slow publishing sales/business development cycles and often reluctant publishers

Managing pivotsMarketing (B2B and B2C)

Building user base/audience (of both authors and readers) Generating (and maintaining) interest and engagement among

readers, authors, and publishersHandling DRMFunding/operating capitalFor start-up and e-first/e-only publishing houses:

Building clout with traditional publishing partners (e.g. bookstores, media)

Developing robust sales and distribution capabilities Understanding the digital marketing and advertising landscape

Now, the publishers…

48.0%

32.0%

4.0%16.0%

Company size

Small

Mid-Sized

Large

Big Five

54.2%

16.7%

29.2%1 - <100100 - <500500+

No. of titles published per year

Geographic distribution of publishers

Respondents also primarily from the

US (over 50%), but also from

Canada, Italy, the UK, Germany, South Africa, Portugal, and

Australia

Who meets and evaluates start-ups?

Business devel-

opmentEditorialInformation technologyManaging

editorialMarketing

Production

Sales

0.0% 20.0% 40.0% 60.0% 80.0% 100.0%

Role/title of the person(s) tasked with evaluating start-up propositions: (select all that apply)

Biggest technology problems publishers face

Data Getting useful data, analytics, and metrics Internal data management (incoming and outgoing)

Digital asset management Creating and managing metadata Marketing assets

Shifting to an XML workflowDigital marketing, promotion, and discoveryStaffing for a digital workflow

Lack of personnel Need for new skillsets and training Sometimes lack of interest

Managing and updating internal systems and technology

What these publishers would be investing in…

Marketing and discoveryMetadataApp developmentWorkflow/collaboration technologiesAnything that weakens Amazon’s hold…

• What are the problems the industry faces today? • Who are the key stakeholders for whom each of

those problems are a pain point? • For what types of content and for which

markets do these problems (and their hoped for solutions) apply?

Finding common ground (and points of contention)

Problems/pain points

Accessibility

Audience engagement

Content/Editorial

Data/Insight/Intelligence

Discovery/Discoverability

Enabling social interaction

Improving workflow

MarketingSimplifying/enabling

transactionsSimplifying technology

0.0% 25.0% 50.0% 75.0% 100.0%

Pub-lishers

Start-ups: What problem(s) are you trying to solve?Publishers: What problem(s) would you like start-ups to tackle?

Problems for whom?

START-UPS PUBLISHERS

Accessibility Authors (54%)Readers (43%)Publishers (26%)

Readers (56%)Libraries (44%)Publishers & Retailers (26%)

Audience engagement Authors (54%)Readers (46%)Publishers (43%)

Publishers (63%)Authors (57%)Libraries(31%)

Content/Editorial Authors (54%)Readers (37%)Publishers (37%)

Publishers (38%)Authors (19%)Retailers & Agents (13%)

Data/Insight/Intelligence

Publishers (66%)Authors (57%),Agents (29%)Readers (26%)

Publishers (94%)Retailers (38%),Libraries (31%)Aggregators (31%)

Discovery/Discoverability

Authors (63%)Readers (57%)Publishers (51%)

Publishers (69%)Readers (50%)Authors (44%)

Problems for whom?

START-UPS PUBLISHERS

Enabling social interaction

Authors (51%)Readers (49%)Publishers (31%)

Publishers (50%)Authors (38%)Readers (31%)

Improving workflow Authors (49%)Publishers (37%)Agents (26%)

Publishers (81%)Retailers(25%)Aggregators (25%)

Marketing Authors (77%)Publishers (43%)Agents (31%)Readers (26%)

Publishers (75%)Retailers (44%)Authors (38%)Aggregators (25%)

Simplifying/enabling transactions

Publishers (46%)Authors (40%)Readers (34%)

Retailers (44%)Publishers (38%)Readers & Aggregators (19%)

Simplifying technology Publishers (51%)Authors (51%)Readers (34%)

Publishers (50%)Readers & Retailers (38%)Aggregators (25%)

To Publishers:

Acces-sibility

Au-di-

ence en-

gagement

Con-tent/ed-itorial

Data/Insight/Intelli-gence

Dis-covery/

Dis-cover-ability

En-abling social inter-action

Improv-ing

work-flow

Market-ing

Sim-plify-ing/en-

abling trans-

actions

Sim-plify-ing

tech-nology

0.0% 25.0% 50.0% 75.0% 100.0%

What problems do you NOT think start-ups need to address?

Trade - narrative fictionTrade - narrative non-

fictionTrade - illustrated

Trade - children's booksK-12

Higher EdScholarly/Academic

ProfessionalReferenceTextbooks

JournalsMagazines

Apps

0.0% 25.0% 50.0% 75.0% 100.0%

PublishersStart-ups

Content/markets

Start-ups: At what types of content/markets are your services aimed?

Publishers: What content/markets do you publish/serve?

Start-ups working with publishers

MetadataEbook files

Trading terms

Licensed contentSales

data/metricsLicense/

use platformNone/no cooper-ation

neededOther

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

What cooperation do you need from established publishing players? (select all that apply)

Publishers evaluating start-ups

Practical-ity to

current business

Low bar-riers/min-imum re-

quire-ments for participa-

tion or coopera-

tion

Faith in start-up manage-ment and personnelLegal risk

Time-burn risk

Financial risk/op-

portunityAuthor/agent re-lationship

What criteria do you use when evaluating start-up propositions? (select all that apply)

Some start-ups publishers are glad they made time for….

Advice from start-ups

Find ways to better serve and support authors

Go D2C: Cultivate direct relationships with readers

Establish new ebook sales terms/models for special use cases (e.g. classrooms)

Think mobileDevelop long-tail SEO, discoverability, and

digital marketing strategiesRethink DRM

Some predictions

“Fiction and non-fiction are diverging as they go digital, and while the focus has mostly been on fiction up till now, things are about to warm up for non-fiction.”

“Publishers will use start ups for: hiring base for engineering talent and out placement source of employment for departing executives. “