#289: Paul Millerd — The Truth About Traditional Publishing (And The Deal He Would’ve Taken)

Paul Millerd [00:00:00]:
Penguin reached out, they said, well, we're going to take it out of print. We probably want to put a new cover on it. We might want to restructure it a little. There was no upside. Readers were loving this book and they wanted to take it out of print. It just didn't make any sense to me.

Jay Clouse [00:00:12]:
Today I'm speaking with Paul Millard, the author of the Pathless path, earning Paul $325,000 in royalties. And last year, Paul decided to double down and produce a new version of the Pathless Path, an ultra premium hardcover book that is just beautiful. So in this episode we talk about that decision.

Paul Millerd [00:00:30]:
I started asking my questions that sent me down the path of creating this new version of the Pathless Path, the.

Jay Clouse [00:00:37]:
Dark side of traditional publishing.

Paul Millerd [00:00:38]:
There's this cone of secrecy around the entire industry and I'm talking to authors working with these traditional publishers and they're afraid to say these things in public.

Jay Clouse [00:00:47]:
And when traditional publishing actually makes sense. So the first version of the Pathless path published in 2022, right?

Paul Millerd [00:00:56]:
Right. Yeah, January 2022.

Jay Clouse [00:00:58]:
And how long did you spend writing that?

Paul Millerd [00:01:00]:
I started in December 2020. Now, a lot of the themes I had been writing about pretty consistently since 2018, early 2018, but really started open the draft of the book in December of 2020, wrote for about 14 months, finished it and shipped it in January of 22. And there was basically no lead time between finishing the book and publishing it. It was literally a few days because I messed up some of the upload and I just launched it.

Jay Clouse [00:01:32]:
And what were your expectations at the time?

Paul Millerd [00:01:34]:
Yeah, so about a year after I quit my job, I had made a made money freelancing doing a bunch of different projects, but I had not really made any money from creating online or writing or really thought that was even a viable path. Literally some of the only people I saw doing it were people like Seth Godin and Tim Ferriss. And I think in my head it was, oh, I'm not those people. So obviously I'm just not going to make money. I did a few small experiments and eventually moved abroad, built this online course teaching strategy consulting skills and started doing a little bit of coaching. On top of that was making money from the course. And that became my funding vehicle for writing, which increasingly had taken over my life in terms of energy and my interest. And so I was spending almost all my time writing from 2018 until I started the book and finished it, but making most of my money from stuff from my old life.

Paul Millerd [00:02:32]:
This online course basically just doing whatever I could to do it. And so my mental model was fund a writing and creative life through other things. And so literally when I published my book, I did not expect to make money from writing. It was just to continue playing that game, which was really great for me. And about two weeks after I launched my book, I took a consulting project, actually working with our friend Andrew Barry. He had an opportunity for me. I had just moved back to the US I was really nervous about making money and I took that job. And so my focus was not on, oh, I'm going to make a bunch of money from my book.

Paul Millerd [00:03:16]:
In my head, my best case scenario, and you can read my newsletters at the time was if I break even, this will be awesome. So I spent $7,000 on the book with editors, design, stuff like that. And I was calculating, I don't know how many books that would be. That would be about 1500 books. And so in my head it was like selling 1000 books would be really cool. If I sold 1500 in the first year and broke even, that would be best case scenario. Yeah.

Jay Clouse [00:03:50]:
And fast forward to today. That's basically according to your website, what you sell on a monthly basis right now, which is awesome.

Paul Millerd [00:03:57]:
Yeah, I think last month I have two books now I probably sold seven or 800 books. But yeah, I think this year I'll sell about about 10,000 books. And total, I've sold close to 70,000 of the Pathless Path, which it's still just so wild. Like I, I can't believe this book continues to sell. But in that first year, I started getting these really lengthy, passionate responses from readers. And so as I'm in this consulting project thinking, why did I take a consulting project? This is not why I'm on this journey. I'm on this journey because I want to write. People are resonating with this book.

Paul Millerd [00:04:42]:
And so when that project ended, I said, okay, I am going to double down and just go full crazy. I love my book Pathless because it was true. I loved the book, I loved the ideas, and I renamed my podcast to the Pathless Path Podcast. I started taking myself more seriously and just started planting seeds, being a little more energetic. And that's when the book really started taking off, when I leaned into that energy. And I think for me, a big thing really is connecting with the readers. That's always been a consistent theme for me. And so it's really hard for me to get excited for something pre launch because I'm not connecting, I'm not getting that feedback.

Paul Millerd [00:05:24]:
And so, yeah, with almost everything I do, I'm always thinking, I'll dedicate my energy and excitement after it's out in the world, because then I can engage with the world in a way that's energizing.

Jay Clouse [00:05:37]:
Well, I want to talk about the offer you got from Penguin eventually for this book after it had been in print. But when you first published this, my understanding is you never even considered exploring a traditional deal. It was just, I'm going to write this, I'm going to put it out there, so talk to me about that.

Paul Millerd [00:05:53]:
I think when I started writing, I had about 2,000 subscribers, maybe 3,000 subscribers on my newsletter. I think on social media, I didn't have more than 2 or 3,000 now at the time, those were solid numbers. The numbers for what was seen as, like, a good audience back then was a lot smaller, right? There were just less people in these spaces. And I think it was a higher hit rate, too. Like, the people that subscribed to my newsletter probably didn't subscribe to, like 100 like they might today. They might subscribe to yours and mine and maybe one more. So it was a very high signal audience, but I just had no indication that I would have any potential for, like, a big audience. I don't think I would have been able to pitch myself and gotten a deal.

Paul Millerd [00:06:43]:
That would have been exciting. So I think combined with my sort of fierce independence, plus the small audience, I never even explored it. Now, throughout the writing process, you're writing a book now, too. When you're writing a book, it's the most complex project you've ever done writing wise. And so you're constantly doubting yourself, questioning things. You're like, what am I doing? And so there were probably four or five moments during the process in which I sort of had this urge, I want to be saved. I want somebody to just tell me what I'm missing. I must be missing something.

Paul Millerd [00:07:19]:
And I dig a little. I talk to people. I talk to hybrid publishers, people in the industry, and they'd be like, no, you're not missing anything. Just keep going. And so I basically just took that to the finish line. And I've learned a ton about figuring out all the small details. It's a weird industry because it's simple and hard at the same time. It's literally just a PDF you upload, but there are a hundred small details you need to care about to communicate that, hey, this book matters to me.

Paul Millerd [00:07:50]:
It's important. It's structured in the right way. You care about the COVID And so Those things I think I'm very good at that are hard to teach.

Jay Clouse [00:08:01]:
Yeah, it's interesting. I'm very early in this process, obviously. And what strikes me about a book, just like you're saying there are more surfaces and opportunities for packaging, call it, than is immediately obvious. Like, the obvious thing is title, cover, subtitle. That's like the package, of course. But the way that you structure the book is matters. The way you title sections, the way you title chapters, the way you start and end things. What I love about this new version of the book that you have, you've really intentionally designed a lot of these pages to have like these breakout quotes and these ideas like this.

Jay Clouse [00:08:44]:
And that's really exciting to me because those are opportunities to do things differently. But as we can probably talk about, that's an easier decision to make when you're not making that decision by committee, which I'm learning is part of the traditional process, at least if you don't exert your will and filter for that a little bit.

Paul Millerd [00:09:09]:
Yeah, I think so. For me, it was always about the readers I was talking to. A big inspiration for my book was I was having these weekly curiosity conversations with strangers from around the world who were literally just reading my writing and then reaching out. So it was writing to these exact people every Wednesday. I had an open calendar. Anyone could book a call with me. And so it was this cycle of conversation, reflection, writing, more people I talked to in this cycle. And so all I was doing is writing a book for them and me in this curiosity stream.

Paul Millerd [00:09:45]:
And so I think by focusing very narrowly, I found a kind of person that absolutely loves my book. And these people love my book so much that they buy 10 copies at full price and gift them to friends and keep recommending it to people. And so this is a huge lever for how, like, more popular books spread, I've realized, is it's word of mouth.

Jay Clouse [00:10:14]:
So you didn't know who that reader was?

Paul Millerd [00:10:16]:
I knew who the reader was. I didn't know they would have this kind of response.

Jay Clouse [00:10:21]:
As you were writing, were you thinking about that reader?

Paul Millerd [00:10:24]:
Yes. There's a part in my book where I talk about my shift of seeing generosity as a trait or skill and then shifting toward practicing generosity. And I was talking about my experiments with generosity. And so one fun thing I did in there was, well, if you want to practice generosity, one simple thing you can do if you don't have other ideas is gift my book to a friend. Oh, wow. And so, but that works because it's genuine and it's something I would actually say in my writing. And I would. I did it in a playful way.

Paul Millerd [00:11:00]:
Like, the book is a product of me and my creative expression and how I live my life and how I approach writing and what I'm writing about. And so it's so tightly linked to what I care about that I think it works incredibly well. Now, I spent 10 years in strategy consulting. I'm very good at, like, stepping back and figuring out, like, what is the game being played. The thing in traditional publishing is they're not great at targeting a hyper, narrow, specific niche. Their customer is literally bookstores. Right. And so bookstores want a certain product in a certain package that they already know works.

Paul Millerd [00:11:45]:
Right. And what already works? All the books that are already selling in their bookstore. And so they don't want to take risk. That makes perfect sense. But for me, there's literally no risk because I'm having the time of my life writing this book, and I want to write it for these readers. And so I'm willing to take a year of my life and do it.

Jay Clouse [00:12:05]:
Yeah.

Paul Millerd [00:12:05]:
No.

Jay Clouse [00:12:05]:
Okay. So I want to drill into this idea of traditional publishers, customers being bookstores here in a second. But something that I can't stop thinking about, and I probably should, should stop thinking about it because it's not super empowering. In most of life, you want to take asymmetric bets. You want something that has super high ceiling, and the floor is also not that low. Right. But in books, and I would say, especially in traditionally published books, the floor is pretty low and the ceiling is unlikely to be that high. So it's like the inverse of the typical asymmetric bet that you would want to take that.

Jay Clouse [00:12:48]:
It kind of feels crazy to do it unless you just, like, absolutely have to do it. But on the other side of that, because it is kind of crazy, and there is a lot of, like, inherent difficulty, even if it's psychological difficulty in doing it. I guess kind of an opportunity in a world where the barrier to entry in terms of content has never been lower.

Paul Millerd [00:13:13]:
I think you have to have something deeper than the money, the status, the prestige, and even the up, like, the leads you'll get to other things that might make you money. For me, it was at the end of my life, am I going to be satisfied that I did this? And even just looking back on the last eight years, it's my two books that stand out above everything else. It is like, man, that was such a satisfying experience. That was the hardest thing I did creatively and work wise and it honestly gets better over time. And so in my second book, I sort of reflected on this. I think back to the first chapter of my career. Ten years, it's literally a blur. I can't remember any of it.

Paul Millerd [00:14:02]:
Nothing stands out. There's one project a little bit, and I didn't even get my name on it because the senior partners didn't want to put my name on it. They put theirs on it because they thought it would sell better to their clients. And so that was like the best thing I remember. That's enough. And I've done well with my book. Think about this. I started in December 2020.

Paul Millerd [00:14:27]:
It is now almost December 2025, five years later. So I spent five years of my life putting this out there, making money from it, promoting it, writing it. And I've made probably close to $330,000 from it. And so five years, that's about 60 grand a year. That's solid. That's fantastic for living a creative life and funding your work. But I'm not buying a new home from book sales.

Jay Clouse [00:15:03]:
But what's lost in that, Some people might hear like, okay, 60,000 a year, that's, that's good. What you have to remember is with zero incremental work, other than like being a living advocate for the thing, like, there is no better revenue stream than royalties.

Paul Millerd [00:15:22]:
It's beautiful. Passive income, it's the best, it's the finest. It's like the fine wine of passive income.

Jay Clouse [00:15:28]:
Truly the best. I think that's. That. That would be such an amazing. But the hard thing about books is if you're doing it for that reason, it's going to be hard to realize that future. I mean, I think you probably could brute force it in a way and get a little bit better and treat it as deliberate practice as anything else. But if you're just thinking, I want to make money, this is not the most sure or quick feedback loop to do that.

Paul Millerd [00:15:57]:
Yeah, my second book's been out a little over a year. I think I've made $10,000 profit on it. And I spent eight months writing that one. And so for me, I know I like this work. It's satisfying. I have proven, yes, I can make money. People like my writing. And so I think the game for me is really a long term one.

Paul Millerd [00:16:24]:
Thinking forward 20 years from now and saying, okay, if I wrote five to 10 more books, that feels like a really worthwhile approach because there might be payoffs to that. Right. So it's just continuing to write and do these things.

Jay Clouse [00:16:42]:
After a quick break, Paul shares his experience talking with the team at Penguin Random House. So stick around, we'll be right back. Talk to me about the Penguin opportunity. Tell me that story.

Paul Millerd [00:16:54]:
Yeah. So March 2023. It's about a year, little over a year after my book's been out. The first year I sold about 10,000 toward Christmas, about 10, 11 months after my book was out, there are a series of mentions online and sharing on Twitter that started boosting my book. And for some reason Amazon's algorithm, I think, picked it up. And there's something about the Amazon algorithm that you get to a certain level and it just sort of stays there for a long time. And when Penguin reached out, they said, hey, we'd love to talk to you about future opportunities. And I took the call.

Paul Millerd [00:17:45]:
I was curious what they'd say and they almost immediately made me the offer, which was a little weird. They didn't really talk to me. I think they just thought, like, he's going to take the offer. And the offer was $70,000 for the lifetime rights of Pathless Path and a second book. And so the second book was basically anything I wanted. This is a weird situation because I didn't have to do any proposal. It was a very quick call and they immediately made me an offer for a two book deal. And the second book was for 130,000.

Paul Millerd [00:18:22]:
And so they just wanted me in their orbit, which is very flattering. I was flattered by this. But at the same time, the month before I talked to them, I made $10,000 in royalties from selling 2,000 books. And the month I was talking with them, sales were even higher. So I was probably going to make 12 to $15,000. And so a $70,000 offer after agents fees is about $56,000 paid out in four installments over two years or so. Right. So you start breaking that down and that's.

Paul Millerd [00:19:02]:
Those are like 15,000, four $15,000 payments right? After taxes, you're looking at 10 to $12,000 four times. It's not that good. That's what I'm making per month right now. And so the second thing is, they didn't really have ideas, I think. I later realized they don't actually fully read the books. I think one person, one of the junior people had read the book, but the senior people I was talking to, they actually have professional readers inside these companies that read the books and summarize them and give them just a tip sheet about what it's about. They didn't understand my book at all. Which is like carving your own path, doing things your own way, embracing creative and weird experiments.

Paul Millerd [00:19:47]:
And so I was like, well, what's the pitch? They said, well, we're going to take it out of print. We probably want to put a new cover on it, we're going to have a copy editor look at it, we're going to give it a polish upgrade, we might want to restructure it a little. And I'm just thinking, this is the pitch. And so I just didn't understand what, there was no upside. The math didn't work, the creativity was not exciting, and I was having the time of my life. Readers were loving this book and they wanted to take it out of print. It just didn't make any sense to me. And so it was actually very easy to turn that down.

Jay Clouse [00:20:28]:
Well, you countered first, right?

Paul Millerd [00:20:30]:
Yeah. I told them I don't want to do a second book that's unnamed, that we, I don't even know yet, give me the money for Pathless Path. It felt like they were trying to give me this $200,000 two book deal and sneak in acquiring the Pathless Path, like they have better models than me. They could probably see it's worth way more than that and maybe I'd earn out and earn royalties and I'd sell a lot more books. But yeah, it just didn't feel good. And I asked them, what are your creative ideas for spreading the book out there? And they literally were saying, we're going to send it to podcasters. They named a few in their orbit. And I said, well, if you love the book, you could send it to them now.

Paul Millerd [00:21:17]:
And they got cold and said, ah, nice try. And it's like I didn't feel the connection right, in how I operate. If I love something, I want to share it. So if they're playing this more transactional mode, just everything was not a fit. But after this call, I think I was so fired up because until then I still had this question of, yeah, I. I don't have any access to traditional publishing. They must be way better than me. But after this call, I'm just thinking, okay, this doesn't make any sense.

Paul Millerd [00:22:00]:
I can compete, I can double down even more and do crazy experiments and bold experiments. And I started asking myself, okay, what are the degrees of freedom on self publishing? I can republish my book in any format, any way, at any price, in any part of the world, forever, right? And so I started asking myself questions. They say they can do hardcovers better than self publish. And that was one of the questions, I said, well, what if I make a hardcover that is so sexy and so much better that I sort of just debunked that idea. And so that sent me down the path of creating this new version of the Pathless Path.

Jay Clouse [00:22:44]:
Do you think there could have been an offer that one you would have taken, but two here in 2025, end of 2025, you would have been glad that you took.

Paul Millerd [00:22:53]:
From what I've seen, unless your offer is crazy money, they're not going to devote their resources to it. And so I actually countered on the call because I said, I'm not going to do a two book deal. I'll consider something for the Pathless Path, but it has to be much higher. So I literally countered with $600,000. It's a proven, successful book that has readers that keep sharing it and it's growing. As soon as I said that number, everything deflated in the call. And they said, well, you have to talk to an agent that we typically never pay authors that much. But I do know.

Jay Clouse [00:23:35]:
Which isn't true. Well, I mean, I guess typically it's true, but like it is true.

Paul Millerd [00:23:39]:
I know authors that have gotten bigger deals than that in our world and those authors have crushed it in traditional publishing because the company is investing the adequate resources that they are going to commit to it for more than just the one month cycle to try and get the perennial seller Wheel Kickstarted.

Jay Clouse [00:24:06]:
So I guess that kind of leads to my next question and maybe that kind of eludes the answer. You're a very vocal advocate for self publishing. And so my question was going to be, is there a legitimate case where you would say, actually yeah, you should go the traditional route because of this?

Paul Millerd [00:24:24]:
Yeah, I think it would have to be somebody very senior from these companies and it would just have to be a more serious offer. I'm in this for the long game. I'm going to keep writing books and I have people that like my writing. I sort of know the value of my approach. I think I could actually do a lot better with a traditional publisher with that reach. One thing I would definitely do tomorrow is do a print only deal with one of these publishers. Exactly like Hugh Howey did with Chiman and Schuster. And Hugh, how he did this.

Paul Millerd [00:25:00]:
And as soon as he did the deal and it got out in the public, everyone blasted Simon and Schuster behind the scenes and said, why did you do this deal? He's talked about this on the Tim Ferriss podcast. And so they don't want to take these deals because they're just so ingrained with, this is the one deal we do with authors and I don't blame them. If you have leverage and control over the authors, you should try and keep that as long as possible to protect your margins and protect the, the beautiful moat of backlist royalties and things like that. But yeah, I would do a, I would do a print only deal tomorrow and it would be win win for both of us as long as I could revert my rights. I think one of the worst things that exists right now for the creative, I would say like the creative quotient of the world is that authors sign away their rights for a lifetime plus decades after their death. And this is terrible because most of the books stop getting promoted after a year. But many of these authors are still pursuing a creative path and writing and doing things. And all this serves to do is crush authors dreams, get them to stop talking about their work and tells them maybe you should stop writing.

Paul Millerd [00:26:25]:
It's terrible. We need marketplaces to revert these rights. Honestly, I think the publishing houses could gain a huge positive reputation from gifting some of these rights back to authors. I've talked to so many people and there's this cone of secrecy around the entire industry and every. Everything I share is because I'm talking to authors working with these traditional publishers and they're afraid to say these things in public. I don't know why people are afraid to say these things. Maybe they're still holding out for future deals or don't want to upset their friends who have deals with these. But they tell me I stopped talking about my book because I have no chance of ever earning out.

Paul Millerd [00:27:06]:
I compromise on my subtitle and I feel really silly saying it and I feel ashamed to promote my book now I hate my cover and I can't do anything about it. The publisher won't even print my book anymore and it's constantly out of stock on Amazon. They won't respond to my emails. And this is terrible. We live in the greatest creative age of like the Internet has changed everything. You're on the front lines of enabling people to put their gifts out into the world through the Internet reach anyone. And these publishing houses are undermining the thing they say they care about. It's terrible.

Paul Millerd [00:27:40]:
And the only point of leverage we have is to motivate authors to stand up for this and push back and say, you know what? I'm not going to keep doing these deals.

Jay Clouse [00:27:50]:
It's interesting because I also see the. I think in most cases traditional publishing doesn't make sense. But I also have this feeling that if you're trying to have a massive book, it helps at least I won't say it is absolutely necessary.

Paul Millerd [00:28:11]:
Yeah, I don't think I can go massive with the pathos path right now. I need some form of partnership or distribution to make that happen. I need, I am still very open to making that happen as an entrepreneur in my book. But I am not going to give up lifetime rights. Five years with the reversion of rights. This is how all foreign rights work, actually. I sell my book to a foreign publisher like I did in China, Taiwan, France. I give them a license for my book.

Paul Millerd [00:28:39]:
They translate it and put it out for five years, no questions asked. I can revert my rights back to myself in that territory and sell it again after five years. That is standard. This is standard in other areas of the world too. In Taiwan, if you do a book deal, there's a reversion of rights after five to seven years. This is standard in many territories. It's just the U.S. these companies have so much power and leverage and it's this aura of prestige that holds it all together.

Paul Millerd [00:29:08]:
And we're, we are not aligned as a category of people. We're all individual free agents. We don't organize, we don't form collective action and we're all just opting out one by one by one. We're getting plucked off. Right. And the agents have no incentive to get us to negotiate harder because they make all their money from these publishing houses. Like we really need to rethink these things. It's possible.

Paul Millerd [00:29:33]:
And these publishing houses would make more and they'd treat authors better. Think about this. If you, if I do a five year deal for paperback and it starts going really well, why would I revert my rights?

Jay Clouse [00:29:50]:
Right.

Paul Millerd [00:29:52]:
And if it's not going well, why do they want the hassle of dealing with another author?

Jay Clouse [00:29:57]:
So when you say you want to do a print only deal, that's hardcover, that's paperback, that's not audio, it's probably not ebooks. Is there anything else that I'm missing here?

Paul Millerd [00:30:07]:
Yeah, it's just hardcover and paperback. And a lot of publishers don't even put out paperbacks because they still look down on them. There's still a legacy of paperbacks are smut novels and not serious books. But paperbacks have print on demand distribution. It's a beautiful opportunity in today's world and technology that exists.

Jay Clouse [00:30:29]:
I spoke to somebody who's building a new publishing house and he was telling me a lot of the same things you're saying. He's, he's has a background in tech and he's moving into this. And he's like, a lot of this doesn't make sense. And what he found was there are a ton of books, a ton of titles that never left paperback, that could sell more or sorry, never left hardcover, could sell more in paperback. But the publisher was not incentivized, never decided to print paperback. And he was going in and for very cheap buying the rights of these books and now he's going to put them back into print. It's basically like, I love that it's kind of a private equity play in book publishing. It made me think like one.

Jay Clouse [00:31:10]:
All these authors are frustrated because they're like, publisher won't print anymore. I can't get the rights back. But then he goes and buys these rights. And Tim Ferriss is famous for buying the audio rights of a bunch of books before that was a big deal. And I'm wondering, can authors just go buy their rights back if it's not going well? Or is that another thing where it feels like maybe they'd negotiate with another publisher, but they won't negotiate with an individual or the author?

Paul Millerd [00:31:33]:
I think it's hard. I think anyone who's dealt with these companies knows that it's a bunch of middle management and layers and bureaucracy. And so any sort of interaction with them is challenging. And so any sort of friction just slows these things down. It's probably more possible, but it's going to take a lot of work and probably rejections, talking to lawyers and yeah, it's probably going to take some work. But yeah, it's great that somebody's doing that because I think there's a real opportunity for a publishing sort of marketplace to buy back these rights because these publishing houses print lots of books, paperback and hardcover, and stock them in a warehouse. If they don't sell, what do they do with them? Do you know what they do with them?

Jay Clouse [00:32:20]:
I think they just keep them. Because another thing this guy told me is he was buying the literal stock. He was getting like the inventory too.

Paul Millerd [00:32:27]:
Yeah, or they burn them because I think they're. You might need to fact check this, but I'm pretty sure they dispose of them because you have to dispose of them to actually take the write off the loss. Yeah, they could be leveraging Print on Demand. They could literally upload the books to Amazon's Print on Demand and just do it one by one, lower the prices, give control. But these companies are not set up to compete in this new digital environment. They were established in an era in which you literally had to fund construction and manufacturing costs for plates, lettering, all these things. The paper was 20% of the cost of a book 100 years ago. And so it's just not set up for this.

Paul Millerd [00:33:20]:
And we're going to see a lot of disruption. We're only 20 years into ebooks being a thing and I'm just betting on the future. It's obviously going to change. It might take way longer than I want it to happen, but it's already changing. I mean, you have James Clear doing Author's Equity, you have Infinite Books, you have Stripe Press, you have so many interesting experiments if you dig beneath the surface.

Jay Clouse [00:33:45]:
So I talked to James about Author's Equity because I wanted to know more about the model. And something interesting he told me was that he's gotten a lot of data back on this now. And he says confidently that you give up 25% of your sales if you're not in retail outlets. And that doesn't mean directly sales from outlets. But even just the exposure of seeing the COVID in the title places probably lifts your Amazon sales from doing that.

Paul Millerd [00:34:08]:
This is why I want a print only deal. I think I probably could sell even way more than that because the book already has sort of a known exposure and awareness.

Jay Clouse [00:34:21]:
And what I like about their model is that they have this ownership reversion. You're talking about 10 years by default on their deals.

Paul Millerd [00:34:27]:
Yeah, it makes perfect sense because people like you have more power, you own your audience. That is incredibly valuable. And the only reason people still just go down this path is because there's all this sort of lore around publishing. Oh, you can't make money from books, you gotta do speeches. It's all embedded in the system. And so people repeat these lines. If you look at all these things from first principles, like none of it makes sense. But think about this.

Paul Millerd [00:34:59]:
James Clear, literally the most successful author on the planet. I've seen his book in random supermarkets in rural Mexican towns. I've seen it in the countryside of Taiwan. I've seen it in random bodegas in Thailand. And he's not publishing another book with a traditional publishing house, he's building his own. So what does he know?

Jay Clouse [00:35:27]:
It's really interesting because there's all these chicken and the egg types of things. So you know a lot because of James. The playbook that I think is winding down, but the playbook for launching a book was go on a ton of podcasts and it's Significantly easier to get your foot in the door of a major podcast. If you had a major book deal but no sales yet to show because it's not out yet, than sell a book yourself and then convince them that you're being honest about your sales and get your foot in the door that way. So it's an interesting tension, and it's one that I'm actively playing with now. It's very interesting, but it does feel backwards in a lot of ways.

Paul Millerd [00:36:14]:
Yeah, it's been pretty interesting. I have sort of given up trying to go on podcasts for my second book. I think I went on four or five. I think for me, just the long game of building relationships and continuing to share and write about my work. And generally people reach out. I'm not going on many podcasts for this one. I thought it would be really fun to talk with you about this because we've had a relationship for many years and I know you're writing a book too. And I think this is where the better conversations come from anyway.

Paul Millerd [00:36:46]:
Because if you're doing 50 podcasts repeating the same things, the audience is aware of that playbook now, too. And so people are just tired of it.

Jay Clouse [00:36:57]:
Yeah, I'm hearing now that people are seeing a lot better results, basically doing newsletter swaps for their book, which is like, infinitely easier to logistically do, way less time. So that's good news.

Paul Millerd [00:37:11]:
But the number one thing is to write a book, people. This is the thing. This is where I put all my energy. I wrote a big, long thing on marketing, and I think the thing we were talking about earlier is I obsessed over the book and putting the care into it, writing exactly the book I would want in the certain way I loved writing about such that when it was done, it would be so delightful to keep talking about it for 10 years. That was always my mindset while I was writing. How can I write something I actually want to talk about for 10 years? And so I hate takeaways at the end of chapters. Some authors have them, but you're not going to get takeaways at the end of chapters because that would diminish my excitement about the book. You're not going to have lengthy storytelling on academic studies or historical figures that weren't already things I had thought deeply about or stumbled upon that really inspired me.

Paul Millerd [00:38:07]:
It's literally only things that I was interested in and were in the flow of my curiosity for those previous few years. And so this is where people should focus. Write a banger. Don't worry about the marketing, because the easiest way to market a book is write something that people buy, finish, share and gift. That is the most important thing because think about all the books you recommend. What's a book you recommend a lot?

Jay Clouse [00:38:45]:
I recommend Hitmakers by Derek Thompson quite a bit.

Paul Millerd [00:38:48]:
How many times have you finished that book?

Jay Clouse [00:38:51]:
Oh, yeah, More than once.

Paul Millerd [00:38:52]:
Yeah. You finished it, right? You finish it, you spent time with it and you refer it to people. And so you need to actually finish a book to recommend it. Those people recommend that book for literally the next 10 years. I've been recommending books like how will you measure your Life? Or Tuesdays with Maury or the Great Work of your Life or David White's books for years. I've probably made the recommendation 500 to a thousand times. And so that is worth way more than one newsletter swap, which is good. You do need to sell those first.

Paul Millerd [00:39:28]:
A thousand to five thousand books. That is very important. You do need that. But the next 50,000 are all sold by readers.

Jay Clouse [00:39:38]:
After one more quick break, Paul and I break down the strategy and economics behind the new hardcover version of the Pathless Path. Let's talk about the new book which you told me I have one of the first two copies, if not the first copy, which is insane to me, will hold this dear. What I love about this is there are just so many counter design elements. I shouldn't say counter, I should say unique, remarkable, memorable, non mainstream, tactile. So this is obviously a big investment of time, of literal money to get designs and things made of this. So what led to the creation of this? And yeah, why basically renew your vows to the first book versus write book number three.

Paul Millerd [00:40:30]:
One thing I realized is that once books start selling, they can keep selling for a long time. Ryan Holiday has talked a lot about this, some of his early books. I forget what it was. Maybe ego is the enemy. It didn't do incredibly well early, but once it started taking off, it just kept selling. James Clear talked about his book didn't sell crazy well, though it did very well compared to most until I think two or three years. I had a conversation with Ramit Sadie, I Will Teach youh to Be Rich. It was published, I think in 2009.

Paul Millerd [00:41:06]:
He's still talking about it. He literally landed a Netflix show three or four years ago. That's 10 years after the book is out. And he's still talking about it. He's still talking to people about your rich life and not wasting money on financial advisors. And he's so passionate about it. And the thing that struck me about that was, oh, I have that. I can do that.

Paul Millerd [00:41:29]:
I love the book I wrote. I love the readers that read it and reach out to me. It's so fun talking to them. And most people I observe lose interest in their book within a year. And so if I can keep going, let's just keep having fun and people are still buying it. Let's invest some of this money back into the book. It's sort of a vote of confidence from the readers buying my book in the first place. And I made over $300,000 from it.

Paul Millerd [00:41:59]:
Let's take a bunch of that money and really do something special and lean into this self publishing angle and sort of wipe away all the critiques of oh, you can't do these things if you're self published. And it's really fun just to do it on my own. It, it's definitely been weird though for me. I'm sort of a bootstrapper that takes all the risk out of projects, builds in public, launches early, quits things early. And this was working behind the scenes for 18 months, spending more than $75,000.

Jay Clouse [00:42:34]:
Longer than the first year. 10x the investment of the first book.

Paul Millerd [00:42:37]:
Yeah. So more than 10x the investment longer than the first book. A project behind the scenes. I'm going to price it at $100. I knew that from pretty early on and I have no idea if it's going to succeed. I'm scared financially as I'm doing that. I'm having a kid or I had a kid and my all my income sources are declining. Like most book sales decline over time.

Paul Millerd [00:43:02]:
And so last week before I launched, I'm like, what am I doing? Have I lost my mind? I had so much self doubt. A couple friends said I would never buy a hundred dollar book. And yeah, I don't know, it's still early. I, I did launch, it's done slightly better than I expected. It's been out a few days, about hundred people, about a hundred books have been sold, which is so cool. I think I'm ready to declare success already. I think in my head before I launched I was thinking okay, even if I spend all this money and I sold, I made back maybe 20% of it. I think I could feel really good about this because again, at the end of my life this is something I feel proud of and that feels satisfying to do.

Paul Millerd [00:43:54]:
And so yeah, it's going to take a lot of work and sort of storytelling around putting this sort of thing out there. But I think it matters. It's going to Raise the bar for other authors. It's also going to give permission to other authors to do bold things like this and say, oh, it's possible to do this. Maybe I can sell a thousand copies for $100 and that's $100,000. That's amazing.

Jay Clouse [00:44:20]:
Like how do you do some of this? This is not like your typical like just print on demand style book. Did you have to find unique suppliers? I mean part of it is hiring designers. That part is obvious to me. And that's layout, that's illustration. But the literal construction of the book, how were you able to make this?

Paul Millerd [00:44:38]:
Quick answer is I found the right person. So I talked to hybrid publishers for a while, talked to several. I reached out to people in the industry. Eventually I found the people that publish Derek Sivers books. He sells direct from his own website. He sells the first book at a normal price and then you can buy his books at cost forever. Really cool model. He's so weird, does things his own way.

Paul Millerd [00:45:06]:
I found Otterpine who he works with and this amazing woman, Saiya Wood. I get on the phone with her and she's sort of just like me. She has a company, she doesn't want to just scale and take every project. She's very selective about who she takes. She likes doing things weird. She cares about books. She really loved the story I was telling about let's do something crazy and bold. And she's really been my partner, helping me through some of the self doubt, helping me dream bigger.

Paul Millerd [00:45:34]:
And one of the things I decided early is I am not going to approach this book like it's a good business decision. And what I mean by that is a much smarter approach would have been trying to sell this book at a reasonable hardcover price, like a striped press book, like 40 bucks. And then working backward and saying how do I get the cost down to actually make a profit on that? I literally approached it with what is the most delightful possible book I can make. And the goal was I want this to be the sexiest book my readers own. And so Saiya knows how to make a beautiful book. And you can basically spend infinite money.

Jay Clouse [00:46:19]:
On books in terms of like crafting it.

Paul Millerd [00:46:23]:
Yeah, you can just keep going. You could add gold plating if you want. But I was really inspired by this Steel Brothers book. They are these two brothers, they published this reimagined version of Walden and the front cover is a quote from Walden and it's text on a page and it was a cloth cover. And it just as soon as I saw it I was Blown away by this book. And I said, I have to do something like this. So the original idea was this quote on the front and I was gonna have just the pathless path be bolded out, but we decided to put it on the back, I think because the illustrator we were working with just kept. She came up with this sort of motif around the pictures and I just loved it.

Paul Millerd [00:47:11]:
I was like, that has to be. Let's just make that the COVID And that sort of opened up a lot of doors around the colors. The blue came to me. It was like, I really like this bold blue. There's a bunch of Easter eggs sprinkled throughout the ribbon. And yeah, we had to find the right printer that could do this without risk of messing up. And so we found a company in Italy which definitely adds more cost than doing it in China. But yeah, it was a ton of fun doing this.

Paul Millerd [00:47:44]:
And then I hand selected all the quotes I went through and decided every single quote that would be on a quote page. I asked Ali Abdaal to write a forward, did a bunch of cool stuff and comes through.

Jay Clouse [00:47:55]:
It's. It's fantastic. Is this still print on demand? Like, will this ever be on Amazon for somebody to go and buy it?

Paul Millerd [00:48:04]:
Could be. I think, I think the goal is to try. I want to go direct first. And part of doing this experiment is I want to sell direct to establish the channel, right? So if people buy this from me, they. I can then loop in my other books selling direct. And so selling my paperback on Amazon, for example, I can make seven or eight dollars a book. However, if I do it through Lulu, which is a print on demand company that has an API that can plug into Shopify, I can then get my book to $15 margin, 14 15, but no free shipping. So there's some trade offs.

Paul Millerd [00:48:43]:
But you can start getting more and more people to buy direct from you, then you can start offering bundles. And I'm experimenting with this launch of doing a notebook, some note cards and some other things. So I want to move more in this direction to say, how can I actually just sell really high quality stuff? That is all part of how I'm approaching my life, my work, all these things and make more money. Rather than traditional publishing, you're making about $3 a book on hardcovers. I make about $5 on average. That's mostly because I price more competitively on Kindles and I just sell a lot more than traditionally published Kindles. And yeah, I'm trying to push up the margins, push up the pricing power, which is what you do as a business.

Jay Clouse [00:49:31]:
Are you comfortable talking about the cost of making one of these?

Paul Millerd [00:49:35]:
Yeah, I think I. I think I said before it was over $75,000, so.

Jay Clouse [00:49:41]:
No, no, I mean the cost. The cost to print one copy.

Paul Millerd [00:49:44]:
Oh, yeah, yeah. I. I don't know the exact. Do you want me to. Do you want me to look it up real quick so I can talk in detail or just get vested?

Jay Clouse [00:49:51]:
If. If you can do it quick, fine. Or if you just, like, know roughly, that's fine too.

Paul Millerd [00:49:55]:
Yeah. So I think one thing I did, we had to decide between printing a thousand or printing 2,500. I think if we're printing a thousand, just the book, we were looking at $15 a copy. And I think by printing 2500, it got down. I could be wrong in that it's something from probably closer to 20, down to 10 to 12.

Jay Clouse [00:50:20]:
Oh, so part of the $75,000 investment is inventory, right?

Paul Millerd [00:50:26]:
Yeah. So it's a bigger bet. And I don't know if I'm going to be able to sell these. And then the slip case was about $8 per book, and so that could have been a really easy thing to cut off. And I ordered 2,500 of the slip case, too. I was gonna do 500 of the slip case, and then I was just like, I'm just gonna go all out and push the edge on this and do something scary. And so the cost dropped greatly when I went to 2,500. But, yeah, eight times 2500 is another.

Paul Millerd [00:50:57]:
I don't know, maybe it's less than eight with 2,500. But. But anyway, I think the total printing cost plus the notebook printing cost is probably 40,000, 40 to 50,000. And so some of that I can smooth out. You can account for your accounting cost over time. It's different accounting standards because I'm storing inventory at their warehouse in North Carolina. And then the upfront design, illustration, consulting, all the work we've done over the last 18 months, Saieya's team, their warehousing team, their packaging team. I think my investment there is like 35 to 42.

Paul Millerd [00:51:41]:
And so it's like 75 to 85 up front. There's going to be ongoing costs, there's shipping costs, there's going to be returned books that people don't want to pay, customs fees, there's going to be lost items, there's going to be packaging fees.

Jay Clouse [00:51:59]:
All.

Paul Millerd [00:51:59]:
All these small things add up. So you need the margin to really buffer against these things. If I was doing at 40, it'd be very hard to make money. And so the goal is to price high early on. I'm giving away the notebooks and the the card and creating a story around it. Over time, we'll probably lower the cost, potentially put it on Amazon as the collector's edition. You can select on Amazon and push down the price. It's what most businesses do, right? You launch high.

Paul Millerd [00:52:28]:
If you're launching a robot, you price it high and then over time it prices lower. But yeah, the First Tesla was 80,000 to 100,000. The Tesla you can buy now is about 30,000. It's a pretty proven business strategy. So that's sort of the approach.

Jay Clouse [00:52:46]:
And you mentioned the ability to bundle as a pro to selling direct. I've seen a few bundles on Amazon, like Ryan Holiday, you can buy some of his books, especially like the new series, as a bundle. But it's so uncommon. Is that not just available to anybody to set up a SKU to sell a bundle of books?

Paul Millerd [00:53:04]:
You can sell multiple books together on Amazon. So I have good work in the pathos path as a series, as part of the Pathless Path collection. So there is one part of the website where you can click and add both to the cart at once. Now, I have no clue when that happens. All I see is six sales for this book and six sales for this. I don't know if they were bought together, so I have no information on that. But on Amazon, you cannot package the Kindle paperback and audiobook in one cheaper package. You can't do that.

Paul Millerd [00:53:42]:
And I know Amazon is not doing this because it would piss off the traditional publishers. The traditional publishers want to control pricing. They love pushing hardcovers and so they artificially inflate ebook prices really high. This is why traditionally published ebook prices are 1699 and they're like 15% of author sales, whereas mine are 4.99 and I sell like 3x more than I did if I was pricing a lot higher.

Jay Clouse [00:54:12]:
Well, man, I'm pumped for you. I'm excited for people to check this out because genuinely most experiences of getting a book are kind of the same. And this is a markedly different experience, which is what you're going for. So kudos, job well done. I'm not easily satisfied.

Paul Millerd [00:54:30]:
I really appreciated your text because that was at a peak moment of self doubt and I hadn't gotten the book yet and I had designed it for 18 months with the idea that I want this to be a sort of experience of opening it where somebody feels, okay, this is beautiful. This inspires me to create and do beautiful work. And so receiving your text, I think you're like, wow, wow, wow, this is sexy. Something like that. It was great. And I think being on these journeys, having friends like you doing these things that understand what you're going for, it really matters. And I always tell people that's one of the most important things on these journeys. So, yeah, just want to say thank you for that.

Paul Millerd [00:55:16]:
I really needed that text.

Jay Clouse [00:55:18]:
Yeah, man. Is there anything we didn't touch on that we absolutely should have?

Paul Millerd [00:55:25]:
Yeah. I don't know what I'm doing. This is completely new territory with me. For me. I'm still pretty scared. I don't know if this is going to pay off or break even. I don't know how things are going to go. I'm feeling pretty good about it now that it's out in the world, but I don't know what the future of publishing is.

Paul Millerd [00:55:51]:
I'm probably wrong about a lot of stuff. I advocate self publishing because I hear from the authors who are not as inspired, but I've heard from so many early people or people without audiences that tell me my story gave them the motivation to create and write a book. And to me, that is so cool. This is the work you do, too. You help people early in beginning phases of their journey to take bolder bets and do these things. And that's a big motivation of why I'm doing it. I do have a little fun poking fun at huge conglomerates. It's not really a risk of offending people.

Paul Millerd [00:56:36]:
These are held by enormous holding companies and employees don't have equity in these companies. And so it's really about the authors. I want authors to dream bigger. I want to see more creative work in the world. And I hope I can make a small dent in enabling people to see more possibilities.