by Susan Wright
According?to writing coach Rochelle?Melander, there are three great ways to test market a book idea. First, check the shelves. Second, ask the bookseller. Third, research your readers. While these testing methods have proven themselves in the past, there are newer, more technologically advanced ways of test marketing book ideas.
Authr.com?gives authors a platform for test marketing a book concept before they write it. The company provides crowdfunding for an idea,?pre-selling?for quick sales volume growth, and a sales referral page where authors can keep tabs on the progress of their book marketing campaign. I recently sat down with Erik Bowman, founder of Authr.com, to learn about how the company was started, how it operates, and what is in store for the future.
Tell us about yourself first. What is your history? Where did you go to school and work in the past?
I consider myself a life-long serial entrepreneur. When I was 10, I sold the tulips from my mom?s garden to my neighbors. My interest in technology came when I wrote my first software program at age 13. Ever since then, I?ve been driven to use my software development skills to create solutions that help others.
At age 20, when I left my hometown of Seattle for?Los?Angeles. I had already started a number of companies ? from a pressure washing service to a jewelry and clothing company. Once I moved to Southern California, I earned my double major in Political Science and Philosophy from California State University and later?earned my Master?s degree in Education.
Here in?Los?Angeles, I?ve worked for a number of organizations, including utility companies, small businesses and start-ups to develop custom software solutions to automate just about any business process. I was Vice President of Technology for Imperial Bank, evaluating investment opportunities and leading the development of technology for credit card processing and insurance verification.
Over the past 12 years, I established an incubator for business?startups, developed an online training program for entrepreneurs, created and published curriculum as e-books, and launched an early crowdfunding site for film production. I also wrote and published 10 books, so I?ve learned a lot about the publishing process. I am now sharing that knowledge to help others get published.
Tell us how your company started and when. Who was involved and what did each person do?
A number of my clients and students were asking me about the writing and publishing process. The more questions I answered, the more questions they had. This inspired me to launch Authr.com. It started out as an informational website. Pretty quickly we started offering services for authors, and it evolved into the crowdfunding platform it is today. Since I already had crowdfunding experience from my?FilmVenture?days, it was a logical next step for Authr.com.
Tell us an interesting story about your business. Were there any ?wow? moments? Anything funny or unusual?
Our goal was to focus only on the U.S. Market. We were not planning on entering any foreign markets until a year or two later. But about five months after we launched?authr.com, an author from the U.K. signed up and immediately faced a currency issue. My first response was how we can fix the problem for this one client. But I realized this one fix could easily be an opportunity to accept funding in other currencies in English-speaking countries. Within four days, we were able to support client funding in Euros, Pounds, Australian and Canadian dollars. It reinforced the power of being small and nimble.
What is your role in the company now?
I?m the founder, but I still manage the day-to-day operations, and even field the occasional escalated support inquiry. Since I have a passion for helping others get published, I like to stay in touch with my clients. This helps me find ways to improve what we?re doing with Authr.com.
What does your company sell and how does it make money?
We offer a subscription-based crowdfunding and book marketing platform for authors without minimum fundraising goals or high-percentage fees. We also offer book project marketing services for authors, including press releases and social networking services to help promote their upcoming book projects.
Which companies do you consider to be competitors?
The big and obvious ones are?Kickstarter?and?Indiegogo, but there are a number of other crowdfunding services out there now. They typically provide crowdfunding services to anyone for practically any purpose, whereas we focus on authors only.
What makes your products and services better than competitors? offerings?
We started out with a laser focus on helping authors, and we?ve maintained that focus. Rather than the project simply ending and losing momentum after the crowdfunding period is over, the author can continue to use the site to accept?pre-sale?orders for their books and ongoing sales referrals once they?ve been published. Unlike other programs where contributions and efforts are essentially lost if fundraising goals are not met, authors can receive funds without having to reach a minimum amount. Our crowdfunding is not subject to taking any portion of fees from the funds the authors raise. We only ask for a monthly subscription to list their project at Authr.com. Beyond crowdfunding, we also provide an e-book cover designer, book proposal builder and QR code hosting. A lot of effort goes into crowdfunding and promoting a book project. We don?t want to see any of our authors? efforts wasted, so we make sure the site stays relevant for the lifetime of promotion an author does for their book.
Does the company have any cash flow from financing activities? What is your total debt, if any?
We have been debt free since the third month of operation. The company was bootstrapped and funded directly by me, and no outside financing was required.
Are you planning an IPO? If so, when? How are you raising capital?
We?re currently not planning an IPO. The book publishing industry is a?multi-billion?dollar market, but we?re still in a niche area. While we?ve had discussions with those in the trade who?ve expressed interest in investing in Authr.com, we?re only considering investments from those partners that make sense for us strategically. If we did do an IPO, it wouldn?t be for another couple years.
Where do you see the company in five years in terms of revenue and profitability?
Based upon our current growth rate, Authr.com could easily become a $100 million company in five years. This is based upon a number of factors, including the ?aspiring author? market size and the viral nature of crowdfunding within a like-minded community of published and aspiring authors.
How big do you think the author crowd-funding market will be in terms of total revenue in 2015?
It?s estimated that approximately 200 million Americans want to write a book.? It?s our job to determine what obstacles are preventing them from writing their book.? So far we?ve determined that it is a combination of factors, including lack of knowledge, lack of time and lack of money. I believe that Authr.com directly addresses two of the three factors and can mitigate the lack of time through helping them with some of the tasks involved in writing a book. Our goal for 2013 is 100,000 subscribers, and by 2015 we are projecting 500,000 subscribers for revenue of $50 million from subscription fees.
What forms of marketing do you use to attract clients?
A lot of our grassroots marketing is done through?Facebook?and?Twitter. We?ve also had great?SEO?placement which has helped drive traffic and sign ups. While we?ve had moderate results doing occasional seminars and?webinars, our best results have come from partner referrals. We find that partners who will benefit from indie authors raising money are the most consistent source of new clients.
How big is the company in terms of its workforce?
Very small. We have a virtual office and only employ three people. We?ve worked hard to automate our internal processes and make the service very easy and straightforward for our clients to use.
Have you faced any regulatory hurdles, or anticipate any in the future? Explain.
We have not encountered any regulatory issues thus far.? We are looking forward to the?Jumpstart?Our Business?Startups?Act as a way to provide a tax incentive to donors in order to encourage greater participation in the crowdfunding process.
Is there any announcement you?d like to make?
We launched the Author Awards in late August 2012 as a way of recognizing indie authors. We?ve recently opened it up to all authors regardless of how they?ve published their books. You can?learn more?at Author Awards Book Competition.
Source: http://investmentunderground.com/6379/featured/authr-com-rewrites-playbook-on-test-marketing/
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