The successful start-up Screwpulp created a new e-book marketplace that connects authors to new audiences and revenue--all from their downtown Memphis office.
Richard Billings, a native Memphian, returned to his hometown after time in the Navy and spent time in a variety of creative fields, from work in television and photography to a stint as a radio DJ. But another creative interest continued to nag at him.
"I always liked to read, and I did a little writing in high school," he says of his love of the literary arts. But when he sat down to write his own novel, he quickly became skeptical of the endeavor. After two weeks of diligent writing--and a mere two chapters to show for it--he decided he had better investigate the realities of publishing before he committed the time necessary to write a book.
"I figured if I was going to do this for a year or more, I needed to know the chances of getting it published. I wanted to know what the opportunities looked like," Billings says.
What he found was not encouraging, and not surprising. "I realized it was nearly impossible to get noticed by the traditional publishing industry, and the pay to the author was pretty low," he says, noting that less than 1 percent of manuscripts are published in traditional means, and even then authors usually receive less than 25 percent of each book sale.
The popularity of e-readers has allowed broad self-publishing, but still leaves authors' work incredibly under-valued. Billings decided that there must be a better way to gain readership at a price point that actually reflected what the market is willing to pay.
Three years ago he conceived of Screwpulp
, a new approach to the self-publishing sector. With the start-up he hopes to shift the rigid publishing industry by responding to consumer demand. Through the Screwpulp website, Billings is removing obstacles for authors while also empowering readers to set the price of books based on popularity.
"I went out and started talking to authors and readers and getting more information, finding out what customers wanted--doing customer discovery," Billings says.
Screwpulp provides a new online platform for authors to make their work available to readers, offering unique customer feedback that drives the pricing model. Authors retain full rights to their work and receive 75 percent of all book sales, and they are also privy to promotional tools and valuable metrics to assess their book's success.
With his idea, Billings participated in Start Co.
's Start Co. 48 Hour Launch event in 2012 and was selected as one of the four ideas to be developed over the course of a weekend, with the participation of people equipped to help flesh out the idea into a new business. After two days they were equipped with a business plan, logo, investor pitch and more, and were ready to find business partners to fund the project.
Soon after, Screwpulp applied to The Seed Hatchery
program and was one of the start-ups selected to compete in a Global Entrepreneurship Week
challenge. "The program takes you from whatever stage you're at," says Billings. "We were still at the idea stage--and we received $15,000 in seed money."
After 90 days (during which, Billings says, you invest "a year's worth of work"), he had a product to sell and was ready to pitch to new investors. Now Screwpulp has four business partners--who are all full-time employees as of January this year--and $330,000 in investment dolllars.
The website launched in May 2013 with four books by four authors; today the site offers 91 books from 71 different authors.
The platform utilizes a crowd-driven pricing model which alters the prices of books based on popularity. The first 25 copies of each book are given away for free, with readers expected to engage with the material through reviews, ratings and social media mentions.
"We are not a publisher; we're an e-book marketplace for self-published authors. We control pricing. We want to ease a new book into the marketplace. If you want a free book from the site, you have to rate the last book you read. That encourages honest reviews."
As a book becomes purchased more frequently, its price incrementally increases to adjust to demand. "With a digital product, there's an endless supply," Billings points out. "But we still need to gauge pricing by the demand of the consumer."
Regardless of a book's rating, after a certain amount of time the cost goes up to at least $1. This helps authors determine if their book has the potential to be successful in the market. "It allows authors to fail fast--they can either re-work that book or start something new," Billings notes.
Online reviews can obviously be tricky business. Authors can pad reviews with positive remarks from friends, or reviewers can bully authors with negative comments without actually reading the text. Screwpulp attempts to avoid these pitfalls by adding more weight to any review coming from reliable, frequent readers on the site.
As for the name, the screw press was the first printing method that allowed for books to be made with moveable type in mass. Now--in the digital age--the industry is moving away from paper (or "pulp"). The company has merged the two ideas into a memorable title. "Not since the screw press has there been so much change in the industry," states the Screwpulp site. "Change in the way we write, change in the way we read, change in the way we acquire books; what hasn’t changed is the way that many publishers feel that they are the sole guardians at the gate."
Now Screwpulp is preparing to come out of beta, go public and look for the next round of investment. "We'll start advertising, and we're hoping to see a lot more growth [when we go public]. And from there we can grow our team," Billings says.
When asked why he's kept the business local to Memphis, Billings answers quickly and enthusiastically. "We have a really great start-up community here with a lot of people involved and lots of opportunities. It's a great place to build any kind of business. I think we'll see more companies moving to Memphis in the near future. It's grown rapidly over the past four to five years."
"The main thing is it's cheaper to operate here. We went to Silicon Valley, and they basically don't need us, and they told us we don't need them either. We don't have to be in Silicon Valley to operate in the tech space. At least not anymore."