Paying Authors Through Crowdfunding: How To Know It Is Being Done Ethically

I have heard rumblings from some authors who are complaining about the “recent practice of offering ‘early submission’ of stories to a publisher in return for Kickstarter or crowd sourced funding.”

Much like the controversy over Random House’s imprint Hydra Publishing this is something Alliteration Ink is already out in front of… and the devil is entirely in the details.

First, let me just state this as plainly as I can:

Crowdfunding is the way that small publishers can actually offer professional rates to authors.

Crowdfunding is what lets us concentrate on making the best book possible rather than concentrating on the most marketable book possible.  This is a huge shift, and something worth going into in some detail.

Three Major Crowdfunding Models

The First Model – Idea-based patronage

Kickstarter in particular was founded on the idea of raising funding before a project started. That’s how, for example, Live Through This was designed.

In this “pure” model, the publisher, author, or anthologist would raise money simply based on the idea of the book.

This can work – Matt Forbeck and Tim Pratt, among others have done so quite successfully. Then once funding was secured, the novel (or stories) would be written.

But this style of crowdfunding has its risks. Even though “The Doom That Came to Atlantic City” funded, the game never got made… and the backers are left holding a big pile of nothing. And especially when you’re talking about anthologies, it’s not hard to imagine a great idea ruined by poor execution.

The Second Model – Attached Authors

So another possibility would be to have authors (I’m thinking mostly of anthologies here) “attached” to a project.

They may have a vague idea for a story, but it’s simply a promise of a story. Long Hidden appears to have used this strategy, stating that certain authors would be submitting to the anthology. This kind of hybrid model helps reassure backers somewhat, and nobody has to do any work before the money is raised.

The Third Model – Raising Production Costs

Which brings me to the third model, and my experience as a publisher. For our crowdfunded anthologies to date, we have selected the stories before beginning the Kickstarter. We essentially already have the “prototype” and are looking for production costs – that is, paying the authors. It’s kind of like what Jasper The Colossal did to make their first full-length album.

There’s a simple reason we do it this way: I know that the anthologists for both What Fates Impose – which successfully funded – and Steampunk World – Kickstarter pending – have rejected stories from authors they originally wanted to have in the anthology.

In fact, that’s the entire reason that Steampunk World’s Kickstarter hasn’t begun. As I announced back in August, Sarah Hans is taking very particular care in choosing the stories so that the anthology isn’t just good, but so that it will be awesome.

Which means that authors have written stories and haven’t been paid yet. And if the Kickstarter doesn’t fund, that raises further problems.

Or it could. But for us, it won’t.

You see, in the proposal for Steampunk World we were very upfront:

Payment: We intend to fund this project via Kickstarter.

The initial funding will provide for a flat US$0.05 per word rate for original stories up to 5000 words. Should we exceed funding goals, providing US$0.05 per word up to 7000 words is a high priority. Query for reprints; should a reprint be accepted, the rate will be US$0.03 a word. There are no kill fees for this project.

Should the project fail to fund for any reason, the project will still continue, though with a different payment structure to be determined. Contracts will be executed at the completion of the Kickstarter.

So yes, these authors wrote a story prior to the Kickstarter. Some of them have been waiting a few months now after acceptance. But the stories are still theirs. They haven’t actually sold me the story yet… because I haven’t paid them and they haven’t signed a contract. If the Kickstarter doesn’t fund, I will offer a different funding mechanism… and the authors can accept or reject it as they feel appropriate. Simple as that.

There’s another ethical way to do this where I could have the rights to their stories. I could execute a contract where:

  1. The payment is upon publication or within 30 days of the successful funding of the crowdfunding campaign.


  1. There is a contingency option if the crowdfunding fails which the author either agrees on beforehand or has an option to re-evaluate the contract at that time.


  1. There is a strong Publish-By Or Revert clause. In short, the publisher agrees to get the work in print by a certain date – and if they fail, the rights automatically revert to the author. Mine from my contract templates is right here: Publish By Or Revert

If all three of those conditions are met, then the publisher is acting ethically.

On the other hand, if the publisher (or anthologist, etc) is asking an author to sign a contract before crowdfunding starts – and doesn’t have those three things in the contract… then there’s a big problem.

Just like the confusion over Random House’s imprint Hydra Publishing actually providing publishing services, the ethical lines are detailed and specific.

But they are very, very clear.