Sat in on a meeting this week chaired by a partner in a local consulting and venture capital firm, and at one point he made this observation: out of every 1000 business plans they receive, they read only about 100 (“because the other 900 are garbage,” he said), and of those 100, they only fund about 3.
I told him at the break that those statistics were very similar to the publishing world. Baen, for example, makes it clear to everyone who reads the guidelines that fewer than 1% of the manuscripts are accepted.
But almost more fascinating was this tidbit: of the 3 business start-ups they fund, they expect to lose money on 2 of them. If they’ve done their research well enough, though — and no doubt they’re very thorough — that last one will make a mint and cover the losses on the other two.
I don’t think any publishers would willingly take that approach. Some books don’t earn out their advances, true, but I believe most publishers won’t take a chance on a book that they don’t expect to sell through a print run.