As I recall, there was a kerfluffle in the aughts when Baen, faced with a short term cash crunch because royalty expenses were higher than planned for (higher than expected sales and no, I don't know why revenue from higher sales would not precede royalty cost payout), had to prioritize who got paid first. Again, AIR, Jim Baen decided to go with paying his buddies first over paying the high earning authors first. This went over poorly with the high earners.
I don't know why revenue from higher sales would not precede royalty cost payout
All I can imagine is some set of contractual terms that required certain expenses to be paid as soon as revenues were known but before end of quarter or end of year when author royalties were to be paid out. Or a debt coming due. But that's just a guess.
AIUI, from a source I trust and who had good insight in what happened, the issue was that Jim Baen might have been a good editor, a great marketer, and with a keen sense of story, but he wasn't really a professional at running a business. When Baen Books suddenly got noticably higher sales and revenue due to its successful ebook strategy, he set aside the normal amount of money for royalties and taxes, and put the extra money into whatever pet projects he had. So when it was time to pay taxes and royalties, Baen Books had set aside much less than they needed.
Then Jim Baen handled the communication with some of the writers and their agents badly. My source was directly impacted by that, in that they got some royalties delayed and couldn't get as big an advance on their next book as was customary, but at least they got to talk directly with Jim Baen.
no subject
no subject
All I can imagine is some set of contractual terms that required certain expenses to be paid as soon as revenues were known but before end of quarter or end of year when author royalties were to be paid out. Or a debt coming due. But that's just a guess.
no subject
Then Jim Baen handled the communication with some of the writers and their agents badly. My source was directly impacted by that, in that they got some royalties delayed and couldn't get as big an advance on their next book as was customary, but at least they got to talk directly with Jim Baen.