Flash Boys is the #1 adult nonfiction book on PW’s bestseller list this week, selling over 55,000 print copies at outlets that report to Nielsen BookScan. Norton reports that in combined print and digital editions the book sold 135,000 copies on its first week on sale. PW checked in with author Michael Lewis’ longtime editor, Starling Lawrence, to get some more background on the country's hottest adult title.
PW: How did Michael conceive of this book? What got him onto this subject?
SL: Flash Boys began as a magazine article about a Russian programmer, Sergey Aleynikov, who worked for Goldman Sachs and was accused—falsely or at least foolishly—of stealing proprietary information when he left for another job. Michael Lewis started working on that in early 2013, and it was published in Vanity Fair last fall. He realized that he had only a dim understanding of High Frequency Trading, which Aleynikov’s work facilitated, and that many others on Wall Street shared his ignorance of this controversial multi-billion dollar business. When Michael asked for a name, many people suggested he talk to Brad Katsuyama, a trader who had delved deeply into the problems caused by the accelerating speed of equity transactions.
PW: How long has Michael been working on this project? At what point in the process did you realize you’d hit on something controversial?
SL: It took a couple of meetings with Brad Katsuyama in the spring of 2013 for Michael to understand that this—HFT—was where the strange tale of Serge Aleynikov led to, and that it could be the subject of a book. Staggering amounts of money were being made by a process that was not at all transparent, and a lot of big players in the market, famous names, knew that something was very wrong…but exactly what? Michael had a steep learning curve here, and I was trying to make sense out of what he told me along the way. (My efforts to tell my colleagues what this big book was about must have been truly comical.) But the stakes became clearer as Michael started turning in chapters later in the year; this wasn’t history, as The Big Short had been, but current events. This was all happening right now, and it was the most lucrative business on Wall Street. It doesn’t take a genius to figure out that people will be very upset if someone starts moving cheese worth billions of dollars.
PW: I heard Michael was finishing the book nearly up to when it was unveiled on 60 Minutes. Why the rush? Couldn’t you have pushed the publication date?
SL: It was in fact a very orderly process—the writing and publication—that happened along the lines established in the fall of 2013 when Michael was able to predict when he could finish. There was a piece of a chapter that could not be completed until January because it described a crucial meeting between Brad Katsuyama and big investors laying out in graphic terms the iniquities of HFT. So while the book is very up-to-the-minute, there were not any corners cut. That said, there is no other author I can think of whom I would trust to write an important book on such an unforgiving schedule. And when you have as much publicity and retail promotion lined up as there has been for Flash Boys, you’re going to look really stupid if you can’t make your pub date.
PW: Were you expecting the reaction the book has gotten on Wall Street?
SL: Going back to the business of current events as opposed to history, I think it might have been predicted that this book would push people’s buttons. You have a ton of money being made in a way that ought to be illegal, but isn’t (yet). So on one hand there are the people who can see, thanks to Flash Boys, what the mechanisms of HFT are, and they are outraged. On the other hand, there are people who make their living in HFT, and they don’t think of themselves as bad guys, and of course they are going to push back on the message of the book. But as for predicting the size and extent of the reaction…no. It’s like a wild fire: if the wind blows hard from a certain direction, you have one outcome; if it rains, maybe another.
PW: Speaking of the Wall Street backlash, do you think it’s been only good for the book? Is there really no such thing as bad publicity?
SL: Michael Lewis is a genius at getting his message out there, both on the page and on the screen, and that has been a crucial factor in the wildly successful promotion of Flash Boys. He has two advantages in the debate now going on. First, he has written a thoughtful, responsible book that is hugely entertaining and may ultimately be very influential. Well, I guess it already is. Second, he has good manners, and he knows that you catch more flies with honey. When Bill O’Brien, president of the BATS exchange, gets on CNBC and shrieks “Shame on you,” then proceeds to cut both Michael and Brad Katsuyama off before they can answer a question, he ends up doing a lot of Michael’s work for him, and, as it turns out, BATS is forced to issue a correction to O’Brien’s erroneous information. Or when Andrew Ross Sorkin makes the claim in the New York Times that Flash Boys has nothing harsh to say about the role of the exchanges in HFT, it is obvious nonsense to anyone who has read the book. So I think it’s fair to say that the publicity has reinforced Michael’s skillful handling of a very complex and important subject.