Madeline McIntosh and Don Weisberg, who have served as CEO of Penguin Random House US and Macmillan, respectively, have joined forces with Nina von Moltke, most recently president and director of strategic development at PRH US, to form a new publishing company, Authors Equity. As its name implies, the publisher will operate outside of traditional publishing business models, offering no advances but paying authors a high percentage of a book’s profits—a model used by some other types of hybrid publishers.

Five of the company’s investors are authors, including James Clear, Louise Penny, and Tim Ferriss. Clear’s Atomic Habits has been a nonfiction bestseller for years and, according to publisher PRH, has sold more than 15 million copies. Penny has been published by St. Martin’s, and her works include the bestselling Armand Gamache series, published by the Minotaur imprint. Ferriss is best known for his 4-Hour series, which is also published by PRH.

According to the announcement, Clear “will publish future books with Authors Equity.” While Penny said that she is committed to St. Martin’s, she invested in Authors Equity because “it’s time for a new way of doing business, where the author is top of the pyramid.” Ferriss, too, will remain with his publisher, noting that he invested because he believes the publish industry is ready for change. “I hope the company sets new precedents in an age-old industry that’s ripe for innovation,” he said in a prepared statement.

McIntosh, von Moltke, and Weisberg all exited major positions at the Big Five over the past two years: McIntosh resigned from PRH last year after helping to restructure the company, von Moltke also stepped down from her role at PRH in 2023, and Weisberg ended his tenure as Macmillan CEO at the end 2022. (Before moving to Macmillan, Weisberg also served in various executive roles at Bantam, Random House, and Penguin Random House.) All three are listed as Authors Equity cofounders, with McIntosh serving as CEO and publisher, von Molte as president, and Weisberg as senior advisor.

Other AE employees include Robin Desser, the former editor-in-chief of Random House who left PRH herself in 2022, who has been named editorial advisor at the new publisher; Carly Gorga, former head of partnerships and brand marketing at PRH US, who is chief marketing officer; and Andrea Bachofen, who headed Random House’s author services group before leaving for Amazon, is chief operating officer. That core group will be based in a small New York City office, and will be augmented, the publisher said in a statement, by a team of freelancers.

All core team members are former employees from major U.S. publishers, and AE’s “core principals” address what many see as the shortcomings of big publishers. The publisher promises “long-term collaboration," acknowledging that larger publishers often don’t have time to help their authors develop their ideas and audience. In contrast, AE says that it is committed to "giving books room to breathe and supporting individuals and teams with the space they need to think big and think differently. We’re in it from day one, and for the long haul.” Along those lines, the publisher will offer authors “flexibility” and “transparency” and make decisions jointly in the best interests of each book.

Simon & Schuster, where McIntosh was named to the board following its acquisition by KKR, will handle distribution and production for “some” titles, the announcement said. Authors Equity has agreements in place “for a variety of fiction and nonfiction books,” and expects to announce its first titles “in the coming months.”