Epublishing: Ambitious Plans for BookSurge
Paul Hilts -- 12/4/00
New venture looks to offer full range of e-publishing and e-retailing services

BookSurge LLC, a Charleston, S.C.-based start-up e-publisher, has obtained a second round of private financing in its run "to reinvent publishing" and become a dominant player in e-books, according to cofounder and CEO Monty Kohli. There are three businesses integrated under the BookSurge umbrella: a publishing house, (GU);, a printer/production house; and an online bookstore,
"As electronic publishers, we found it unprofitable to list our books on Amazon," Bob Holt, BookSurge's publishing consultant, told PW. "The more people who touch a book, the more you lose in cuts taken out. So we decided to go as direct as possible from author to consumer. As GU, we'll be competing with a hundred other electronic publishers; but at Digitz, we'll be partners, providing print and distribution services for those other publishers. And the BookSurge bookselling site will sell everyone's electronic titles." offers authors 30% royalties on printed books, 70% on downloaded texts and an introductory offer of 100% royalties paid for e-book sales in the first three months an author is with BookSurge. Along with its other benefits, GU offers its authors fulfillment in print-on-demand paperback or Adobe's PDF PC- and Mac-readable e-book format through GU's own selling site. At press time, GU had about 150 authors' titles in its database, and editorial director and cofounder Jeff Schwaner is offering classics such as Dickens's A Christmas Carol for $7.99 in paper and $3.99 in e-book form.

The second company,, provides e-book creation and file formatting and POD for about 45 publishers, Holt said, using a Hewlett-Packard setup similar to what Sprout had. Digitz adds a fillip, though. It will ship books 48 hours after the author approves the final formatting, or the production is free. "We think waiting four to six weeks for a book is not print-on-demand," Holt told PW.

Aim High
The third company in the mix, the online bookstore, is scheduled to open early in 2001, promising to sell the works of "all e-book publishers," Kohli said, claiming that BookSurge "will soon be the largest bookstore in the world." Kohli feels he can get the business of other e-publishers by taking a smaller cut in production and fulfillment; larger venues like Amazon, he said, have to take larger cuts to support their infrastructures.

In the meantime, BookSurge has launched a consignment program with bricks-and-mortar bookstores to get new authors what they need most--visibility--for a price. "If the author believes in his titles and will pay 50% of the cost of at least five copies of his book, we'll cover the other half, with the booksellers taking no risk except the shelf space," Holt said. "So far, 15 or 20 stores have signed up where a local author is planning a signing." In mid-November Chapter Two Bookstore in Charleston, S.C., began selling 40 GU titles in a special display.

Silicon Valley angel Kanwal Rekhi, who has invested in several high-tech companies founded by Indian immigrants, "sees enormous growth potential in the [e-publishing] industry," Bombay-born Kohli said. Terms of Rekhi's private financing were not disclosed; the first private financing was provided by Gwyneth Williams, managing director for Continental Airlines' international operations and a partner in the venture. BookSurge LLC is currently seeking a first round of backing from venture capital firms.