What Makes Moguls Believe They Belong In the Book Business?

Eric Wolff went to work for the consulting firm McKinsey & Company after graduating from college in the spring of

Eric Wolff went to work for the consulting firm McKinsey & Company after graduating from college in the spring of 2005. As he described it at the time on his Facebook page, he spent the following summer reading books that “warn of the inadequacy of the American Dream, and how it tempts generally good, intelligent people to sell the better parts of themselves for lives they later wish they could relive.” By reading these books, Mr. Wolff hoped he would be able to escape such a grim fate.

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Two years later, he left McKinsey and enrolled instead in the Columbia Publishing Course, the immensely popular, six-week book-biz training seminar that has been taught since 1988 by former publishing executive Lindy Hess. After the course concluded, Ms. Hess—who serves as a mentor to many of industry’s most prominent figures—did for Mr. Wolff what she tries to do for all her students at the end of each summer: helped him find a job as an editorial assistant.

He landed at Little, Brown and Company and while he sensed that its parent company, the French publishing giant Hachette, worked relatively well—that its editors were more disciplined than its competitors when it came to acquisition and apparently more talented at picking out cheap books that turn out to be surprise hits—Mr. Wolff said he knew just as well that Hachette was vulnerable to the same blunders as the competition, often investing in “expensive brand-name flops” and “overpaying for prestige … unproven hype … and countless small, unprofitable ‘passion’ acquisitions that distract people from profitable operations but are the reason most people—at least at the literary houses—stay in publishing.”

Such observations were above Mr. Wolff’s pay-grade, however, and when he tried to raise them with Hachette’s CEO, David Young, he was not encouraged. Frustrated by the bars on the cage in which he read manuscripts and took messages for the editor he assisted, Mr. Wolff decided to return to finance, and in June took a job as an analyst at a small West Coast–based hedge fund.

His plan was and remains to become wealthy enough to return to New York and use his capital to erect a healthy new publishing empire in the midst of the infected, hobbling ones that exist at present.

Writing from Chennai, India, this week, where he has been stationed since the fall, Mr. Wolff, now 26, predicted that the constellation of corporately owned publishing houses that dominate today’s industry—Random House, HarperCollins, Simon & Schuster, Penguin Group, and even the relatively vital Hachette—will not survive the current upheaval intact.

“Truth is, there isn’t a whole lot of reason for a big media company to own a book company unless it wants to be in that business,” Mr. Wolff said. “Corporations generally want growth stories, and there’s no growth in books.”

His hope, he said, is that the CEOs of those corporations will realize they actually don’t want anything to do with books anymore and jump ship. Then trade publishing will “return to what it once was, and what it is probably best suited for: a prestige business for rich people.”


MR. WOLFF WAS SAYING this about one week after Jeremy Dickers, the president of Houghton Mifflin Harcourt’s parent company, an Irish multimedia concern formerly known as Riverdeep, told The New York Times that he was open to selling off the trade divisions of the company if the right offer came along. That remark was made in the wake of the revelation that editors at Houghton’s trade division could no longer acquire new books because there was no room for it in the budget—an order that led yesterday morning to the resignation of publisher Becky Saletan. The stunning measure followed several years during which Education Media and Publishing Group Limited, as Riverdeep is now known, was buying up publishing properties and sculpting them into what its CEO, Barry O’Callaghan, had hoped would become a lucrative complement to his core business of educational books and software. Facing overwhelming debt, Mr. O’Callaghan must now consider unloading the part of his publishing empire that draws its meager revenues from authors like Philip Roth, Jonathan Safran Foer and J.R.R. Tolkien.

What Makes Moguls Believe They Belong In the Book Business?