Legal Setup

[Erotica Jane]

First of all: admission of fandom.

I notice some familiar names in this vicinity; not familiar, as a person would be to a friend, but more like how it would be for a groupie to wander into a comic con and find herself in a sea of exalted celebrities. I mean, come on, Greenguy? Cleo's Porn Links? Shemp? My inner-nerd: totally engaged. (If you have Nathan Fillion here, I may never leave.) I've been surfing the dirty (wonderfully dirty) waves of your sites for aeons; LOR being the very first of the bunch, that opened the doorway to literally zillions. Consequently, yours truly? Prodding sig links like a woman possessed.

And now that we've got that out of the way, and I've made you all entirely uncomfortable, and myself look like a prize prawn in the process . . .

Legal Setup

When not hungover, brain dribbling from ears hungover, I write erotic novels. Always, just for fun though. But I'd like that to change. I've considered sharing my output in the traditional and modern ways; most notably, real-world publishing and Amazon Kindle. And that still may be a go, but I have another idea in mind: to join the ranks of the many people I admire. (Yourselves, of course.) I know the score, affiliate marketing, and I'm in love with the idea of sharing something good, and in return, receiving something good: affiliate commission; it benefits all, and seems to be in the true spirit of the internet (or, the original spirit). I'd like to setup a free erotica site to share what I write; in the process, grow an affiliate income. And all of that I can do myself, being no stranger to the process. All of it except for one glaring - and vital - component. You guessed it: the legal aspect. If I go ahead and setup my business, I obviously need to setup the legal side, too.

I've researched for weeks and come to a conclusion: the safest way is to hire a lawyer. Only trouble being, I simply lack the funds. Now, I'm not foolish enough to believe that a business, a good business, can be setup without startup costs, and of course running costs, but if you lack the often vast funds for a lawyer, you lack the often vast funds for a lawyer. I simply can't swing it. Which means - I either resort to traditional publishing or Kindle, I wait until I have funds for a lawyer, or I wander onto this forum, in the hopes that some kind soul can demystify the process, by pointing me in the right direction. Spoonfeeding is not required; I'm a worker. If anyone here has a moment to spare, and can pen even a short but helpful reply to this post, I would surely appreciate it. What I could do with knowing is this: does there exist a specific, and idiot proof resource online, where I can easily learn how to setup all of the legal elements of my site to ensure I'm doing everything as I should be?

To help: I'm based in Britain, will not be using any sexually suggestive images, and will be providing the kind of erotica that is found on Amazon; in other words, nothing weird. I hope to throw this erotica into blog posts and into PDFs for download and sharing. Blog posts, short stories, novels. If anyone can point me in the right direction, even if that direction is in the form of, "Listen, Jane, stop being silly - get a lawyer," then I would truly appreciate it. And in return, I don't expect to be all take take take. I'm not remotely clued-up as to the adult industry, but I'm looking forward to sharing what I know from mainstream.

Thanks for reading! Now - coffee, plenty plenty of coffee.

Jane

[JustRobert]

Welcome Jane

There is a bloke on your side of the pond that writes stuff and sells it, at least that's what he tells us with all of his around here.

He goes by ecchi and he may be able to point you in the right direction, thou he is a fan so he might be a bit

Good Luck

[Erotica Jane]

Originally Posted by JustRobert

Welcome Jane

There is a bloke on your side of the pond that writes stuff and sells it, at least that's what he tells us with all of his around here.

He goes by ecchi and he may be able to point you in the right direction, thou he is a fan so he might be a bit

Good Luck

LOL! Thanks for the recommendation! I'll wait to see if he hops in here; if not, I may politely, and ever so delicately, attempt some private brain-picking. Don't hold it against me, but I'm a fan, too. For shame!

[JustRobert]

Originally Posted by Erotica Jane

Don't hold it against me, but I'm a fan, too. For shame!

Never, take a look at my avatar and the text underneath my name

ecchi should show up or I will start talking about the lovely 22C weather we will have this weekend

[ecchi]

I'll answer your questions in a moment. First, two notes for G.

1. Dr Who fans are NOT crazy, they are the enlightened ones. People who don't watch Dr Who are the crazy ones.
   
2. If you are going to invite Nathan Fillion to join the board to keep Erotica Jane happy, then could you also ask Tamala Jones (Lanie) to join, for my benefit!

Now back to the matter in hand:

Rather than go through solicitor to run your affiliate program, I would suggest you use a third party processor to do all the work. This will cost you nothing to set up, although (obviously) they will take a percentage of each sale. I use two companies, both allow you to set your own percentage of the sale price. However be careful, they state it as a percentage of what you get after their cut. When you advertise, you really have to state it as a percentage of the sale price, rather than quote what they say, otherwise you will look dishonest.

There are five reasons I use a third party processor. They are:

1. You don't need a solicitor, which will cost you thousands before you even start.
   
2. A lot less work that trying to run it yourself. I tried that when I started, spent more time running the damn affiliate program than I did writing.
   
3. You don't need to employ an accountant, which you will need if you run it yourself.
   
4. Although the processors charge a percentage, I still think it works out cheaper than employing an accountant and solicitor. And if you work out the time you yourself spend on running the affiliate program, and imagine you pay yourself minimum wage, you will find you owe yourself more money than the third party would have taken
   
5. (This is the best bit) If someone screws up, and something illegal gets through, in most cases (NB "most", not "all") it is the third party processor that is breaking the law, not you - they get to go to jail, and you just get a major fright!

Now there are two companies that allow erotica, and allow you to set your payment percentage. Here are links to their sites:

A1 Adult eBooks (aka Fiction 4 All)

SmashWords

There are several differences:

A1 are a British company, located in England (so they are UK law compliant). Pretty much a one man band, and the guy who runs is is quick and very helpful. They specialise in adult fiction, and even without your pushing it send details out of your new releases to all their clients. You can expect them to sell between a dozen and a hundred of each book to start with, which may not be many, but it is a good start.

One disadvantage of A1 as that they specialise in bondage, and although they sell other types of book,they do not sell as well to their members (this can be seen by the fact that "sales to their members" of bondage books that I manage for JW Throat, Slavegirl Annie, and "The League Of Sadistic Bastards" tend to be in the 50 to 100 range, my own books that are non bondage, only sell about 12-25 copies to their members) however if your main push is going to be via your affiliate program, this may not matter.

A more serious problem is that Stuart kept changing his mind about the affiliate program. Sometimes he offered a third of sale price, sometimes ten percent, now it is set by the author. He also changed the link codes twice, forcing affiliates to change all their links. So a lot of affiliates decided "fuck this for a game of toy soldiers" and stopped using them.

The advantages of Smashwords are that they are a more professional looking site, they have a large team and (and this could be a deal maker) they also act as agents, and pass your books on to other publishers.

The disadvantages are:

• Their site only looks professional on modern browsers using Windows 7 or above, it does not work properly on older browsers (no idea how it copes with non-Windows OS).
  
• They block access to erotica by default. The surfer has to sign up and change their settings to see erotica. If someone comes from an affiliate link, they will probably not bother signing up to see your book's ad page.
  
• Their software only works with Microsoft Office. If you created your book on any other word processor (even if you saved it in MS Doc format) their software will mangle it and sell a corrupt version of your book.
  
• Since you are not American, you will have to first prove this to the US IRS, otherwise you will be paying income tax on your books both in America and England! This is a long, multi stage process involving a lot of form filling in, correspondence with both Smashwords and the US government, sending of "proof of UK citizenship" etc. In other words - it is a pain in the arse, and by the end of it you will be writing to your MP demanding that we point all our nuclear weapons at Washington, then press fire!
  
• Although they sell to their existing members, you won't sell as many as you will with A1. Between none and ten (in my experience, more often none than ten).

Of course, there is nothing to stop you selling your books through both companies. Initially I sold my Adult books through A1, and my non-adult books through Smashwords. I am currently in the process of adding the adult fiction to Smashwords too, so both will carry my erotica.

Do be aware that neither company really push their affiliate scheme. And with the exception of one widget, they don't supply tools for the affiliate. You will have to do this yourself. You can look at my two affiliate programs, as examples, via the links below:

Planet Dominatrix (my book)

Eric Shaun Publications (some are mine, but most are other people's books that I publish)

Hope this helps. If you need any other information, let me know.

[ecchi]

Originally Posted by JustRobert

ecchi should show up or I will start talking about the lovely 22C weather we will have this weekend

I'm here, I've answered, so don't you dare!

[Erotica Jane]

Originally Posted by JustRobert

Never, take a look at my avatar and the text underneath my name

ecchi should show up or I will start talking about the lovely 22C weather we will have this weekend

I missed that LOL. I could do with a Tardis today. I didn't walk to the shop this morning; I swam!

Originally Posted by ecchi

I'll answer your questions in a moment. First, two notes for G.

1. Dr Who fans are NOT crazy, they are the enlightened ones. People who don't watch Dr Who are the crazy ones.
   
2. If you are going to invite Nathan Fillion to join the board to keep Erotica Jane happy, then could you also ask Tamala Jones (Lanie) to join, for my benefit!

Now back to the matter in hand:

Rather than go through solicitor to run your affiliate program, I would suggest you use a third party processor to do all the work. This will cost you nothing to set up, although (obviously) they will take a percentage of each sale. I use two companies, both allow you to set your own percentage of the sale price. However be careful, they state it as a percentage of what you get after their cut. When you advertise, you really have to state it as a percentage of the sale price, rather than quote what they say, otherwise you will look dishonest.

There are five reasons I use a third party processor. They are:

1. You don't need a solicitor, which will cost you thousands before you even start.
   
2. A lot less work that trying to run it yourself. I tried that when I started, spent more time running the damn affiliate program than I did writing.
   
3. You don't need to employ an accountant, which you will need if you run it yourself.
   
4. Although the processors charge a percentage, I still think it works out cheaper than employing an accountant and solicitor. And if you work out the time you yourself spend on running the affiliate program, and imagine you pay yourself minimum wage, you will find you owe yourself more money than the third party would have taken
   
5. (This is the best bit) If someone screws up, and something illegal gets through, in most cases (NB "most", not "all") it is the third party processor that is breaking the law, not you - they get to go to jail, and you just get a major fright!

Now there are two companies that allow erotica, and allow you to set your payment percentage. Here are links to their sites:

A1 Adult eBooks (aka Fiction 4 All)

SmashWords

There are several differences:

A1 are a British company, located in England (so they are UK law compliant). Pretty much a one man band, and the guy who runs is is quick and very helpful. They specialise in adult fiction, and even without your pushing it send details out of your new releases to all their clients. You can expect them to sell between a dozen and a hundred of each book to start with, which may not be many, but it is a good start.

One disadvantage of A1 as that they specialise in bondage, and although they sell other types of book,they do not sell as well to their members (this can be seen by the fact that "sales to their members" of bondage books that I manage for JW Throat, Slavegirl Annie, and "The League Of Sadistic Bastards" tend to be in the 50 to 100 range, my own books that are non bondage, only sell about 12-25 copies to their members) however if your main push is going to be via your affiliate program, this may not matter.

A more serious problem is that Stuart kept changing his mind about the affiliate program. Sometimes he offered a third of sale price, sometimes ten percent, now it is set by the author. He also changed the link codes twice, forcing affiliates to change all their links. So a lot of affiliates decided "fuck this for a game of toy soldiers" and stopped using them.

The advantages of Smashwords are that they are a more professional looking site, they have a large team and (and this could be a deal maker) they also act as agents, and pass your books on to other publishers.

The disadvantages are:

• Their site only looks professional on modern browsers using Windows 7 or above, it does not work properly on older browsers (no idea how it copes with non-Windows OS).
  
• They block access to erotica by default. The surfer has to sign up and change their settings to see erotica. If someone comes from an affiliate link, they will probably not bother signing up to see your book's ad page.
  
• Their software only works with Microsoft Office. If you created your book on any other word processor (even if you saved it in MS Doc format) their software will mangle it and sell a corrupt version of your book.
  
• Since you are not American, you will have to first prove this to the US IRS, otherwise you will be paying income tax on your books both in America and England! This is a long, multi stage process involving a lot of form filling in, correspondence with both Smashwords and the US government, sending of "proof of UK citizenship" etc. In other words - it is a pain in the arse, and by the end of it you will be writing to your MP demanding that we point all our nuclear weapons at Washington, then press fire!
  
• Although they sell to their existing members, you won't sell as many as you will with A1. Between none and ten (in my experience, more often none than ten).

Of course, there is nothing to stop you selling your books through both companies. Initially I sold my Adult books through A1, and my non-adult books through Smashwords. I am currently in the process of adding the adult fiction to Smashwords too, so both will carry my erotica.

Do be aware that neither company really push their affiliate scheme. And with the exception of one widget, they don't supply tools for the affiliate. You will have to do this yourself. You can look at my two affiliate programs, as examples, via the links below:

Planet Dominatrix (my book)

Eric Shaun Publications (some are mine, but most are other people's books that I publish)

Hope this helps. If you need any other information, let me know.

In all my years of popping on and off forums, I don't think I've ever seen, let alone received personally, such an extensive and helpful reply. Many thanks, ecchi; that was very kind of you. I'm going to spend my day digesting everything. I have solid direction now, whichever route I take, and that's very exciting! Thank you!

Jane

[Greenguy]

I can't read all this - and let's be honest: I only really need to read the 1st paragraph

[Greenguy]

OK - so I read it. Well, most of it

1st off, thank you for the kind words. Flattery will get you everywhere around here LOL

2nd, seeing as I am not a Brit - well, my ancestors were mostly ,so I guess I kinda am, but not in a helpful way - and I have no idea the legal laws over there, I'm just going to assume Ecchi has that part under control

[ecchi]

Originally Posted by Greenguy

I can't read all this - and let's be honest: I only really need to read the 1st paragraph

Ooops, I owe you an apology. I am so used to you slamming Dr Who that I automatically assumed the post that suggested Dr Who fans were crazy was from you. Just realised it wasn't, it was from JustRobert, the traitor (I think the penalty for treason is still to have your head shaved then be made to walk naked through the marketplace while people throw eggs, tomatoes, and excrement at you).

Sorry.

[ecchi]

A couple of other points I did not mention the other day:

Firstly: Another advantage of Smashwords is that they sort out an ISBN for you. I had never bothered with this before, but I have since discovered that some online booksellers won't touch your book without an ISBIN, and I do get a few sales from them, even for the erotica (in fact more for the erotica than the mainstream stuff). Plus, you kind of feel like a "real" author once you get an ISBN.

Secondly: You are going to find getting affiliates an uphill struggle. You will note that JR said about me "....with all of his around here." This is because I never miss an opportunity to mention my affiliate program, so everyone here knows about it. But if you look through their sites you can work out which are my adverts by the fact that they are not there. As far as I am aware, only one member of this board has ever used my affiliate program. And even then it was the one for the books I publish for other people, not my own books!

I did wonder if the reason was simply that there is a long time member of this board, who has been here longer than me and is a personal friend of several members, who hates me and used to troll my posts. It may be that being his friend most people listen to him and avoid my program. However I think it goes deeper than that because:

I have also mentioned, several times, how I make the most money on my adult free sites. I don't quote sponsors with ref code, so I don't benefit from this advice, I simply mentioned (on several occasions) how I make more money from non-adult products than adult products. However, again as far as I am aware, no one has taken that advice. They prefer to continue to only try to sell paysites, a model which is dieing on it's arse due to the amount of free porn out there. In other words, they won't try something new, they just bury their head in the sand and mumble "the old ways worked last century, and one day they will work again." Getting existing webmasters to sign up for your affiliate program will be difficult! You may want to consider other avenues for affiliates. (For example I am currently testing pushing my program to Facebook and Twitter users as a way of monetising their streams. It is too early to say if this is working, but you need to think of things like that if you want it to succeed.)

[Erotica Jane]

Originally Posted by Greenguy

I can't read all this - and let's be honest: I only really need to read the 1st paragraph

1st off, thank you for the kind words. Flattery will get you everywhere around here LOL

2nd, seeing as I am not a Brit - well, my ancestors were mostly ,so I guess I kinda am, but not in a helpful way - and I have no idea the legal laws over there, I'm just going to assume Ecchi has that part under control

LOL, Ecchi came to my rescue, and in the process, totally made my day; I'm so excited to have a plan. (Thank you, Ecchi!) But! And not unlike my own butt - this is a rather large but - hearing from the Greenguy has totally made my day, too. (I really want to use a certain smilie on the right there, and with it, a reference to a scene in Wayne's World, but cool, Jane, be cool, LOL.) Thank you, Greenguy - and wonderful Tardis-lovers, JustRobert and Ecchi - for a warm and downright lovely welcome. So glad I found this place!

Jane

[Erotica Jane]

Originally Posted by ecchi

A couple of other points I did not mention the other day:

Firstly: Another advantage of Smashwords is that they sort out an ISBN for you. I had never bothered with this before, but I have since discovered that some online booksellers won't touch your book without an ISBIN, and I do get a few sales from them, even for the erotica (in fact more for the erotica than the mainstream stuff). Plus, you kind of feel like a "real" author once you get an ISBN.

Secondly: You are going to find getting affiliates an uphill struggle. You will note that JR said about me "....with all of his around here." This is because I never miss an opportunity to mention my affiliate program, so everyone here knows about it. But if you look through their sites you can work out which are my adverts by the fact that they are not there. As far as I am aware, only one member of this board has ever used my affiliate program. And even then it was the one for the books I publish for other people, not my own books!

I did wonder if the reason was simply that there is a long time member of this board, who has been here longer than me and is a personal friend of several members, who hates me and used to troll my posts. It may be that being his friend most people listen to him and avoid my program. However I think it goes deeper than that because:

I have also mentioned, several times, how I make the most money on my adult free sites. I don't quote sponsors with ref code, so I don't benefit from this advice, I simply mentioned (on several occasions) how I make more money from non-adult products than adult products. However, again as far as I am aware, no one has taken that advice. They prefer to continue to only try to sell paysites, a model which is dieing on it's arse due to the amount of free porn out there. In other words, they won't try something new, they just bury their head in the sand and mumble "the old ways worked last century, and one day they will work again." Getting existing webmasters to sign up for your affiliate program will be difficult! You may want to consider other avenues for affiliates. (For example I am currently testing pushing my program to Facebook and Twitter users as a way of monetising their streams. It is too early to say if this is working, but you need to think of things like that if you want it to succeed.)

I'll be going with Smashwords, too, and before I lay down a few ideas about my plan, I must first say: thank you so much for all of your kind help. I'm no stranger to IM, mainstream, have frequented many boards, and for many years, and to receive such extensive and professional assistance - right off the bat, having just joined the board - is an unexpected and sincere delight. I do hope you'll stay in touch (message me for email address, if you like); it'll give me a chance to return the favour. Speaking of which: I love your setup, will most assuredly be promoting your works, too, the minute I'm a little more organized in adult.

Okay. Original plan first.

How does one potentially make a killing by writing and publishing erotica? Well, few Cliff Notes:

- Investigate genres;
- Designate a genre open to market penetration;
- Write / outsource a novel / collection to satisfy demand;
- Associate the same pen name with each work in that genre;
- Concentrate on series novels;
- Use the Amazon KDP platform;
- Set price to $0.00 initially;
- Submit to free e-book locations;
- Boost interest from promotional platforms;
- Thus, generate engagement, ratings, reviews;
- Set price to what the market can tolerate for maximised profits;
- Take action on your marketing plan.

Cliff Notes, many aspects left out, but essentially a solid plan; and followed, rinse, repeat, for a decent length of time, it should yield very stable income results. However.

However, this is the problem with KDP, and Smashwords, and every other similar ebook publishing and syndication outfit: the grossly long waiting period to receive your royalties.

And that problem requires a solution.

This was mine:

- Purchase a relevant keyword domain;
- Develop a professional website (Wordpress CMS);
- Add a growing collection of free genre-erotica;
- Flash, Short, Novella, Novel;
- PDF downloads;
- Infuse with SEO articles for long-tails (blog);
- Social media integration;
- Above, backed up by growing relevant social followings;
- Encourage user-submitted original content;
- Blog posts, flash, shorts, novellas, novels;
- Monetize with CPA offers

The obvious advantage to the above system being this: no waiting around for annoying-ass payout periods, that often amount to us drumming our fingers for 3 months or more. CPA networks tend to have payout periods that, as you know, range from 7 days to 60 days, tops, but already being a member of many CPA networks, including those that pay each week, I could cut down the waiting period of KDP and Smashwords by almost 1200%.

Time for another however.

The above system is a great one, in theory, and backed up by a tried and tested business model: sharing free ebooks in return for traffic growth, a component of which would be viral.

However.

Where Greenguy is literally green; I am green in this sense: the adult industry. I wouldn't know where to begin sorting out the legal side of the plan above. It requires me to organize so many legal areas that are beyond my knowledge and my budget. Which leaves me with Smashwords or KDP, and I'm leaning more in the direction of the former. Neither of which are ideal, and neither, I think, will earn me as much as the original plan might have done, but - I'm obviously intent on doing everything 100% legally, and KDP or Smashwords would seem to be the best route to doing so. For me. Right now.

Once again - I can't thank you enough, Ecchi. I think it's terrific that we both appear to have a similar model, or a similar model in mind in my case; so pleased I found this board, and received your very kind and very helpful advice. It goes without saying:

[Greenguy]

Originally Posted by ecchi

Ooops, I owe you an apology....

I probably should have said I only read the 1st paragraph of the thread

Originally Posted by Erotica Jane

(I really want to use a certain smilie on the right there, and with it, a reference to a scene in Wayne's World, but cool, Jane, be cool, LOL.)

[JAI-LING]

This is a great thread. Learned a lot. Welcome to the board, btw, Jane.
Wishing you all the best here. Great group of rabble rousers and old geezers like me here.

[Erotica Jane]

Originally Posted by Greenguy

That would be it, LOL.

Thank goodness the producers didn't take my suggestion and go with the third installment, Wayne's A Woman, where he gets a sex change and does this instead:



Double:

!!

Originally Posted by JAI-LING

This is a great thread. Learned a lot. Welcome to the board, btw, Jane.
Wishing you all the best here. Great group of rabble rousers and old geezers like me here.

Thank you! This board rocks. Just the right mix of naughtiness and knowledge; two of my favourite things!!

[ecchi]

Originally Posted by Erotica Jane

Which leaves me with Smashwords or KDP

That does not have to be "or", you can publish on both (I've not done so, simply because I've had a few problems with their system, but most Smashwords authors also publish on Amazon, Smashwords even encourage it). However do note that KDP will give you the option of using them exclusively, avoid that. Although they make it sound like a good idea, the only people I know who are satisfied with this service are people who think of Amazon as "God", and are flattered by the fact that Amazon sell their book. Once you go "exclusive" you are killing all other markets, so effectively by offering you an exclusive deal they are offering you the opportunity to make less money!

Also, if you are worried about the long lead time before you get any money, be sure to ask Smashwords for their letter to send to US IRS as soon as you sign up. I did not do this until I had money owing, and it takes a bloody long time to get done. Best to do it so that it coincides with the first three months, rather than add months on top of that!