Uncovering and explaining how our digital world is changing — and changing us.

On the latest episode of Recode Decode with Kara Swisher, Kara sat down with Serial Box CEO Molly Barton to talk about how Barton’s company is trying to change the way people read — or, in a sense, trying to go back to the way we all used to read.

Serial Box delivers weekly installments of books that readers can pay for as they go, making it easier to try a story before they buy the whole thing. Currently, the startup has contracted teams of writers to collaborate on novels that it calls Serial Box Originals, but Barton said it expects this year to start partnering with traditional publishers, to serialize the books you might otherwise find in print.

“We feel like reading is incredibly important, more important than ever, and almost therapeutic in a way,” she said. “The world is so busy, the idea of becoming immersed in the story is so relaxing, almost like meditation. Our whole purpose is to make it easier for you to fit reading into your life and just weave it into your daily and weekly media diet.”

You can listen to Recode Decode wherever you get your podcasts, including Apple Podcasts, Spotify, Google Podcasts, Pocket Casts and Overcast.

Below, we’ve shared a lightly edited full transcript of Kara’s conversation with Molly.

Kara Swisher: Hi, I’m Kara Swisher, editor at large of Recode. You may know me as someone who thinks all wordplay should be illegal and anyone who breaks the law should be severely pun-ished, but in my spare time I talk tech and you’re listening to Recode Decode from the Vox Media Podcast Network.

Today in the red chair is Molly Barton, the CEO of Serial Box. That’s Serial, spelled S-E-R-I-A-L. It’s an app that delivers fictional stories to its users in serialized installments every week. Each episode is available both as an e-book and as an audio file. Molly, welcome to Recode Decode.

Molly Barton: Thank you, happy to be here.

Thanks for coming in. I’m really interested in this area. There’s been a lot going on in it and different things have been tried, and sort of how we read and consume ... I guess, books, in a lot of ways, has changed. So, talk a little bit about how you got to this first. How did you create Serial Box? And start early, like how did you move to something like this?

Sure. I came to Serial Box from traditional publishing, actually. I started as an editor at Penguin and I worked on ...

So, that was your goal? To be a fiction [editor]?

I thought I was gonna be an editor for my life and had a great editorial job at Viking and I worked with writers like Terry McMillan, who wrote “How Stella Got Her Groove Back.” I also edited a book by Nick Hornby, who wrote “About a Boy” and “High Fidelity.” So, I thought that’s what I was gonna do. But I ended up working for the president of the company. I ended up having this kind of ringside seat to digital transformation within publishing.

Well, talk about that, because people don’t remember what was happening. This was, what year were you doing this?

This was in 2007, 2006.

Right. So things had already gone far in terms of people, and Amazon obviously had made its impact on things.

Yes.

In the mid-90s to the mid-2000s with selling of books. And Google, the same thing with their ... whatever they were doing there with their books.

Scanning lots of books.

Scanning, yes, I remember.

And Amazon had taken hold in terms of delivery of physical books, but that was right around the time when the Sony Reader and the Amazon Kindle came out. So e-books sort of became a real thing, and after earlier attempts with Rocketbooks about 10 years before that. So there was a lot of work required to digitize all the files, to get contracts agreed, to make sure that we had the rights to distribute digitally. I was sort of knee-deep in that, building the team and building the capacity to support this new business line and was really excited because I thought, “Oh, it’s going to open up a whole new area of audience that maybe we’re not reaching.”

What we found was exactly the opposite, same books that were selling on physical in the New York Times Bestseller List were also selling in e-book. Over time, I really began to focus on how we can grow the audience. I was really frustrated by a lot of the typical ways of operating in traditional publishing and feeling like it was ...

Talk about that. There’s a reason that I don’t write books anymore. I literally was sitting in a room, I think maybe Random House, one of the Random House divisions ... The first experience was I was writing about the coming internet and how it was going to impact all of media. So I had a sense that things were going to go awry, and I talked about that a lot in the first book.

By the second book, I remember sitting in a room, it was a different editor, and saying, “If I had to kill everyone here except for two people, everyone involved in this book, the only people who would be left would be me and Jeff Bezos, as far as I could tell. I could hire an editor. I could hire a distributor, he would be the distributor. I could hire a copy editor, publicist, and stuff like that, but y’all ... where is your value?” You know what I mean? Because they didn’t do a lot of editing anymore, there wasn’t a lot of guidance, which is what you’d ... And I remember thinking, a 1,000-word Wall Street Journal article got more attention than the editing of my book, which is really interesting. My second book, not the first one.

The first one was, I think, John Carr doing it and he was great. He’s sort of the older times. I had a great editor, too, I just think she was hamstrung, too, like the speed and everything. I don’t blame the line editors, essentially, who were trying really hard to shape things. But it was a different experience completely. So I just think, why would you write a book anymore? What is the plus of it?

Right, I know. A truly great editor or publisher does have a really special skill, which is dialing deep into an individual’s style and contribution and kind of honing that and shaping it and helping put context around it and help people understand why this is so important right now and how it relates to everything that came before and how it’s going to shape what happens next year. And that’s really important work.

It’s wisdom.

Yeah, it is a certain kind of wisdom and skill, but you’re right, the conglomeration and corporatization of publishing means that a lot of acquisitions editors have very little time to actually do developmental editing and they’re expected to attract works that are essentially done and then a lot of the onus is on the writer to drive audience and then the publisher gets 85 percent.

Right, exactly.

It’s a great deal!

The economics are like, “No thank you, I can do this myself.” I remember thinking that. What didn’t you like about it, what were those things?

Those things, but also sort of how self-important the industry was. One of the basic problems is, if you just look at the way that editorial teams are staffed, those are the gatekeepers, supposed to be sifting through everything that’s out there and finding the best stuff. But if you make the salaries of those jobs so low, then only children of privileged families can afford to take those jobs, you are, by the very nature of the structure of the industry, really narrowing who you can address as an audience. So I really wanted to open things up so around those years I was working on ...

So what things did you work on, to try…? So, getting on the e-reader?

I really tried to engage with self-publishing. I actually applied for a million and a half in innovation funding from Pearson, the parent company, and started a platform called Book Country, which was, essentially, a highly professionalized version of Wattpad.

Explain that.

Anyone could post their work in progress if they gave feedback to somebody else who already had their work on the platform. So, basically, a huge online writers’ workshop focused on science fiction, fantasy, mystery, crime and thriller, because those are the categories of writers who are really open to fan feedback.

From Penguin’s perspective, the idea was, we’ll get a lot of data about what’s happening on the platform and be able to invite some of those more successful authors into a traditional contract. But I was really like, self-publishing is taking hold. I think it was around that time Clay Shirky said “publishers are a button now.”

I really wanted to open the frame and sort of experiment with what the real value was and do a better job than the music industry had done, proving what they were worth.

Which was a disaster.

Yeah. So, as time went on, I began to really focus on audio and e-book growth globally. I shifted away from working for the US company, to reporting to the global CEO.

That’s Marjorie [Scardino], right?

That was John Makinson, who reported to Marjorie. So it was a $300 million global business, and one of ways that we were expanding it was through a geographic expansion unit — opened trade in fifteen markets. I was still really wrestling with format.

I was inspired by the history of Penguin. Penguin is a really interesting company. It started in the ’30s in London by a guy called Allen Lane who felt really passionate about the idea that everyone should be able to buy a great book for less than the price of a pack of cigarettes. He also was really interested in …

The classics.

Yeah. So he went around town and bought paperback rights to all these great books and the publishers were like, “Oh, paperbacks!”

Right. “Oh, Homer.”

Right.

Really.

”Who’d want a paperback? And everything published in paperback is such poor quality, sure, you can have these rights.” So he created the paperback format and he also really messed around with distribution. He built vending machines on railway platforms to catch people on their commute.

That’s technology!

And make sure that they had something great to read, yeah. So I was really inspired by his work.

Meet the customer where they are.

Exactly. So I was inspired by that. I started playing around with short format and asking authors to write sort of prequels to their big upcoming novels so we could release a digital short. All of the work was around how could we have more contact with the fans than waiting for two years from now, when the next book is available?

The reason for that is I sat in 22 financial meetings a month looking at what drove success, and the clearest way to improve your chances of success is to come back on a regular cycle with a similar book to what you released before.

Called the dancing monkey theory, they keep dancing the monkeys.

Keep doing it over and over, at eight o’clock. The traditional publishing response to that was to ask the most successful authors to write faster so you could publish three books a year instead of one. I was like, well, that’s a lot of work and most authors can’t keep up with that schedule.

And then their quality goes down.

Quality suffers dramatically. So I was looking instead, actually, at what the music industry was doing with unbundling the album and taking each piece of content and using it as a marketing tentpole in a really organic way, giving yourself a real reason to go back up for the funding. It just so happens in publishing and reading, there’s a long history of serialization.

Of course, Armistead Maupin and Charles Dickens and ...

Exactly.

In newspapers.

In newspapers and weekly magazines. I actually learned recently that everyone talks about Charles Dickens as the kind of grandfather of serialization, which is true, but the same year that he wrote “The Pickwick Papers,” which was his first serial, in France, a newspaper owner was looking to take his weekly newspaper and make it a daily paper and he was trying to come with a reason why people would buy the paper so much more often. So he asked the writer — and I will butcher this pronunciation, but — Honoré de Balzac to write a serial so that each day a new installment was there in the paper and people had a reason to go and spend their, whatever amount the paper was at that point.

So there is this long history of a tight relationship between weeklies, magazines, newspapers and “books.” But it’s somehow fallen away. So I decided to run some experiments and ask authors to let us release pieces of their books, out in conventional distribution through Amazon, Apple, Google, and we four and five X’d the sales, just through breaking the price. They got a taste ...

You know the porn industry did that.

No. No, no, no, tell me. Tell me.

That’s it. They just released bits. Here’s a little bit, now would you like to buy more? They were very smart. It was a woman, I can’t remember, she was brilliant. It was back in the ’90s. I was like, “This woman is onto the right idea.”

Got it.

A lot of ideas started like that.

The atomization of content started with porn.

It did in a lot of ways. Actually, Tinder was born from a porn idea. Anyway, they are very creative people, let me just say, and they have got a lot of competition, so they know how to be creative. Taking it a way back from porn, so you saw this and it worked really well. So what did that say to you?

It worked really well until I thought, “Okay, there’s really an opportunity here.” At the same time, I was seeing a lot of the data around the growth of audiobooks, which happened slightly behind the growth of e-books but was perhaps a little bit more organic in its growth. E-books were driven so aggressively by device sales and audiobooks just started to creep up and creep up. So many people have a smart phone so they didn’t need a separate device and the cost of audio production was coming down so breadth of catalog was much richer.

So I was seeing that audiobook listeners were getting younger and younger and bigger and bigger audiences, over 30 percent growth in audiobooks last year. There’s so much heat around podcasts, and obviously it’s a huge industry, but audiobooks is a paid industry that’s been around for a long time. That said to me, “Okay, you’ve got this growth in audiobooks, clear success in breaking books into pieces and an environment where everyone feels overwhelmed. Let’s take these obvious patterns and evolve the delivery of book content.”

We’re here with Molly Barton, the CEO of Serial Box. How do you describe it? So you were doing this and seeing signs that people liked this. You were actually doing something that had been done, too, in a different format but you were just technologizing it, whatever the word is. What made you move to doing this? What was the impetus that got you there?

Well, the success of the experiments that I had run ...

Within a big organization.

Within a big organization really made me feel confident that there was something there. I had sort of been bitten by the entrepreneurial bug. I sat on the board of three startups that Pearson and Penguin had invested in.

Which ones?

All consumer-facing book retail platforms. So, one in New York, called Bookish, which was the book industry’s attempt at Hulu. One in Australia, in Melbourne, called Bookworld, and then one in London, called E-Books By Sainsbury’s. So, I really sort of got in there with those teams because they were very small and up against a huge task that was much too ambitious for what’s possible for a startup. That’s what happens when big companies try to get in there.

Oh, yeah. I was at the Wall Street Journal with my startup. That was a delight, every step of the painful journey.

Yeah, I remember. So, I had seen a lot of the mistakes of how to try to drive innovation within the industry. So, I felt there was a good opening, because I had had the background. I had a mix of editorial experience, global experience, digital and audio business experience. And, I love working on product development. My team at Penguin had built a lot of apps in collaboration with other media companies. I love being in the situation where I’m switching tasks all day. So, a startup environment is great to me.

I left about four years ago, and interestingly, my business partner ... I didn’t know at the time, he was working on the same concept. We were introduced by Evan Ratliff, who started the Atavist, and he said, “Molly, you know, I’ve met this guy Julian. He’s working on serialized content, and you’re the only other person that I know, so I figured you should meet him. I don’t even know if he’s smart.” So we got on the phone and he said to me ... We had this really awkward call, because we were competing.

Within a couple minutes, though, he dropped all pretense and said, “Really, my ambition is to be HBO for reading.” I started laughing, and he was like, “Well, I don’t think it’s that bad an idea.” I was like, “No, no, no. I literally have that phrase written in my deck that I’ve been sharing with investors.” So, we had ... He came to the idea from ...

Wow. So like, “Let’s join together”?

Yeah. So, he came to the idea from the consumer experience. He had graduated from Duke Law School and was working in the Obama Administration, in the Department of Justice, on gun control policies. So he was like, “God, this is a huge job. I don’t have any time.” But somehow, was managing to slip in a comic book or an episode of TV, and kept thinking to himself, “If someone would just deliver book content to me differently, it wouldn’t feel like such a psychological lift to start.”

So that made a lot of sense to him. He spent part of his childhood in Asia, and serialized reading on phones is the dominant form of reading there. Has been for 10 or 12 years. China Literature is the dominant player in the space, but there are five or six other companies behind them. We came together, got to know each other, launched in September 2015.

And, you raised funding from ...

At the outset, we did it, sort of, the most honest, hardest way. Meaning, we wanted to develop a proof of concept before we went out and raised external funds. So, we bootstrapped. We got a little bit of help from family and friends. Our first phase of the strategy was to stand up the platform.

So, you did it in a responsible way. How unusual. Not using OPM.

In retrospect, yeah, yeah, yeah. We spent about 24 months, actually, before raising external capital, proving early product market fit. So really ... Just to say it really clearly, we’re evolving the delivery of book content for the smartphone age. What we do is, we deliver audiobook and e-book installments that are bundled together so you can switch back and forth between reading and listening.

And, it knows where you are, that’s the astonishing...

It knows where you are.

That’s what I love about it.

Yeah, it’s great for the commute. I mean, most Americans have a 22 ... The average is a 22-minute commute, and part of that is walking, part of it’s riding. So, we really wanted to tune the experience to that daily ritual and make it easy to keep going. So, you can be walking to the subway, listening, hop on your train ...

And you’re right where you are.

Yup.

I still keep losing my spot in both, audio and ... It’s really irritating.

Yeah.

“Where am I? Oh, did I put the thing in right?” I just ...

Well, and also, just that whole idea of breaking it into parts. It’s so simple, but on the other hand, so useful. If you say to yourself, “Okay, I know I have 45 minutes, then I can fit this into that.”

Right, and so you did this proof of concept.

We did that proof of concept.

What was yours called, and what was his called?

I had a name called Signal.

Did he have Serial Box?

Serial Box, yeah.

Oh, okay. Better.

Yeah, better. And he’s a lawyer, so he’d already trademarked it, so ...

Okay, good. So, what the hey.

Yeah. So, we stood up the platform. We also created ... The other thing that we’re doing is kind of industrializing content development. We’re using methods from television that we’ve adapted based on my own editorial experience, so that teams of writers write Serial Box originals that we release. We do distribute other publishers’ content, but we have Serial Box originals, most of which are written by teams. So, the first couple of years was trying to build up a small catalog.

Right. Of books?

Mm-hmm.

So, you’re publishing books?

Mm-hmm.

This is individuals, or teams?

Teams.

Meaning?

Four or five writers.

Writing something? Such as...

Mm-hmm. The same way that a team of writers writes television. We have a lead writer, and then we hire for ...

Give an example of that so people can understand. I know what you’re doing, but explain that.

Sure. So, one example is our first horror series that we just released about a month ago, called “Silverwood.” So that, actually, originated as a web series on YouTube, and it was an anthology story structure. And we thought, “Wow, there’s almost a million subscribers who are into this show, but there’s a real opportunity to come in and write a narrative spine.” So, we hired Brian Keene, who’s one of the best horror writers in the world. He’s won the Bram Stoker Award a bunch of times. He’s considered a Grand Master. And then, we surrounded him by a really great team of other writers, including a pair of sisters who write together as The Sisters of Slaughter, and a writer who works with Stephen King quite often.

So, we put together this kind of supergroup of horror writers, and they built a “season.” So, 10 episodes, that at the end, you’ve essentially read a book, but you’ve done it in the same way that you watch TV, of like, “Oh, I’ll try one.” Then, if you like it, you can think, “Oh, I want another.”

Right, right. It’s just brilliant. I think this is a fascinating thing. So, how do they do compared ... Do they, then, the publishers, want to publish them? Or you’ve already published them?

We publish them in e-book and audio, and then we hold the rights in all formats. Publishers have come to us and licensed print rights or licensed translation rights.

Why not just print them yourselves? Because it’s just another business?

Yeah, I don’t want to get into it right now. Maybe someday, but it’s ... As you experienced, I mean, the economics ...

Then you have to talk to Amazon, right?

The economics aren’t great, but we certainly may do that at some point.

You’ve already published it. The idea of what publishing is is different.

Mm-hmm.

You know, again, when I think about books I’m like, why do I want to publish a book? I do it every day. I publish a book every month, you know what I mean?

Mm-hmm.

Or, something like that. The team of writers thing, I think is kind of brilliant. I mean, if you think about it.

Well, I love the idea that it’s not fixed in time. Like, we met with a writer yesterday who’s working on a really interesting book involving some very visible political characters, and he was saying, “I’d love to leave it kind of open, so that I can go back and change episode two, or installment two, depending on what happens.” And, it should be this kind of live stream, because people want Kara, what she thinks right now.

Right, exactly.

Not what she thought 18 months ago.

Right, exactly. That’s the problem with books, they’re so static. That’s why I absolutely don’t want to ... Everyone’s like ... I’ve literally been given 30 offers of books, and I’m like, no. I just don’t. It’s just, what, 18 months from now? I don’t even understand that.

Right, how am I supposed to see around the corner that far?

Right. Unless it’s something like a pure work of fiction, which I don’t write, or something. I’m sort of like, I have no interest. Non-fiction doesn’t make any sense anymore, to me.

Even in fiction, if you think about the difference between television and books, most novels are finished 18 to 24, maybe 36 months before they’re published and they hit your hand in the store. Whereas television is written and then shot very quickly, within less than 12 months.

They’re pretty pertinent and relevant.

They can pick up zeitgeists and what’s going on in the news, and fold that into the show in real time.

They can.

So, we’re doing that in our fiction series, which is really fun.

It’s interesting that you picked horror and stuff like that, that’s easy to do that in, that you can work with a team. It’s hard with some genres, presumably, right? Or, no? Do you do romance like this? You can do, what?

Yeah. I mean, we focus on … For the originals that we produce ourselves, we focus on science fiction and fantasy, mystery, crime and thriller, and some contemporary drama. We’re starting to work with partners that we’ll be announcing soon on some of the major studios, on big franchise properties. But we’re also working with a few non-fiction partners.

Right. Which is interesting. But it also frees you, right, from being alone?

Right.

That’s what I hated.

Well, there’s no reason for it. I mean, every time we bring writers together and take them through this process that we’ve built, which is kind of our secret sauce, one of them will exclaim, “This is magic! This would’ve taken me four months to figure out on my own. We just solved it in 20 minutes.”

Right, exactly. So, you got funding, then?

Yes.

How much?

So, last August, we started raising ...

Meanwhile, you’re running a business?

Yes. So, we’d sort of proven product market fit, proven willingness to pay.

What do people pay every week?

They could either pay $1.59 each week for a given series, or pay up front and get a bit of a discount. That’s for both the e-book and the audio. They get a notification on their phone each week saying, “Your new episode’s available.”

So, we raised $1.6 million in an angel round last August. We’re actually in the midst of our seed round and negotiating term sheets.

How hard is that?

Hard, definitely.

Because, there’s been a lot of these. There’s been a few. I can’t remember all of them. There was a couple.

Well, there have been some different things going on.

What were the other ones?

So Wattpad, everybody talks about. They’ve been around a long time. The way that I describe the difference between what we’re doing and what Wattpad is doing is, essentially, Wattpad became like YouTube for writing. Anyone can post, and that’s fine, and sort of opens up self-publishing, in a way. But really, what goes on on Wattpad is more about ... More similar to Instagram, where it’s ...

Right, the Instagram, yeah.

The social currency is writing rather than photos. Then, you’ve got the kind of chat fiction apps, like Hooked and Yarn. I’m sure you’ve heard people talk about them.

Hooked, yeah.

That format is very different and much more similar to a mobile game.

Yeah, that’s just really just the text going.

It’s just text back and forth.

It makes me nervous. I don’t know why.

I think, I mean, that voyeuristic, kind of reading someone else’s text messages.

I just ... The horror ones I couldn’t take. “Someone’s in the house. Oh, God, someone’s in the house!”

“Someone’s in the basement! Don’t go down there!”

Yeah, don’t go there. It just was like, I can’t take it in text.

It’s a little hard ... It’s pretty limiting, in terms of story.

Then, there’s one other that was more fiction-like ...

Oh, yeah.

Yeah, there were a bunch of them. So, what is the worry that people have?

In terms of investment?

Yeah.

I think there’s just ... Well, women-led, I think the last stat I read was ...

Yes, it’s horrible.

Two percent of venture capital went to women-led funding.

They suck. They suck!

So, you add that plus real reticence around media. So, it’s a tough ...

It’s not a big enough … “it’s a niche.”

Right, right, right. So, we look to models in the marketplace like China Literature, which IPO’d last year at a value of over $12 billion, and raised a billion dollars in their IPO. It’s a serialized reading platform, simple as that. So, this just hasn’t hit this market. We’re ahead of it.

You can do it with so many things. You can go into education. There’s all kinds of ways this could go.

Yeah. Well, and it’s not ... You know, we’re focused on fiction for the originals, because that’s what we know best, and we have kind of unfair advantage there, in terms of access to the talent pool. But many kinds of content will benefit from this delivery.

The biggest difference between what we’re doing and some of the other startups that have tread in similar territory is that we’re not kind of throwing out the whole traditional industry and saying, “We have a whole new format. You don’t have to read. You just read text messages. You don’t have to read any prose anymore.” We’re taking the best of the traditional industry and innovating on that.

How is the reception from the publishing industry to that?

They are really interested in the idea of installments. They want to see how ... What is the retention rate from one episode to the next? This whole idea of not asking someone to buy a whole book before they know if they want it is compelling.

Right, which you had proved already at Penguin.

Right. So, we’re increasingly working with traditional publishers. Eventually, we feel like our catalog will probably look something like Netflix, where there’s a bunch of Serial Box originals, maybe 5 to 10 percent of the content available, and then we have the balance of the catalog, distributing other content of the creators’ work.

Right, but what does the best on this platform?

Well, we have seen pretty even performance, which gives us a lot of confidence that we’ve been creating high-quality work. Some of the older series on the platform, “Book Burners” and “Tremontaine,” which were our first two... We’ve had the most time to market them. They have more substantial audiences, but more recent releases like “Bullet Catcher” ...

What is “Bullet Catcher”?

“Bullet Catcher” is an amazing, very light fantasy set in the West. It’s this great relationship between a young girl and a bullet catcher, who is someone who can bend bullets.

Okay. Why does that ... Why did that do well?

That, I think, is catching people’s interest. It has stunning art. It’s beautifully written and it sort of appeals to anyone who is into “The Dark Tower.” It’s got some good comparables and we’re just seeing it move out of the gate really quickly. We also recently released “Silverwood,” which I mentioned earlier, our first horror series, that is doing quite well, and then “Dead Air.”

What’s quite well? And “Dead Air”? What is “Dead Air”?

“Dead Air” is sort of our response to Serial and S-Town, in a way.

Yeah. Is this a podcast or ...

It is about a young podcaster who gets embroiled in an investigation in her hometown. It’s set in the South, written by three best-selling southern American fiction writers.

Right.

We wanted to do something that ...

How do you decide what to go for?

Well, so we’re looking at sub-categories that are trending and seeing a lot of attention and spikes in sales. We’re also looking for gaps in the marketplace based on series that ended 15 years ago or TV shows that have cult following but have fallen off.

One example is “Geek Actually,” which is in some ways an updated version of “Sex and the City.” It’s not all white women, not all straight women. They met at a Comic-Con and they’re friends in a Slack channel. That, actually, immediately attracted a bunch of film and television interest.

Right.

So we’re turning that into a series.

Right. In which they are having adventures together.

Yes.

Right. Exactly. It’s sort of a combination of TV and book reading. It’s really interesting when you think about it.

In a way, we are, because we’re focused on the serial format, it lends itself naturally to television.

Right.

Because we’re focused on worlds where we can bring out a season two, season three, etc.

Right. I’m looking at the app right now. These ... Most of these are yours, it looks like. It’s not the ...

At this point, yes.

At this point, and not to be ... Could it be them not to want to give you all the stuff, or not?

We just haven’t asked because we’ve been focused on building up our catalog.

Right.

Phase two of our strategy is rolling out these partnerships with the major studios.

With the major studios. The big cost is paying these people, right, to do this? Do they get a right? Do they get parts of this as they sell or do you give a piece to the authors?

We share in success with them. We have a revenue share, but we hold the copyright and the IP.

Right. Have you thought about not doing that?

It simplifies things for film and television pretty greatly to not have shared copyright amongst the team of writers.

Yeah. I just think it has got to change. It’s really, I remember, that’s the other part of like, “Why am I making something for you?” Like, “Why don’t I own all of it?”

Right.

Or, “I wrote a lot of it,” or, “It’s mine. I made the cake.”

Sure. Yeah. It would be different if it’s a single-authored work.

Yeah. Right.

But, in many cases, we’ve developed the concept ...

Right, and then you hire people ...

Then we’re bringing writers in.

Right.

They’ve written two episodes, so ...

Right. So it’s contract work. How is that working, contract work with people?

Well, honestly, it’s fantastic for them because it’s a good complement to their own books. We work with about 70 writers, 14 of which are New York Times best sellers. They view their Serial Box series as a great way to have more frequent contact with their fan bases.

I actually was really inspired by reading about some of the early history of the Wu Tang Clan and how they built that business, partly because I live in Staten Island, so I feel ... But they basically built a supergroup before any of them was tremendously famous and the whole idea was, they wouldn’t sign with a label who would make them have their individual records be with the same label. They want to have their Wu Tang label and then each of them could go off and do their own records in off years.

Yeah, the claiming of your talent is really interesting.

Yeah.

Have someone who’s done it. It’s really, it’s ... I continue to do it and they continue to resist. I was just talking to some people about something that they want me to do it and they want to own me and I was like, “I don’t want you to own me.”

Yeah.

I just don’t. I don’t know why and they’re like, “Well, you’ll be more big.” and I’m like, “Why are you saying that? I’m tired of you.” You know what I mean?

Yeah. So that can ...

Everyone should be able to do that or they are not ... People are either not talented enough or they’re not ... they don’t ... risk aversion and things like that. It’s an interesting things in these creative fields, especially Hollywood too, it’s kind of interesting.

Yeah. Most of the writers who are really serious about their career have a blend where they have some work with a traditional publisher, but they’ve bought up the rights to their backlist so they’re managing that distribution and then maybe they have a Serial Box Series. In the end they can have five or six ...

It would be an interesting time. This represents a really interesting, bigger trend around that, around talent, where talent goes and how it’s deployed. What Hollywood and the book industry thrive on insecurity and fear, you know what I mean? Like, “Oh, if I only get a book, if I don’t get a book.”

And vanity.

And you’re so captive — and vanity. You are so captive of everybody else’s efforts in a way that it used to be a team, but it’s not now.

It’s an interesting thing. I think about that a lot, so I love in companies like this where you can possibly do it. I think it’s really hard because I think you have to change users’ habits of having stuff shoved at you, right? Do you know what I mean? Even if it gets to be Netflix, which is cool, then gets to be shoved at you. You know what I mean? That’s how it all goes because it’s easier to bring everything under one roof than it is to be a little more creative.

All right, let’s finish up talking about where it goes from here. So you raise this money, what is a successful book to you guys? What does that look like? Most books only sell like 5,000 to 10,000. That’s the dirty secret, right?

Which is ridiculous because, if you look at podcast numbers of successful podcasts, it should be much bigger than that. I mean, we have quite global and big ambition. Because our cost model is very efficient, we can break even on a series with just a few thousand readers, which is fantastic. But we’re well above that for quite a number of our originals.

How do you attract people to the platform?

It’s a blend of word of mouth and organic and earned media, which I like to say because “organic” is not organic, like, you worked for that. We were very happy this morning to see actually yesterday iTunes sent out a list of apps you have to download before Thanksgiving and it was like Delta, United, Netflix, Serial Box.

Wow! Some person in Cupertino was like, “Screw these big ones! We’re picking the Serial Box.” Yeah.

That kind of thing helps a lot, obviously. Then we do some paid acquisition through many of the typical channels, but other interesting channels. We look to the early days of Netflix and sort of who they co-marketed with as analogous.

Yep. That’s smart, that’s super smart.

Then the third piece is partnerships with specific media companies. Some of those are affiliate, but some of them are much more customized.

Such as?

Haven’t announced them yet, but many of the big media sites have covered five or six of our series as we’ve released them. We’ve started to develop more in-depth partnerships where they released bits of content and then we ...

How did the big publishers look at what you’re doing? Do they have interest or they ...

To be honest, I kind of steer clear of them while we’re in these formative years.

Or just sitting there doing the same thing?

We started working with the studios first.

Yeah.

Because Hollywood is much more ...

Well, they’ve had their head handed to them.

They’ve had their head handed to them. They’re really interested in direct-to-consumer platforms. Every kind of studio has got one up or building one and so they’re sort of past the hurdle.

And interesting, publishing is still ... “Amazon! Oh no!” I’m like, “Stop, that’s what they’re focused on.” I’m like, “That’s not the issue.” And it was … Amazon had to have had a foray into publishing. But who wants to sign with Amazon? It’s the same difference except you’re in a worse position.

Right.

Right?

Well, I mean they have really interesting audience insight, of course, that they don’t share with traditional publishers.

That’s right. They can go into this kind of business, if they thought about it.

Yeah. I think that they could be a great.

Shh… They’re busy making microwaves right now, so don’t worry about it. Just trust me.

Moving into Long Island City.

They’re inside the house. Don’t let them inside the house. I’m just telling you.

Yeah.

It’ll be interesting. So, where do you hope to go from here? What is the ultimate goal? Where’s reading go?

Really, well, reading is — and this is my sort of most philosophical reason for doing what I’m doing — it’s actually scientifically proven that reading, whether you’re reading visually or listening, builds empathy more effectively than almost anything else.

If you think about that for a second, it makes sense, because with any video format, you’re still seeing people who are not you. Whereas in listening or reading, you’re kind of co-creating the experience and so you’re much more willing to step outside of your own limits or prejudices, whatever it is.

We feel like reading is incredibly important, more important than ever, and almost therapeutic in a way. The world is so busy, the idea of becoming immersed in the story is so relaxing, almost like meditation. Our whole purpose is to make it easier for you to fit reading into your life and just weave it into your daily and weekly media diet.

The next phase for us is launching these huge recognizable brands next year in partnership with studios. And then working with traditional publishers to bring more of their catalog onto the platform so that we become the best way to ...

To sample.

Yeah, the best way for ... We’re never going to try to out-Amazon Amazon in terms of selection.

Don’t. Right.

There’s no reason to. But many, many people don’t know what they should read next.

You also have providing something called taste.

Yeah. So we’re curating.

Merchandising taste.

Making it much easier for people to choose something that’s worth their time.

Yeah. That’s probably true. Anyway, Molly, this is fascinating. I’d love to have you back. I want to see what you do next because it’s really, this is where the internet started, with books. It’s a really interesting thing in words and it’s really interesting where reading goes because it’s never been more popular and then it’s ... You have so many devices in order to do it. It’s a really fascinating time for that.

Oh, I was just going to say I feel like the internet started with books in some ways and then there was this whole maybe 15 years of throwing away gate-keeping and throwing away all of that, and I think we’ve all come to realize you do have to pay for quality.

You do.

It’s really helpful to have someone guide you.

Absolutely.

We’re in the beginning of a new era.

Absolutely, but you give them flexibility at the same time. Anyway, it was great talking to you. Thanks for coming on the show.

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