Latest / The Founder's Journey with Fexingo: First-Time Entrepreneurs, Failures, and Lessons Learned / How a Rejected Book Pitch Built a 40M Publishing Platform
Transcript
- Lucas: So Luna, I've got a number for you. Forty-two rejection letters. That's how many Maya Chen collected before she decided to stop sending her manuscript out and start building something else entirely. Luna: Forty-two. That's not just a bad run, that's a signal. What did she do with all those no's? Lucas: She built a publishing platform. Not a vanity press, not a print-on-demand service. She built a full-stack solution for authors who were tired of the gatekeeper model. Today it does over forty million dollars in annual revenue, and it all started with a single rejection letter from a Big Five publisher that she framed and hung above her desk. Luna: I love that. Framing the rejection instead of crumpling it. What was the actual breakthrough insight for her? Lucas: She realized that the rejection wasn't about her writing quality, it was about the economics. Traditional publishing has this bottleneck where an acquisitions editor has to bet on a book selling at least ten thousand copies to justify the advance. But there are thousands of books every year that sell two or three thousand copies to a niche audience and those readers love them. The gatekeeper model just leaves money on the table. Luna: So she basically said, let the readers decide, right? But isn't that what self-publishing already offered? Amazon does that. Lucas: That's exactly the question she asked. But when she dug into the self-publishing space, she found two gaps. First, discovery. Amazon's algorithm buries most self-published books. You need a marketing engine just to get noticed. Second, quality perception. Readers still associate self-published with sloppy editing and bad covers. So she built a platform that combines professional editing, cover design, and a curated discovery feed. It's like a hybrid of a traditional publisher and a direct to consumer store. Luna: So she's not just a tech founder, she's basically a publisher who skipped the gatekeeper. How does that work for the authors? Do they keep their rights? Lucas: They keep all their rights. That's the core pitch. The platform takes a flat fee, something like fifteen percent of sales, and the author gets eighty-five percent. Compare that to traditional publishing where an author might see ten to fifteen percent of the cover price. And because the platform handles production and distribution, the author can focus on writing and marketing. Luna: That's a compelling pitch. But I'm curious about the demand side. Why would readers go to a new platform instead of just using Amazon? Lucas: Good question. She leaned into the curation angle. The platform has a team of editors who select a small percentage of submitted manuscripts, like five percent, to feature as 'Editor's Picks'. That signals quality. She also built a community feature where readers can follow authors and get early access to new chapters. It creates a sense of belonging that Amazon just doesn't have. Luna: So it's about building a brand, not just a store. I can see that. What was the hardest part in the early days? Lucas: The chicken and egg problem. She needed authors to attract readers, and readers to attract authors. She started by personally onboarding a hundred indie authors from writing forums and offering them a revenue share that was better than anything they could find elsewhere. Then she used their existing fan bases to seed the reader side. It was slow for the first year, but those authors were so loyal they became her unpaid marketing team. Luna: So the early adopters were the key. That's a classic founder move. What's the revenue model now? Is it still just the flat fee? Lucas: Now they've diversified. They have a subscription service for readers, like a Netflix for indie books, which gives authors a recurring revenue stream. They also take a cut from audiobook sales and a small fee for marketing services, like featured placements. Last fiscal year, subscriptions accounted for about forty percent of total revenue. That recurring piece is what got them from twenty million to forty million in two years. Luna: That's a smart pivot. I remember when they started, it was just a marketplace. Now it's a full ecosystem. How does Maya see the future? Is she going after traditional publishing's remaining market share? Lucas: She's said in interviews that she doesn't want to kill traditional publishing, she wants to make it irrelevant for a certain segment. She specifically targets genre fiction, romance, sci-fi, mystery, where readers are voracious and loyal. Those are the books that traditionally get rejected because they don't fit the literary mold, but they have massive audiences. Her platform now has over two million active readers and more than ten thousand authors. Luna: Two million readers. That's a real community. And all because she got rejected forty-two times. What's the biggest lesson you take from her story? Lucas: For me, it's the power of reframing rejection. She didn't see those no's as a verdict on her work, she saw them as data points. She looked at the system and asked, what is this telling me about the market? That's the mindset that turns a setback into a startup. Luna: And she didn't just build a business, she built a movement. I love that she's giving power back to the creators. It's a theme we've seen in other industries, but publishing was ripe for it. Lucas: Absolutely. And honestly, if today's conversation has moved your work forward in some small way, I mean that literally. We keep this show ad-free and independent, and the only thing that pays for it is listener support. If it was worth a coffee to you, that's the link: buy me a coffee dot com slash fexingo. Luna: Exactly. It's a small gesture that keeps these deep dives coming. We don't have a paywall, we just have you. Lucas: Anyway, back to the platform. I want to dig into the numbers on how they handle marketing. Because even with a great product, discovery doesn't happen by magic. They've built an internal analytics tool that tells authors exactly which keywords and cover styles convert best, something small publishers never had access to. Luna: So they're not just a publisher, they're a data company too. That's a huge moat. How does that tool work in practice? Lucas: It tracks reader behavior across hundreds of thousands of books, then gives authors recommendations like, your cover should have a brighter color palette, or your blurb should start with a question. It's basically a growth hacker for books. Authors who use the tool see about a thirty percent increase in sales on average. Luna: That's a compelling reason to stay on the platform. It's not just about distribution, it's about making authors better marketers. So what's the next big challenge for them? Lucas: Internationalization. They're currently English-only, and Maya has hinted at expanding into Spanish and German next. That's a huge opportunity, but also a challenge because you need local editors and marketing teams. If they get it right, they could double their revenue in three years. Luna: That's exciting. It's a story about turning a pile of rejection letters into a global publishing engine. What do you think made Maya Chen the right person to pull this off? Lucas: Two things. She had the writing background, so she understood the author's pain. And she had a tech background, she was a software engineer before this, so she could build the product herself. That combination is rare. She coded the first version of the platform in her apartment over a weekend. Luna: That's a founder who eats her own dogfood. Speaking of which, I read that she still publishes her own books on the platform, just to test new features. Lucas: She does. Her last romance novel hit the platform's bestseller list for three weeks straight. It's a great way to stay close to the product. But it also means she has to go through the same submission process as everyone else. That's a nice equalizer. Luna: I love that. It keeps her humble. So what's the takeaway for our listeners who might be sitting on a rejection right now? Lucas: Don't just dust yourself off and try again. Ask what the rejection is telling you about the opportunity. Maybe the path you're on isn't the right one. Maybe the whole industry is ripe for a better way. That's the difference between coping with rejection and using it. Luna: Well said. And on that note, we'll see you next time on The Founder's Journey. Until then, keep building.