Little asshole brings millions

The alternative publishing house eichborn goes public.

By going public, eichborn is one of the few german publishers to retain its independence from corporate groups. But even outside bertelsmann, holtzbrinck and springer, money has to be made with books.

At the end of 1999, eichborn published the black book of capitalism. Now the independent publishing house is going public. Until 5. May, one million shares – one-fifth of the total number of shares – can still be subscribed. From 9. May, the frankfurt-based "company with the bow tie" then be listed on the smax, the german stock exchange segment for high-growth medium-sized companies. The whole thing could have brought the anti-capitalism publishers up to 24 million marks – it’s more likely to be ten.

Fischer editor vito von eichborn founded the publishing house as an alternative in 1980. In 1989, when hans magnus enzensberger published his "other library" the image was perfect. Eichborn’s image resonates with: unconventional, old-68, wg, students. Since 1992, however, it has also included merchandising, cookbooks, guidebooks, comics, "the little asshole", "the campus". After a slump in profits at the beginning of the 1990s, vito von eichborn sold his company – since then, eichborn has made a lot of money and looks more and more like a heap on which the buffet leftovers from various hotels are dumped together. "General store" business journalists affectionately call it.

Einborn publishes 200 books a year. Last year, this brought in sales of 38.8 million marks – an increase of 20 percent over 1998. Rough success: 1.4 million copies sold "aldidente", a cookbook for all lovers of the cheap mixed away. But the publishing house is still located in frankfurt’s kaiserstrabe. Where junkies, prostitutes and dealers say good night to each other "good night". If you look down the street from the eichborn offices, you can see frankfurt’s banking and financial district.

Program manager wolfgang ferchel is delighted by the view. He talks about books like this: "eichborn successfully labels content, or rather refines it, via the book market. This is what we want to continue. In addition, however, we want to make even more efficient use of all the rights we have to a successful title in the future. This is not possible without new capital, and it opens up whole new economic dimensions for us." once again, someone wants to become a media company.

Matthias kierzek, the company’s ceo, has very similar ideas to other aspirants: producing films and doing something on the internet. In concrete terms, he wants to produce eichborn materials himself for the cinema, set up an individualized advice service on the internet – and buy smaller companies for six million marks each over the next two years. This all sounds like a betrayal of ideals, a sell-out and all kinds of other bad things. On the one hand. On the other hand, you have to look at the publishing business. And eichborn board member kierzek is right in his description: "there aren’t many independent publishers left who are not tied to the big three: springer, bertelsmann and holtzbrinck. But we believe that it is more worthwhile than ever for independent publishers to assert their self-determination and expand their position. And that means growth."

The example of klaus wagenbach shows what makes the difference in a publishing house. The independent berlin publisher had published the novel "expansion of the combat zone" by the hitherto unknown michel houellebecq before the hype in france and successfully published it in germany. The rights for houellebecq’s next book "elementary particles" wagenbach could no longer afford them, so they went to the financially strong dumont verlag in koln. Eichborn must indeed grow.

But up to now, german publishers have always done this by slipping under a corporate skirt. Back in the 1960s, gottfried bermann fischer sold s. Fischer verlag to holtzbrinck. The stuttgart-based group – which also publishes the tagesspiegel, handelsblatt, wirtschaftswoche and zeit, among others – also owns droemer-knaur, rowohlt, wunderlich, j. B. Metzler, kindler and, to a small extent, kiepenheuer witsch. Bertelsmann owns goldmann, blessing, and since 1998 siedler verlag and berlin verlag. Springer includes econ, claassen, propylaen, quadriga, ullstein and list.

So far the publishers have done well with this. Holtzbrinck in particular had the – justified – reputation of not integrating its publishing houses into the group, but instead letting them operate decentrally on a long leash. The leash has become shorter. At the beginning of march, it was announced that the largest publishing group in the droemer-weltbild group was, "is reorganizing its programs". The publishing houses edition spangenberg, fretz wasmuth are facing extinction. Even the traditional publishers rowohlt and fischer are getting a taste of the new hardboiled. Both are not exactly commercially successful. Rowohlt has reportedly lost around ten million marks in each of the past two years – on sales of around 100 million marks.

Holtzbrinck doesn’t have a short leash, but it does have a short leash "commitmens". These are annual self-commitments of the publishers to achieve a certain turnover. Since that probably went to shit, management consultants from mckinsey have been at work at fischer and rowohlt since the beginning of the year. As early as the fall of 1999, peter wilfert was appointed as rowohlt’s managing director. He made it clear that the sub-publishers rowohlt berlin, wunderlich and kindler were to be built up into brands, and that each of them would have to be "be economically sound". That is, there is no longer any mutual subsidization. Books that don’t make money aren’t published either. Publishing director nikolaus hansen speaks of "a new spearhead of the mainstream" and from sales, which are expected to increase to 125 million in two years. At rowohlt berlin, the new publishing focuses ("young, fast, coarse urban") promptly led to the fact that editors kundigten.

Affiliation with the group thus means a noticeable loss of independence. In addition, decentralized "decentralized models" a la holtzbrinck cannot change this. And so eichborn’s going public appears to be more than just making a killing. Whether it has anything to do with protecting ideals, however, is also questionable. Because at eichborn, the economic thinking that holtzbrinck now wants to introduce to the rowohl parents has long been a normal state of mind. Program managing director ferchl: "we don’t have any program areas that we drag through economically. Of course, there are always individual books where the content is more important to us than the economy. But there are no program areas that are unprofitable; everyone writes positive contribution margins." and this is exacerbated by the borsengang.

As a stock corporation, eichborn does not have to worry so much about books, but rather about future prospects for shareholders. So the film business. And the return on investment – you want to pay out a small amount in the first year of business as a stock corporation.

You just can’t do business with 68-ideals. Kierzek learned that painfully ten years ago. Back then, he took over the frankfurt city magazine "pflasterstrand". The paper was to become a glossy political magazine. A year later, the accountants put an end to it.

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