The Book World Still Isn’t Diverse. Dhonielle Clayton Is Trying to Change That.

One evening this fall, a crowd of writers and publishing professionals mingled in a speakeasy-style lounge in Midtown Manhattan. The party, hosted by a new company called Electric Postcard Entertainment, was the kind of lavish affair that’s become rare for the book business in an era of corporate consolidation and cuts.

Guests traded industry gossip and sipped potent signature cocktails with names like “timeless love” and “immortality serum” — phrases that alluded to the company’s coming romance and fantasy projects. The crowd included executives from Sony, film agents and producers, book scouts, novelists and editors and publicists from publishing houses like Macmillan, Simon & Schuster and William Morrow.

The company’s sales pitch was delivered stealthily via gift bags stuffed with candles, a branded sweatshirt and tea. Along with the party swag was a small sealed envelope holding a plastic card with a QR code that led to a website, where excerpts from 10 of the company’s new book projects were posted. There was a lesbian time-travel romance, a novel about an immortal Black travel writer who wanders the globe for centuries and a fantasy about the epic rivalry between two prominent Black families who wield magic.

The stories hadn’t yet been fully written — these were teasers for potential books, and Electric Postcard, which generated those book ideas, was looking for buyers. A note on the site urged interested parties to contact New Leaf Literary & Media, an agency that represents Electric Postcard’s projects.

The mastermind behind those fictional plots and dozens more is Dhonielle Clayton — a former librarian whose hyperactive imagination has spawned a prolific factory for intellectual property. Though her name doesn’t always appear on the covers of the books she conceives, she has quietly become an influential power broker in the book world.

“She’s like a puppet master,” said the best-selling novelist Jason Reynolds, who attended the party and is a longtime friend of Ms. Clayton’s. “People don’t know Dhonielle’s hand is in everything.”

In addition to running Electric Postcard, which she founded last year, Ms. Clayton is the president of Cake Creative, another packaging company that develops intellectual property for children’s books, and the author of more than a dozen novels.

Like other packagers, Ms. Clayton, 40, comes up with plots for potential novels and hires writers to execute those ideas, then sells the books to publishers. Packagers have been a fixture of the publishing industry for decades, and have engineered hits like “Gossip Girl,” “The Vampire Diaries” and “Pretty Little Liars.” By farming out ideas to writers but holding onto the copyright, packagers can build up large and lucrative catalogs of intellectual property. While some offer authors a cut of the advance and royalties, allowing them to share in a book’s success, others pay only a negotiated fee, which can range from a few thousand dollars to the low tens of thousands.

But Ms. Clayton has bigger ambitions, and set out to create a different kind of packaging company. She’s aiming to create a pipeline for fiction featuring racially diverse and L.G.B.T.Q. protagonists, as well as characters living with disabilities, and who come from diverse religious and cultural backgrounds, to convince publishers that those stories can be commercial blockbusters. She works exclusively with writers from marginalized communities, and aims to give her authors a fair cut of the pay, and the tools to have their own careers.

In an industry that’s long had a diversity problem, Ms. Clayton has sometimes struggled to get publishers on board. She’s received countless rejections, and has heard many variations of the argument that books centered on people of color don’t sell. But in the past decade, her packaging business has sold 57 books; 41 of which have been sold since 2020. Nine projects have been optioned for TV and film. Many of the 26 writers who have worked with Ms. Clayton have gone on to sign deals for books based on their own ideas, she said.

Graduates include rising stars like Kwame Mbalia, who started his own imprint at Disney after his “Tristan Strong” fantasy series became a best seller in 2019. Another Cake protégé, Nick Brooks, wrote “Promise Boys,” a campus murder mystery about a group of Black and El Salvadoran students wrongly accused of killing their principal, based on Ms. Clayton’s idea. The book, which came out earlier this year, sold to Henry Holt for a seven-figure sum. It was optioned by Netflix, with Temple Hill Entertainment and Higher Ground, Barack and Michelle Obama’s production company, signed on as producers, and Mr. Brooks attached as a writer.

Brian Geffen, an executive editor at Henry Holt Books for Young Readers, said he was hooked when Cake sent him a splashy audiobook sample for “Promise Boys” that had multiple narrators and sound effects. He bought the book, based on a sample and an outline, in a competitive auction. “I’m not the type of editor who loves to buy off a sample, but we ended up making a sizable investment in the book,” Mr. Geffen said. Part of what gave him confidence in the project was Ms. Clayton’s involvement, he said. “Dhonielle’s reputation preceded her.”

The Industry’s Diversity Problem

Like many corners of the entertainment world, the book business has long been, and remains, overwhelmingly white. Authors of color frequently find they get paid less than their white peers, and that publishers don’t invest as much in marketing their books, hampering their sales.

While there’s been a push to change that over the years, progress has been painfully slow. White workers accounted for 76 percent of publishing industry employees at more than 150 companies, including publishing houses, agencies and literary journals, a 2019 survey conducted by Lee & Low Books showed (their next report is due in early 2024).

In 2020, after the killing of George Floyd ignited protests around the country, publishers faced growing pressure to make publishing more inclusive. Major publishing houses hired and promoted editors from racially diverse backgrounds and created new imprints dedicated to works by writers of color. Editors rushed to sign up books by Black authors and acquired titles that explored race and racism, many of which sold well.

While there aren’t current industrywide statistics on the racial backgrounds of U.S. authors, recent reports from two of the country’s biggest publishers show both significant strides and a lingering racial imbalance. In a recently released diversity report, Penguin Random House, the largest publishing house in the United States, said that an audit of its publishing programs from 2019 to 2021 found that some 75 percent of its authors were white. Similarly, Hachette Book Group reported this spring that while acquisitions of books by nonwhite authors and illustrators increased 20 percent between 2019 and 2022, white authors and artists accounted for 76 percent of the books the company purchased in 2022.

Some in the industry are now worried that publishers’ commitment to diverse books has stalled.

“I do feel like the enthusiasm has left the building,” said Rockelle Henderson, who worked at big publishing houses for 16 years and now runs Rock Inked Incorporated, a marketing and literary agency. “When you go to sell something, they’re like, oh no, we’ve tried that, or the market is saturated.”

Publishers have also been thrown off by sluggish sales this year, a decline that followed the surge in books sales during the height of the pandemic in 2020 and 2021. As a result, some are reluctant to take a chance on titles that aren’t guaranteed sellers, and are pouring more money into sure bets like celebrity memoirs and upmarket women’s fiction.

“The perception is still that when a book by a writer of color works, it’s an aberration,” said Ayesha Pande, the founder of the Ayesha Pande Literary agency.“The entire industry is still very much set up to publish books by white creators — that’s what they’re good at, that’s what they know how to do.”

“Everything else, they consider to be a risk,” she added.

Some publishers that raced to diversify their lists then saw disappointing sales for some titles are now falling back on the old arguments that such books don’t resonate widely — a standard that doesn’t seem to apply to white writers, Ms. Clayton said.

“A lot of writers are struggling to break through again,” she said.

She’s saved every rejection note, both to study the patterns and to keep a record.

“I’m a librarian, I’m an archivist,” she said. “I have the receipts.”

Writing What She Wanted to Read

Growing up in Maryland, Ms. Clayton was, by her own account, “a little nerd, a bookworm with thick glasses, like a fussy little cat.” Much of the time, she would hide under the dining room table and read — devouring classics like “Harriet the Spy,” “The Phantom Tollbooth,” “Roll of Thunder, Hear My Cry,” “A Wrinkle in Time.”

After teaching English in Washington, D.C., and Maryland, in 2010, she moved to New York, where she enrolled in a children’s literature program at the New School, and worked as a librarian at a charter school in Harlem, where she lives now. She struggled to find engaging books for her students, who mostly belonged to immigrant communities from the Caribbean, Central and South America, West Africa and Bangladesh. Many of the books she could find that featured characters from diverse backgrounds were older titles, many of them about topics like slavery or segregation.

“I thought, this is incredibly unfair. An entire portion of a generation of children are being underserved, and it’s affecting their relationship to words,” she said. “And so I was like, you know what? I’ve got to write.”

She wrote the kind of fiction she wanted to read — action-packed fantasies and mysteries — but it felt like writing into a void.

“At the time, books that featured characters of color or marginalized characters were pigeonholed into multicultural literature, they were teachable lessons,” she said.

She wrote eight novels before selling her 2015 debut, the young adult novel “Tiny Pretty Things” — a murder mystery set at a ballet school, where a Black ballerina struggles to fit in. Ms. Clayton co-wrote it with Sona Charaipotra, a writer she met at the New School.

A few years later, she published her first solo title, “The Belles,” a suspenseful fairy tale that spawned a young adult fantasy series, and went on to publish 10 more novels.

Though her books were well received, the pay was often modest. For the first decade of her career, all of her advances were less than $30,000.

In the years that she was struggling to break in as a novelist, Ms. Clayton started looking for other ways to change the industry. She had learned about book packaging while interning with a literary agency, and saw it as a way to create a sustainable supply chain for the kinds of books she wanted her students to be able to read.

She teamed up with Ms. Charaipotra, and in 2011 they co-founded the packager Cake Creative, with the aim of changing the children’s book landscape.

Ms. Clayton’s manic creative energy made her well-suited to running a packaging company, said Ms. Charaipotra, who left the company a few years ago to focus on her own work. She sold her stake to Ms. Clayton.

“She has 100 ideas going at any given moment,” she said.

A New Model for Book Packaging

From the outset, Ms. Clayton and Ms. Charaipotra decided that Cake would be different from other packagers, which have mixed reputations. At some companies, writers are sometimes treated like interchangeable cogs, expected to write under a pseudonym, or in some cases, getting pushed out after creating a successful series, which are then kept going under their name by ghostwriters.

At Cake, rather than maintaining a stable of writers, they made it a priority to help authors pursue their own book ideas. They also offered writers a percentage cut of the book advance and royalties, rather than just a flat fee, and paid for writing they did on spec.

Ms. Clayton and New Leaf, the literary agency that represents her companies’ projects, declined to share the terms of their author contracts, but said that in addition to getting a percentage share of the book advance and royalties, writers get a cut of subsidiary rights like audiobook and translation rights, and bonuses if the screen rights are optioned and a movie or series is made.

To find promising new writers, the company puts call-outs on social media, gets referrals through Ms. Clayton’s extensive network of authors, and sifts through writing samples that are submitted through a form on the company’s website.

Their authors are put through a rigorous writing boot camp, with coaching on plot structure, character development, dialogue, pacing and genre conventions. They are taught how to read a deal sheet, how to assess the terms in a contract, how to take feedback from editors and what to expect from marketing and publicity.

“It shouldn’t have taken me eight books, start to finish, to break in,” Ms. Clayton said. “I wanted to shorten the runway for other people.”

For the first few years of Cake’s existence, Ms. Clayton found herself up against some of the same barriers that she’d faced as a Black author trying to land book deals. Publishers seemed skeptical of her argument that diverse books could reach a wide audience.

“The types of rejections that I was receiving were, ‘We already have a book about a Black girl. We already have an Asian book,” she said.

Those attitudes, once common, began to look increasingly outdated, as teachers, librarians and authors started lobbying for books that served the needs of a diverse readership. Anger at publishers boiled over in 2014, fueled by an event at a publishing trade convention featuring children’s book luminaries. The event lineup included only white authors, and Grumpy Cat, the feline social media star.

“That was the diversity,” Ms. Clayton recalled. “Grumpy Cat.”

For many in the industry, it felt like a breaking point. Publishers faced mounting pressure to make children’s literature more inclusive, and eventually, word got out that Ms. Clayton had a knack for spotting talent and was developing a catalog of books with a diversity of themes. After years of rejections, people started coming to Ms. Clayton.

Some of the publishing industry’s biggest stars began seeking out her ideas and her network of writers. In 2018, Rick Riordan, the author of the blockbuster “Heroes of Olympus” Greek mythology-based fantasy series, started a new imprint at Disney. Mr. Riordan was looking for authors who could write middle-grade novels based on myths and fables from different cultures, and he wanted to publish a series centered on African American folklore.

Ms. Clayton came up with a fantasy world where Black folk heroes like John Henry have heroic powers. Kwame Mbalia, an unpublished writer in North Carolina who was working as a pharmaceutical metrologist, inspecting equipment for drug manufacturers, learned from a sci-fi and fantasy writing Slack channel that Cake was looking for a Black writer for a project, and sent in a writing sample. Ms. Clayton hired him to write the book, and Mr. Mbalia embellished her idea, creating a story about a Black boy named Tristan Strong who stumbles into a magical world filled with folklore figures like Gum Baby, Anansi, and other figures from African American and African legends. Disney bought two books based on three chapters and an outline.

After “Tristan Strong Punches a Hole in the Sky” came out in 2019, it drew starred reviews and became a New York Times best seller, and won a Coretta Scott King Award, a prestigious prize given to Black children’s book authors and illustrators. Disney turned it into a trilogy, and eventually offered Mr. Mbalia his own imprint, Freedom Fire Books. Its first three titles are due out next year.

Mr. Mbalia said he sometimes questioned how much of the “Tristan Strong” story he could take credit for, since Cake created the concept and holds the copyright. When he brought that up with Ms. Clayton over dinner one evening, she assured him that he made the story his own.

“I remember her being like, this is your story,” he said. “You wrote this. Only you could write this.”

“I Have Zero Grace About It”

In 2020, when there was a renewed push to diversify the industry, Ms. Clayton got a few offers to start her own imprint at a publishing house.

Instead, she decided to expand her business into adult genre fiction. She came up with the idea for Electric Postcard, developing intellectual property for the adult market, which has been slower to diversify than children’s literature.

To compensate for her own creative blind spots, she brought in four other novelists as collaborators and book idea generators, including Zoraida Córdova, who writes romance and fantasy; Tiffany D. Jackson, who writes thrillers and horror; Gretchen McNeil, who writes horror and suspense; and Natalie C. Parker, who writes horror and fantasy.

They all meet regularly over Zoom to pitch projects and go on annual brainstorming retreats. So far, the company has sold 11 books since it was founded last fall.

But there are still hurdles. Ms. Clayton has been disheartened, though not entirely surprised, to see enthusiasm for diverse books dissipate among some publishers, and to be told once again that the market for such works is marginal.

“I have zero grace about it,” she said.

Her mood lifted when she started listing some of the book ideas she thought of that now sit on bookstore and library shelves: “The Gauntlet,” a series about a Bangladeshi Muslim girl who gets trapped in a magic board game; “Love Sugar Magic,” a fantasy series about a family of Mexican American witches; “Last Gate of the Emperor,” an Afrofuturist adventure set in a mythical Ethiopian empire.

“They all come from my brain,” she said. “And they all come from the students that walked into my library. I’m making books for those people.”