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Kali: Very good points. I have been talking with some author friends about this, and no one really is clear about what exactly the value proposition of going through an editorial is, except that it certainly has value. I wanted to look into a "joint venture" model, where author, editor and graphic artists (if applicable) each make their contributions to a novel in exchange for a percentage of the returns. No one gets any money up front. Each would assume more risk (which new authors do now anyway, since they need to dedicate a lot of time to writing with no guarantee that they will be remunerated). The advantage to the editor is that they could pick and choose among projects that they evaluate as being worthy, and spread their risk by editing multiple projects simultaneously.
There are some things, though, that an editorial does provide which a "joint venture" does not.
1. Legitimacy: There is a massive volume of self-published stuff out there, and editorials do filter that for the reader.
2. Access to volume discounts (this is especially important in the case of printed books).
3. Marketing resources: This overlaps with legitimacy. It is not clear these days how valuable this is, as the volume of publications makes marketing somewhat ineffective in the majority of cases.
So, does it make a big difference to go without marketing? Can you get reviews from known authors / in known publications? Can you build an audience on your own?
In these case, the value proposition might not be worth it for what you have to give up to the publisher. But it is hard to be sure.
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