Steve Potash started digitizing books long before it was cool.
Now in his 60s, the CEO of OverDrive began digitizing law books in the 1970s, thinking this was the next big step in the publishing world.
Every new invention that came along—PCs, CD-ROMs, Windows—made him more optimistic for the future of digital publishing.
But 40 years?
No, Potash never thought it would take that long, but he also never gave up.
“I was always optimistic,” Potash told TeleRead. “It was during 1999 when I was one of the founders of IDPF, and we’d had the Open eBook Forum. I thought ‘Oh, now!’”
No, still not now.
“By ’03, e-book was dirty word,” he said.
It would take a few more years for the e-book world to begin its ascent with the introduction of the Kindle in 2007 and then the iPad in 2010. Potash has been at the forefront of many of the innovations in the industry, making OverDrive one of the largest distributors of e-books, audiobooks, music and other works—though libraries, schools and retailers.
“I sometimes take credit that I have been part of more e-books failures than anyone else in the industry,” Potash joked. “I have to say, we swing at more pitches. I had a lot of foul balls, but we also scored a few singles, doubles, and with the OverDrive platform, we hit a home run.”
OverDrive has partnered with nearly 5,000 publishers to get their inventory into the hands of consumers.
In 2015, the Japanese conglomerate Rakuten acquired OverDrive for a reported $410 million. Rakuten provides a variety of consumer-focused businesses including an e-reading platform in Kobo, instant messaging with Viber, and e-commerce with Ebates and Rakuten.com.
The acquisition is beginning to show results with more coming to the Kobo reading platform very soon, according to Potash.
It’s no wonder a company like Rakuten would be interested in OverDrive. The latter company has had such great success that it was only a matter of time before a big entity swooped in.
“We have had consistent double-digit growth for over a decade,” Potash said. “We are a supply chain to online bookstores and retailers and OEMs. Then, of course, in ’03 and ’04, we started to launch into library and institutional markets. I am fortunate that for the last 12-15 years, year-after-year, we have had continual double-digit growth in profitability.” Within the public library world, OverDrive was not the first provider of e-books—companies such as netLibrary preceded it. But Potash was still among the pioneers, the one who would go on be the main force within the industry. “Are Digital Libraries A ‘Winner-Takes-All’ Market? OverDrive Hopes So,” read the headline of a 2013 post on the Forbes site.
Don’t think that Potash or anyone who works at OverDrive is surprised by the success. With the experience and innovation at OverDrive, they expected this type of outcome.
That’s because those at OverDrive are constantly looking to expand into growing markets. The international markets have been ripe, and it has taken advantage. Recently, OverDrive launched into public libraries in Germany and neighboring areas. It also will open e-book libraries in Japan, Taiwan, Singapore, Malaysia and China.
Potash also says OverDrive’s people are excited about a renewed sense of interest in Spanish-speaking markets.
“Spanish-language markets, the Euro zone, and Asia are three regions that are exhibiting really great opportunities for publishers to sell their digital books into.” Potash said. “I am proud to say our e-books and audio books are offered in over 50 languages now. “
Closer to home
While OverDrive is heading overseas, the Cleveland, Ohio-based company continues making its mark in the United States with its powerful digital app and now it’s looking toward education.
OverDrive has several ventures within education’s wall, including K-5 Quickstart, an instant access app of a pre-set collection of 200 premium ebooks, digital resources for K-12, and a focus on academic libraries.
Among the challenges younger children have faced is using tablets or others devices to access materials. K-5 Quickstart takes away those issues by allowing children to select e-books easily and instantaneously without any software.
“It’s very difficult for schools and institutions to install and manage a variety of apps,” Potash said. “We have to make it to so young children can see a book and with one touch, read the book. K-5 Quickstart overcomes the challenges with schools as a collection of e-books. They walk up to any machine and instantly start reading.”
OverDrive has been successful with the K-5 Quickstart program for a number of reasons including the support of librarians and educators. That’s because it has made using the programs easy and readers can simultaneously check out a book. There is no wait time to read an e-book.
“We have overcome some of the challenges operationally so they can add it as part of the environment,” Potash said. “And we made it really compelling for teachers, parents and students to have easy access.”
When it comes to K-12, OverDrive is in more than 12,000 school districts offering more than two million titles. OverDrive has also partnered with several academic libraries, including the University of Pittsburgh and McGill University.
Some of the focus isn’t just through educational material such as digitized textbooks, but finding items that young people want to read. OverDrive recently announced a deal getting DC Comics into the OverDrive dashboard.
“It’s promoting reading and the screen as a place you can enjoy immersive reading of a story,” Potash said. “Comic books, graphic novels, anything that gets children reading. Even the teachers are supportive.”
Embracing indie authors
Indie authors have seen growing success in the OverDrive platform. Librarians across the country order ebooks they want to share in the app for their patrons. Many of them have included indie authors.
OverDrive has partnerships with Smashwords and Author Solutions with more on the way coming to Kobo Writing life. However, the issue is getting the self-published books and small press books into the app itself.
“There really isn’t any challenge to the end user,” Potash said. “The difference is our professional selectors when they are shopping for the e-books in our marketplace. We have put them into a catalog for indie- and self-published authors and that was at the request of the majority of professional selectors. OverDrive adds 150,000 front list e-books every month.”
While the indie-published books have been difficult to find at times within the app as they are part of section marked for small press and indie authors , there are numbers to show that there has been success.
In an April 2016 report on digital library trends for public libraries, OverDrive noted that indie author titles are growing at rate of 20 percent while self-published ebooks are seeing a bigger growth. Forty percent more self-published books were borrowed in the first quarter of 2016 compared to the same time in 2015.
“I think that is the result of giving librarians the opportunity to buy self-published authors and we are giving them the opportunity to curate and merchandise shelves in their community,” Potash said. “We are seeing a big rise of book clubs. This is where we have seen success. Local authors work with their local libraries that are interested and want to support that author. That’s a win-win for everybody.”
A family affair
As with many businesses, OverDrive’s beginnings were small.
The company at first was little more than Potash and his wife, Loree Potash. He had majored in journalism at Ohio State, and that is reflected in the premium OverDrive places on communications skills when hiring executives, as well as in well-publicized outreach efforts such as the OverDrive Digital Bookmobile.
Both husband and wife hold J.D. degrees from the Cleveland-Marshall College of Law. What’s more, Potash spent 15 years as a special counsel with the Ohio Attorney General’s Office, so digitization of law books must have seemed a natural for him. The couple’s familiarity with legalities also may have helped publishers feel more comfortable with OverDrive than otherwise.
In addition, Loree earned a masters degree in library science and worked as a librarian, one reason why the company could connect so well with members of that profession. She would go on to a number of jobs at OverDrive throughout the years—PR, HR, accounting, payroll—but has since retired.
The couple’s three children have found their way back to OverDrive after working in various industries. “It was never the plan. I said to my wife, ‘If this was the plan, I should have had more kids,’” Potash said.
Their daughter Erica Lazzaro is the General Counsel at OverDrive, and Karen Estrovich is a Director. Their son Brian Potash is the Manager of Education Sales.
Yet while the blood relations run deep at OverDrive, it’s not the only way family has helped the company. Many of the employees at OverDrive have been there for more than a decade.
“OverDrive is one big family and we have a tremendous amount of talent here,” Potash said. “I am proud to say we have well over a dozen individuals who have been working in digital books at OverDrive over 15 years, and many more who have been here for 10 years. Even though we are several hundred, we have a very tight family-oriented here.”
Working with Amazon
OverDrive has a close partnership with Amazon, allowing patrons to download library e-books loans right into the Kindle app or tablet. This has helped the success of OverDrive and local libraries, and readers can expect the same opportunity in the years ahead.
“I am proud to say we went live with direct support to Kindle,” Potash said. “It’s going to be five years. We have the successful relationship that OverDrive and most important is the convenience able to borrow and read on their Kindle.”
Of course, this all falls under OverDrive and Potash’s mission.
“We are laser-focused on bringing in the next generation of readers,” Potash said. “We are engaging readers through all channels. We have a focused team trying to build solutions that solve problems in the classroom. These challenges are global, it’s not just in the U.S..
“Everyone wants to promote local culture or empower the next generation work force. We are excited to get back to the base strength and that is reading. While we are strenching a distribution platforms for new business models, I think we are realizing that at the core of our strength and culture and our history, it’s about long form and immersive reading. We really value the book, value storytelling, and the ability to utilize that wonderful medium to keep publishing and digital reading front and center as part of OverDrive’s focus.”