From left: Emma Komlos Hrobsky, Tin House; Halimah Marcus, Recommended Reading; Celia Johnson, Slice; Jamie Schwartz, CLMP; JD Scott, Moonshot; David James Miller, SET; Brigid Hughes, A Public Space.

The conversation at Wednesday night’s indie lit mag panel at Powerhouse Arena did not stray from its predictable territory: the challenges of getting funding, the ever-evolving landscape of digital publishing and self-satisfaction about being Brooklyn-based.

Though quieter than some nights at Powerhouse, the audience that turned up to hear the discussion between six editors (from Moonshot, A Public Space, SET, Slice, Tin House, and Electric Literature’s newly launched Recommended Reading) and moderator Jamie Schwartz, managing director of the Council of Literary Magazines and Presses, was considerable.

Ms. Schwartz began the conversation by asking about money, a topic panelists returned to over the course of the night. “I think it’s a mystery to most people how the economics of literary publishing works,” she commented. “It’s really like an oxymoron.”

Anyone who hoped this mystery might be illuminated further was sorely disappointed.

Halimah Marcus, the managing editor of Electric Literature explained that since the publication’s launch of Recommended Reading—a weekly piece of fiction posted each Wednesday on Tumblr—nine weeks ago, the publication has had the chance to focus more on its readers and online subscription numbers, but she admitted that converting readers into funds was “complicated.” With the magazine’s elimination of paid subscriptions, Ms. Marcus explained that they have been relying on fundraising with their new status as a non-profit as well as revenues from “other forms of merchandize”—in lieu of a print publication available for purchase at Wednesday's event, Ms. Marcus brought Electric Literature flasks to sell.

Slice’s co-founder, Celia Johnson,was somewhat more candid, explaining that she and Maria Gagliano were almost broke when they started the magazine in 2007. “We kept it running by holding bake sales and many house parties that were surely illegal,” she explained, noting that though they strive to pay their writers, the magazine still doesn’t have a paid staff. Additional funding comes from events, such as Slice’s second annual Literary Writers Conference, which charges writers $300 for two days of workshops and will take place this weekend.

“We’ve become well versed in the art of throwing parties for free,” Ms. Marcus added, laughing with Ms. Schwartz about using homemade canapés rather than catering.

David James Miller, the founding editor of SET, which is available for free as a PDF download, explained rather self-righteously: “My intent was always for it to be about the work of the individuals.”

“I didn’t want to have to think about a bottom line,” he said conclusively.

Moonshot’s editor-in-chief JD Scott alluded vaguely to “using the internet for promotion” and PayPal donation drives.  Adding that he has a 40-hour a job week, he called his work for Moonshot a “labor of love,” a phrase that was repeated throughout the evening.

And while the turnout for the panel would seem to be an encouraging sign, Ms. Schwartz revealed that from a financial standpoint, the event itself was rather self-defeating. Though the four represented print publications were available for sale at Powerhouse, Ms. Schwartz informed the audience that when readers buy literary magazines at bookstores, the publications actually lose money.  The money’s in subscriptions, Ms. Schwartz informed us. Except, of course, for the publications that have eliminated paid subscriptions. The Observer left the panel with far more questions than we arrived with.

Sheila Heti.

Sheila Heti’s new novel, How Should a Person Be?, is dedicated to Margaux Williamson, a main character who is the best friend of the book’s protagonist—Sheila—and, not exactly by coincidence, is Ms. Heti’s best friend in real life as well. Last night, at a launch party for the book at powerhouse Arena, the real Ms. Heti spoke into a microphone as the real Ms. Williamson sat in the front row.

“When I showed Margaux the first draft of this book,” she said, “I thought she was going to say, like, ‘This is the most beautiful thing I’ve ever read.’”

How Should a Person Be has the subtitle “a novel from life,” and it consists, in part, of a compilation of fictionalized emails and interview transcripts. Ms. Heti recounted the experience of showing Ms. Williamson her manuscript in real life, a process that is also documented in the novel. “It’s interesting to have characters that tell you that you did the wrong thing,” Ms. Heti said.

In a sweet but earnest voice, Ms. Heti read from the prologue, delivering a meditation on genius, blowjobs and bagels with an aura of seriousness despite frequent laughs from the audience.

A Q&A followed, and audience members seemed determined to flaunt that they’d already read the book; the novel was published in Canada in 2010, but struggled to find an American publisher. One man prefaced his question by asking, “Are you okay?,” noting that the book contains a great deal of suffering and pain.

“I’m okay,” Ms. Heti assured the audience.

When asked whether she plans to keep writing fiction, Ms. Heti said yes with no hesitation. “I don’t have anything against fiction,” she said.

All of the questions were from men until, someone from the audience shouted, “A girl!” The final question came from one of the audience’s female members (she had not yet read the book) who boasted that she had “a good wrap-up question.”

“How should a person be?” she said.

Ms. Heti looked skeptical. “That’s a good wrap-up question?”

“The book is not called, ‘How a Person Should Be,’ it’s called How Should a Person Be?” Ms. Heti said. She explained that, for her, the questioning of this is more important than any answer could be. The inquirer appeared less than satisfied, and Ms. Heti said, somewhat apologetically, “Well, buy the book!” and hastily concluded the reading, stepping away from the microphone to take a long sip of beer out of a red Solo cup.

“Q&As are so mortifying,” one audience member remarked.

Later, The Observer spoke with Ms. Williamson about her role as a character in her best friend’s novel. “It was very, um, educational. Not just reading the book but also talking for so many hours,” Ms. Williamson told us. “It’s painful but I couldn’t imagine my brain without it right now.”

“When you read about the character Margaux in the book, do you feel like you are reading about yourself?” The Observer asked

“I don’t even remember what’s real and what’s not real,” Ms. Williamson said. “I had never heard any of the recordings and then finally I listened to them and it was right out of the book, verbatim. I completely forgot that was real and it’s hilarious, and it was kind of a joy to listen to.”

Ms. Heti mentioned a similar haziness between the novel and her life. “I think about the book more than I think about those years,” she told us.