Hey
Not sure about Chris Fox (I've not watched the video) but I know an author who did similar in 2020... they grossed about half a million but profit wasn't all that impressive because they reinvested a lot into growing their platform (paying up front for audio narration, paying up front for german translations on all their books, and of course advertising) aiming for a million this year.
The thing to remember is that for a lot of people their books are assets, and assets need investment to grow (I actually think of every book as like a rental property. Yeah it's going to make me passive income for a while but I still need to DO THINGS with it to maintain that). I've launched a book, made 20k, pulled it down and reworked / recovered, then relaunched and made another 5k on release month the second time around (after the expense of relaunching). And I'll keep doing that, either through audiobooks or foreign translations or boxsets or Bookbub deals or recovers or free runs or Kindle Countdown Deals.
Because everything (for a lot of people) is about building and growing a platform. Building assets that will sell three or five or ten years from now.
I think the question is a bit of a "how long is a piece of string" one though because everyone is running their businesses differently. It's going to depend hugely on your genre and your strategy and your own personal goals.
I know people who didn't take anything out of their business for the first year. Just reinvested in covers and ads.
I was a little different in that I set out to write books that already had a hungry and underserved market and didn't need paid advertising. So I barely spent anything on ads at the start, which allowed me instead to reinvest in other things. Not a lot of people are willing to do that, they want to write what they want to write. And even if they are willing, they often either won't do it or they won't know their market well enough (I know a lot of both types).
Some people will throw money at a book because they are passionate about it, when any outsider can see it's pointless.
Some people won't spend enough and thus will end up with a midlist book that could have gone bestseller if they only had the resources to throw at it.
Some people won't write in series (which gives you a better ROI because read-through), some won't stick to a genre or an audience (which means you're having to start from scratch with every new release), and some will just burn their audience out by releasing shit books, so they are having to pay for a brand new audience with every single book.
As of right now I spend about 20% of the earned income on paid advertising during the launch. Then I'll lower spend and focus on the next book. Unless it's a book 1 in a series, in which case I'll keep a moderate spend going to funnel readers in.
But that wasn't the case when I started out, I simply didn't have the budget for that and had to grow my platform more organically by "killing my darlings" and writing in niches that were hungrier. I invested in the basics like a newsletter and covers. Now I do covers myself but pay for an editor and ads and an ARC team and a site to host a reader magnet etc. But the expenses grew with the profits.
I can tell you I know authors who regularly make the top 100 who are spending $500 a day per book to get there, and they are fantastic writers with really good professional covers and know the market inside out. And they are making good money even with those levels of spending.
But you don't have to be top 100 to make really good money. There's lots available in the midlists, if you have enough books and treat them like assets.