Revealed: the eight-year-old girl who saved Harry Potter

J K Rowling's new adventure is sure to be another mammoth bestseller. But, reports John Lawless, the first Potter manuscript was destined for oblivion - until the publisher's young daughter read it

The eagerly anticipated launch next week of her latest book, Harry Potter and the Half-Blood Prince, will propel Rowling's wealth further beyond the £562m she has already amassed from the record-breaking series. Yet, as Nigel Newton, the chairman of Bloomsbury Publishing reveals today, the first Harry Potter manuscript was rejected by all of his major rivals.

And it was only the pester-power of his daughter, Alice - who read a chapter and demanded more - that finally convinced the publisher he had a winner on his hands.

The story he tells in a rare personal interview is almost as unlikely as one of Rowling's muggles-and-magic plots. Bloomsbury, the off-beat company named after the 1920s London literary set, was just about the last chance for Rowling to get the original Harry Potter and the Philosopher's Stone into print.

Her agent, Christopher Little, called at Bloomsbury Publishing's cramped offices in Soho Square and gave Newton a sample to read. He took it home but, instead of settling down with it himself, handed it to Alice, then eight years old.

"She came down from her room an hour later glowing," Newton recalls, "saying, 'Dad, this is so much better than anything else.' She nagged and nagged me in the following months, wanting to see what came next."

Newton made out a cheque to Joanne Kathleen Rowling for just £2,500, which has since proved one of the wisest investments in publishing history.

He had signed up a writer who was to go on to outsell Jackie Collins's steamy blockbusters 10 times in a year. The first Potter book is also on its way to becoming the world's best-selling novel of all time. "It was very fortunate for us," said Newton. "We'd only just started to publish children's books in June 1994. And we hit it lucky." He told The Independent on Sunday that "eight others turned J K Rowling down; ie, the whole lot".

The not-knowing-what-comes-next factor has created 260 million sales for successive books. Christopher Little is reported to have earned almost £19m in 2002. Daniel Radcliffe, who stars as Harry Potter in the films, became, at 14, the world's youngest millionaire. But Rowling became a dollar billionaire. Forbes magazine estimated her wealth last year at £562m, reporting that she is "one of only five self-made female billionaires and the first billion-dollar author".

Bloomsbury has since invested in other children's books, including a new release of The Popcorn Pirates from Alexander McCall Smith. He admits, though, that the Potter phenomenon is likely to be "a total one-off. There has never been anything like it."

It is appropriate that Harry Potter and the Half-Blood Prince is to be launched at a glittering ceremony at midnight on 16 July, in the city of Edinburgh where Rowling wrote the original. She completed her first book, Rabbit, at the age of six, and had discarded two adult fiction novels before Harry Potter "simply fell into my head" during a tedious train journey from Manchester in 1990. She had returned to the Scottish capital after living in Portugal, where she had her first child. Harry Potter was penned in a nearby café as her daughter, Jessica, slept.

Rowling has given a new account of her delight at Bloomsbury's decisive vote of approval on her personal website, explaining that "finally, in August 1996, Christopher telephoned me and told me that Bloomsbury had 'made an offer'. I could not quite believe my ears. 'You mean it's going to be published?' I asked rather stupidly. 'It's definitely going to be published?' After I had hung up, I screamed and jumped into the air."

Now aged 40 and remarried, she remains resolutely unfazed by her own amazing story, admitting: "The rewards were disproportionate, but I could see how I got there, so that made it easier to rationalise."