10 Business Moves That Pushed Hip Hop Culture
When hip hop stepped up and became a business.
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Cash Rules Everything Around Me - Hip hop and money enjoy an uncanny union, with the celebration of success being a part of the culture since "Rapper's Delight." Of course, in order for a culture to maintain itself, it has to be profitable. But in no genre of music have artists made moves more profitable or innovative than the following 10. (Photo: Mark Scott/Getty Images)
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1. Jay Z Invests in the Brooklyn Nets (2004, $1 Million) - We decided to go with Jay Z's initial investment in the Nets, as the details of his sale of ownership are somewhat murky. In 2004, Jay Z put money down to be a part of an ambitious project that was more or less completed in 2012. What made it profound was that Jay was in the process of expanding his brand and going beyond the music industry in terms of revenue. Jay was one of the first to invest in not just a sports team, but in a construction project that was started to bring the team to Brooklyn. It was around this time that the prospect of being an emcee/businessman took on corporate proportions. (Photo: Jim McIsaac/Getty Images)
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2. Run-DMC Lands Deal With Adidas (1986; $1 Million) - By today's standards $1 million may not seem like a whole lot when it comes to endorsement deals, but think back to how things were in 1986, when most sneaker endorsements went to athletes. So for a hip hop group that didn't play any sport professionally to land that type of deal by a brand that made sense to their lifestyle was an incredible feat. Many even consider this the genesis of hip hop lifestyle marketing as the alignment between hip hop and Adidas was a union made in heaven.(Photo: GERARDO SOMOZA/Landov)
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3. 50 Cent Acquires a Stake in Vitaminwater (2007; $4.1 Billion) - Around 2003, 50 dominated the airwaves and had pretty much taken over the industry with his endorsement deals. Yet there was one business move that separated him from the rest: his deal with Glaceau, the company behind Vitaminwater. It wasn't just his signature Formula 50 drink that made this unique; 50 actually received a stake in the company. Whereas the other ventures were companies using his G-Unit name to sell products and paying him a hefty sum, with Vitaminwater 50 actually had equity in the company. That percentage would eventually pay off somewhere between $60-$100 million for Fif when Coca-Cola bought Glaceau for over $4 billion. (Photo: Glaceau/ Vitamin Water)
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4. Jay Z Acquires Stake in Translation, LLC (2008; Estimated Value: Unknown) - This may be the first time a hip hop artist bought a share of an ad agency, and promptly took it to another level. Jay Z already had a hefty number of appearances in various ads, but to be an owner in an agency means that a product of the culture is ready to control its public image and be able to determine how it is presented to sell these consumer goods. (Photos from left: Larry Busacca/Getty Images, Kevin Mazur/WireImage)
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5. Jay Z Scores App Deal With Samsung (2013; $20 Million) - What's significant about this deal is that it marks one of the first times in which hip hop and technology have converged. The premise was that a million free digital copies of Jay Z's Magna Carta Holy Grail would be "given" (read: available for download) to those who owned a Samsung Galaxy device. Similar deals may have existed in the past, but for an artist of Jay Z's caliber, to align his music with a tech company is fairly new. (Photo: Samsung Galaxy)
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6. Russell Simmons Sells His Stake in Def Jam to Universal Music Group (1999; $100 Million) - The late '90s was a swinging time for hip hop. After years of keeping Def Jam afloat and turning it into a multi-million dollar empire, Russell finally managed to set a new bar by selling the legendary company. It was one of the first times that a major label not only recognized the power of having a hip hop label, but was willing to pay nine figures in order to have it. This move put Russell in a whole new tax bracket and thus began the corporatization of hip hop music. (Photo: MHD, PacificCoastNews.com)
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7. Diddy Lands Deal With Diageo (2008; $100 Million) - How awesome is it to get paid $100 million to become the face of a vodka brand? In 2007, Diddy landed a deal with Diageo to develop the Ciroc brand. Since then it's turned into the vodka of choice for club go-ers, hip hop artists and pretty much anybody in between. Though hip hop artists have been endorsing alcoholic beverages for years, this was one of the first brands with a legit hip hop impresario at the helm pooling all of his resources into making it the du jour vodka brand of choice for those actively a part of the hip hop lifestyle. Years before, Dame Dash and Jay Z had tried their hands at popularizing Armadale vodka but it never quite caught on. Ciroc did. And we're pretty sure it's here to stay. (Photo: Annette Brown/Getty Images)
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8. Jay Z Sells Rocawear to Iconix Brand Group (2007; $204 Million) - It still stands as one of the largest, if not the largest, hip hop clothing buyout in history. The story behind it is also epic: in 2005, Dame Dash sold his share of Rocawear to Jay Z for roughly $30 million. Not bad, considering the two had both sold Roc-a-fella together. However, when you consider that only a few years later, Jay goes out and sells the company for over six times the amount he bought it for, you have to wonder if he had been eyeing this move for quite some time. (Photo: RocaWear)
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9. Russell Simmons Sells Phat Farm to Kellwood (2004; $140 Million) - After 12 years of turning Phat Farm into the premier urban-lifestyle brand for the hip hop generation, Russell Simmons eventually sold it the Kellwood brand company. This preceded the Rocawear buyout, thus setting a high standard for what was to come next. (Photo: Johnny Nunez/WireImage)
