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business newsHollywood CEOs: Jay-Z
By
Justin Rohrlich
Oct 28, 2009 7:35 am
The biggest rapper in a business suit.
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-- Jay-Z
From the Marcy Houses in Bed-Stuy, Brooklyn, to a hip-hop superstar with nearly 40 million albums sold, to a corner office as president and CEO of Def Jam, to independent business executive lording over an empire that includes a clothing line, fragrances, an ownership stake in the New Jersey (soon to be Brooklyn) Nets, a chain of clubs, and soon, hotels, Jay-Z -- née Shawn Carter -- truly is a business.
Jay-Z occupied the number one spot in the Forbes annual list of “Hip-Hop Cash Kings” this year, earning $35 million. Surprised? Don’t be. Rap has now surpassed country music as the nation’s most popular genre after rock.
It’s the rare rapper that finds himself sharing quality time with Microsoft (MSFT) founder Bill Gates, New York City Mayor Mike Bloomberg, Prince Charles, and the most powerful woman in the free world, Oprah Winfrey (read more on Oprah as a Hollywood CEO).
"Jay-Z is my new best friend!" Winfrey gushed on Gayle King’s Sirius/XM Satellite Radio (SIRI) show. "He was so charming and delightful -- and he smelled so good."
Jay-Z was even name-checked by Harvard Business School professor Rawi Abdelal after the release of the “Blue Magic” music video, in which he displays a briefcase full of 500 euro notes. Abdelal referred to this as a "turning point in American pop culture's response to globalization."
Jay-Z also has a fan in a gentleman you may have heard of before: President Barack Obama.
During primary season, Obama responded to a particularly pointed verbal jab from Hillary Clinton by miming the act of brushing dirt off the shoulders of his suit. The crowd went wild.
Why?
It was an unmistakable reference to the Jay-Z track, "Dirt off Your Shoulder."
"I felt like, man, what time are we living in, where a presidential nominee is making reference to a rapper?" Jay-Z recalled thinking. " We've sat and had dinner, and we've spoken on the phone. He's a very sharp guy. Very charming. Very cool.”
Sources have pegged Jay-Z’s net worth at $350 million. From all the pies he has a finger in, that number could even be considered low.
Here are a few of Jay-Z’s business ventures culled from an ever-expanding list: Roc-A-Fella Records: Founded with partners Damon Dash and Kareem “Biggs” Burke in 1994, they brought Roc-A-Fella to Def Jam in 1997 and sold a half-stake at that time for $1.5 million. In 2004, the other half was sold to the label for a reported $10 million.
Rocawear: Established in 1999, estimates place Rocawear’s gross revenues in the neighborhood of $700 million a year, and the line is distributed throughout Europe, Japan, Canada, and the US. In March 2007, Jay-Z sold the brand to Iconix Brand Group for $204 million.
Rocawear Fragrances: Manufactured under license by Elizabeth Arden (RDEN), last fall’s launch of Rocawear 9IX saw the cologne quickly become the number four brand of the season. This month, Rocawear X will celebrate the 10th anniversary of Rocawear.
The New Jersey Nets: Jay-Z paid a reported $4.5 million for his share in the NBA team, which will move to downtown Brooklyn after their new home, the Barclays Arena, is completed.
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Photo by Jemal Countess/Getty Images
As would be expected, Jay-Z’s effort at world domination continues. In May, he bought out the remainder of his Def Jam contract and left to start Roc Nation -- a “360-degree” deal with music industry powerhouse Live Nation (LYV), which made Jay a reported $150 million. Live Nation will provide $5 million annually for his record label, publishing arm, and management company, with more money made available as needed for future acquisitions and expansion. He also received a $25 million payment upfront and will earn $10 million per album for a minimum of three albums over the next 10 years.
If there’s any question as to whether or not Jay-Z is the biggest baller in business, this should put an end to that conversation:
England’s Guardian newspaper reports that one member of Jay-Z’s entourage is a dedicated “chicken wing chef”, responsible for preparing a minimum of 100 wings a day, sourced from a specific family farm in Mexico.
Top that, Puffy.
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No positions in stocks mentioned.
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