The Music Mogul
Jay-Z has bult an empire on the back of his hip-hop stardom with a cigar in his hand.
From the Print Edition:
Jay-Z, May/June 2009
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There's been plenty to celebrate for Jay-Z. If anything, the music career (and all of its offshoots) that began in 1996 with the founding of his record label, Roc-A-Fella Records, and the release of his first CD, Reasonable Doubt, has been one long celebration, with victory after victory in a musical field that Jay-Z himself refers to as "a competitive sport."
Competitive sports, of course, require champions. Forbes magazine placed Jay-Z at No. 7 on its Celebrity 100 power rankings in June 2008—just behind Johnny Depp, Tiger Woods and Jay-Z's wife, Beyoncé, and ahead of Brad Pitt, Steven Spielberg and LeBron James. On the same magazine's money rankings, he came in at No. 10, ahead of Will Smith, David Letterman, Madonna and Alex Rodriguez. The magazine estimated his annual pay at $82 million; published estimates of his personal wealth run as high as $350 million—and that was before his most recent big deal with concert-promotion giant Live Nation. Jay-Z himself shrugs at suggested figures when queried. (He won't discuss his marriage to Beyoncé at all: "You need to have certain parts of your life you don't talk about. I'm not hiding it; I'm just not giving details.")
Jay-Z's reach is vast, with tentacles, as he refers to them, extending into a variety of ventures. For starters, there's Roc-A-Fella Records, now an imprint of Def Jam Records. He and his partners sold a half stake to Def Jam in 1997 for $1.5 million; they sold off their remaining share in the label for $10 million in 2004. Jay-Z's first 10 albums—released between 1996 and a short-lived retirement that began in 2003—sold 33 million copies.
Then there's Rocawear: the massively successful clothing line was sold to Iconix Brand Group for $204 million in 2007. "We sold off the women's line, the kids', the bags—but we kept the men's line, which is the parent company," Jay-Z says. "And I maintain creative control of that."
Not that he has any designs on being a designer. "I never had those aspirations," he says. "I know what looks good aesthetically—or I should say I have my personal taste that the culture gravitates to. Me? I couldn't draw a stick figure."
There's also his string of 40/40 sports bars; his premium vodka, Armadale; an endorsement deal with Armand de Brignac's Ace of Spades Champagne; a partnership in an advertising agency that focuses on multicultural consumers. He owns a piece of the NBA's New Jersey Nets (who are scheduled to move to Jay-Z's native Brooklyn in 2010 or 2011). He's appeared in ads for Budweiser Select, Hewlett Packard, the NBA. His signature sneaker (the first for a nonathlete) was a best seller for Reebok. And he's become politically active, campaigning for Barack Obama in 2008 and taking up the cause of access to clean water in the Third World ("Really, it's a civil rights issue," he says).
He made his most recent major move in 2008, signing a deal reportedly worth $150 million with Live Nation. It was billed as a so-called 360 deal, one in which Live Nation would partner with Jay-Z on all of his creative output: not just recordings, tours and merchandise but all entertainment ventures, including film, publishing and a record label (Roc Nation) through which he can discover and promote new talent.
"It encompasses so much," Jay-Z, 39, says, studying his cigar. "I believe what it's about is a true partnership. We're building this brand and participating in the equity. It's about extending the brand beyond one platform. The music industry made so much money from music that it didn't care about anything else."
Jay-Z's own music has earned him the title of world's best rapper—whether as Jay-Z or his alter egos, Jigga and J-Hova. Still, he nearly walked away from that throne when he announced his retirement from performing and recording in 2003 (before coming back in 2006 with Kingdom Come). Retirement wasn't a new idea, "When I started, I had a goal," he says. "I was going to make an album—a gold album. And then I was going to be the owner of my own label. Telling my story through my music was just a means to getting into the business."
Retirement didn't stick. "I think he figured out that he had a lot left to do," says Michael Rapino, chief executive officer and president of Live Nation.
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