The 9 Biggest Hip-Hop Business Moves Of 2013
When Jay Z declared that there were new rules to this music industry, he wasn't kidding. King Hova's deal with Samsung to release his Magna Carta...Holy Grail album made his project platinum in a day, and forced the RIAA to redefine what constituted a sale in an ever-shifting business landscape.
But Jay wasn't the only one forging ahead with new ways of thinking about the music industry. From Nipsey Hu$$le's $100 mixtape to Dr. Dre's Beats announcing a new streaming service to Nas getting into the publishing game, the revenue streams have gotten more diverse, the partnerships have grown bigger and the new-look business models have gotten a much-needed facelift. XXL has recounted the year and compiled the nine biggest business moves—positive and negative—that 2013 has brought, celebrating those who are pushing the business forward. After all, it's a business, man. —Dan Rys (@danrys)
Jay Z Launches Roc Nation Sports
He brought the Nets to Brooklyn, but that wasn't enough; in April, Jay Z sold his minority stake in the basketball team in order to launch Roc Nation Sports, a new arm of his management company in partnership with CAA. And who did he sign up immediately? Then-New York Yankees star Robinson Cano, who promptly got himself a $200 million contract with the Seattle Mariners in the off-season. Mega-stars like Kevin Durant and up and comers like Geno Smith also signed on, and Hova officially got himself into the sports business.
Nas Inks With Mass Appeal
Nas has been a late bloomer in the business world, largely staying out of affairs as guys like Jay Z and Dr. Dre became entrepreneurs in addition to their music hustles. But Esco splashed some cash this year, becoming Associate Publisher of Mass Appeal after investing a reported six figures in the publishing company. "I didn’t care to interrupt me being a creative musical artist," he said at the time. "I said I’ll be more of a businessman down the road. I’m down the road now.”
Lil Wayne, Rick Ross and Tyler The Creator Get In Hot Water
The Spring wasn't too kind when it came to rappers and their sponsorship deals. First up was Rick Ross, who came under fire for a lyric in his "U.O.E.N.O." remix which was purported to glorify rape, which got him dropped (then re-signed) from his sponsorship deal with Reebok. Then came Lil Wayne, whose reference to Civil Rights hero Emmitt Till on Future's "Karate Chop" remix forced him to apologize and cost him his Mountain Dew sponsorship. And finally it was Tyler, The Creator, who in a commercial co-production deal with Mountain Dew was accused of creating “arguably the most racist commercial in history." Not the best tagline for a company.
Jay Z Partners With Samsung
#NewRules indeed. Jay Z announced in a surprise ad during the NBA Finals that he'd have an album out a mere three weeks in the future, and in the days following the announcement it came out that Jay would be dropping the album on the Fourth of July with the help of Samsung, who would release the album as a free app for 1 million customers. The phone company paid Hova $5 million for the privilege, ostensibly making Magna Carta...Holy Grail platinum immediately, a move which caught SoundScan and Billboard off-guard and which caused the RIAA to change its rules on what constitutes gold and platinum records. By taking on some of the most established barometers of success the music industry has ever had, Jay strove to take a step toward redefining what the business is, and what it could be in the future.
Nicki Minaj Owns The Forbes List
“Pull up in that You Can’t Afford This / Only rap bitch on the Forbes list,” Nicki Minaj rapped on Rich Gang’s “Tapout” earlier this year, and she showed up on the list again this year, coming in at No. 4 with $29 million in revenue and outshining the likes of Lil Wayne, Drake and Rick Ross. But the best part about Nicki's hustle—her clothing line, perfume, moscato partnership, Pepsi deal, American Idol hosting gig, and a ton more—is that she's the best to do it, reprising her role as the only woman ever to hop on the Forbes Hip-Hop Cash Kings list. It's a woman's world.
Beats Music And Their $500 Million Investment
Beats Electronics has been a major cash cow for Dr. Dre and Jimmy Iovine for a while now, and the two headphones magnates are now expanding the parameters of what this company will be doing. With rumors swirling, Beats secured a $500 million investment from The Carlyle Group in September, clearing the way for their announcement on December 5 that Beats Music, a new online streaming platform, would be launching in January of 2014. That should go nicely with the four-year program at USC the duo is funding as well.
Talib Kweli's Kweli Club
On October 5, Talib Kweli announced that he'd be dropping a second album in the same calendar year, titled Gravitas, but that he'd be taking a little bit of a different approach in how he'd be releasing it. That approach centered around the Kweli Club, a fresh look at what a fan club/artist interaction could be in 2013, with fans getting a direct line to their favorite artists.
“When you pre order my newest project, Gravitas, available Dec 15, you will be buying it directly from me, no middleman, and I will now have a direct relationship with you,” he wrote on his website at the time. “Who needs this industry when we have each other. The technology exists for me to have this relationship with the fans, and vice versa. It is a grand experiment. Let’s go for it!” Later in the month, in a further way of testing out distribution models and direct-to-fan interactions, Kweli would launch his own radio station on Radionomy.
Nipsey Hu$$le's $100 Mixtape
Nipsey Hu$$le raised more than a few eyebrows when he announced he'd be selling his latest mixtape, Crenshaw, for $100 at a pop-up shop and through his #Proud2Pay site campaign, but what was initially regarded as a brazen strategy quickly became a brilliant marketing ploy. Nips sold 100,000 copies on his first day alone, netting him $100,000 overnight and even grabbing thumbs ups from Rozay and Jigga, with the latter sending Roc Nation to purchase 100 copies alone. “At worst, we just get a lot of publicity, and at best it’s going to spark something off," he told XXL a week later about the decision to sell the tape. "And I think what happened was the latter."
Lyor Cohen's New Company
Lyor Cohen has been a giant in the music industry for nearly three decades, becoming an early executive in Rick Rubin and Russell Simmons' Def Jam label in the 1980s and helping to bring that imprint to its current high-profile prominence. After leaving his post as CEO of Recorded Music at Warner Music Group last year, speculation ran rampant that Cohen would be creating a new kind of company and taking some of his biggest name artists with him. Little is exactly known about Cohen's new venture, named 300—part label, part marketing company, part distributor, with major backing from Google and Atlantic—but it seems like a step toward redefining what a music company can and should be.
“It was a battle that changed the way wars are fought,” Cohen told Billboard magazine about the name, lifted from the 300 Spartan Warriors who fought the famous battle against the Persians memorialized in the movie 300. “These guys found that if you were well synchronized, strategic, loyal with great planning and preparedness you could do much more with less and be highly effective.”