Just as he did with Iconix, Jay-Z seemed to sense both the desperation of his corporate quarry and the proximity of the market’s peak. His $150-million pact was, along with Madonna’s, the largest handed out by Live Nation. By the time the world economy went into a tailspin six months later, Jay-Z had guaranteed himself an annual eight-figure salary for the coming decade, and Live Nation had stopped handing out massive multiple-rights deals to musical acts.
“Those deals aren’t happening anymore,” says LaPolt. “Jay-Z is an astute business person, and all of his advisers are really, really impeccable. So if they did the deal, it’s because it was good for Jay-Z. That’s the one thing we do as practitioners—when someone’s giving us money, our job is to structure the rights [so that] we give as limited an amount of rights for the most money we possibly can get. That deal was something that was turned over, upside down, left, right, and center by his representatives.”
Though the timing of Jay-Z’s deal was uncanny and its scope staggering, perhaps the most unusual part was the musical joint venture it created. Live Nation’s executives recognized that Jay-Z, far more than any of the other recording artists it had signed, had both a thirst and an aptitude for entrepreneurship. They also recognized that he was serious in his demands that an outlet for such desires be a part of any deal he signed. Under these auspices, Roc Nation was born. “The Jay-Z deal was unique in that it came with a caveat that he was able to develop this company with Live Nation,” says LaPolt. “He was actually [going to be] signing and managing and developing new talent.”
Using a clever moniker to evoke both Live Nation’s name and Jay-Z’s Roc-A-Fella Records roots, Roc Nation was founded as just the sort of next-generation musical venture that Jay-Z had envisioned as he was leaving Def Jam. The company was set up as a miniature entertainment conglomerate, complete with arms for creative consulting, publishing, and management for artists, songwriters, producers, and sound engineers. Roc Nation was also a record label, but not in the traditional sense of the term. Rather than build up an expensive production infrastructure, its model was to distribute albums in one-off deals with existing record labels (Jay-Z’s Blueprint 3 was distributed by Atlantic Records). All of Roc Nation’s artists would be signed to 360-degree deals, albeit at a much lower rate than the one their boss scored.
For the up-and-coming acts themselves, multiple-rights deals have always been somewhat dangerous. Since most young artists tend not to have a great deal of leverage in their negotiations, they traditionally sign fairly cheap deals with record companies in the hopes of getting famous in time to score a more lucrative second contract. In the meantime, they can always make money by touring. Under a 360-degree deal, they’re locked into that low-paying deal across all of their revenue streams.
“I think the 360-degree deals make a lot of sense if you’re an established legacy artist,” says entertainment lawyer Bernie Resnick. “But they’re very dangerous for emerging acts because all of your eggs are now in one basket.”21
Still, there aren’t many aspiring musicians who would turn down a record deal. And unsurprisingly, Jay-Z didn’t have much trouble finding artists to populate Roc Nation’s lineup. In February 2009, he signed rapper Jermaine Cole, better known by his stage name, J. Cole, to be Roc Nation’s inaugural artist. A communications major at St. John’s University before joining Roc Nation, Cole was well aware of his role. “If it wasn’t for [Jay-Z], they wouldn’t even be talking about me,” he told XXL months after signing. “So until I put out an album, make a classic, put out hit singles, I’m gonna be Jay-Z’s artist. But the only thing that’s gonna get me out of his shadow is building my own shadow.”22
As he showed during his tenure at Def Jam, Jay-Z has a knack for scouting and developing undiscovered talent. Somewhere along the way, he picked up the ability to make young artists and ordinary people feel at ease around him, a skill that came in handy in his new role as head of Roc Nation. Nick Simmons, an aspiring music executive, witnessed this quality firsthand while working as a Def Jam intern under Jay-Z. By 2009, Simmons had worked his way into a full-time job at Columbia Records, the Sony-backed label contracted to distribute J. Cole’s first album. As soon as that deal was finalized, Jay-Z scheduled a meeting between his team at Roc Nation and the folks at Columbia. Simmons remembers the reaction in the conference room that day.
“All of a sudden, the door opens, and Jay-Z walks in, and everybody just claps—standing ovation,” he recalls. “So then we go around, and everybody introduces themselves at the table, and it’s still kind of tense. People are stuttering, like ‘I—I—I’m this person, and I do this.’ Jay-Z is the last person to introduce himself, and he just says, ‘Jiggaman, ya heard?’ Everybody started laughing and that just eased the whole tension and the mood in the room. So, I believe he knows he has a presence around people, and I guess that was his way to break the ice with us, to make us feel comfortable around him.”23
What impressed Simmons even more than Jay-Z’s ability to lighten the boardroom mood was his command of the situation at hand. “He essentially told us the meeting was all about business, and, from my experience, that’s what he’s about—business,” Simmons recalls. “He told us what he wanted, what he expected from J. Cole, what he wanted the plan to be. He said, ‘J. Cole’s young, he’s a college graduate, he should hit these markets, the college market, we’re going on a college tour.’ ”
Then Jay-Z asked who was in charge of college marketing. “The guy raised his hand, and Jay-Z said, ‘I need to talk to you ’cause this is a big initiative,’” Simmons recounts. “So he just sat at the meeting, and he told everybody, ‘This is what we need to do: radio people need to target this song, we’re going to go with this song, we should have a single out by here. We don’t want to rush this project, we want to have grassroots marketing.’ He had a plan, and he just laid it out for everybody.”
There were other impressive aspects to Jay-Z’s marketing plan for J. Cole. When Jay-Z was putting together his own first album for Roc Nation, he prominently featured J. Cole on a track called “A Star Is Born.” When XXL magazine put Jay-Z on its cover in October 2009, the issue also featured a story on J. Cole (not to mention a twenty-four-page spread of Rocawear ads at the front of the book and over twenty pages of editorial content focused on Jay-Z). Knowing Jay-Z’s tendencies, none of this was a coincidence.
“Powerful artists often negotiate with editors for package deals,” says music professor and journalist Elizabeth Mendez Berry. “So it’ll be, ‘Okay, I’ll be on the cover, but you have to cover this artist I’m working with. You have to do this feature, that feature.’ It’s a way for them to use their own popularity to promote their protégés.”24
J. Cole, then, is simply the latest beneficiary of Jay-Z’s business smarts, though it’s clear his boss pays him a bit of extra attention. “I can tell he’s very protective because this is his first artist,” says Simmons. “He wants to make sure everything goes perfectly.”
Perfection is a tall order, but Jay-Z’s first two years at the helm of Roc Nation have included plenty of highlights. In addition to releasing a tremendously popular album of his own and completing one of the most profitable hip-hop tours in history, Jay-Z has lured new artists including Wale, Mark Ronson, and The Ting Tings to his company’s management wing. He has also spearheaded joint ventures to create cobranded memorabilia with the New York Yankees and a line of headphones with Skullcandy. He’ll have to keep up that pace to make Roc Nation a long-term success. For now, though, he’s already delivering on his promise to create a new kind of music company—the kind he left Def Jam to start.
12
History and Beyond
Not all of Jay-Z’s ventures have gone perfectly. His entrepreneurial wastepaper basket is filled with scuttled plans for a Jay-Z Jeep, a failed Las Vegas nightclub, and an aborted casino and racetrack project in New York.1 But most moguls have had their share of failures, and they survive on the strength of new ideas good enough
to erase the bad memories. Few will remember that Steve Jobs was once fired from Apple; instead, they’ll remember how he came back and revitalized the company he founded by creating the iPod.
Jay-Z’s business career will be known for its highlights—Live Nation, the Nets, Rocawear—and other deals he makes in the coming years. He won’t be remembered for the mentors he’s cast aside, but rather for the protégés whose careers he’s helped launch, including Kanye West, Rihanna, Rick Ross, Ne-Yo, and J. Cole. He has expanded his own musical tastes, popping up at performances by alternative groups like Muse and Grizzly Bear and even collaborating with rock acts like Santigold and Chris Martin. His 2010 album The Blueprint 3 was not only one of his most eclectic, but one of his most successful in terms of pop-culture appeal. “It’s a credit to Jay-Z’s longevity,” says Craig Kallman, chief of Atlantic Records. “The fact that he had his crowning creative achievement in terms of radio and global reach with this album is remarkable this far into his career.”2
Meanwhile, Jay-Z’s entrepreneurial impulses only seem to be growing more refined and international in scope. In 2005, he bought a large chunk of The Spotted Pig, a Michelinspangled gastro pub in the West Village.3 In 2009, he joined Will Smith and Jada Pinkett-Smith to invest $1 million in the Tony Award-winning Broadway show Fela!4 The following year, Jay-Z suggested he might be interested in buying a stake in the English Premier League’s Arsenal soccer team. “I don’t know a lot about the business of soccer, but in the future if the right opportunity presented itself, then who knows?” he said. “I am a businessman, and I will always look at an opportunity.”5
With a personal fortune of roughly half a billion dollars and a place in hip-hop’s pantheon already secured, it would seem that Jay-Z has few reasons to keep working, let alone take on a challenge as difficult as buying a foreign soccer team. Yet he still makes new music and pursues uncharted business ventures with more rigor than ever. Some observers would point to his seemingly infinite desire for wealth and fame, spurred by the insecurity and poverty of his youth.
Jay-Z might say it’s something a bit nobler—the perfection of his legacy. He rarely waxes sentimental, but his song “History” is about as close as he gets to all-out schmaltz. After alluding to the poignant hopes of his early life (“All I got is dreams, nobody else can see / Nobody else believes, nobody else but me”), he explains his journey to the top by likening abstract concepts to fictional women. Until he finds Victory (“She keeps eluding me”), he’s stuck with Success (“She’s good to the touch, she’s good for the moment, but she’s never enough”). Once he finally wins Victory, they’ll have a child (“We’ll have a baby who stutters repeatedly, we’ll name him History”). The song’s final verse offers a compelling glimpse into the soul behind Jay-Z’s invincible exterior: “Long after I’m gone, long after I breathe / I leave all I am in the hands of History.”6
I’ve been sitting with DJ Clark Kent at the Applebee’s in Brooklyn for nearly three hours. The winter sun is sinking toward the snow-covered rooftops along Flatbush Avenue, and our margaritas have been reduced to puddles of ice and salt. Kent is still riffing on Jay-Z.
“I think it’s unfair to call Jay-Z a rapper,” he says. “I think rapping is something he does. When he says, ‘I’m not a businessman—I’m a business, man,’ you really have to take that seriously. He is a business, and rapping is just something that’s in his business.”7
Kent toys with the swizzle stick in the empty glass on the table in front of him.
“There’s people who sit around saying they want to be Bill Gates, but there’s way more people who say they want to be Jay-Z,” he muses. “They don’t know who Bill Gates is. Jay-Z’s probably sitting around going, ‘I want to be Bill Gates to the tenth power.’”
With that, Kent pulls out his BlackBerry. It’s later than he thought—time to go. He shakes my hand and scoots out of the booth. As he’s putting on his overcoat, he offers a final thought about how history will view Shawn Carter.
“He’s not a rapper, he’s not an entertainer,” says Kent. “He’s a Jay-Z.”
ACKNOWLEDGMENTS
This book nearly ended before I had the chance to start it. I was at home with the flu on a sweaty summer afternoon—feverishly banishing unwanted press invitations and Nigerian bank transfer scams from my inbox—when I chanced upon an e-mail with the subject line “Book Project Opportunity with Portfolio (Penguin).” My addled brain didn’t register that this might be a message worth reading until my index finger was descending upon the delete key. Many thanks to Jillian Gray, the sender of the message and the editor of this book, for reaching out to a writer even younger than Jay-Z was upon the debut of his first album. If it weren’t for Jillian, Adrian Zackheim, and the rest of the folks at Penguin/Portfolio, I might have been selling my first book out of a car trunk as well. My eternal gratitude goes to my agents, Ed Victor and William Clark. I dread to think what I would have done without William’s encouragement and Ed’s advice (“You shouldn’t begin your book proposal by saying you were searching for an anecdote for your book proposal!”).
I wouldn’t have been in a position to write this book without the support of my friends and mentors at Forbes. I will be forever grateful to Mary Ellen Egan and Stewart Pinkerton, for hiring me; to Lea Goldman, for handing me her hip-hop Rolodex; to Dan Bigman, for putting me in charge of Forbes’s hip-hop coverage; to Tom Post, for the honesty of his editing; and to Bruce Upbin, who is a much better editor than a fantasy sportsman. A big thank-you to Lewis D’Vorkin, Matt Schifrin, and Neil Weinberg for their good judgment and continued support. Thanks also to David Randall, Asher Hawkins, Emily Schmall, Hana Alberts, and Peter Schwartz for camaraderie and encouragement, and to Bill Baldwin, Larry Reibstein, Kurt Badenhausen, Dave Whelan, Jim Clash, and Dave Serchuk for their guidance. An extra helping of gratitude to Carrie Coolidge, Sue Radlauer, and the members of Forbes’s copy desk, who’ve saved me from untold embarrassment.
Jay-Z straddles the line between two worlds; appropriately, the bulk of this book was written from an apartment located on the dividing line between Harlem and the Upper East Side of Manhattan. Other parts of this book were conceived, written, debated, reported, and edited in a variety of states, both geographical and mental. For generous hospitality and creative support, many thanks to Susan Calhoun, Charlie Moss, Suzanne Maas, Julia Bradford, and Charlie Warner in New York; William Christian, Daniela Sloninsky, and Matt Lachman in California; Terry Fixel and Gus La Rocco in Florida; Addison, Jaden, Joslin, Maggie, and Joel Peck in Illinois; Bridget, Neil, Mary Beth, James, and Irma O’Malley in Texas; and Sebastian Hain and Sarah Hellriegel in Germany.
A book is nothing without good sources, and that’s doubly true when the book is unauthorized. Thanks to sources-turned-friends and friends-turned-sources, especially Patti Silverman, Nick Simmons, Sarah Vass, Diana Liao, Eric Arnold, Lacey Rose, Branson, Fab, Serch, and “Deep Throat” in Santa Monica; as well as those who provided a constant stream of Jay-Z news that not even my Google Alert could rival—Hannah Elliott, Janine Lebofsky, Deepak Thosar, and Jon, Naomi, and Lee Peck. Thanks to Alman Shibli for his insight into the tonal qualities of flow, to Elizabeth Mendez Berry and Touré for sharing their personal impressions of Jay-Z, and to Damien McCaffery for a very helpful last-minute read.
A big thank-you for unwavering support from old friends: Ryan Victor, Sam Moss, Luke Silver-Greenberg, Morgan Silver-Greenberg, Madeline Kerner, Kelly Reid, and Corey Taylor; slightly newer: Dan Adler, Jon Bittner, Rebecca Blum, Katie Manning, Dan Hammond, Lara Berlin, and Marcus Leonard; newest: the Mount Sinai Class of 2013. Special thanks to Melissa Ocana and Ezra Markowitz, who repeatedly called from Oregon to make sure I hadn’t (completely) lost my mind, and to the artist formerly known as Nick Messitte-Greenberg for a ruthlessly thoughtful read.
Sanity is something I wouldn’t have had without the comrades who joined me at trivia in Brooklyn nearly every Tuesday night during the writing of this book. Without Andrew Cedotal, Nico
le Villeneuve, Mallory Hellman, Laurie Burkitt, Mike Seplowitz, Lauren Henry, Francesca Levy, and Bethany Kerner, my life would be comparatively devoid of errata and camaraderie. My endless gratitude goes to Jon Bruner, who, despite not knowing how to pronounce the name of Jay-Z’s wife, provided unwavering support of the technical, editorial, and miscellaneous variety. A big truckful of thanks to Julien Dumoulin-Smith, both for reading this book on a flight home from Dubai and for a friendship without which I wouldn’t know anything about business or hip-hop.
Thanks to my mother, Suzanne O’Malley, who taught me a lot of things—perhaps most of all that being in the right place at the right time isn’t a matter of luck, but rather a matter of putting yourself there. To my honorary mother Judith Greenburg, whose thoughtful and thorough feedback dramatically improved the quality of this book, and whose comments served as a litmus test for rap lingo (“What’s the derivation of ‘Hov’? Dan suggests it may refer to Jehovah, which would be very interesting . . .”). To my father, Dan Greenburg, my toughest critic and biggest fan. Dad, on both counts and for the example you set both as a writer and as a person, I can’t thank you enough.
The biggest possible thank-you goes to Danielle La Rocco, my best friend, lover, muse, adviser, doctor, and editor. Thanks generally for being wonderful and specifically for putting up with my neurotic writer behavior, including late-night inspection of Jay-Z lyrics (“It sounds like you’re building a railroad in there!”), the pot of cooked pasta I left on the stove overnight, and my recurring dreams of conversing with Jay-Z inside a Duane Reade.
I wish that Leah Greenburg, Sam Greenburg, Don O’Malley, Pat O’Malley, and Françoise Dumoulin could be here to read this book. I’m deeply saddened that Andrew Clancy will never get the chance to write his own.
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