Since the recession began in December 2007, Black unemployment has risen 4.5 points, to 13.4%, according to the Bureau of Labor Statistics. Rather than sit on the sidelines anxiously waiting to be plucked from unemployment obscurity some individuals have decided to direct their efforts towards self-employment.
In these challenging economic times young African-Americans choosing to launch a business will find that certain strategies used by successful Hip-hop artists can be used as a roadmap for success because, contrary to popular belief, the defining characteristic of Hip-hop is not the Bronx or even beatbox, but entrepreneurship. Hip-hop is ”…an art form that embodies the entrepreneurial principals of innovation and – of course – perspiration,” says Jason Young, a Harvard graduate and founder of Young Investments, a financial advisory service for young professionals.
Marketing: Build and they will follow
Hip-hop’s impact as a global musical force is due to its translatability among different cultures in the world. Building a brand that is transferable irrespective of geography is a key element of defining a marketing strategy for tangible business results.
Creativity: An Uncommon Approach:
An emerging business should stay clear of a “one size fits all strategy” when it comes to product development and marketing. The road less traveled may be well suited for a newly minted business plan. Rapper The Game intentionally leaked the clean version of his album, The Documentary before its official release date. While record labels constantly bemoan the negative effect that leaked albums have on sales, it didn’t seem to have hurt The Game – The Documentary has sold over 5 million copies. Budding entrepreneurs would do well to consider a creative yet a counterintuitive marketing strategy which will help them to stand out from their competitors in the marketplace.
Equity is friend not foe
Maintaining a significant ownership interest in what you create gives an entrepreneur future leeway to negotiate finance and strategic management decisions. A true pioneer, rapper Master P agreed to a deal where Priority Records would be given 15% of the profits for distribution, while 85% of the money would go to his own record label No Limit.
He also has complete ownership of the master recordings that will allow No Limit to profit from future sales of catalogs and reissues. Master P negotiated No Limit movies the same way, working out a distribution deal with Miramax Films in which they are paid to distribute the movies but he retains ownership of his movies, which include I Got The Hook-Up, Foolish and Hot Boyz. Master P’s high level of equity ownership has enabled him to maximize his personal wealth. Entrepreneurs should take heed.
Expand your brand
Leading entertainers such as Will Smith, Sean P-Diddy Combs, Jay-Z, Common and Mos Def have expanded their personal brands to include a diverse portfolio of revenue generating formulas – movie tickets, clothing lines, fragrance deals and real estate. Once a solid brand has been established, the opportunity for entrepreneurs to expand into other areas is possible.
Today’s entrepreneurs have an unofficial guide in Hip-hop, which offers much in the way of business acumen than what the typical story would have them believe.