Out of desperation to get signed, most artists give away a huge percentage of the rights to their music upon receiving their first record deal. Those who are fortunate enough to hang on to their songs—or buy the catalogs of other musicians—often cash out to make a quick buck later on. Michael Jackson, who shrewdly added a massive chunk of the Beatles’ catalog to his own in 1984, was forced to sell a 50 percent stake in the catalog to Sony ten years later for $90 million. The deal, prompted by Jackson’s creditors, turned out to be a disaster: at the time of Jackson’s death in 2009, the catalog’s worth was estimated at $1.5 billion, valuing Jackson’s half at $750 million.11
Dash advised Jay-Z to try and get back the rights to his music, something few artists figure out until later in their career, if at all. “Own your masters, slaves!” Jay-Z exhorts his fellow musicians in one song.12 In the case of Reasonable Doubt, Jay-Z’s recovery of his masters was possible both because his complaint was valid and because he was willing to confront Socolov—something a meeker artist might be scared to do for fear of getting dropped. Kent attributes Jay-Z’s boldness to the experience he gained on the street dealing with characters even more ruthless than record label executives.
“If you did it in the streets, and you did your business properly in the streets, and you made good money in the streets, when you walk into a boardroom you look at everybody in the boardroom like they’re suckers,” Kent explains. “So you know that it’s not going to be hard for you to master the boardroom if that’s what you want to do. You ran the streets. You mastered guys trying to kill you and guys trying to take over your block.”
Even if Jay-Z hadn’t been able to get his masters back, his deal was for only one album. He made the arrangement deliberately so that he’d be free to pursue another more lucrative deal if his career took off. “That was the smartest thing he ever did. The label knew he was talented, but they didn’t know how talented,” says Lawrence. “Everybody does a twoalbum, three-album, four-album, seven-album deal. Nine times out of ten, the label wants to lock you in for life. . . Having that one-off allowed him to be free.” Serch believes Jay-Z also benefited from the help of a strong supporting cast. “He had very arrogant businessmen around him, that were providing him excellent information, helping him make good decisions.”
With the masters in their possession, Jay-Z and Dash were able to sell Reasonable Doubt for a second run. This time, they had a bidding war on their hands—not just for the rights to publish the second run of Reasonable Doubt, but to sign the ascendant rapper for his next album. In 1996, Jay-Z and Dash mulled offers from Sony and a somewhat smaller one from Def Jam Recordings; they eventually chose the latter because of its reputation as the home of hip-hop. The deal called for Def Jam (now part of NBC Universal) to purchase a 33 percent stake (published reports incorrectly pegged it at 50 percent) in Roc-A-Fella Records for $1.5 million; the label also acquired a portion of the rights to Jay-Z’s future master recordings. Def Jam would cover all production costs for Jay-Z’s albums and videos, and they’d share the profits with Roc-A-Fella. But because Def Jam owned only a third of Roc-A-Fella instead of the usual fifty-fifty split, they also took just a third of the profits. Thanks to stubborn negotiating from Dash, this left the Roc-A-Fella trio with 67 percent of the gains instead of 50 percent, a difference that would add up to millions of dollars once Jay-Z’s music really started to sell.13
“I think Jay learned a lot from Dame,” muses Kent. “If you’re down with somebody who’s doing smart things, you become smarter instantly, because you watch the smart things. You might figure your own way to do the smart things, but if you see it, you understand it.” Russell Simmons, the cofounder of Def Jam, sees Dash’s role in Jay-Z’s career as even more crucial. “The thing you have to understand about [Dash] is, he thought the whole thing up,” Simmons told New Υork magazine in 2006. “Jay-Z just came from Damon’s imagination. The man is a visionary.”14
With the Def Jam-backed Roc-A-Fella label officially established, Jay-Z embarked upon a rigorous recording schedule. Though the edgy Reasonable Doubt had proven to be a worthy debut, Jay-Z decided to soften his sound to draw a wider audience. So he turned to Sean “Diddy” Combs to produce his second album, In My Lifetime, Vol. I, in 1997. The album was distinctly slicker than Jay-Z’s debut, and it earned a lukewarm response from critics who preferred the rapper’s Brooklyn grit. Rolling Stone called it “a corrective measure in the opposite direction as Reasonable Doubt, bearing all the marks of an artist with his eye on a larger pop prize, to the detriment of his art.”15 Still, In My Lifetime quickly earned platinum status and more cash for the Roc-A-Fella partners.
It wasn’t until Jay-Z’s third album, Vol. 2. . . Hard Knock Life, that his career exploded. The title track, an infectious ditty that sampled a song from the Broadway musical Annie, burned across the summer’s airwaves and was eventually named the eleventh best hip-hop song of all time by VH1.16 The album sold five million copies in the United States alone,17 but hip-hop purists lamented that the rapid-fire lyricist had slowed down his rhymes—in terms of both speed and nuance—to appeal to a pop audience. Well aware of the shift, Jay-Z made no apologies: “Truthfully, I wanna rhyme like [rapper] Common Sense, but I did five mil / I ain’t been rhyming like Common since.”18
From a business perspective, moving toward the mainstream was the right decision. The nature of Jay-Z’s Roc-A-Fella /Def Jam deal gave him added incentive to make albums with mass appeal. Whereas most artists would only see royalties of about $1 or $2 per copy sold, the joint venture earned Jay-Z closer to $3 or $4 per copy19—meaning he made $15 to $20 million on his third album alone. His career as a hustler was over.
Jay-Z’s hustler’s instinct was a different matter. After the meeting with Rolling Stone’s Touré in 1997, Jay-Z offered to drive the writer home to Brooklyn. They walked to Jay-Z’s Range Rover; the rapper hopped into the passenger side, his driver slid behind the wheel. When Touré opened the door and sat down in back, Jay-Z twitched and turned back to him. “He said, ‘Where I come from, we don’t usually let anybody sit behind us,’ ” Touré recalls. “He knows I’m not going to fucking shoot him. But. . . I think that hustler’s instinct is still there within him, and will always be.”
That inclination may have been the driving force behind a highly publicized incident in December of 1999. Just weeks before the release of Jay-Z’s fourth album, Vol. 3. . . The Life and Times of S. Carter, a brawl broke out in the VIP section of the Kit Kat Club in Manhattan’s Times Square. Amid the scuffle, Jay-Z confronted record producer and onetime friend Lance “Un” Rivera, who’d been rumored to be bootlegging copies of Life and Times after coproducing the song “Dope Man” on the album. According to published reports, Jay-Z delivered a line cribbed from The Godfather: “Lance, you broke my heart,”20 and then plunged a five-inch blade into Rivera’s stomach.21
Jay-Z turned himself in for questioning the next day and was released on $50,000 bail. The rapper retained prominent attorney Murray Richman, whose previous clients included fellow hip-hop artist DMX and mobster John Gotti Jr.,22 and maintained his innocence throughout what turned into nearly two years of legal wrangling. Though Jay-Z faced a lengthy prison term if convicted of felony assault, he ended up pleading guilty to a lesser charge (misdemeanor assault) and received three years of probation as part of the plea agreement. According to the Associated Press and others, Jay-Z told Judge Micki Scherer, “I stabbed Lance Rivera.” Rivera also filed a civil suit, which Jay-Z settled by paying him between $500,000 and $1,000,000.23
In an interview with Britain’s Sunday Times, Jay-Z described the incident as “unfortunate” and claimed the media blew the incident out of proportion. “They got hold of the rap-wars thing and ran with it, and that got more egos involved. I knew that situation was not something you play with. It was dangerous, but the sad thing is, it was no different from where I grew up, so I didn’t feel threatened. Those battles became like trivial things. For me it was, ‘Leave that. Let�
��s get about our business.’ ”24
An extreme devil’s advocate might say the whole episode revealed a certain willingness in Jay-Z to take matters into his own hands, to actually attack any threat to his business interests. Such tendencies could come in handy, if harnessed, as an executive. Some even suggested that the whole incident was part of a marketing ploy meant to recreate the mafioso aura of Jay-Z’s first album, which features a black-and-white portrait of him as a cigar-puffing, fedora-topped gangster. Employing both Gotti’s lawyer and Pacino’s line in the Rivera incident served that purpose, and the confluence suggests a person almost cartoonishly infatuated with the image of himself as a mobster. Fortunately for Jay-Z, he shared his underworld idols’ ability to beat criminal charges.
On a deeper level, however, the Rivera case echoed earlier experiences in Jay-Z’s life. What compelled him to stab Rivera was the same desire for payback that led him to shoot his brother in the shoulder for stealing his jewelry years earlier. To take his career to the next level, to escape the shadow of violence so often unfairly associated with even the most law-abiding members of the hip-hop community, Jay-Z would have to find a balance between street cred and restraint.
As it turned out, whatever pirating Rivera may have done didn’t do much to dampen sales of Life and Times. The album sold nearly five hundred thousand copies in its first week alone25 and was certified triple-platinum by the RIAA barely a year later.26 By that time, Jay-Z, Burke, and Dash were already finding other ways to diversify their burgeoning Roc-A-Fella record label beyond Jay-Z’s music.
The first was developing other artists on the label. Usually, this isn’t a priority for an independent label—or for the larger parent label. Bernie Resnick, a Philadelphia-based entertainment lawyer who’s worked with Jay-Z, explains. “The way it usually works is that when you’ve got an artist signed to your little independent label, and the major label wants you, then they have to make a deal with the independent label in order to get the rights to the artist. So what they do is they take on the indie on a distribution basis, and they say, ‘We’ll fund the production of your next album for this artist, and we’ll have what they call a first look deal at other artists that you guys sign,’ because they really want this artist, the lead artist.”27
Essentially, the major record label offers a slew of dealsweeteners to lure a top artist, which is what happened in Jay-Z’s deal with Def Jam. Items like the first look deal are usually more of a courtesy than a major part of a deal between an independent label and a major, and perhaps rightfully so: the major label has no way of knowing whether the independent label just got lucky by finding and promoting one artist. Jay-Z’s operation was different.
“Roc-A-Fella showed that they were more than just a vehicle to promote the artist Jay-Z,” says Resnick. “They also were good at finding and developing and promoting other artists. . . they really kind of expanded their reach and started to reach down into Philadelphia, where there was a sound that was similar stylistically to what they built their business on, and they grabbed a lot of Philly artists and brought them to the New York scene. . . they really became a factory.”
Roc-A-Fella discovered, developed, and promoted a host of artists including Philly rappers Beanie Sigel and Freeway, and Brooklyn-born emcee Memphis Bleek (who frequently performs with Jay-Z to this day). To make sure these releases wouldn’t fall on deaf ears, Jay-Z appeared on at least one track in each artist’s album; his star power helped Sigel’s debut sell nearly one million copies. Years later, Roc-A-Fella’s own Kanye West would start putting out albums that rivaled Jay-Z’s best releases in terms of both sales and critical reception.
Publicity for Roc-A-Fella acts came not only from Jay-Z’s appearances on its other artists’ songs, but from clever marketing in other arenas. Most record labels dispatched a promotional van for each of their artists, with name, picture, and logo plastered all over the outside. “Inside the van was all the peripherals—posters, stickers, CDs, all that stuff—and it was run by your street team people,” explains Serch. “Roc-A-Fella had a Mercedes E-Class 320, white, with the Roc-A-Fella logo on the hood. And that was their promo vehicle. That was a typical Jay maneuver.”28
Roc-A-Fella Records soon expanded beyond music, thanks to two of Dash’s guiding principles: “We shouldn’t let other people make money off us, and we shouldn’t give free advertising with our lifestyle.”29 Dash wasn’t saying that Jay-Z and other Roc-A-Fella artists should stop rapping about designer clothes and high-end liquor; rather, that they should be compensated for the endorsements—or create their own brands. During the late 1990s, Jay-Z and Dash grew fond of Iceberg, an Italian knitwear designer that had recently branched into jeans and sportswear. The Roc-A-Fella crew often showed off their Iceberg gear at glitzy events and dropped its name in a few songs. Largely because of this, Iceberg’s sales skyrocketed, at least according to Dash. But when he set up a meeting with the brand’s brass to explore some sort of partnership, the response was lukewarm. “The vibe with the company was that they weren’t sure they wanted to touch hip-hop. Or have us represent Iceberg,” Dash says. “I said: ‘Yo, I feel like we’ve tripled your sales. Help us do our own clothing company, or at least pay us to represent it.’ I walked out of there like, I’m definitely doing Rocawear.”30
Rocawear was the cross-promotional title of the urban clothing line Dash dreamed up shortly thereafter. The venture started with three sewing machines in the back of the Roc-A-Fella Records office; early offerings were limited to T-shirts with the Roc-A-Fella logo stitched on the front. This arrangement posed some problems. “We didn’t know how to sew, and we didn’t really know people who knew how to sew,” says Jay-Z. “We quickly realized that this just wasn’t going to work.”31
So Dash and Jay-Z met with Russell Simmons, founder of Def Jam and Phat Farm clothing, and asked his advice. Simmons put them in touch with industry veterans Alex Bize and Norton Cher; in 1999, Bize and Cher teamed with Dash and Jay-Z to launch Rocawear. The company was soon producing jeans and sweatshirts, eventually launching kids’ and plus-size lines as well as footwear and even a cologne, 9IX. Similar to early Roc-A-Fella, Rocawear didn’t have the infrastructure to make its own products, so it struck a handful of licensing deals with clothing manufacturers. Within eighteen months of its birth, Rocawear had pulled in $80 million in revenues,32 something Jay-Z would brag on his 2001 album The Blueprint: “One million, two million, three million, four / In 18 months, $80 million more. . . Put me anywhere on God’s green Earth, I triple my worth.”33
Dash encouraged Jay-Z to cross-promote their products whenever he had a chance. If he was going to mention a clothing brand in a song, why give free advertising to someone else when he could boost his own sales with a Rocawear shout-out? Meanwhile, fashionistas who picked up the latest urban styles from Rocawear would, at least in theory, be more likely to buy Jay-Z’s music.34 “Dash is very sharp, very shrewd,” says Resnick. “Jay-Z was a talented guy who had a desire to learn business, but wasn’t experienced. I think his learning curve was steep but quick. He asked questions and listened to the answers and learned very rapidly.”
But cracks began to form in the relationship between the two, starting with the Hard Knock Life tour in 1999. Conceived by Dash, the tour included four dozen cities and united rapper DMX and his Ruff Ryders posse with Jay-Z and Dash’s Roc-A-Fella crew. Widely considered the most successful hip-hop tour of its time, it grossed $18 million.35 Over the months on the road, however, Dash’s combative management style began to weigh on Jay-Z and others. One executive called Dash “a defibrillator,” meaning he would bluster his way through most situations, the opposite of his generally laid-back counterpart. “Yeah, it’s a lot,” Jay-Z said of Dash’s management style. “But, to his credit, when you have that workin’ for you, it’s great.”36
Dash became fixated on Roc-A-Fella films, an obsession that his business partner did not share. Fancying himself a silver-screen auteur, Dash produced Streets Is Watching,
a straight-to-video flick starring Jay-Z. Released in 1998, the movie was little more than a string of music videos connected by a series of borderline-pornographic interludes. Still, it sold a reported one hundred thousand copies in its first year and netted Roc-A-Fella $2 million.37 The following year, Dash produced a documentary of the Hard Knock Life tour called Backstage, further fueling Dash’s Hollywood ambitions. As time wore on, Dash became quick to dismiss Jay-Z’s increasingly polished business acumen, even in public. In 2001, he told The New Υorker, “If I gotta bring Jay [to a meeting], that mean we got a problem.”38 Even as Dash and Jay-Z’s relationship was souring, they teamed with their third partner, Kareem Burke, to launch Armadale Vodka with Scotland’s William Grant & Sons. Again, the idea was to stop giving out free advertising and to create another cross-marketing vehicle.
“You always hear us talking about the vodka in one of our songs, so we were like, ‘Why are we still making money for everyone else?’ ” Burke said in a rare interview. “We just acquired the company and said, ‘Let’s do it ourselves.’ ” Curiously, few Scots had ever heard of the swill. Shortly after the multimillion-dollar deal was announced, a town councilor in Armadale, Scotland, told U.K.—based publication the Sun, “I’ve never even heard of Armadale Vodka, but these lads must like it a fair bit if they have decided to buy the label.”39
All the while, Def Jam and parent Universal loomed over Roc-A-Fella. Such relationships were known to follow a certain pattern. “Eventually, when the thing either peters out or is as big as you can get it, then the major label comes in and kind of takes over,” says Resnick. “They often have consulting agreements to take in the leaders of that company for a while, but ultimately they’re trying to take over the business.”
Empire State of Mind Page 4
