The Definitive Look at Jay-Z, Businessman
Jay's story from low-level cocaine dealer—based both out of Brooklyn and a small import shop in Maryland—to his current state as king of all media is one that has been told before. But I'm yet to read anything that so encapsulates how wide-spread his business interests are. It's worth reading in full, but as a small sample, below is a quick look at how Shawn Carter set himself up to revolutionize the sports agent game. It's a crash course in Business 101:
In his book Decoded, Jay talked about how, early in his rap career, he realized he needed to separate his real Marcy friends from new “business friends.” Through his ownership of the 40/40 club and general networking via his courtside Nets seats, Jay has made many “business friends.” They've come in handy. Once Mikhail Prokhorov bought the Nets, invested $200 million, and lowered the ownership stake of Jay-Z and the other Brooklyn minority owners, Jay gradually decided to move to the agency side of things, hiring away a fixer known as World Wide Wes (reading his bio is a fun Wikipedia trip), taking advantage of those athlete friendships, and opening up Roc Nation Sports. From New York:
The launch of Roc Nation Sports was orchestrated through the usual social-media striptease. One day in early April, Roc Nation and CAA announced they were forming a partnership to start the agency and stealing Robinson Cano from powerhouse Scott Boras. As an opening statement, it was like picking a fight with the biggest guy in prison. Cano tweeted out a picture with Carter and the message “Rocboys!” Over the ensuing weeks, further clues leaked: A picture of Carter with the Jets’ rookie quarterback Geno Smith appeared on Instagram, as did one of the WNBA player Skylar Diggins standing next to a gift from the agency, a white Mercedes. Then, moments after game seven of the NBA Finals ended, Roc Nation executive Rich Kleiman tweeted: “Everything starts Now.” A few days later, Kevin Durant posted an Instagram photo of himself and Carter signing a contract, with the hashtag #newrules.
Roc Nation takes a modest cut off the playing contracts of its athletes—just 3 to 5%. The real money comes from a higher fee charged to the marketing contracts that are brokered by the firm. So while Jay won't make a ton off Cano's next baseball deal, he did likely just make a killing off Cano and Pepsi. It's debatable how involved Carter was in the nitty-gritty business of contract-work and legalese. But only Jay has the cultural clout to bring Cano and Pepsi together.
Naturally, established agents are grumbling. (“Guys are just going to Jay-Z because they fetishize him,” one anonymous guy told New York.) Which , I think, plays rights into Jay's hands: What's more fun for many an athlete than to say “Fuck off” to the seedy guy who has been taking 10% off your contracts, and heading instead to the most famous rapper alive?
It's are pretty brilliant. #newrules.