The Pomp Podcast - #1155 Zack Greenberg On How Jay-Z Became A Billionaire

Episode Date: February 9, 2023

Zack O'Malley Greenberg is an author and a former reporter at Forbes. I recently read the book "Empire State of Mind: How Jay-Z Went From Street Corner to Corner Office" which Zack wrote. I wanted to sit down and talk to him about how Jay-Z became a billionaire, lessons learned, what insights did he learn, and who else in the music industry, sports, or celebrity circuit will be the next Jay-Z.   ======================= Announcing LYCEUM | Miami, a day-long event on March 4th, 2023 in Miami hosted by Pomp. We’re gathering an explosive group of experts to engage in a series of fascinating discussions. We'll cover topics from investing, emerging tech, scientific research, sports, music and more.We have some massive names being announced via Twitter throughout January so stay tuned for details.This will not be your typical event and it certainly won’t be one you want to miss. We’re going to learn a lot, make some smart friends, and as always, we’re going to have fun.Spots are limited so head to lyceummiami.com to buy your ticket today. ======================= Pomp writes a daily letter to over 200,000+ investors about business, technology, and finance. He breaks down complex topics into easy-to-understand language while sharing opinions on various aspects of each industry. You can subscribe at https://pomp.substack.com/ =======================

What's up everyone? This is Anthony Pompliano. Many of you know me as Pomp. You're listening to the Pomp Podcast, which is my effort to find the most interesting people in the world and sit with them for hours while I ask questions in an effort to learn. We have no advertisers on this podcast, so it would mean the world to me if you would subscribe to the show on your favorite audio platform, watch episodes on YouTube, and tell your friends and family about the podcast. My goal is to help millions learn from the world's most interesting people. So let's get into today's episode. Zach O'Malley Greenberg is an author and a former reporter at Forbes.

I recently read the book Empire State of Mind, how Jay-Z went from street corner to corner office, which Zach wrote, and I wanted to sit down and talk to him. How did Jay-Z become a billionaire? What were the lessons learned? What insights did he take from writing the book? And who else in the music industry, in sports, or around the celebrity circuit would be the next jay-z this conversation is fascinating because zach helps me break down jay-z's life how he rose in the business world and who else is following the same exact blueprint i really

enjoyed this conversation and i hope you guys enjoy it as well here is my conversation with zach o'malley greenberg this episode is brought to you by accenture when your advertising operations fall out of sync everything else follows spotify and accenture are working together to reinvent the rhythm of ad sales using automation analytics and smarter workflows to simplify campaign delivery and access better data across the business the result less time spent on operations more time connecting brands with the moments and fandoms that matter most learn more at accenture.com slash spotify if you pull a muscle all of a sudden you realize how often you use that muscle so the bladder is exactly like that when it's working well we don't think about it

But when it's not working properly, you're getting up at night or in the cases of many men, you may have some leakage. If this is something that's affecting your quality of life, there are really good solutions these days. Depend makes the guard and the shield. The shield would be if you have some leakage on occasion, if you have heavier leakage, you could use the guard. Anthony Pompliano runs Pomp Investments. All views of him and the guests on his podcast are solely their opinions and do not reflect the opinions of Pomp Investments. You should not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only.

All right, guys. Bang, bang. I've got Zach here with me. I wanted to talk to him because, as many of you know, I'm very interested in the hip-hop culture and its intersection with business, and I was gifted a book, Empire State of Mind, How Jay-Z Went from Street Corner to Corner Office. This is the billionaire edition, and I found it absolutely fascinating. And so, Zach, I thought a great place to start was you've covered music for a long time. You've written about all of the top musicians, some profiles. You've written all this stuff about investing in business.

Why did you want to write a full book about Jay-Z and kind of his exploits into the business world? Well, I think the short answer is he's the best example of exactly that, right? I mean, if you were to take any musician in the world, in the history of the world who has a business acumen, you would rank them. I think it would be if you have a hard time finding anybody who would not put Jay-Z number one. So, you know, actually, it turned out rather fortuitously, though, because when I when I first started writing this book, it was because I got a deal from Penguin when I was 25 years old. I just got a cold email from an editor over there and she said, hey, I've read your stuff in Forbes. Do you want to write a book about Jay-Z or maybe Diddy? And I said, you know, sign me up. And basically it went like that. You know, I think sort of right place, right time.

But I was doing the right thing, too, which was writing about the business of hip hop for Forbes. And I had just started putting out what was then my, I don't know, the beginning of my annual tradition, hip-hop cash kings the highest earning rappers of the year and you know jay-z was routinely on the top when the first one came out uh it was jay-z diddy and 50 cent at the top they actually did a remix of the song i get money called the forbes one two three and uh you know that kind of kicked off my my career uh writing about the business of hip-hop so you know i think diddy diddy is definitely up there in terms of business acumen but um you know diddy's almost like somebody who it was almost like if richard branson had a sideline as a rapper you know uh it's just kind

of like ancillary like the the rapping is ancillary to his business career uh he's so plainly focused on the business and you know jay-z really i mean you could also put him up there with any artist in terms of number one albums i think he's got more number one albums than any solo artist in the history of the world he's only behind the beatles uh in terms of you know musical acts so um the way that he was able to take that musical energy and parlay into the business world uh is just second to none and i think um you know i think what's been really cool is watching over the past you know decades since then uh seeing how he's evolved you know even after he had gotten to this lofty place he's continued to get bigger and bigger and bigger uh and everybody revised the

book every couple years so you know most recently the billionaire edition which was a year about a a year ago. So what's fascinating about this is you put the subtitle of the book, How Jay-Z Went From Street Corner to Corner Office. And in a recent song that DJ Khaled put out, God Did, he says the following. He says, judge it how you judge it. Say we go in corporate. Nah, we just corner boys with the corner office, which I'm not going to say that he took that from the book and then put it into the song, but it's very much a theme of his life. And one of the big takeaways that I had from the book, it was literally one of the first big ideas I took out was this evolution is the mark of every great success and he started out selling drugs but now

has transformed himself into this you know huge businessman what do you think drove that was it kind of the street credibility and the street mentality that made him successful was he always going to be successful without the music like kind of unpack a little bit as to like why is he the one who was able to do this out of all of the thousands of rappers over the last 30 years that didn't achieve the same amount of success that Jay-Z had? Yeah, you know, I mean, Jay-Z above all is very honest in his lyrics, which is, I think, kind of unusual. You know, a lot of people brag, a lot of people, you know, bluff. But if you go through his, you know, you find a lot of sort of instances where, you know, when you check the facts, like it's actually true, whatever he

he's boasting in a lot of his songs, but the boasts that he makes are often true. So, you know, I think he would say, and he has said in many ways, he was lucky because a lot of his peers are dead or in jail. And I think that's why he's focused a lot on criminal justice reform, that kind of stuff. He recognizes that he could have been a statistic. You know, we had a few near death experiences, you know, kind of like in and out with the law, you know, never really uh got got in trouble for anything you know i mean he's had legal issues in the past but you know never did any any serious time or anything like that um but you know i i think you know there's that element there's the there's the lucky and good right um and the good is you know

i think first and foremost he has this incredible lyrical ability um you know in writing the book there are stories in there where you know like jay-z has this reputation for um he never writes down his rhymes he just keeps them on his head and there was this one guy i interviewed a producer uh from the very early days who knew jay he knew this kind of reputation he didn't believe it he's like who can keep all those songs in their head so you know he went into the studio with jay and jay was just kind of goofing off with the with the guys and you know the studio time they have an hour or two in the studio the clock is ticking down and producer's like get with it let's go and And so Jay-Z's like, all right.

And he takes out this notepad and he's sort of like, you know, he's going like writing on the notepad and this producer's like, oh man, you know, he's, he's totally full of it. Like he, he writes his stuff down. This is all just some, you know, some myth that he's put out. And, and so, you know, he goes and he spits his verse very clean, leaves the studio on time. And, and so this producer's going to sort of clean, clean up and, and he walks into the recording booth and uh and there's the note the notepad and jay-z left it and

he opens it up and it's totally blank so you know he uh i think he he likes to he likes to mess with people uh in that way and um you know there is really like a cinematic uh uh kind of aura to him And, you know, he likes to do things like that. So, you know, right off the bat to have these ideas that come out of his brain, you know, and into songs is impressive enough to be able to to just commit them to memory. You know, you got to think that that applies to other areas of his life and business as well. So, you know, that's the creative side. On the business side, you know, he just has this ability, you know, in writing the book, people were talking about, you know, he plays, he's a big chess player, but he's not thinking about, you know, what's my next move, my next move. It's like, what's my next move after my next move after my next move after my next move? And, you know, so you could take something like him getting a stake in the Nets, which happened, you know, I think in 2003. And, you know, if you, you know, if you kind of go through the course of his career, you can see these other little steps and you're like, oh, that's what he was after.

Right. It's like, OK, he really wanted to move the Nets to Brooklyn and have equity in a franchise that was going to be worth more. Or, oh, wait, he wanted a piece of the new stadium, which is going to be more than just basketball. Oh, wait, he wanted to start his own sports agency because he saw the value in that. Oh, wait, you know, now he's doing this stuff with the NFL. And suddenly you begin to realize that maybe getting a stake in the Nets, you know, in 2003 or whatever it was, what he really wanted was to buy an NFL team in 20 years. Right. And now we're starting to see that there are pieces being moved around where he might, you know, he's been mentioned as a potential buyer for the commanders, along with Jeff Bezos, you know, maybe then doing something together. So that's kind of how he operates. And, you know, I think one of the fascinating things that is hard to know is, did he did he actually set out and say, like, I want to buy a football team in 20 years? or was he just like, I have an idea of where I want to go. And if I keep doing things in that

path, um, you know, I'll, I'll, I'll get to some pretty interesting opportunities. So, um, but you know, it, uh, I think you'd have to, you'd have to have that. What is it? Would you rather have $200,000 or lunch with Jay-Z? You know, you'd have to, you'd have to get that lunch with Jay-Z to, uh, to really find the answer. One of the things after reading so many books about so many different people, that is a common theme. Uh, and it sounds so stupid, uh, but they all work incredibly hard. They're all willing to take very big risks early on in their career. In this book in particular, you mentioned this idea that in the 1980s, he was willing to work for free to learn the craft. And what you wrote was, though Jay-Z today grosses millions per show,

he spent four months in 1989 working the hip hop equivalent of an unpaid internship, rapping for room and board, which consisted of a spot on the tour bus floor and a free pass at the buffet. And what I took away from that is like, nobody thinks the guy who wants to buy an NFL team or owns an NBA team or, you know, has rock nation, like all these different things that were like, wow, Jay-Z literally was sleeping on the floor of a tour bus and the 1989, uh, kind of summer and was literally learning the music business. And what did you kind of take away? Is the, is the work ethic just stayed with him over the decades? And so it's like the same guy, it's just now he realizes how to use capital and how to use his connections and kind of business

acumen or is maybe he slacking off now? Like what's your read on, on him? I would say slacking off. I think he's definitely just operating more quietly in a lot of ways. But yeah, I think that same ethos of sleeping on the floor and doing an unpaid internship, I mean, that has followed him through his entire career. So that was a point in time where he was starting to have some success as a hustler, but his heart was in music. So he was really trying to make it work.

And so he was on the tour with Big Daddy Kane and I think maybe Digital Underground and Tupac was around there. And, you know, so he was rubbing shoulders with some really interesting folks in those days. And, you know, but I think for him, it was all about, like, let me learn this craft. Let me figure out how this business works so that I can get out of the hustling game and do this thing that I'm really passionate about. And after a while, you know, in his early 20s, it didn't seem like it was going to work. So he was having so much more success as a hustler. it wasn't until he was 26 um and a DJ named Clark Kent really convinced him like you have to give

this one shot you know you have to put out one album and just see where it goes and and Jay-Z's plan was always to go back to being a hustler because he didn't think the economics worked in music but when that first album came out and he started doing well you know I think he he kind of revised his uh his process but but that trait has remained like even as he worked his way through the music business uh you know one of the things that came up in doing my interviews for the book was everybody said um jay-z just asked so many questions you know he was always uh wanting to to accumulate more knowledge you know i liken it to a hermit crab like he takes other bits of knowledge and adds it to his shell you know and then and then he kind of moves on to the next so

he absorbed everything he could from his early music mentors and you know and within 10-15 years his mentors were like you know Warren Buffett and uh uh you know Bono uh so so he he was able to kind of keep you know moving up and and meeting you know more and more interesting people and absorbing everything he could from them um but you know again that's that's the same kind of mechanic as as doing the thing for free like you're sitting there you're accumulating knowledge and the value comes in what you do with it. Yeah. One of the big takeaways I had from the book also was a necessity is the mother of invention. And in the book you write with Jay-Z's debut album, Nearly Complete, he and Damon Dash shopped at all the major record labels, but there

were no takers. And I think one of the stories that people have heard over time is like, own the equity, build your own thing, go direct. Like all these themes that now kind of seem to rebubble up in society, especially in the tech world, they didn't necessarily want to do that. It's just they didn't have any other options. And then I thought it was pretty telling that they also named it Rockefeller Records. And it always, I think, growing up, I was like, yeah, does that do anything with like John Rockefeller? Or is that just like, you know, similar name? But you really call out and you say that, no, they absolutely that's what they wanted to do is they wanted to name it after the world's first billionaire. And they wanted to evoke images of

the Rockefeller family's enduring dynasty, which tells me that they really were thinking quite big even early on when no one else believed in what they were doing. Totally. I would also say it's a triple entendre. It's rock, like I'll rock you, like Rockefeller, a fellow. Then I would also say it's a reference to the Rockefeller drug laws. There's a certain irony that some of the money they came in with was from sort of skirting the laws of you know the record drug laws that kind of thing so but yeah i think above all like you say it's the dynasty element um and and dynasty is a word that that jay-z used a lot um it's it's interesting though like jay-z as this huge proponent of equity um you know getting skin in the game that sort of thing yeah he he was shopping

that record um you know he wanted to get a deal from one of the majors but i think they were all too freaked out i mean this was in the mid 90s and and this was you know when things were getting pretty violent with the east coast west coast thing and um there was you know all the parental advisory wars and tipper gore and all that stuff you know so there was definitely like um like a concern around the the subject matter uh and you know on top of that if you go back to jay-z's first album it's very um it's it's like kind of inaccessible like very rapid fire lyrics you know it's there's no dumbing down slowing down I mean it's 26 years of his life packed into into one album uh you know with this sort of rapid fire flow and these like deeply layered references

and you know like a lot of hustler slang and um sort of like obscure reference you know a lot of film reference stuff like that so um i think people didn't really think that it would sell and in fact i think you know ultimately is one of his worst selling albums but um but it did you know it did eventually go platinum and when they went out with it independently um it did extremely well sold a couple hundred thousand copies and obviously the economics are a lot better than that than they are on a record deal so um you know by virtue of getting iced out from the major uh you know music labels they were able to to have ownership and and that's a theme that kind of like is pervasive throughout hip-hop and i think that's why hip-hop as a genre the most successful artists

are obsessed with equity because whether it's you know puffy starting his own clothing line uh or jay-z starting his own record label um you know they found that it you know they weren't necessarily going to get the kind of endorsement deals that they that they thought were fair so they could start their own things and create more value that way um but um but yeah i mean i think it's really sort of underreported the fact that you know like jay-z and damon dash went to this italian sportswear company called iceberg uh that they really liked and occasionally rapped about and you know they wanted an endorsement deal and the executives basically like oh we'll give you some t-shirts you know and uh and that's when they kind of decided to go start their own and

and i think jay-z more than anybody has mastered the art of you know if i'm gonna rap about a a type of brand rather than rapping about an established brand uh that i'm not getting paid by or that i'm not owning you know i'm gonna start my own um so whether it's clothing line or a uh you know record label or later a champagne brand a cognac you know that kind of thing it's almost like he's he's spun up this entire empire of things that he can rap about uh so that he can kind of benefit off of the the free publicity rather than somebody else so along these lines there's a number of controversies uh i think there's watches there's champagne uh there's multiple things that he rapped about and people are like there's no way he's rapping about that

that without getting paid, but the company or him denied that there's a relationship breakdown, like what's your read in terms of is everything he's rapping about likely he's got some sort of ownership directly or indirectly, or there are things that potentially he just likes and doesn't have a relationship. Like that was kind of a theme in the book where it seemed like people had questions, but there weren't necessarily always answers from the companies or from him. about a brand new conference that I'm hosting on March 4th at the Miami Beach Convention Center. The event is called Lyceum Miami, and tickets are completely free for anyone who wants to come. I'm bringing together many of the most popular guests from the podcast over the last couple of

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person in real life once again after three years of a hiatus from real life events and so i'm hosting the event and as i mentioned anyone from anywhere can come to this event completely for free all you need to do is go to lyceum miami.com and you'll be able to pick up a free general admission ticket make sure you claim your ticket in order to get in through the doors lyceum miami is going to be a great time so come check it out come hang out with me many of the popular guests from the podcast and other like-minded individuals lyceum miami march 4th miami beach convention center i hope to see you there all right let's get back into this conversation yeah i think that uh You know, he couldn't possibly own every single thing that he raps about, right?

You know, it would be, I mean, you'd have to have trillions of dollars probably to own every company that puts out the products that he raps about. But, you know, certainly in key categories, he's accumulated more and more of them. And I think, you know, as you alluded to, the champagne is a really interesting example of one. So, you know, that was a story that I followed in writing the book. And, you know, I don't know, after years of being a business reporter, you start to get like a sixth sense for, you know, that something doesn't smell right about this. And I just remember like watching the video for Show Me What You Got in, I think it was South Kingdom Come.

So maybe it was 2008, I want to say, 2007, 2008, something like that. and um and i saw these you know he's got these like gold bottles he's rapping about the ace of spades champagne i'm like there's no way that he's not he doesn't have some kind of interest in this company so um as i was writing the book i kept kind of poking around and you know nothing was really coming up and uh but then i i i found myself um up at harlem in this uh speakeasy that used to be owned by a guy named Branson Belchi who was um like a legendary hustler was sort of the guy who brought fine champagne to hip-hop he also happened to be Biggie's weed man he was like the provider of the highest quality bud to all the biggest rap stars especially New York where

it's hard to find that stuff and you know you you wanted that uh what was it it was like Acapulco gold or chunky black or whatever it was you get all these strains and you know Branson would come through and and so he he was sort of like the sommelier of weed and um but then he would bring along a bottle of tattinger or um cristal or something like that um you know and drink it with the guys and and you know that he was sort of like the pied piper of fine champagne as well and uh you know i i i got to be really close with them and so you know we're sitting in his speakeasy and and um i'm telling him about my dilemma i'm like what do you think about this champagne situation and he's like he's like well i've got this bottle of antique gold and he brings it over

and it's this gold bottle it's the same as the armand de brignac asa space champagne that jay-z is rapping about and it's selling for 300 and um he's like this antique gold uh you know you can only get it in europe but it was 60 bucks a bottle and um looks pretty similar to me so so basically i just i ran i ran into a wall and uh i couldn't get any more answers other than you know these kind of theories so i just went to france i arranged an interview um at the the catier champagne headquarters and they took me on this grand tour and you know we went down into the cellars 100 feet under the ground and and there in these racks were these gleaming gold bottles of champagne they didn't have any markings on them and this is the same company that makes

antique gold which i think stopped being produced in 2006 armand de brignac started up in 2007 or whatever it was and uh and then that's what it was the video of jay-z you know holding these gold bottles um you know happened in between so you know i asked i asked these characters like hey how did Jay-Z start to be interested in your champagne and oh well you know he found it in a mom and pop shop in New York and just really liked the taste and so he decided to rap about it and that was it so I went back to New York I did a little more digging and and yeah I confirmed my dates and I and so I wrote them back and I said how did he get how did he get the bottle into his video if it wasn't out when the video came out you know how did he find it into a how

did he find it in a mom and pop shop and they said okay well we do have a relationship with him blah blah blah and um and so the book kind of you know exposed sounds very dramatic because it's not like he was doing anything wrong um he was just kind of trying to have a champagne and drink it too right uh he wanted to seem like uh like a tastemaker just kind of recommending something nice and he also wanted to get paid so um yeah i kind of uh blew the doors off of that and there was a little kerfuffle and and there was some controversy over it and um but then two years later he he uh he announced that he had bought the whole thing you know and and um and and it kind of it kind of uh uh i think validated my reporting and you know that he had already had

a piece in it and and so forth so you know he talked about jay-z being honest um in his in one of his songs a couple years ago he said that his champagne company is worth half a billion dollars And then I think the next year he sold half of it to Louis Vuitton for, I think it was $250 million or $300 million or something like that. So LVMH now is the JV partner on Armand de Brignac's Ace of Spades Champagne. And, you know, it's kind of like Jay-Z's focus on equity has come full circle. You know, he bought into this brand. And he built it up and then he kind of like sold half of it back to a big conglomerate to try to to try to help expand it and to help fund it. So a little bit of a revision on the equity theory, you know, better, better to to own, but also better to have a really big corporate partner who can help, you know, with the with the bills when something gets that big.

it. What's funny is it almost feels like he was flipping products and brands, even Rock Nation to some degree, right? He was able to go into Def Jam and kind of eventually flip that a couple of times into what became Rock Nation through a number of different business deals. The Champagne, he was able to kind of partner with somebody who was maybe not as well known or not as globally dominant. He's then able to kind of make a couple of deals and then flip it eventually to LVMH. uh it reminds me a lot of like what happens on the street right and kind of understanding how to take products and and work with different people and things like that um is that a theme of what he's been doing is basically being able to gain control of certain assets grow them and

then understanding that look if you're gonna have a partner having lvmh as a partner is a pretty damn good partner to have and in some way actually having them involved puts him even further on a pedestal puts them even further, you know, in terms of the validation of the tastemaker of the brand of like, who I think society thinks Jay-Z is now. Is that part of the strategy as well? Yeah, absolutely. And, you know, there is this element of his career that sort of reminds me of, you know, you hear about in business school, sometimes there'll be a challenge, like, take this paperclip and turn it into a car by the end of the semester, you know, But if you trade the paperclip for, like, I don't know, a baseball card, you trade the baseball card for a CD, and suddenly you have a Volkswagen within a few months if you keep getting a little bit more with each deal.

And I really do think that's how he operates. But, you know, part of it is that he can provide his own value to anything he buys. And it's sort of like when Warren Buffett buys Coca-Cola stock and the word comes out, you know, then the stock goes up. If Jay-Z buys a champagne company, it's immediately worth more than what it was before he bought it, simply by virtue of the fact that it is Jay-Z who bought it and people are more likely to consume it. So you can really pursue a very lucrative strategy that way if you keep buying things. And then as long as you get a reasonable deal and you don't overpay, they're immediately worth more. you invest more time and effort into them. They're worth even more than that. And then you sell them or you sell half of them. And it's a lot better strategy, say, than just taking a few million

bucks for an endorsement deal. One of the most ambitious things that you highlight in the book is this idea of Jay-Z blue. And whether it was him or somebody on his team came up with the idea of like, let's create a color. They work with a well-known artist to create the color. They basically protect the intellectual property and then it sounds like they basically went to a bunch of companies and were like hey we have this color why don't you put jay-z blue on i think it was a jeep or a car uh and it sounds like they got close to actually launching it and then uh the automotive company backed away because they actually were scared that jay-z blue as a color and him as a person may overshadow the release of the new car which seems kind of crazy like what what was your

takeaway in terms of, uh, the ambition and maybe even arrogance of like, we're going to create a color and then we're going to go put this on all these things and we'll make money that way. Yeah. This was sort of like, you know, the early to mid auto industry, right. Um, U S auto industry, uh, kind of flirting with the future, but like woefully, um, woefully out of touch, uh, headed for, you know, uh, catastrophe during the great recession. Right. And and so, you know, I think at the time people realized that hip hop was a big deal. They kind of thought it might be a fad, but they wanted to, you know, interact with it, perhaps if it could be advantageous to them. They were a little freaked out still about, you know, the associations with violence, that kind of thing.

but um but yeah so there was a deal uh that seemed to be heading toward completion where um Chrysler was going to create a jay-z jeep painted jay-z blue it was going to come pre-loaded with every song he'd ever written and buttercream leather interiors and 22 inch chromies and the whole thing and um and uh you know he was scheduled to fly to Detroit to finalize the deal and at the last minute you know it got it got kiboshed uh got canceled and um you know from what i from my reporting what i understood was that some higher up uh got freaked out about his past as a drug dealer and that you know that that could kind of yeah like you said i think i think that was exactly it that this was going to be the the jeep commander and i think they were worried that

it was going to be more about the jz jeep than it was about the j you know the jeep commander which was their new you know flagship ultra luxury big suv so um yeah i mean that that sort of thinking is how detroit you know kind of almost uh uh went bankrupt i mean because he did you know some of the companies got to be bailed out that kind of thing so um but there's a there's an interesting lesson here too uh i think to go back to warren buffett he has this quote um better to get a new boat than to keep patching a leaky one, something like that. And, you know, I think Jay-Z was like, well, I'm not going to concern myself. Like this industry isn't ready for me. I'm not going to waste my time anymore. I'm going to move on to other things. And, you know, and that's

really what he did. Jay-Z also didn't really talk about it, you know. And this was one of the things that i dug up in my reporting and you know i think that with him he has this aura of invincibility right i mean he's married to beyonce he's a billionaire like he's you know he's got this everything's going right for him um and he mostly up until really a few years ago only rapped about the things that were going right to kind of underscore this image that he had uh but i think as an entrepreneur you know you go through things i mean you you probably have more things that don't work out than things that do work out i mean if you think about a vc right i mean if you if you get one out of ten investments that really hits then you know you're you're a

great vc um but you know you're not going to talk about the other ones maybe so much so i think i think with jay that it's important to realize that he has had his failures like any entrepreneur or, and it's, it's more about what you learn from the failures. Um, you know, in a way it's more interesting than what you learned from the successes because once, you know, you combine all of the lessons from all those failures, you could set yourself up for that greater success. And that's, that's certainly what he did. Another part of the book, uh, hits on something that I always talk about, which is like the person you marry is one of the most important decisions of your life, but I'm usually talking about it from like a happiness standpoint and kind of just like

enjoyment of people's lives. But you have two excerpts that I want to read real quickly. The first is, in terms of the entertainment industry, it's the biggest merger, Jay-Z and Beyonce. You could possibly imagine. It's two superpowers coming together. It's sort of Microsoft and Apple deciding they can literally be in bed together, which came, that's a quote from music historian Jeff Chang. And then you've got another part here where Jay-Z talks about, and he says, we exchanged audiences. Her records are huge, top 40 records. And she helped Bonnie and Clyde go to number one, what I gave her was a street credibility, a different edge. How intentional was this versus like, no, they just fell in love. And then there was a bunch of, you know,

positive byproducts that came out of it. Yeah. You know, it's a, it's a great question. And there are definitely sort of arranged marriages in the, in the entertainment industry. And, and, you know, you get the sense that some things are done just for convenience, not for love and, and maybe that there's no real relationship there but um but i do get the sense that jay-z and beyonce uh have an actual relationship and you know at this point they've been together for so long it's like you know you see celebrity marriages dissolve um you know by this point if there's not something real happening there at the same time yeah it's a great uh there's a great synergy um professionally and i think that the thing that he was talking about in that quote

you know that was true when they got married in the late aughts and you know when i wrote my book uh when i first started writing it they'd only been married for for a year or two and i just remember some people were still like oh right beyonce's husband you know i mean she was so much bigger than him in terms of overall celebrity and you know still is i'd say but jay-z was not a household name sort of in the international business scene when they got married in the same way he is now and i think that you know certainly musically yeah she had more of a pop audience uh there's a lot of synergies there he had more of a hip-hop audience or like some of them came over um and listened to his stuff and you know some of his audience like he gave her

credibility like a like a street cred that she maybe didn't have before but but i think the the big the big lesson is on the business side right um you know the fact that jay-z was connected to this this superstar who you know who is palatable to like pepsi right uh to to to some to some of the biggest most mainstream brands in the world um you know in a way softened his image and i mean that in sort of like the best possible way right like earlier in his career you know there are deals that he wasn't getting because of his past uh you know whether it was the jay-z jeep deal or some of the record deals early on. But, you know, I think if Jay-Z had been married to Beyonce at the time that the Jay-Z Jeep thing had been going on, there wouldn't have been that question. It's

like, oh, he's married to Beyonce. She's, she's wholesome. She, you know, we can, we can get behind that. So, so I think that it, it sort of helped corporate America warm up to Jay-Z a little bit. And, you know, for her, it brought all that horsepower of, of his, of his sort of business uh management style this sort of entrepreneurial style to her empire and you know she started getting paid she she sings about uh getting paid in equity for for doing a show um a private gig i think for uber stuff like that you know that that wasn't going to be happening you know prior to jay-z so uh i i would say more than the musical synergies the business synergies have been uh you know incredibly huge and and they kind of have a great um you know you talk about a

two-income household right uh they get their money in really different sort of ways i mean you know she can go out and tour and gross 300 million dollars in a year um you know he can't do that uh what he can do is he can invest it and you know and build value you know build equity um and and he can be he can have these giant assets that are appreciating but she can go out and get the cash. So I think that's a nice combo, especially when you have, I think he has a $50 million mortgage or something. They bought an $88 million mansion a couple of years ago and they took out this mortgage. I think it was still 3%. So he figured he could earn a greater return than that. But you got to have somebody bring it in actively while you're investing it. And that's

what she does. Why do you say that he couldn't go tour and bring in $300 million? What do you think the number would be if he did a similar type tour you know he could do arenas i mean he can sell out an arena uh gross you know a little over a million dollars a night she could sell out a stadium and gross you know five million a night and so if you were to go i mean you know if you just do like the quick math on that um you know yeah i mean i guess if he really wanted to do a two-year tour and go around the world and and you know play every day like could he gross a million dollars a year sure but um but you know just uh the time and effort required what he would have to do versus what she can do you know if you can fit four times as many people into a building um

to pay for your you know to pay the same amount of money to see your same show uh you know the scale obviously is just much greater so um i think still you know as big as he is um he's not a pop star. And even when you see him do arenas, it's always like he'll do it with Beyonce or he'll do it with Justin Timberlake, something like that. Because he just doesn't have the, you know, the, I mean, I don't know that there are any hip hop acts other than maybe Drake who could sell out a stadium by themselves. And Beyonce just has such a larger audience. Yeah. Yeah. It's fascinating that people who are into hip hop and rap, they forget it's still pretty small compared to the pop audience. But another theme that you have in the book is that he

actually spends less and less time with rappers. And he starts spending more and more time with various billionaires. And some of them that you mentioned are Warren Buffett, Bill Gates, Michael Bloomberg, Mikhail Prokof, Oprah Winfrey, and many others. Is that an intentional thing? Is that just like your interest becomes in business? And so you just naturally gravitate towards the people who have kind of figured that out and mastered it. So you want to learn from them? Like, what do you think is driving such a different set of friends as he got older? I think it's kind of about, you know, what's your reality? Like, what are your, you know, what are your, what are your problems? What are your hopes and dreams? And, and, you

know, you want to spend time with people who are, who are like having some of those same concerns occupying their mind. Right. And, you know, he just kind of, he got to a place where he he was one of one right in hip-hop I mean you could argue you know Diddy or to some extent um Nas or if you drink but but you know I mean he's you know what does he have in common with some um you know 19 year old who just signed a record deal uh and you know and and is rapping about like money phone I don't know you know what I mean so um I think for him it was just uh you know those are the circles that he ran in it kind of happened naturally i think at first there was an element where you know he was trying to always be almost like he was almost trying to be the

poorest person in the room uh you know the least successful person in the room and that the more time he spent with people who were more successful than him the more he could um learn their kind of secrets and and tricks of the trade um so so i think that kind of happened naturally but then you know, once you're in that rarefied sort of air, you know, you start getting, getting invited to things, you're going to, to the Met Gala and you're going to the white house and all that stuff. And, and it's just, you know, that that's, who's there. Uh, so, so I, I kind of think it was, it was natural evolution as he became more successful. Where do you think he's going? What, what's like the, uh, uh, the end game here? Is it just bigger and bigger deals, uh, kind of

be the, the guy who becomes the richest, uh, you know, hip hop artist of all time? Is it to be a multi-billionaire? Is it to give it all away? Like, what, what do you think kind of is the end game for him? Um, I don't think he, he necessarily is wanting to get rich just to get rich. I think he's has enough money, like, you know, what do you, he's worth $1.5 billion. Um, you know, he, he doesn't really need to do anything anymore anyway, but he, I think he really enjoys it. I think it energizes him. And, you know, I would look at it the same way you look at any billionaire. I mean, you know, why does Elon Musk keep going? You know, why did he leave after, you know, why didn't he just stop after PayPal? Like, why did he keep going? And I think there's something else that drives him.

And I think it's the same with Jay and whether, you know, I don't know that he would want to give it all away. Certainly in his lifetime, I think he's more interested in how can he do interesting things? You know, how can he he keep building and building? And in the process, you know, how can he have an impact like something like buying an NFL team? I mean, I think that I think that's definitely in his sights and that's about so much more than just, you know, having the credibility and, you know, making money through football. It's it's having the seat at the table, you know, becoming the first black owner of an NFL football team, you know, you know, having having an impact just just by being there, just by virtue of who you are. and I think that's something that's become a lot more important to him in recent years as he starts to think a little more about his legacy and when you think about um kind of in hindsight his biggest mistake and his biggest good decision or biggest success what would you put in each one

of those categories oh that's a great a great question um yeah biggest mistake um um it's the i think i think there's an element where he took a little longer than he might have to really open up about some of his failures and i think that that could have been really valuable um a little earlier in his career and again it wasn't really until uh he put out 444 a few years ago and i think that album um what was that 20 i came out 2020 2018 i don't remember 2018 something like that a few years ago anyway uh that was when he was sort of his apology album to beyonce he really kind of did some soul searching that sort of thing um you know but he he waited i I think maybe a decade longer than he needed to, to show that vulnerability.

And I think that I think that that sort of thing can be so valuable to other people coming up. So, you know, I think, I don't know that monetarily it would have been any different, but if what he really wants to focus on now is a legacy I think some of those lessons of, of getting deep into what didn't work are what are most valuable to people coming up. And I think, you know, it would have been a service to start doing that a little earlier uh as far as the biggest success

um the best business decision um you know probably the whole rock nation apparatus um i mean you could you could say the champagne deal but i guess we talked about that a lot already i think what he's done with rock nation you know which is taking the name rockefeller records right And kind of, you know, his rockwear clothing line, finding his own name that kind of evokes the names of the things he's already sold, creating a new thing, getting Live Nation to fund it, you know, to guarantee him tens of millions of dollars in funding every year for a thing that he still owns for this sort of multipurpose entertainment company that he can kind of do whatever he wants with. I think that was a pretty remarkable decision. And, you know, to get that sort of money, those sort of guarantees from a touring company, when, you know, as we talked about a little earlier, like hip hop is not, is just not on the scale of pop when it comes to live music. recorded music hip hop is is the most consumed genre in the world but live music is still a different story um you know to get that kind of a deal from a touring company that's that's pretty remarkable and you know he re-upped it again recently and you know so so i think that that's

um yeah hard to hard to top that you didn't just write a book about jay-z you've also written a number of other books. And your most recent book was about A-list celebrities, actually angel investing was something that Jay-Z has done multiple times. He's now raised multiple venture funds and kind of continues to move into the asset management space. But what are some of the takeaways just from celebrities, athletes, musicians, all starting to kind of follow in these footsteps? Yeah, you know, so the book is called A-list Angels. It came out in March 2020 at the same time as COVID, so not the best timing there. But, you know, it dug into this phenomenon, which I started to explore back in 2016. I wrote a Forbes cover story on Ashton Kutcher

and Guy Osiri, his business partner, who's the manager of, had been the manager of U2 and is the manager of Madonna and some other folks. And, you know, it kind of detailed how they got in, you know, they invested early in Uber and Airbnb and some other country, some other companies started their own venture fund and and the book really explores you know not just that but but sort of this the rise of the of the celebrity angel investor and you know what is it exactly that a celebrity um gets out of the deal what is the entrepreneur was a startup get out of the deal and sort of why is this happening and and and why do we care and um you know it's it's funny because you think about um the the rival reason hip-hop early on

uh you know now um both jay-z and naz have their own venture funds and you know that you can you can see them um kind of tweaking each other a little bit like in in verse in some of their songs like when they talk about uh how big their funds are or you know the startups they invested in that were um the most successful uh you know even when jay-z started his own fund he called it MVP, Marcy Venture Partners, I think it stands for. And, you know, that was after Nas had started Queensbridge Venture Partners. So, you know, there's this sort of like funny little thing where Nas named his fund after the housing project where he grew up. Jay-Z named it after his, but his is like MVP, like he's the most valuable player.

uh you know so there's a little bit of back and forth competition i think going on there um and it's interesting to see how it translates from um you know from the old days until now but um but yeah i think that that's where you know a lot of this energy has gone in terms of the uh the strategy of like let's get equity you know instead of just taking cash deal um a lot of celebrities are like okay maybe i can get free equity in a startup i can get some advisory shares or maybe I can, you know, by virtue of my celebrity status, I can get into an oversubscribed round for a startup that's sort of, you know, there's no free lunch,

but something that's, you know, headed toward an IPO that's going to be a big deal. And, you know, some of the value that founders can get out of having celebrities on the cap table. My last question for you is who's the next one? Who do you, when you look out on the landscape, whether it's music, celebrity, who do you think has the potential

both from a notoriety, a branding, an aspiration or ambition, and then also just kind of surrounded with the right people to be able to pull off something like this, whether it's become a billionaire or kind of acquire many of the assets similar to Jay-Z? Who would you say is kind of next in line? Yeah, I mean, you know, there are a lot of interesting names out there.

I kind of think the one I've got my eye on is Berner. He's the founder of Cookies, this huge cannabis brand. he's actually the third or fourth richest guy in hip hop right now. And I think as federal legalization becomes a real possibility, his empire is going to become, you know, ever more valuable and already is doing, you know, fantastically well, I think more than anybody really realizes. But he's somebody who has that same kind of entrepreneurial energy and, you know, can really dissect things and, and, and think, you know, four moves ahead. Uh, so I would keep an eye on, on burner for sure. So he's an interesting person for you to say, because

he's released like 40 albums. My guess is that very large portion of the audience is not going to know who he is. Um, and so he doesn't have nearly the kind of notoriety on the music side as somebody like a Jay-Z would. Um, but really is this also highlighting the fact that many of the who kind of start with music they may do that to build a little bit of momentum maybe some cash flow but ultimately they know the game is not music the game is to get into business and so they just use that as the launch pad and they're going to care less and less about the success of their music career uh absolutely although burner you know he's incredibly prolific i mean as you say he's an insane quantity of albums that he puts out it's just non-stop so uh i don't think he needs to be

releasing music that often uh quite that often to to uh have an impact but you know i think he really loves it he cares about it and um and it absolutely informs the success of his cannabis brand his clothing line stuff like that so you know uh i i do think that it's a conscious choice as well you know the the um the music dovetails with the with the the main business um and um you know i think he's definitely taking lessons from from jay and them and you know to see how that works so uh but i'm also interested to see you know if uh if cookies down the line ipos and he suddenly got a lot more cash on his hands um a lot more liquidity you know what does he go and do with that is it just stuff in the cannabis space or does he start investing in other things too

does he start doing the jay-z thing and um you know i think that could be really really interesting And, you know, certainly Cookies has a chance to be the Armand de Brignac of weed. It's probably already more valuable than Armand de Brignac. You know, maybe the better question is, could it become the, you know, I don't know, what's it, what's, what's a bit, what's, could it become the Veuve Clicquot of weed? You know, it's like something that's the high end, but very widely consumed brand. And, you know, could you start to get a massive scale? even become you know the budweiser of weed uh and i think that you know there's no sort of like clear-cut number one brand out there where everybody knows like oh it's you know that

that is the number one weed brand um but but i think his is certainly in the running to do that once things uh really open up federally i think the reports are that he turned out 800 million dollars for uh for the company already i don't know if he owns 100 or he's got investors or what but uh obviously there's a number of investors who think it's quite valuable and if you think you know the federal uh kind of approval and uh the legalization of it at the federal level would uh would put a big you know kind of multiple on that uh you know under the assumption that it happens yeah he uh he owns about a third of the company still um he turned down the 800 million dollar offer the the weed business has been sort of weird lately there's been some you know the way

that has been rolled out in different states there's been oversupply in some states which is encouraged like selling out the back door and shipping off to other states where it's not legal yet because you can get a better deal sometimes but um you know i think that kind of stuff is going to sort itself out and and um you know i think one of the big issues is just something that's federally illegal uh even if it's legal in the state you know you have to do this in cash you gotta you gotta have a lot of safeguards in place you can't get financing in the same way so um you know i think once uh it does go legal federally which i think it will you know within the next i don't know three to five years uh you know yeah he's going to be in a really great

position too awesome where can we send people to find you on the internet or find any of the books that you've written yeah uh my handle on on all platforms is zog blog um and um you can find empire state of mind in uh you know wherever books are sold i'd say friendly neighborhood bookstore, you know, go support your independent bookstore if you can, but you can get it wherever books are sold. And as I mentioned at the beginning, Zach and I met because I read Empire State of Mind, how Jay-Z went from street corner to corner office. It is fantastic. Even if you're not into hip hop or rap, it is a great kind of overview of what has become, you know, one of the least likely billionaires, if you go back to kind of where they started. But Jay-Z has done a

fantastic job of kind of building his empire uh and so it's the revised edition there's a billionaire edition since he became billionaire i highly suggest you go get it if uh if you've not read it um and zach thank you so much for your time i uh i enjoyed talking and something tells me that we could talk for hours and hours about every single one of the people in hip-hop that uh seems to be moving into the business world and doing so at such a rapid pace Amen to that well thanks for having me on Pop