Hip-Hop Moguls: Beyond The Hype

As rap music has exploded, so too have the fortunes and businesses of some of today's hottest young music executives

must still rely on a major label for distribution. “When are we going to get to the point where we’re manufacturing and distributing our own records?” asks No Limit’s Scott. “That way we don’t have to share the money with anyone.”

Although these young moguls have been able to swing the balance of power somewhat in their direction, they are still far from having complete dominion. “I consider those capable of maintaining themselves alone who can, through abundance of men or money, put together a sufficient army and hold the field against anyone who assails them,” wrote Machiavelli. In the music business distribution is the final battleground.

“Sometimes Russell [Simmons] is so humble that you wanna say, ‘Get real,'” explains Anne Simmons, no relation, the former president of multimedia at RUSH Communications (No. 36 on the be industrial/service 100 list). This is one of those times. When asked to comment on hip-hop’s new moguls, the pioneering rap impresario replies in a rapid-fire cadence. “That story is not about me. These young guys have way more power, control and access than I ever had,” says Russell from his Manhattan headquarters.

That may be true, but much like Berry Gordy and Clarence Avant before him, Russell paved the way for today’s young black music executives to get paid. Even more important, he showed us that rap was about more than music. “Russell was the first to really understand that hip-hop was a culture and as such could be translated into a number of different venues,” says Andre Harrell, who worked for Def Jam before starting Uptown Records. Today’s moguls have learned his lesson well and have imitated, with great success, Russell’s ability to leverage the marketing muscle of music across fashion, film, television and artist management. Every RUSH Communications venture, from Phat fashions to RUSH Media, has built on the power of the Def Jam brand and the youth culture it represents.

To a person, every young CEO featured in “Hip Hop’s New Moguls”-Puffy, Master P, Damon Dash, et
al-cited Russell as the one who set the bar for success in this industry. And their stories read like case studies in the Russell Simmons School of Mogul Making. “He established the paradigm of how to make it in the business of hip-hop,” says Anne Simmons, who now heads dRUSH, a joint venture between RUSH Media and the Deutsch Inc. advertising agency. “There are two types of people in this world-the ones like Berry Gordy and Russell, who can take something from nothing and create something-and then there are people that are great executors.”

“I was successful in attracting the financial community to what I was doing in hip-hop because I was bringing them something they couldn’t understand and showing them how to make money from it,” says Russell. He recently sold his remaining 40% ownership stake (along with current Def Jam CEO Lyor Cohen) to Universal for $130 million. Now Russell can turn his attention to other ventures, such as getting a better

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