This post appears as a foreword to the new paperback edition of Empire State of Mind: How Jay-Z Went From Street Corner to Corner Office, by Forbes staff writer Zack O’Malley Greenburg (Penguin/Portfolio, 2012). It is excerpted in full with the permission of the author and the publisher.
One of the wonders and strengths of free enterprise is its openness to newcomers. Entrepreneurs from the most unlikely backgrounds can achieve astonishing success. The key is offering products or services that other people want, even if they didn’t realize they wanted them before they saw them. As Steve Jobs famously answered when asked if he wanted to do market research: “No, because customers don’t know what they want until we’ve shown them.”
Shrewd recording artists like Jay-Z are hyperaware of this, as I learned while spending an afternoon with him and Warren Buffett in 2010. Musicians create offerings that more often than not are ignored or are greeted with indifference. As Jay-Z puts it, “That model still exists of just putting artists out and seeing what works.”
Shawn Corey Carter epitomizes the essence of the American entrepreneurial spirit. His extraordinary tale—rising from a less-than-ideal childhood to great success—is incisively and sensitively chronicled here by Zack O’Malley Greenburg. You usually learn more about business by studying the lives of its great leaders than by studying courses in business school. And Jay-Z’s fascinating and inspiring biography is proof of this.
Jay-Z’s achievements are especially notable because entertainers are notorious for quickly making money and even more quickly losing it. The things that set Jay-Z apart from this norm are what make Zack’s book timely and the examples and lessons it highlights timeless.
In a way, Jay-Z was fortunate because, by entertainment standards, he started late. As he told me in 2010, “My first album didn’t come out until I was twenty-six, so I had a bit more maturity.” That meant his music was better. “[My debut] album had all these emotions and complexities and layers that a typical hip-hop album wouldn’t have if you were making it at sixteen, seventeen years old. That isn’t enough wealth of experience to share with the world.”
Starting late also meant that Jay-Z had a better grasp of the “here today, gone tomorrow” syndrome. He determined early on that, as much as humanly possible, he would control his destiny. “That was the greatest trick in music that [executives] ever pulled off, convincing artists that you can’t be an artist and make money. For many years artists were dying broke because record companies took advantage of them.”
Jay-Z would therefore make great music and control the business side as well. Moreover, before most others, Jay-Z saw that the digital revolution was disrupting the traditional way of doing things in the music industry. He knew the only way he’d survive and thrive was to make sure he had his arms around all aspects of the business—and not only the music side, but also the extensions of his brand into other areas.
As with any true entrepreneur, Jay-Z is also an iconoclast who knows the importance of not being confined by the conventional wisdom. One conventional axiom in the music industry is that it’s primarily a young person’s business. That Jay-Z is still phenomenally successful in his early forties is amazing. He is because he worked hard to make sure his music speaks not only to a young audience but also to his contemporaries, who are entering middle age.
To that end, Jay-Z is also willing to work with other artists, such as Eminem and Bono, at concerts. He feels that too many performances leave audiences with the feeling that the promoters are out to get every last dollar from them. He wants his events to leave customers feeling the opposite—that they got a heck of a lot more than they bargained for. Like a wise capitalist, Jay-Z always keeps one eye focused on the future.
Entrepreneurs such as Steve Jobs have a strong belief in themselves. Jay-Z demonstrated that trait when he laid out $5 million in cash to buy back the rights to a future album—the one that would become Blueprint 3—from Def Jam’s parent company, Universal Music Group.
There’s an intriguing addendum to the transaction that added a harrowing element of risk: “What people don’t know,” he told me, “is that the day before I flew from Hawaii, I was doing some recording and put it on an iPod. [On the plane] I had on jogging pants. And my iPod, with all the music I had recorded, [went] missing. It was on the plane somewhere . . . Every day I would wake up and check all the Internet places and everywhere. It was like that for three months.”
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