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by Ali Abidi

Journalist Dan Charnas discusses his new book The Big Payback: The History of the Business of Hip-Hop.

It’s no secret that Hip-hop is now a multi-billion dollar industry and the predominant popular culture of global youth. It has birthed CEOs like Sean Carter, Damon Dash, Lyor Cohen, Steve Stout, Chris Lighty, Sean Combs and early pioneers like Charlie Stettler and Russel Simmons. Although hip-hop’s cultural influence has been documented twice over,  there has never been a comprehensive look into the economic machine behind hip-hop from it’s earlier humble beginnings to its present day status as a musical juggernaut. The Atlanta Post sat down with Dan Charnas, author of The Big Payback: The History of the Business of Hip-Hop to discuss corporate America’s early flirtations with hip-hop, the evolution of the record deal, corporate appropriation of rap music, and hip-hop’s influence on corporate marketing.

Why did you think it was so important to chronicle the business acumen of rappers and the evolution of the rap industry?

The real reason is that nobody’s ever told that story of the people who work behind the scenes. For decades what was a street culture nobody even knew about and what is now the world’s predominant pop culture. Part of it comes from me having been part of the industry for about 15 years working for a record company and working with the Source [Magazine]. Another part comes from being a journalist and being really fond of the great writing that’s been done by hip-hop by writers like Jeff Chang, who wrote the best book ever on HipHop, focusing primarily on its cultural history.

Brian Coleman wrote a great musical history. But neither of them, except for ones that deal specifically with record companies like Ronin Ro’s book on DeathRow Records, “Have Gun Will Travel” and Stacey Gueraseva’s book “Def Jam, Inc. ‘, deal on the linear manner with which the evolution of the industry took place. I can tell you from personal experience that without the hard work of the people that worked at the record companies, the DJ’s at the radio stations, those who worked at the agencies, and worked in management, the artists couldn’t have broken through without the help of these people and that was the inspiration to tell the story. I just think it’s an important story to tell.

When did corporate America begin to take hip-hop seriously as a profitable venture?

Charlie Stettler was the first  person to get corporate America to sponsor a hip-hop related event. [He organized a Rap & Breakdance] contest at the Radio City Music Hall. The mob basically, at the time, controlled the unions and didn’t want the event to happen. So they threatened Charlie and were like we don’t want those [racial epithet] at Radio City Music Hall. Charlie goes ahead and makes it happen anyway and brings security down from the Fever Night Club in the Bronx. They have this talent show at which Coca Cola is the corporate sponsor and this was the first time any corporation sponsored any hip hop related event. This was in 1983. And what happened at this event is that there was this group performing called the Disco 3, whom Charlie Stettler ends up managing and who later became the legendary Fat Boys. So that was the first corporate sponsorship of hip-hop.

Charlie Stettler went on to get Watch Watch to sponsor the Fresh Fest and from there we start to get people like Adidas, like Sprite and brands like those who begin to take interest in hip-hop Culture.  In my book the brand that takes the award for really taking an active interest in understanding hip-hop culture would be Sprite. In the early 1990’s,  Daryl Cobin helped them come up with the Obey Your Thirst campaign. That’s really a turning point in the relationship between corporate sponsors and hip-hop.

In the early days it seemed like the economic models that governed how records got released were very different region to region.  An obvious example that’s always brought up is how the Southern Rappers taught East Coast rappers that they didn’t necessarily need a major to put out and push a record. Do you think hip-hop has taught corporate America something?

Absolutely, the example in my book is the street team. Obviously street promotions were the only way in the Bronx and Harlem in the 1980’s that news would spread about hip-hop gigs. You had to put flyers up. Russell Simmons got his start like that. He started putting up flyers for Rush Productions promoting college parties; street promotions is nothing new, it just got branded in the 1990’s.

Sometimes they would just call them college reps, sometimes they would call them local promoters who would team with the small labels to spread the word at the barbershops, corner stores, and just distribute sticker, flyers and things like that. Nobody’s really sure who came up the term street team first but I do recall using the term at Def Jam very early in the 1990’s.

On the east coast, hip-hop was pushed into the public eye by record companies like Def Jam and Profile. On the west coast there were no record companies, all they had were these pressing plants called Macola and individual artists would get custom pressings done and Macola would push it out to the record stores for them and swap meets and outlets like that.

The 90s seemed like the era of Soft Drinks. This past decade seems to be all about liquor. What do you think about rappers endorsing liquor? Do you think Diddy is playing Ciroc? Does he actually have that much leverage for them to give him such a hefty paycheck?

He’s not playing them because he has equity. For a guy in a situation like that to not have equity would be tragic. I devoted a lot of time to the story of Damon Dash, who’s first go-around was something like a tragedy. The tragedy of Dame’s first go around is that he really did have the most expansive vision of what hip-hop could be but that came from a sense of entitlement. Rocawear got started because Dame went to iceberg jeans to see if they could get an endorsement deal for Jay-Z. Iceberg said, well ‘we’re not really interested, we don’t think Jay-Z can help the brand.’  And Dame was like “Oh really??” Well I’m going to start my own company and put you out of business.

Rocawear eventually became the ascendant brand. In the early 2000’s, Sean Jean, Rocawear, and Phat Farm sent Nautica, Tommy Hilfiger and all those people running for the hills. So that led to Jay eventually saying I’m not going to sponsor somebody else’s vodka; if I’m going to be holding a vodka in a video it’s gonna be my own and that was the Armadale venture which they did with this distillery in Scotland.

Also,  the Stride Rite (Pro-Keds) deal which did not end up well because Jay and Dame’s relationship did not end up well. Can you remember any other time in history where a hip-hop company bought an established mainstream [brand]? So Damon’s vision was very keen, he was like we can buy everything; we can become the new power broker.

Hip-hop can be a three hundred and sixty degree experience for this generation. Ultimately, its bigger than hip-hop…its about a generation of African-Americans carving out their own economic space in corporate America. The nationalist extreme hasn’t necessarily worked out for black America but the thing that does seem to be working is the joint venture [structure]. When Jay-Z wants to do business he doesn’t do it alone, he does a joint venture with an established corporation which he can sell and parlay into something. Hip-hop for this generation, particularly African Americans and people who work along side them and admire them and fought for the same things they fought for, is really about finding a kind of peace with America and a power in America .

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