Four Reasons Why Rappers Are Like Startup Founders
Your favorite rapper has a lot in common with your favorite startup. Both came from nothing. Both achieved a status greater than the sum of their hits.
A rapper’s MVP is his demo tape, or a SoundCloud page with hits recorded in a basement. From there the sky’s the limit.
Started from the bottom now we here
Your greatest asset as an entrepreneur is your conviction, your passion and your “newness,” to quote recent podcast guest Erica Swallow.
No one clears a path for you as an entrepreneur, and the only way to make it big is to earn each new customer, and to win each deal through a combination of moxy, charisma and perseverance. Believing in the dream is how entrepreneurs change the world. While rappers might fill arenas and with the gift of gab, it’s these tools which the entrepreneur uses to create communities and build bridges to the future.
Graduated from the school of hard knocks
Many entrepreneurs are fortunate to start their journey at a top college or university. It is at institutions like Harvard, Stanford, MIT, Carnegie Mellon and University of Michigan, that founders are able to network with other high-flyers and the sons and daughters of privilege. These early contacts are a
huge advantage once the product is built and the team is looking for partnerships and guidance to reach the next level. But many more entrepreneurs interrupted their education, or have no formal training, which makes them fit the mold your typical rap artist.
As someone who was steeped in the notion that college was a path to success, I’m constantly amazed by the prolific intellect of people for whom college was never an option. KRS One never went to college yet his nickname is the teacher. In fact, KRS left home at the age of 14, and lived in homeless shelters in The Bronx. Kendrick Lamar is among the greatest lyrical talents of the decade. He brings a new life and vitality into the rap game, at a time when I feel ready to turn my back completely. In the vignettes between songs on his album Good Kid, M.A.A.D City, Kendrick’s mother exhorts him to stay off the streets and behave, so that can pass his classes and graduate to the 11th grade. No mention is made of going to college.
The power of stories
The ultimate gift startup founders and rappers share is the power of storytelling. “It’s not what you do, it’s why you do it,” asSimon Sineksaid in his TED Talk. When people buy into you as a person they will go to the ends of the earth to make sure you’re a success. The ability to generate emotion and connection with the audience are essential. Emotional intelligence and human curiosity are much greater determinants of success than any paper credential.
Exploitation is far too common
There is also a great similarity between venture capital investing, and recording contracts. Opinions on VC firms vary considerably, but the upfront investment in a startup mirrors a recording contract, where the artist is expected to make back multiples of his advance. The VC model assumes that one out of every ten investments will be a hit, just as record labels only need one 50 Cent, or 2 Chainz to earn back the money invested into the career of Da Band.
Sequoia Capital is among the venture capital firms in Silicon Valley that have deployed “scouts” to help them source early-stage deals, not unlike the A&Rs who go to nightclubs and try to find up-and-coming talent before they make it big.
Rappers and musicians rarely own their master reels, and their intellectual property is controlled by their label in exchange for money to book studio time, to book top producers like Just Blaze, Timbaland or Pharell Williams. The deck is clearly stacked against the artist.
Startup founders take risk capital to hire the best user interface designers, data scientists, sales professionals and other top-level professionals who can take their business ambitions to greater heights. The money is not a gift. Those investing expect serious return on the dollar.
We’ve known for more than a decade that the music industry is hopelessly broken. Now the call is starting to rise from more corners that VC is broken. Trends such as equity crowdfunding and sites such as Angelist may snuff out all but the best VC firms within the next few years.
The challenges will always exist. Dreamers and doers will always persist. .