“Artist should have CEOs, not Managers.”

Kanye West

To no surprise, Kanye West’s statement about artists needing CEOs and not managers threw some people for a loop. Although, if you take a deeper look at the comment, which Kanye made back in 2018 in an interview with Charlamagne The God.

The rapper, singer, songwriter, composer, record producer and fashion designer makes a very valid point. After winning 21 Grammy Awards and with over 140 million records sold Worldwide. Kanye West is undoubtedly one of the most influential content creators of our time.

His assertion about the rise of CEOs in hip hop — directly — speaks to where we are headed as an overall industry that is producing more and more megabrands.

By definition, CEOs manage organizations.

In today’s World, an artist’s success is not limited solely to music sales. The challenge for the new wave of ‘Hip Hop CEOs’ lies in building brands around artists. Then expanding that brand equity across multiple categories to drive growth and efficiencies.

With the rise of the Internet and music streaming, the record business has shifted to favor more agile organizations. A great example is Atlanta’s Quality Control Music.

The record label not only has some of hip hop’s top talent in The Migos, Lil Yachty, City Girls and Lil Baby.

Quality Control is also the driving force behind Cardi B, who is signed under a management deal and Trippie Redd who is signed to Solid Foundation, Quality Control’s talent management subsidiary.

At the helm of Quality Control is the label’s CEO Pierre “Pee” Thomas, COO Kevin “Coach K” Lee, Executives Tamika Howard and Simone Mitchell. With Tamika Howard — running the point, as the label’s General Manager.

Hip Hop has traditionally been a low capital intensity investment with high growth and high margins. The new wave of ‘Hip Hop CEOs’ should have a great understanding of the company’s inward focus (artists, infrastructure, growth potential, etc.) as well as a deep connection to the outside (markets, fan bases and the overall society in which they operate).

Coach K has been a mainstay in the Atlanta Hip Hop industry and has evolved into one of the city’s gatekeepers. From his early beginnings as a manager for Pastor Troy, Gucci Mane and Young Jeezy.

Coach K has cultivated and maintained a sustainable hip hop scene through a community-first approach to building a local music industry. As the COO of Quality Control, ‘Coach’ has continuously reiterated that there is no “inside” without the “outside”.

One of his main focuses as the Chief Operating Officer of Quality Control is to build fan bases and build brands — simultaneously.

“We’ve built our company brick by brick — grab your fans, build this fan base, and then let’s just grow it out, out, out.”

Coach K

With the rise of music streaming and big data, the music industry is ever-evolving. Not only has the role of music professionals changed, the need for ‘artist development’ has changed as well.

It’s a matter of short-term success or long-term growth and the need to build brands around artists have become more and more prevalent. Music managers have developed into assets within ‘Boutique Labels’ and are no longer just the people who handle booking, interviews and finances.

This is why you are seeing more and more managers assume the ‘CEO’ role.

‘Instead of taking a percentage of earnings, lets form a record label and split the check.’

Managers who assume the role of the CEO shift their focus to creating opportunities, increasing profit margins, developing markets and most importantly — building brands around artists.

If the focus is not to sign a major label deal, the independent label route is the best way to go. Artists can retain ownership and still benefit from partnering with major label distributors when appropriate.

Besides Quality Control, there a number of artists who have started their own labels and continue to run a smooth operation.

Lets take a look at a few:

Forming a ‘boutique label’ or joining one that’s already established presents a win-win situation for most artists. The dynamic presented is that you can build your brand, develop your sound and grow within a proven system without giving up ownership.

There will always be a mutual value being created between major labels and boutique labels because of the track record. When it is time to partner with a major label for a release, artists are in a position to create leverage and land a big pay day without entering into a lopsided deal.

“It gives them an opportunity to find things early, develop them, get things bubbling and then we can sign it when it’s ready for prime time.

They really know how to build things from the ground up.”

Ethiopia Habtemariam, the President of Motown Records — who brokered the deal with Quality Control

Now, lets deep dive into ‘4 Reasons Why Artists Need CEOs & Not Managers’.

1. The Link Between ‘The Outside’ to ‘The Inside’

Where is the focus? That’s one of the biggest differences between Music Managers & CEOs. Managers operate within a certain parameter. While CEOs connect the dots and give overall direction to the organization that will ensure long-term growth.

Primarily with the focus being centered around ‘The Outside’. Hence, Quality Control’s powerful mantras:

  • Control The Streets (Outside)
  • Solid Foundation (Inside)

CEOs help to define what “The Outside” is to “The Inside” and “Who matters the most?” The CEO clearly defines and reiterates a clear perspective for a team to follow.

Without an “outside”, there is no “inside”.

‘The Inside’ being defined as the overall record label, executives, artists, producers, etc. and ‘The Outside” being fans, markets, media outlets, networks, etc.

“Other labels have these A&Rs and CEOs and chairmen, sitting in an office looking on the internet at numbers on SoundCloud and Spotify — they’re just into the analytics.

That’s part of it.

But if I’m being honest — and it might sound ignorant — I don’t own a computer. I’m really out here in it.”

Pierre “Pee” Thomas for the New York Times

2. Decide Where To Play & Where Not To Play

The second key difference is that CEOs decide which competitive spaces to enter. While also determining what endeavors to stay away from and not waste resources. This allows artists to not only compete, but to win.

CEOs help to develop core strengths and competencies, grow an understanding of fan bases, build brands, innovate and develop market scalability.

Overall, creating value and opportunities through deciding what is an attractive business to enter.

Key Factors include:

  1. Always build from the core out.
  2. Always ask what is authentic?

These key factors will raise a number of questions.

What is the core business? Where should the focus be?

What is not the core business? Where should the focus not be?

“We have all our artists working on albums. We have a couple film and television [projects] in development right now. I have sports athletes [in their] contract year.”

Coach K continues to build upon his “Community-First Approach” by building a multimedia facility in the heart of Atlanta that will be home to music, television, visual art and film. Quality Control expects to create hundreds of jobs within the city of Atlanta.

“I think our music’s just evolved here. That’s one of the reasons I really wanted to build this infrastructure here.”

— Coach K

3. Balance The Present & Plan For The Future

One major benefit of CEOs is that they can help artists gain perspective. By nature, artists live in the moment and create in the moment. CEOs can help artists create flexible short-term goals, sustainable long-term goals while developing a realistic end-game for the future.

CEOs assist in planning out 3–5 year plans, as well as 10–15 year plans. Executing ‘Perfect Timing’ is as much as an art, as it is a science. Keep in mind, that too strong of a focus on the present, can take away from opportunities presented in the future.

Great CEOs can create a balance between present investments and planning 10 years out. Ultimately, placing bets on long-term growth and sustainability.

CEOs have to make critical choices to manage this balance and create the future.

“This is why it’s so hard for us to stay on track. He’s so used to fast money that I’m trying to get him to understand:

It’s fast money — but there’s a lot that comes with it.

The streets are going to always be there. But it’s got consequences.

I try to show them: Hey, there’s money over here, if you apply yourself. It’s safer money. No consequences. You don’t have to be the best rapper, but guess what?

If you keep working hard…I know it’s not what you’re used to but the reward will be greater at the end.”

Pee on Lil Baby

4. Set Standards & Form Values

CEOs by nature of the role, should be a formative influence within the record label and should continuously push the narrative of what’s expected from members of the team.

A strong set of values will help to develop a record label’s identity. More than anything else, values are about behavior. Forming strong values will help to move the business forward and create a sustainable future.

“In the absence of explicitly defined standards, people will develop their own; that’s human nature.”

A.G. Lafley, the recently retired CEO of Procter & Gamble, serves on the board of Snap Inc.

A taped printout on a bare wall at Quality Control Studios reads,

“DO NOT come to the studio UNLESS you are working.

BE RESPONSIBLE for the company you bring.

DO NOT have anyone dropping off or picking up drugs at the studio.

This is not your home, this is not a hangout, this is a place of business.

PLEASE conduct yourself accordingly and in a professional manner.”

(Also: “ANY gambling, all parties involved must pay the house 30%!”)

Standards are how you measure your values.

Anything that can be measured can be improved.

Holding yourself to a higher standard will help guide your decisions and help to raise the overall expectations of the organization.

The new wave of ‘Hip Hop CEOs’ will be in a position to:

  • Reiterate the record label’s purpose, standards and values for the future, as well as for the present.
  • Determine which avenues to take when developing businesses around their artist’s brand.
  • Remain agile, while keeping the focus on “The Outside” (fans, markets, media outlets and networks).
  • Create a sustainable environment that fosters growth and ensures that the business wins on all fronts.

“Brands last longer than songs.

Every last one of our artists turns into a brand, so why wouldn’t an artist want to be a part of that?

Especially if it’s right for them. Like I said, sh-t, we probably have 10 or 11 artists. Five or six of them are major stars.

We don’t chase artists. We’re big on: ‘We see talent, let’s develop it.’ ”

Coach K for DOCUMENT

Check out Pee and Coach K’s interview with “Rap Radar” below.

“One cannot manage change. One can only be ahead of it.

In a period of upheavals, such as the one we are living in, change is the norm. To be sure, it is painful and risky, and above all it requires a great deal of very hard work.

But unless it is seen as the task of the organization to lead change, the organization…will not survive.

The outside changes inevitably, sometimes very fast, and often unpredictably. Regardless of the dynamics, the same work must be done: linking the outside to the inside.

The CEO is the only person who can appreciate both the inside and the outside. This work will never go away.

The majority of a CEO’s time should be spent on the four tasks outlined here. Yet this is not the reality for many — perhaps most — CEOs. I give more attention to internal demands than I should; I constantly fight the gravitational pull from the inside.

But it has become clear to me that the CEO’s real and unique work draws on a uniquely external perspective that is inaccessible to the rest of the organization unless the CEO makes it accessible through choices and actions every day.”

— Management Challenges for the 21st Century, Peter Drucker

In today’s World, the Internet and big data has afforded many industries the opportunity to create value and build wealth. The evolution of music streaming has changed the way that artists are being developed.

With a heavy focus on building brands that are sustainable and focusing on long-term growth. The need for CEOs in the Hip Hop industry have became a necessity and almost a given.

The new wave of ‘Hip Hop CEOs’ will build brands from scratch through a combination of data-backed content, marketing strategies and repeatable formulas.

Music streaming has paved a way for independent record labels to operate as agile organizations. By focusing on these four areas:

  1. Being The Link Between ‘The Outside’ to ‘The Inside’.
  2. Deciding Where To Play & Where Not To Play.
  3. Balancing The Present & Planning For The Future.
  4. Setting Standards & Forming Values.

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Written by

Entrepreneur based in Minneapolis, MN. I write about Music, Inspiration, Economics & Business. Website: 227-mn.com & Newsletter: http://ow.ly/nBJJ50AbYAF

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