Read the case study, Russell Simmons Hip-Hop Entrepreneur Starting and Operating a Small Business by Mariotti and discuss the following questions:
hip hop entrepreneur Russell Simmons turned off his cell phone and took a rare moment to admire the view from his fourteenth floor office in mid town Manhattan. at 47 Simmons knew he had a lot going for him. as the president of rush communications he sat at the helm of a constellation of successful enterprises, including a record label a clothing line a philanthropic arts foundation and a multimedia production company. lately he had been thinking about how to leverage his influence as a hip hop mogul to inspire young people to get involved in social issues such as voter registration and education reform. yet when he was growing up in Hollis, queens in the 1960s and 1970s Simmons never could have imagined that his life would have turned out like this.
Window of opportunity
Early on simmons decided that he wanted to make his own way in the world.. his father had been a teacher and his mother worked as a recreation coordinator. both enjoyed stable jobs but simmons who never liked school very much enrolled at the city college of new York as a sociology major. that year something happened that permanently changed the course of his life. he went to hear a rap artist named eddie cheeba perform at a club and was amazed to see how the rapper had cast a spell over the audience with his freestyle rhymes. in simmons own words.
just like that i saw how i could turn my life in another better way all the street entrepreneurship id learned i decided to put into promoting music
At the time rap and hip hop were underground musical styles but Simmons set out to change this. he believed that rap music had the potential to reach a larger audience and so he teamed up with another aspiring rap producer named rick Rubin. Rubin had built a recording studio for rap artists in his new York university dorm room. together they decided to transform ricks studio into a viable and legitimate record label. by 1985 def jam records was officially underway. def jam experienced its first surge of success when it scored a number one hit with run dmcs remake of the aerosmith hard rock classic walk this way. bridging the worlds of roack and rap music turned out to be a stroke of genius. simmons and rubin single handedly introduced a whole new market of mostly white surburban heavy metal music fans to hip hop. suddenly run dmc was being featured on mtv and rap was no longer an underground fad.
simmons learned an important lesson form run dmcs breakout success. he realized that these rap artistis had soared to the top of the charts becasue they had remained true to their street style and musical origins. while run dmc may have popularized wearing gold chains adidas sneakers and name plate belts among suburban teenagers these were the fashions that its core audience of urban youth had already embraced. simmons understood that percieved as authentic was key to making itin his segment of the music industry. according to simmons
you have to tell the truth. it endears you to the community. the people can smell the truth and theyre a lot smarter than the people who put the records out.
simmons knew how to market his product and his ability to promote rap music and the hip hop lifestyle was influenced by how close he was to it. simmons has remained true to this philosophy of keeping it real thoughtout his business career. it permeates everything he does and is even reflected in his preference for wearing phat farm sweatshirts instead of brooklynn brothers suits. since those early days simmons has gone on to launch many otrher business ventures, which are all geared toward the same target market urban teens and preferences of other consumers.
In 1999 simmons sold his staker in def jam records to polygram records for over $100 million. he has since focused his energies on developing the various entrainment fashion and multimedia companies that are housed under rush communcation. simmons business goals have evolved from promoting hip hop music to developing new products and services for th urban youth market. one of his lastest pet projects is the rush card a prepaid card that aims to compete with costly check cashing services that target urban youth who do not have a bank account.
these days simmons is also using his stauts as a taste maker and hip hop entrepreneur to influence public debate anout political issues. in 2002 he organized a youth summit in new york featuring hip hop artisti such as alicia keys. when simmions put out a call to action over the airwaves over tweny thousand students showed new york cits hall to protest the mayors proposed cuts to the eduction budget. simmons has demonstrated that he has the skill and sophistication to market ideas as well as products and services. rumor has it that he may even decide to run for public office at some point. but for now he countiues to sit at the helm of rush communcations where he keeps his radar attuned to new opportunities ion the marketplace.
- How did the culture and upbringing in which Simmons was raised provide him with an advantage in his industry?