common knowledge

Jon Taves

Perhaps used solely as an excuse to eat carbs and sit in air conditioning, Americans love going to the movies in the summer. Can you blame them? Apart from the carbs and air conditioning, a screen the size of their house displays fantastical worlds, beautiful people, and lots and lots of explosions. This summer’s cinematic darling, Guardians of the Galaxy, stars Chris Pratt. Now shockingly “swoll”, Pratt leads a group of misfits on a quest to save the galaxy. (Although, I’m sure you could’ve guessed that from the title.)

As stars are wont to do before their new movie/album/book is released, Pratt went on a whirlwind tour of promotional interviews. One went viral, an interview with DJ Whoo Kid on his “Whoolywood Shuffle” radio show, after a video surfaced of Pratt perfectly rapping verses from Dr. Dre’s 2001 hit, “Forget About Dre”. Being the millennial I am, once I saw that video I was reminded of my love – albeit brief – for gangster rap in 2002, sending me down a Spotify rabbit hole. For a little more than a week my ears feasted on nothing but Dre, Tupac, Eminem, 50 Cent, and N.W.A.

Only recently coming up for air, and back to my usual mix of folk rock and classical music, I’ve taken time to reflect. Dre, the man who started my journey “Straight [Into] Compton”, is an incredible figure. Not only is he an impressive musical talent, but he’s an even more impressive businessman. In 1965, Dre (Andre Young) was born into humble beginnings. His parents separated shortly after his third birthday and his mother’s poverty, along with the crime-riddled neighborhood in which he lived in Compton, CA, led to a difficult upbringing. Coupled with making poor grades, transferring school three times, and fathering a child at seventeen, Dre wasn’t exactly set up to succeed.

Nevertheless, succeed he did. He founded N.W.A. in 1986 and had success as a solo artist a few years later, eventually forming his own label – Aftermath Entertainment – in 1996. By the time he left music in 2011 to focus on his business, Beats Electronics, Dre had received six Grammy awards. Three of those were for producing, with Dre responsible for kick-starting the careers of Snoop Dogg, Eminem, 50 Cent, and Kendrick Lamar.

Success in entertainment is one thing, but success is business is a different beast. There are seemingly endless stories of athletes and entertainers becoming broke after earning millions of dollars in their careers – an entire ESPN documentary, Broke, was made around this phenomena. Not only did Dre avoid squandering his money, he grew it. By forming Aftermath Entertainment, he earned royalties from the artists he produced and when he sold his share in the label to Interscope Records, he made $52 million.

Dre’s greatest feat in business was forming Beats Electronics with Interscope Records and Geffen A&M executive, Jimmy Iovine. Iovine recalls that the company originated when Dre once said to him:

It’s one thing that people steal my music. It’s another thing to destroy the feeling of what I’ve worked on.

That complaint grew into a $3 billion idea – the figure Apple acquired them for in mid-2014. Beats Electronics manufactures high-end headphones and speakers for personal and studio use. Beats began this endeavor by partnering with Monster Electronics and HTC. Concerned about a potential decline in the quality of their products, however, Dre and Iovine took the company under their control in 2012 and ran the entire supply chain, from R&D to manufacturing to delivery.

Dre has been described by rappers on his label and Iovine as a perfectionist and an incredibly hard worker. They claim he also has a unique ability to create “exactly what he wants”. Lucky for Dre, “what he wants” is also what consumers want. In 2014, before the sale of Beats, Dre’s net worth was calculated by Forbes at $550 million: the second highest in hip-hop, behind Sean “Diddy” Combs. Expect to see a change in the rankings next year.

The key to entrepreneurship is having a passion for the product or service you’re selling and the right mix of work ethic, determination, and partnerships. Ideas come and go, and as Sam Altman of the Y Combinator venture capital firm once said, he sometimes aims for “rebounds”. If they fall in love with a pair of founders, even if they suspect their idea will fail, they’ll invest in them just to be around for when they get it right. Dre fits that mold. His background wouldn’t lead anyone to predict success in the business world, but his unique blend of tenacity and street smarts led him from the corner store to the corner office. When thinking of the most successful US entrepreneurs, don’t “Forget About Dre.”

Jon Taves is a contributor to Common Knowledge Media and the editor of the economics and finance-based website, EFEssays.com.