The Big Payback: The History of the Business of Hip-Hop, by author Dan Charnas is the latest look into the earning aspect of the multi-million dollar hip-hop industry.
In a recent article in the Washington Post, Charnas posted excerpts from the book detailing 50 Cent’s multi-million dollar deal with Vitamin Water and how Chris Lighty was instrumental in Fif’s monumental deal.
“By 2004, 50 Cent was undoubtedly one of the world’s biggest pop stars. But it took some amount of convincing on Oza’s part to overcome the trepidation of Glaceau CEO Darius Bikoff and president Mike Repole. 50 Cent’s association with gunplay presented a problem: What if their chief spokesperson ended up dead in a rap beef?
But the 50 Cent who showed up for his first meeting with Bikoff was surprisingly different from the rapper’s public image: calm, respectful and deliberate, without too many flamboyant flourishes. Lighty was the rapper’s perfect business complement.
In the weeks and months thereafter, Lighty and Oza hammered out the terms of a deal. 50 Cent would take a stake in the privately owned company, one that would graduate over time and escalate if the company hit certain numbers.
The two entities – 50 Cent on one hand and Glaceau on the other – signed an agreement of mutual confidentiality. Still, word got around that Lighty had negotiated something close to, but not more than, 10 percent of the value of the company.”
The book also mentions how Fif and Lighty were instrumental in the flavoring and details of the G-Unit boss endorsed beverage.
“Oza presented the [50 and Lighty] with several flavor options for Formula 50. For Chris Lighty, the choice was simple. Despite the high-minded science of Glaceau, their product was basically a smarter, more upscale, more aspirational version of the ultimate ghetto beverage on which Lighty and 50 had grown up: the “quarter-waters” sold in every bodega, deli and convenience store from Queens to Compton.
The quarter-waters (so named because they once cost 25 cents) were just like the Kool-Aid everybody drank at home. But nobody drank wild flavors like strawberry and kiwi in the ‘hood. They drank grape. Formula 50 had to be grape.”
Though initial reports of 50 earning as much as $400 million when Vitamin Water was sold to Coca-Cola were false, Charnas reveals that Fif’s take still pushed him into the upper echelon of rap earners in one fell swoop.
“In the media, initial reports put 50 Cent’s cashout at $400 million, calculated by dividing the purchase amount by 50 Cent’s reputed 10 percent share.
But in reality, 50 Cent’s take was much less. Another stakeholder needed to be paid off first – the diversified Indian conglomerate Tata had invested $677 million for 30 percent of Glaceau in 2006, and got $1.2 billion when Coca-Cola bought them out.
When all the other costs had been deducted, 50 Cent was thought to have walked away with a figure somewhere between $60 million and $100 million, putting his net worth at nearly a half billion dollars.”
“The Big Payback: The History of the Business of Hip-Hop,” by author Dan Charnas hit bookstores December 7.
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