Kanye West is clearly one of the few people of the rap genre who always finds a way to make it to the headlines of mainstream media on a regular basis. The last one was, as I checked both BBC and CNN as part of my daily rituals, I was surprised to see he made the headlines on both websites for asking Facebook founder and billionaire to invest 1 billion in Kanye West fashion ideas. Apparently the very successful rapper has been trying to gain access into the fashion and design industry and has met with significant failures and financial losses but based on his personal self-belief he is determined to crack that industry. In his very noble pursuit, he apparently has now acquired over fifty million dollars of personal debt. Poor Mr Kanye West! So he took to twitter to ask Facebook founder, whom he claims to be a fan of his music to invest 1 billion dollars in Kanye West’s ‘fashion/design’ ideas.
The pursuit of even more money will always make you think that building a school for some 400 kids in Africa who might become the next winners of Nobel prizes is not as good an investment as helping an already successful rich man, achieve his next dream; if we were to accept the poor tasted tweet that Kanye West targeted at the Silicon valley moguls who he asked to help fulfill his dream
First his plea helps us to understand the difference between a multi-millionaire and a billionaire. Most people will perhaps pray to have as much money as Kanye West and cannot probably think of him needing anything that he cannot afford; but here we face the reality. Money does not solve all of our problems and you can never have enough of it! The pursuit of even more money will always make you think that building a school for some 400 kids in Africa who might become the next winners of Nobel prizes is not as good an investment as helping an already successful rich man, achieve his next dream; if we were to accept the poor tasted tweet that Kanye West targeted at the Silicon valley moguls who he asked to help fulfil his dream. I will however focus on the business lessons that lie in the Kanye West state of affairs that everyone can learn from.
Sometimes, when we know or are related to someone who has a bit of money, we have this sense of entitlement, expecting them to ‘invest’ in our business. No it is their money, you need to respect it, if you want them to invest, then make them an offer that represents a win-win for you both.
- That you are successful in one field does not guarantee success in another. Success is not directly transferable. You have to do the first works! You have to do the graft in a new field to excel and rise to the top of it.
- Do not borrow money to start a business. Borrow money only to grow a successful venture. We have definitely been hearing a bit about this man as a supposed designer. Now we know that all we have heard is simply from money he himself has spent on publicizing it. Probably over 100 million; his own money and borrowed money. One success though along the way was his collaboration in making sneakers, called Yeezy’s. My business head tells me Kanye West would have benefitted more investing money in growing the Yeezy sneakers brand than an idea that he seems to have tried and tried 50 million dollars deep without success. He should have stopped after the first 5 million.
- It will be even sadder if the debt is in his personal name- He seemed to suggest that this amount is a personal debt. I.e. if you went into Kanye West account log you will see outstanding loan of $50 million and he will probably be paying back like $20,000 every month. All smart business people trade and borrow as a company, limiting the liability to themselves. If all that money is borrowed in Kanye West’s name then he sure had better send his begging request to Mark Zuckerberg from Facebook to get Marks’ ears; otherwise we will soon be reading of another bankrupt star.
- Business can be a killer; you need to respect it and take the time to learn it with humility- Most people including Kanye think that business is just something they can take on anytime; maybe after they retire or simply when they are tired of being bossed around. Business is a craft; you need to learn it like you learn a profession, to learn you need to have the humility to be taught. When you are not taught about business; even when you have a failed prospect you will continue ‘investing’ in it. Most of us would have gotten broke earlier than Kanye, hence we do not even get to take our non-viable ideas as far as he seems to have; but now we know that it is all on the wings of debt.
- Listen to the market- If the market place is not buying your products. You will not be successful. Your business should be able to sustain itself organically from the sales that come into it. If your sales do not sustain your business, you need to make adjustments fast and realise it early enough and have the business head to identify the point at which it ceases to be a viable proposition.
- No one owes you nothing– I am certain that when Mark Zuckerberg purchased his Kanye West albums, he paid the appropriate price for it. That’s the transaction done. Mr Zuckerberg owes him nothing for being a fan. Sometimes, when we know or are related to someone who has a bit of money, we have this sense of entitlement, expecting them to ‘invest’ in our business. No it is their money, you need to respect it, if you want them to invest, then make them an offer that represents a win-win for you both.
- You need to make your business investable– I am very certain the Facebook founder will have no qualms in investing in the music of Kanye West, after all; he has millions of record sales to justify that and he is still marketable and Zuckerberg will definitely make profit from it. But what this man doesn’t get is that he simply does not have an investable, marketable entity in this fashion design field. I have only seen one picture of him standing with his models; the clothes looked like super sacks; even in this world of crazy fashion, I do not see how they can sell. If they could sell, investors would have come to him before he needed to ask.
- There is a way to seek investment– I wonder if this man ever reads the newspapers, he would have found out that David Beckham is planning on starting a new football club including building a stadium. It seems David had good advisers because what he did was to set up a consortium of rich folks, with him being the brand ambassador. He looks to me that he is smart enough not to have invested even 1 dime into the project, because he knows that he as a brand is the real draw and he brought the investors in to monetise his brand. What Kanye West has done is the equivalent of David Beckham, building the stadium and running the team with his own money. The ability to leverage other people’s money to achieve profit for all stakeholders is the ultimate sign of financial intelligence.
- Stop asking the wrong question– I will be surprised if Mark Zuckerberg gave him any money. If I were in Kanye West’s shoes, I will be asking Mark Zuckerberg to come on board without a dime of his money but as a mentor to provide me the advice and business acumen to penetrate and be successful in an industry I am not traditional to. It was an opportunity missed. If the success of Kanye west’s ideas was about money, $50 million dollars would have made the ideas successful, unfortunately he seemed to be caught up in a battle with his ego and financial ignorance; which is true for most people who start out in business.
If the success of Kanye west’s ideas was about money, $50 million dollars would have made the ideas successful