3 Investing Lessons from Jay-Z


In 2019, Shawn Corey Carter became hip-hop’s first billionaire. Better known as Jay-Z, Mr. Carter hasn’t just made his money rapping, despite being one of the best-selling artists in the business. Instead, he’s built a sprawling empire, comprising a music label, sports management company, streaming service, and upscale sports bar.

With the Brooklyn-born rapper continuing to grow his net worth, there are certainly plenty of investing lessons to be learned, both from his businesses and from his words. Here are three.

Image source: Getty Images.

1. Diversify

With many artists struggling in 2020 as the coronavirus ended live concerts, Jay-Z is still making money this year – even without a new album release.

While it would have been easy for the rapper to stick to the music business, he certainly didn’t put all of his eggs in one basket. Instead, he spread his money over a diverse pool of investments and various business ventures. In fact, Mr. Carter is said to have amassed a valuable collection of art; invest $ 20 million in JetSmart, an app that aims to act as “Uber for private jets”; invested in Uber; and opened several upscale sports bars and restaurants. The rapper also earned over $ 204 million in 2007 when he sold fashion label Rocawear to Iconix brand group. He even started a fund, Marcy Venture Partners, LP, which raised $ 85 million invest in consumer-oriented start-ups.

So while some of Jay-Z’s businesses suffered during the COVID-19 era, others, including Tidal, its streaming music service, as well as its alcohol brands, including D’Usse cognac. and Armand de Brignac champagne, helped the rapper grow his fortune.

All investors should follow Mr. Carter’s example, acquiring stakes in companies across different industries and developing various sources of income. This reduces risk and maximizes the potential for economic gain, no matter what unexpected events come your way.

2. Invest in what you know and love

When Jay-Z formed Roc Nation sports, he told Variety: “Due to my love of sports, it was a natural progression to form a company where we can help top athletes in various sports in the same way that we have been helping artists in the music industry for years. ”

In fact, a lot of Jay-Z’s business ventures involve investing in businesses that the rapper personally enjoys. He described his brands as an “extension” of himself, saying “They’re close to me. It’s not like running GM, where there’s no emotional attachment.”

By choosing to invest in companies that he knows intimately, Jay-Z increases his chances of success. Of course, he can also cross-promote his other projects within his music, which means his investments work well together.

Investors should take this lesson to heart and buy stocks of companies they understand and like. Invest in things you love and hold on for the long term is much more likely to be an effective strategy for building wealth.

3. Commit to your goals

Jay-Z said, “You can want success as much as you want, but to get it you can’t falter. You can’t slip, you can’t sleep. One eye open, for real and for real. always.”

He lived these words, repeatedly showing that when the doors don’t open for him, he finds a new path. In fact, Roc-A-Fella Records was born because no major record company would sign it. Roc-a-Fella Records not only launched Jay-Z’s career as a hip-hop superstar, which made Mr. Carter’s other business ventures possible, but also created an artistic empire and ultimately led to a multi-million dollar deal with Def Jam. Media group.

As far too many people give up on creating wealth because of the obstacles like a lack of money or a lack of investment knowledge, Jay-Z shows that if you care about being successful, you will find a way and you won’t give up at the first hurdle.

Build your wealth the Jay-Z way

In his hit song Legacy, Jay-Z made it clear that he thinks long term with his business decisions, as his goal is to build something for his children to leave and create generational wealth.

This kind of overall goal, accompanied by a desire to learn and a solid investment philosophy, have clearly paid off for the Brooklyn-born rapper. Hopefully his advice will pay off for you as well.

This article represents the opinion of the author, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are heterogeneous! Questioning an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.

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