Nipsey Hussle’s mission was still in progress, but luckily he left his playbook behind.
The late Nipsey Hussle (via The Hundreds)
Nipsey Hussle’s death is heartbreaking. The Crenshaw native’s mission finally got the attention it deserved. As I wrote several weeks ago in Direct-to-Consumer Hip-Hop is Not a Game, Nipsey’s strategy was harder than it looks. Everyone talks about ownership, but the Victory Lap rapper was locked into that mentality and accepted the tradeoffs that came with it.
The Marathon Continues is the name of Nip’s 2011 mixtape. It soon became the tagline for his movement. The Marathon Clothing store in Crenshaw was the first step in a grand plan to launch similar stores across the world. His community activism and revitalization efforts were refreshingly pure.
In the wake of his death, fans have posted ‘The Marathon Continues’ as a call to action for his vision to live on. But what does that truly mean? It’s impossible to replicate Nipsey’s authenticity and inspiration. The path forward won’t be easy, but we need to break down the business decisions and concessions he made along the way.
What vertical integration meant for Nipsey
The 33-year-old rapper had big dreams for his Marathon stores. Here’s what he shared in an interview last year with Forbes:
“We’re creating an ecosystem, from production to consumption. Not only do we own the supply chain, but we can curate the experience. From the ownership of the actual master, to the retail experience and marketing the product, to consuming it. That’s the same model as Apple, if you think about it.”
Apple’s integration moves are clear. The company creates iOS software that only exists on the products it manufactures, then sells those products at a premium price in its own retail stores. And based on last week’s celebrity-packed event, Apple now wants to own and sell more of the content that’s consumed on those products.
The strategy has caveats. Apple’s not fully integrated. It still relies on third-party suppliers and authorized resellers. And some of its past integration attempts never took off. But the 43-year-old company is still a model that’s often followed.
Nipsey’s goal was similar. He owned his masters and the music he created. Here are two relevant quotes from the same Forbes interview:
“If I have 10 Marathon stores in different parts of the globe, and I drop 1,000 units to each store at $100 each, I’ll make $1 million as soon as we sell out the first 10,000.”
“You can go to The Marathon store for the first week and hear the song or view the video in-store. Then, after a week, it can go live on all other platforms. The exclusivity period belongs to a platform we own and control.”
He used a windowing tactic to maximize revenue from loyal fans. After selling past mixtapes for $100 and $1,000, he knew his day-ones value exclusivity and pay top dollar for it (even though the project would be widely available soon after). The high sticker price was both a marketing tactic and a price discrimination move. Every business should want to maximize each customer’s willingness to pay. When die-hard fans spend the same money on a product that a casual fan does several months later, money is left on the table.
Nipsey wanted the Marathon stores to be memorable. Millennials place a high value on experiences. That’s why Las Vegas wants more artists to start residencies. That’s why music festival culture has blown up. Even a relatively minor experience, like stepping into a well-designed Apple store, achieves that goal. That’s what Nipsey was after.
Vertical integration enhances the ability to differentiate, gain control, realize more profits, and potentially reduce costs. But few artists get there. It takes time and resources that some aren’t willing to give up.
Nipsey spoke on the business decision to release his early work as mixtapes and not albums. (via HipHopDX)
Running a brick and mortar retail outlet like The Marathon Clothing is not cheap. In a vacuum, it contradicts the standard approach in today’s music industry, which thrives on minimal distribution costs and ubiquitous access. But it aligns well with the direct-to-consumer model. Warby Parker, Rent the Runway, and many other DTC companies have physical storefronts in expensive cities. Marathon was ready to accept those costs to fulfill its vision.
The strategy also requires expertise in different areas. Some artists don’t have folks on their team with experience running a successful warehouse operation or a chain of retail outlets. Sure, today’s artists dabble in retail when they launch pop-up shops for album releases, but that’s light work in comparison. Nipsey and his business partner David Gross—a real estate developer— were deeply involved with each step. Decision-making teams are often a hallowed inner-circle. Artists need to let these folks in.
Time is also a factor. These moves take time away from making music in the studio. It’s a costly tradeoff for an artist that’s built a business model to drop new music consistently.
As a culture, we glorify the integration moves by Nipsey with Marathon or Beyoncé with Parkwood Entertainment (a future Trapital story). But we often gloss over the risk, cost, lack of flexibility, and barriers that can arise. These details are critical to reflect an accurate picture.
Marathons take time
Last year, Nipsey launched Vector90, a co-working space in Crenshaw. It was designed as a pathway from the streets of South Central to opportunities in Silicon Valley. Nipsey recently bought the plaza where The Marathon Clothing sits. The purchase was an additional step toward economic empowerment. These moves were praised because they acknowledged the time and dedication needed for successful community building.
He distinguished his efforts from the “slacktivism” that’s begrudgingly common from high-net-worth individuals. Nipsey didn’t start a nonprofit or a foundation and ask a friend to run it for him. He didn’t throw money at the local school district to boost PR. Thankfully, his moves echoed a slow and steady progression. It’s a theme that’s consistent with Nipsey’s music career.
Victory Lap (2018) is technically his first studio album. Everything he put out before that, dating back to the early 2000s, were mixtapes. By 2016, he made $1 million from Tunecore, a digital music distributor that helps indie artists collect revenue from the major streaming platforms. It’s an impressive feat, but took over a decade’s worth of work to get there.
Nipsey’s the first to admit that the journey was not as perfect as it seems from the outside. Here’s what he shared last year on Big Boy’s Neighborhood:
“That’s why I call my thing a marathon. I’m not gonna lie and portray this ultimate poise like I been had it figured out. Nah, I just didn’t quit. That’s the only distinguishing quality from me and probably whoever else going through this, went through this, or going through this is that I ain’t quit. I went through every emotion to pursue what I’m doing.”
It’s intriguing to think whether Nipsey’s career would be different if he started out today. On one hand, indie artists have more options to support their goals than ever before. But it’s hard to ignore the growing number of young rappers who generate bidding wars with record labels and land eight-figure deals in a short amount of time. It’s a blessing and a curse for today’s artists, but the challenge stays the same.
David Gross and Nipsey Hussle at the launch event for Vector90 (Timothy Smith via LA Times).
In a November interview with a local Fox affiliate, Nipsey provided a glimpse for what he wanted after he’s gone. “We playing the long game. We don’t want the money to stop when we go. When we can’t work no more. We want it to outlive us, we want it to be generational.” Sadly, that time has come. Far too soon. His loved ones and business partners carry an insurmountable burden, but they are not alone.
The marathon continues the push for artists who want to own the ecosystem of their brands. The marathon continues the evaluation of ownership and whether it makes sense for each artist. The marathon continues the sacrifice that artists make and the emotions they manage along the journey. The marathon continues the community development efforts that make a legitimate impact. And the marathon continues the vision for someone who lived life with purpose.
We’re fortunate that Nipsey Hussle left a playbook behind. There’s a lot to learn from it, and there’s a lot more work to do. The Marathon Continues. 🏁
Rest In Power, Ermias Asghedom – Nipsey Hussle. 1985-2019
P.S. – Here’s one of my favorite Nipsey quotes:
When you say ‘follow me on Twitter’, and you get 10 million people to follow you — you just leveraged your influence to add value to an app that you have no ownership in.
That’s facts. It’s one of the many reasons I end my Trapital articles with an ask to join my email list instead.