Berner’s Billion Dollar Cannabis Business and Hip-Hop’s Wealthiest Artists

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Berner (via Shutterstock)

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how the Cookies crumble

Zack estimates that Berner’s net worth is $410 million. Most of that is from Cookies, his cannabis business that does nearly $500 million in annual revenue.

When weed was legalized in California, Berner worked at a Bay Area dispensary and gained a reputation for his Girl Scout cookies-style strain of cannabis.

He turned that into a standalone Cookies company that licenses its products to other dispensaries, sells direct-to-consumer, and has a clothing line too. Cookies now has nine distinct brands and operates 55 stores in 20 states and seven countries. It’s the type of legitimate enterprise that Stringer Bell dreamed of when he took that Macroeconomics 101 class in The Wire.

And when Berner’s not building his business, he’s still a prolific hip-hop artist. In 2022, he released a 30-track album and had over 100 million Spotify streams overall.

wealth for the non-superstar

The wealthiest artists tend to be the ones who first reached the highest levels in music. Jay Z, Diddy, Rihanna, Dr. Dre, and Ye leveraged their massive fanbases and influence in music to build their billion-dollar businesses. They launched audience-first companies with built-in distribution.

They’re all impressive, but Berner’s success is more unique. He wasn’t a household name from his music, but he still used his notoriety to build Cookies. He also did it in a polarizing industry with tons of regulatory challenges. It speaks to the strength of the company, its products, and its marketing.

Also, weed is historically (and literally) grassroots. Cannabis consumers don’t rely on big brands or celebrities to influence buying decisions. Berner started selling weed when he was an underground rapper. He’s the perfect salesman. If you have ever bought weed, you’ve probably bought it from someone who also tried to sell you their mixtape too. If that’s not product-market fit, I don’t know what is.

Berner’s not alone as an artist building a non-superstar business empire. Master P is a hybrid. He was well-known after No Limit’s run. “Make Em Say Uhh” was an anthem. But P never reach the consistent music heights that Jay Z or Diddy did. Percy Miller did get there in business though. His consumer products have distribution in Walmart and other major locations. Plus, he owns most of his businesses so the margins are much higher.

Another example is Chamillionaire. He had a huge hit in 2006 with “Ridin Dirty.” He never hit that superstar level in music, but he started angel investing, worked at Upfront Ventures, and has invested in several companies that have exited, like Lyft, Ring, Cruise.

the rest of the list

Here’s the full list of Hip-Hop’s Wealthiest Artists of 2022:

–  Jay Z – $1.5 billion

–  Diddy – $1 billion

–  Ye – $500 million

–  Berner – $410 million-

–  Dr. Dre – $400 million

Not much has changed for Jay Z recently. His name is always in the mix of potential buyers when an NFL team is up for sale though. $1.5 billion isn’t enough for outright ownership of a team, but he could still contribute to a sizable stake in a bid.

Diddy recently bought a $185 million cannabis business and hopes to bring that Ciroc marketing magic to the industry. Berner’s success with Cookies is a sign that a great marketer can win in this space.

Ye and Dr. Dre have dropped on the list in recent years, but Zack predicts that Drake may be the next artist to rise up. With his massive streaming numbers and his massive deal with Universal Music Group, it may only be a matter of time.

Listen to my full conversation with Zack on the Trapital Podcast:

0:00 Zack’s process behind putting the list together  

2:59 The newest billionaire on the list

8:31 The growth of Diddy’s DeLeon tequila brand

17:06 Sean John’s place in Diddy’s portfolio 

18:40 Diddy’s latest moves in cannabis and possibly Twitter 

21:47 The evolving business of REVOLT

26:24 Berner’s “surprise” $410 million net worth

31:50 High potential for Berner’s business

34:52 Berner’s business success supersedes his music fame 

39:50 Drake moving up the ranks 

43:50 Girl Dad stories




[00:00:00] Dan Runcie: Hey, welcome to the Trapital Podcast. I’m your host and the founder of Trapital, Dan Runcie. This podcast is your place to gain insights from the executives in music, media, entertainment, and more who are taking hip hop culture to the next level.

[00:00:23] Dan Runcie: Hey, today’s episode is a two parter. The first part of the episode, we’re gonna do a breakdown on one of the more recent news that happened in the music industry. Motown Records CEO and Chairwoman Ethiopia Habtemariam has stepped down and there is a lot to unpack there. So we’re gonna talk about that. And in the second half of this episode, we’re joined by my guy Zack O’Malley Greenburg, and we are gonna talk about the recent list that he put out, which is his hip hop’s 2022 list for the wealthiest artist. He has some new announcements, some usual names, and we break it all down. But first, let’s start with the news at Motown. So it was last week, shortly after Thanksgiving. Ethiopia and Universal, and Motown announced that she will be stepping down from her role. This is a role that she has officially had at this level for just over a year and a half. I think it was March, 2021 that the role was announced, but she’s essentially been the face of Motown from a leadership perspective for over a decade now and when the move happened, I think that there were a fair amount of people I could understand that could have been caught off guard by it. But when I start asking around, asking a few people questions who I know understand the situation pretty well, it’s quick to see that what’s being pushed publicly isn’t quite reflecting what’s actually happening behind closed doors. But before we get to all that, let’s talk about some of the wins that I think Motown and Ethiopia have accomplished over the past decade, because I think these stand out and they’re really important. I look at the 2015 joint venture deal that she did with quality control music, as one of those deals that can ultimately help bring a record label from its days of resting on its laurels to being able to get a bit more current. We’ve seen this happen time and time again. You look at Interscope in the early nineties. Interscope was a legacy rock and roll label. Jimmy Iovine was trying to figure out the next thing and then boom. Here comes Suge Knight. Here comes Dr. Dre and Death Row records comes through. Not only does Death Row continue to rise up with the supportive Interscope, but you also see Interscope adopt a bit of that cool factor and really revive itself, and now Interscope is continuing to be one of the strongest record labels that we have. You also saw that a few years later happened with Republic records and with cash money signs. The deal that I’ve talked about plenty of times on this podcast, that 1998 distribution deal and that deal did a lot for Baby and Slim, but it arguably did even more for Republic Records, which now I believe it’s in its fourth year in a row, the leading industry or the leading record label in the industry when it comes to overall market share. And I do think that what quality control and Motown were able to do, do deserve some similar praise. But the slight difference here is that Motown for a lot of its time and even more so as we continue to learn, was saddled under the Capitol Music Group umbrella and didn’t really have the opportunity to standalone as a true record label that could run on its own and be a standalone entity. The same way that we see with Interscope, the same way that you see with Republic. And some of the other record labels that are under the Universal Music Group umbrella. When the news first announced though, there wasn’t as much chatter about Ethiopia’s departure. You think about the times that Def Jam has turned over CEOs. There are think pieces on think piece. You can’t get people to stop talking and sharing their opinions, and some of them on base, but people sharing their opinions about what Def Jam did and didn’t do wrong, but there wasn’t as much here. You saw a little bit in piece that Gail Mitchell at Billboard had done where I think she did a good breakdown. You could definitely read between the lines a little bit of some of the things that necessarily weren’t being said, but what I think we started to unpack and what we started to get a sense for was, even though Motown had increased its market share considerably under Ethiopia’s tenure, I believe back in 2017, it was around 0.4%. And as of most recently from what Billboard reported in 2022, it’s at 0.95%. And that’s great, more than double. And you think about how much more recorded music has grown from 2017 to 2022 now as well, that’s a pretty huge growth and that’s nothing to shy away from. The thing is, record label executives and the music industry aren’t just judged on market share. You’re judged on how efficient you are with what you do to acquire that market share. You’re also judged on your ability to score deals and your ability to do it in a way that’s efficient. Everyone still has a PNL at the end of the day. But I think the slight difference for some of these companies is that because they sit under the Universal Music Group umbrella, you may not necessarily know what’s really happening unless you have a really discerning eye and you can put two and two together. And if you look at some of the moves that Motown has made over the years, there have been a number of big signings. But have those big signings always necessarily led to the type of results? You know, someone like Universal CEO, Lucian Green wants to see from a record label that now would be standing alone and no longer under the Capitol Music Group umbrella. You look at an artist like Lil Baby, who you know, through quality control, is part of that Motown collective. But, you needed a few more artists at that level and you needed to get them at affordable rates. And I think the biggest win that we saw from Motown in recent years was they recently signed NBA Young Boy. This is about a year after he started working with his record label, but how much did it cost to get NBA Young Boy? He had just posted on Instagram, this is two months before this deal was made public. He had just posted on Instagram, this was in August, 2022, that he was a 60 million dollar dude. You’re saying you’re a 60 million dude. A lot of people thought that was a cash money deal. They thought that was probably what Baby and Slim offered, but you later find out that this is what was coming from Motown, and I don’t know if that’s the number or not, but you can just assume a few things. One, NBA Young Boy was someone that just got out of his deal at Atlantic Records and he’s getting out of his deal. This is the second most streamed artist according to HITS Daily Double for year to date for 2022. But as we also know about streams, not all streams are necessarily weighted the same, and those YouTube streams may not necessarily lead to the same payouts that you may get from the digital streaming providers. Your Spotify, your Apple music, your titles, your Amazon, and so forth. So you have that. You also mix that in with NBA Young Boy’s audience isn’t necessarily the type to go buy up a bunch of vinyl. They’re not the type to go buy up a bunch of digital copies or then necessarily sell out an arena. And it’s great that he has those streams, but he has those streams because he is dropping an album every other month. It’s not the same as Columbia having a big release from Harry Styles and then monetizing the shit out of that. Or Kendrick Lamar having a big release on Interscope, and then that continues to do numbers and numbers. It’s not the same type of thing in that way. So I think, even if you were able to win a bidding war, which is great, obviously a number of labels would’ve wanted to get NBA Young Boy. There’s a certain price to everything, and even though we may not know the specific details, we can put two and two together. There are also a few other recent signings that could be called a bit into question. There were signings of Diddy and Brandy, and these are names that I think a lot of people, especially millennials and Gen X folks grew up with, and they’re gonna be people who have done quite a bit in the music industry, but they’re at a different stage in their career. They’re hot. Their years of earning meaningful revenue for a record label aren’t necessarily where they are at this particular point in their careers. That’s okay. But does the price that was paid to get them, justify that. And I think there’s kind of an unsaid thing where if you’re signing someone who is already well off, they are likely doing this for their own choice, then it may cost a little bit more than an equivalent artist who could produce just as much from a revenue side as what you may expect from Diddy or Brandy moving forward if they don’t have that name and that cache. And to be frank, the stability to not do a deal unless it’s gonna be lucrative enough for them. And then you also have artists like Smino and Vince Staples who are talented at rap, and they definitely had the moment where you thought things were rising up, but they don’t move units like that. And then it brings you back to the broader piece of what’s happening, specifically with the JV, with quality control music. And I think that you’ve seen a lot of success there. Little Baby is one of the most successful artists that we’ve seen, but I think you just needed a few more artists, even Migos. I think that Migos in some ways from a commercial standpoint, peaked with that first culture album that came out. Culture two wasn’t able to hit the same heights and Culture three definitely wasn’t either. None of the solo artists were necessarily able to do that, and unfortunately there was some, you know, conflict between the Migos themselves. Takeoff is no longer with us. There’s just a lot that just didn’t exactly line up. It’s really tough, and it’s even tough to share it this way because I think one of the reasons you didn’t hear a lot of chatter and discussion about this is a lot of people really wanted to see Ethiopia succeed, myself included. We wanna be able to see these black executives continue to reach the highest ranks that they can because we also wanna be able to see the same, whether it’s toon feat at Def Jam or other. But the way that things are presented externally and this effort to necessarily hide things may have you thinking that these executives have more control and influence than they actually do. And they weren’t necessarily given the same level of influence or control that John Janick may get at Interscope or that the Lipmans may have at Republic. So we really have to be honest when we’re reporting these things and what we’re showing and what we’re not, because it does a disservice not only to the industry about, you know, trying to hide these things because listen. This is a place where there’s plenty of people that are talented. People learn from where they can come through and it doesn’t, and it isn’t gonna hurt people the way that you think that it is. And one of the reasons that these things often can be controlled this way, the music’s industry’s PR machine can be so strong and it can have you having this, you know, Misconceived perception, and while I think insiders do know, there’s a lot of folks who are on the outside that will eventually rise to those ranks who just don’t necessarily have a clear picture. And anytime that there’s that big of a delta, that’s how information just doesn’t necessarily get itself to the right people at once. And we wanna make sure that we’re doing everything we can to empower the folks in the next generation. And I know a lot of this is swimming uphill. This is an industry that is controlled by a lot of lawyers, and it’s an industry that really thrives on the PR of how things spin, but been behind closed doors. It’s a very different situation. In some ways it’s almost a stark difference to something like tech where so much of the drama and decisions that happen within big tech are happening. You know, out in the open you could see things and while some of that, you know, can be to a fault, I do think it leads in some ways to some better discussions around what success can look like and what opportunities can look like. So I hope we can all use this as a reminder to make sure that we’re being transparent as we can. When we call things out, it helps more. Think and be able to have the right discussions about what success looks like, and the more that we can report on what success benchmarks actually are, so that you’re not just relying on an imperfect key performance indicator like market share, and you’re actually reporting on. Efficiency. It’s great that someone landed a deal, but how much should it cost to get that artist assigned? And will that payout turn out the way that you think that it is? And at the end of the day, this is about PNLs. Are you bringing in enough profit to offset any of the loss? And is there future belief and potential in your ability to get the buy in, do it in an efficient way, and keep driving the business? Quite the buzz after Thanksgiving. We’ll see what the rest of the year brings. I think things will be pretty quiet until things head into January. But with that, let’s turn things over to the next part of the episode. Here’s my conversation with Zach O’Malley Greenberg about the wealthiest hip hop artists in 2022.

[00:13:06] Dan Runcie: All right. We have Zach O’Malley Greenberg back with us, who recently released Hip Hop’s wealthiest List for 2020. Your second year doing this independently, by the way. So shout outs to you on that. And it was great to see the results. We had some expectations, Jay-Z, number one, but there’s two people I really wanna dive into with this conversation. Let me just run through the list first. So you have Jay-Z, number one, one and a half billion. Diddy to newly minted billionaire, 1 billion. You have third, Yey at five hundred million dollars. 4th, Berner, 410 million. And then we have Dr. Dre at 400 million. So let’s start at the top. What was it like for you, not just releasing this independently, but being able to put it out and as you were putting it together, what were some of the stuff that stuck out to you?

[00:13:56] Zack Greenburg: Yeah. You know, first of all, this list is probably the thing that I put the most effort into every year. At the end of the day, you see these numbers, you know, 1.5 billion, they get reported. And it was the same in my days at Forbes, as doing it independently. People take the number, everyone with it. And I think a lot of times people just assume it’s like, ah, somebody’s pulling them, out of wherever. But you know, I would say I put more time into those numbers, than I have put into some cover stories, you know, that are several pages long. So it’s going through each of these, you know, these superstars and figuring out, you know, what’s in their portfolio. What is each asset worth calling? People, you know, who have knowledge, whether it’s, you know, within the camps of the stars themselves, or industry experts that are covering, you know, the booze business or the weed business or something like that. Finding ways of valuing these assets. And, you know, and I think the new thing for me, aside from doing it independently was, I’ve been taking courses at Columbia Business School this year. I’m part of a fellowship where I sort of do my first year of business, school light, and get to bounce around and learn some of these concepts that, you know, maybe, I didn’t know before I got to sharpen them. And it’s given me some new tools for looking at things like Diddy, Ciroc Partnership and, you know, ways to value things that are a little bit weird and not sort of like a run of the mill asset. So, yeah, you know, I mean I think the big takeaway, the big surprise is probably Berner being on the list, being ahead of Dr. Dre. Like you said, I think Diddy being a billionaire, finally, you know, Diddy would say that’s not news. You know, you would say that he should be higher. I’m sure it’s been really cool to take a look at it, you know, independently and with some of these new tools in my toolkit to come up with, I would say my most active list.

[00:15:40] Dan Runcie: Yeah. Well, that’s good to hear. And I wanna talk about Diddy first because I feel like. That’s the one. I’ll be honest, the news there surprised me a bit, not because I didn’t think that Diddy was a billionaire, but more so because of how his business is and how things are structured. And it made me wonder, okay, how much has changed? Because I knew that Ciroc was the main thing that he had, that was the one of the largest drivers of his net. But you can correct me if I’m wrong, but I thought that the sales had peaked around the mid 2010s and maybe there was a slight decline, but maybe, you might have more intel on that. And I know that revolt and I know that business there. And with Sean, Sean itself, I know he had sold it and bought it back. So I was a bit curious to see or maybe hear how much net worth changed as a result of something that had appreciated in value versus your calculations of how you’d be doing this now as opposed to maybe how you had done it years back?

[00:16:41] Zack Greenburg: Yeah, I mean, so, you know, I think my methodology changed slightly. The breakdown isn’t that much different. Ciroc is still the main component. You know, you could say safely, it’s the slight majority of his 1 billion net worth. And it’s a weird arrangement because he does not hold an equity stake. However, the deal is structured to emulate an equity stake because, you know, it wouldn’t have worked as an equity stake cuz Ciroc is owned by Diageo, it’s this giant public trade company. They couldn’t really be like, Hey, here’s, you know, a quarter of our company or something like that. There wasn’t really anything to do with that. So it was more creating a framework around the Ciroc brand to function like an equity stake. So if Diageo were ever to sell Ciroc, Diddy would get, you know, let’s say the proceeds after you back out the amount of money that Ciroc has put into the partnership. So, you know, it would be a lot. And there’s no doubt that even if things have sort of flattened out a little, it’s a multi-billion dollar brand. You know, I mean, if you look at something like Ketel One, you know, brands like that that have changed hands, you know, these are billion dollar brands and you know, Ciroc is I think number two behind Grey Goose. So it’s up there. They’re not gonna sell it, but if they did, you know, we’re looking at a pretty big payday. So the question is how do you value something that isn’t gonna get sold? And really, you know, you wanna really nerd out about it from sort of MBA type perspective. You know, thinking about valuing cash flow. That’s, you know, one of the fundamentals of valuation in corporate finance and stuff like that. And, you know, there are formulas and without getting into like the, you know, sort of like more details of it where you can sort of enter assumptions into the formula and you can get a number. But basically what I did was I took the way I was doing it before I ran the numbers that way, and then I kind of did some pre cash analysis and kind of like average things out and any way you slice it, these Ciroc partnership is, you know, worth a little more than half of his, billion dollar valuation. The other things that, you know, I think perhaps I had been, you know, undercounted a little bit in the past or have appreciated. A lot since then, you know, revolt is still hanging around there. And that’s another thing where the valuation could depend on you. Do you value it as, you know, sort of a, like a TV based entity, even though it’s more digital? Do you value it as a news outlet? Do you value it as a tech startup? There are a bunch of different ways to look at it, but in any case, you know, he is the majority owner. Another thing that I think people sleep on is DeLeon tequila, that is really growing and he owns half of that. Actually. It’s a 50-50 joint venture with the AIO and they’re moving a hundred and something thousand cases a year now. Actually, you know, booze has done really well during the pandemic. You might imagine people, I don’t know, I feel like we’re back to, you know, some of our old ways of going out and doing things. People are drinking at home during the pandemic. So, you know, Ciroc and DeLeon didn’t get hurt in the way that, let’s say the live touring business did. So Diddy was pretty well slated there. And then you go through and he’s got like a pretty immense art collection. He’s got some real estate that’s appreciated pretty rapidly over the past few years. You know, some of which he owns out, right? And, you know, you kind of add it all up. And, he’s comfortably a billionaire. And yeah, I mean, if you notice like  you know, some folks when they hit that status or when they make the list or something, we’ll kind of like to tweet about it. But, you know, I don’t think I saw anything from Diddy because, you know, he’s thought that he’s a billionaire for, you know, years already. And, you know, maybe he was, but now I, I definitely think that he is and, I would expect, you know, to see other, let’s say mainstream business outlets follow suit in, you know, kind of acknowledging what’s definitely the attitude.

[00:20:40] Dan Runcie: Yeah, appreciate the breakdown there and thinking about just like different categories there. If thinking about Ciroc itself, as you mentioned, maybe the sales flattened out a bit, but looking at revolts specifically, and I know that business has, you know, gone through some evolutions as well over the past few years, would it be safe to assume that the biggest valuation change here for Diddy’s assets that maybe brought him to a billion is daily owned and some of the artwork in terms of like what’s appreciated? If we assume that whether it’s Ciroc or Revolt have flattened out a bit. Like would those be the ones you say that had put him over 1 billion? 

[00:21:21] Zack Greenburg: Yeah, you know, he was pretty close before, last time I did it before was, I think it was three years ago. I think he was at 740. You know, personally, you know, without getting too deep into it, I would’ve put ’em a little higher. But, you know, you get your files. I did. And that spar deal and you know, you gotta create a consensus. And I think, you know, and Forbes always says it, it would rather be conservative about valuations that it would rather understand an overstate, but you know, so that’s part of it too. Yeah, I think there’s definitely been an appreciation in the value of DeLeon the real estate, you know, there’s a lot of startup stakes, and he’s not doing it as, let’s say publicly as, Nas or Jay-Z, but, you know, he definitely hops in as an angel in a lot of, a lot of startups that, that have done well. So, but, you know, yeah, I think DeLeon doesn’t get the glory of Ciroc, but you know, it’s a younger company. There’s more room to grow. And not to be a shit, but it actually tastes really good. I’ve tasted other, you know, celebrity tequilas and they’re not good, but it is a tasty booze, if I may say so myself. And I think the way that he launched it was that he found this sort of, you know, like a boutique brand that had already won some awards and then he kind of got in with Diageo and, and they boosted. To where it is now. So I really think that’s probably like where you could see a lot more growth, if he’s gonna start to try to challenge Jay-Z for that.

[00:22:53] Dan Runcie: Why do you think that DLleon hasn’t gotten that same amount of love that Ciroc has gotten, at least publicly?

[00:23:00] Zack Greenburg: I think a lot of attention was focused on, you know, like Casamigos or some of the other really big brands and it hadn’t quite gotten to that level with the same, you know, distribution and mind share. And, you know, frankly, I mean, I think Diddy has been devoting more energy to Ciroc, but you know, you’re starting to see it, you know, it’s a little bit less in your base kind of vibe with the brand. it’s like more of a sipping thing, less of the shots at the club kind of thing. Although I’m sure, you know, you could sit either or do shots at either at the club. But I think it’s just not around as much. I mean, I think the case volume on Ciroc is still like 10 times more than 10 times as high as DeLeon. So, you’re just not gonna see it around as much. And I think that’s why.

[00:23:51] Dan Runcie: And the other thing too, that you mentioned is that DeLeon itself is actually a joint venture with Diageo, unlike Ciroc Partnership. So of course I know that the Ciroc partnership, now we’re talking 15 plus years ago at this point when things kicked off and different positions, different leverage and relationships. So I wonder if the relationship is part of the reason why Diddy was able to have the type of ownership. Partnership with DeLeon that he may not have, at least in writing with Ciroc? 

[00:24:23] Zack Greenburg: Yeah, I think so. And I think that was part of his motivation, for how he structured DeLeon. He wanted to have that. Actual equity stake, you know, like ironclad 50-50 joint venture type thing, rather than an agreement that mimics a joint venture. So, you know, I think that the success of Ciroc definitely convinced Diageo like, all right,, we can do this with another brand. He’s the guy. And, for my book, 3 Kings, I talked to some books over there and you know, I think I talked to the CEO at the time, and they couldn’t have been more abusive about him. And of course, you know, like whatever, he’s part of their team. Of course they’re gonna say good things about him, but they were saying just like the attention to detail. Like he would, he would go to clubs and, you know, go to the bartender and be like, why is the Ciroc not on the top shelf? And what are you going to do? You’re gonna be like, oh, sorry Mr. Coles gonna leave Joe here. You know, and they’ll put it up on the top. I mean, it’s sort of like a retail politics level of stuff. And you know, I always say that, that Diddy, you know, in a way, like you could argue. Who has had the most scheduled career and you know, who’s the goat of, you know, on the business side. And you know, I think a lot of people would say Jay-Z, and they wouldn’t be wrong. But, you know, I think Diddy in a way has done more with less because he hasn’t been musically relevant in, you know, a really long time in that way. Still puts stuff out in whatever, but it’s not like the anticipation that exists when Jay drops an album or even a verse on, you know, on a DJ Khaled song or something. And, you know, I always like to say that Diddy is kinda more like Richard Branson if he happened to just have had, you know, like a moment as like a big time rapper And you know, certainly as a producer, he’s had ahead a lot of things. And not to diminish that, but he acknowledges himself. He says, I don’t write rhymes, I write checks. And I think that’s a strong student. I think it’s especially impressive to see that he’s done it without being particularly talented. 

[00:26:40] Dan Runcie: Yeah. I think that, His true line of being able to sell a lifestyle is what sets him apart in a lot of ways. He did it with his music. I think in a lot of ways. Bad Boys modeled after so much of what he learned at Uptown, and then you’re able to transfer that lifestyle to, okay, this is the music that you listen to now. This is what you wear while you wear Sean John. This is what you drink while you’re listening to this, right? Mm-hmm, you’re gonna drink and this is the media that you’re gonna watch. Now with the cannabis line that he just bought, this is what you’re gonna smoke while you’re enjoying this lifestyle too. Mm-hmm. And I think that a lot of those businesses have had varying success and we can go into that, but I do think that the ones that have been the most successful, Ciroc, Sean and the music, there’s that tight connection and there’s a key timing aspect that goes into all of it.

[00:27:35] Zack Greenburg: Yeah, and it doesn’t even need to be his music. Right? That is popular in order for the Ciroc Formula to work, it’s the Ciroc Boys, it’s DJ Khaled, Summer Watermelon, or whatever it is. You know, I think his ability to make those partnerships, to find other people you know, who are kind of doing now what he was doing then musically are, you know, I think that that’s part of the formula and that’s why it works so well. And you know, I mean, it’s funny, like DJ Khaled, you know, something like Wild Thoughts was doing exactly what Diddy was doing a couple decades ago, right? He was taking a song from a couple decades, you know, one or two decades ago and putting, you know, some new voices, the modern voices on it. And it was a song that was great before and now it’s got, you know, like more kind of a vibe to it and you know, goes off the chart, so I think Diddy is just very savvy with that kind of stuff, even if it’s stuff. 

[00:28:31] Dan Runcie: Let’s talk about Sean John for a bit, cause I’m curious how that factored into your methodology with everything, because as many people know, he started the brand over 20 years ago and well, in 2016 he sold the brand, then the brand was up in auction, and then he bought it for public number I saw was 7.6 million. So now he has that back as an asset. How did that piece of it factor in for you and just the journey overall of Sean? 

[00:29:02] Zack Greenburg: Yeah, and not much now. You know, I mean, I think what factored in more was, sort of like his cash pile. Like he sold it for. Like, whatever it was five years ago, something like that. I think he got, he got 30 million out, 40 million, something like that, that he then put into other things. And uh, you know, obviously without him it doesn’t do well. And so he went bankrupt and I think it’s really smart for him to buy it back. You know, who knows what he might end up doing with this, but, I think there’s just,  you know, like a tremendous market for sort of like nineties nostalgia right now. You know, I think Sean John, or even a Rocawear, if they could have, I dunno, that’s a little more complicated, but I think that, you know, if he’s at the helm and his part as a lifestyle, Would never count him out. So, but yeah, as far as what it’s worth right now, it’s sort of more of a rounding error and overall number. But, you know, be interesting to see what comes.

[00:30:04] Dan Runcie: And when you made your list around the same time, I believe that same week, there were two other announcements that came up. One was the cannabis company that he bought for, I believe it was 185 million. And the other one, I don’t know if this one was a hundred percent confirmed, but did you see that thing floating around about him making an investment in Twitter along with Elon Musk’s bid?

[00:30:28] Zack Greenburg: Yeah, no, you know that was all after the numbers got finalized, so, you know, those weren’t really factored into it. But you know, I mean, yeah, it all makes sense. It’s all part of the lifestyle thing. It’s all part of the Diddy empire, the Diddy MO, and you know, he’s look, I mean, on the cannabis side, right? Like he’s puff daddy, you know, like what are, what are you puffing? It’s exactly, it makes sense. It’s like part of the brand. And, you know, if he could do the same thing with cannabis leaders with vodka, Which is to say like, I mean, I don’t know. I think when he started vodka was not, you know, it was not really seen as a stylish thing. It was more like, you do a shot to get drunk. I mean, I don’t know, maybe that’s physics. I was in college when that happened, and that’s when, that’s sort of the vibe on vodka. But he made it like the champagne of vodkas. He associated his lifestyle with it and similarly, I think with weed, it’s like, you know, we’re in this very nascent part of the canvas economy, you know, becoming legal and, and sort of how do you start to differentiate brands, you know, and when you have legalization you can have, you know, like. The champagne of weed, right? You can start to differentiate, you know, like what type of buzz you’re gonna get because it’s regulated and you can actually say like, this is the thing that has this much THC and it’s gonna give you this kind of high, versus like, this is just gonna knock you on your ass. I think it’s a great place for him to get into, but you know, at the same time it’s like, It is a really hard place to do business still. And you know, it is not without risk. It, you know, because it is not federally legal yet. You have to do, you have to do most of your business in cash. You can’t get loans in the same way, especially if you have a plant touching enterprise. You have to do all these, handle all these different state regulations, which are constantly changing and are subject to the whims of, you know, clinical races and you know, potentially gerrymandering, all kinds of stuff that has nothing to do with Diddy. So, you know, I think that’s the tricky part. And you know, also not being a first mover in the way that somebody like Berner is. But at the same time, it’s like, you know, he fills a different niche in the mark potentially than Berner does. 

[00:32:45] Dan Runcie: And yeah, no, that’ll be fascinating to watch. Yeah. I think the thing about Revolt is a great concept in the vision, of course. Makes sense. Seeing how influential Diddy was with MTV and whether it’s the voter die shirts that he would wear or some of the other programming, he leveraged it so well as a hip hop artist. So if you know you have that impact, why wouldn’t you wanna go start your own company and go do the same? Right. I think some of the timing just became a little tough in that he started the cable network in 2013. People are already starting to cut the cord at that point. And then I know the company’s transitioned much more into digital media, but even that, given that so much of it is social media based, relying on other platforms and their algorithms, I think we saw so many of those companies in that same timeframe, even the ones that were perceived as being successful, whether it’s your Buzzfeed or your Huffington Post or your Complex, like all of those valuations came back down to earth. And you look at a company like Revolt, which I think was largely playing the same game, although I think they still make tons of great content and there are tons of great, brilliant people working there. I think that the digital media itself and where things transformed was a bit tough. Like let’s say that Diddy had started let’s say 2007 as opposed to 2013, I think we’d be having a very different conversation, 

[00:34:03] Zack Greenburg: You know, or 1997 , you know, I mean, yeah. I think it could be a whole different conversation and, you know, yeah. That’s one of the smaller pieces of the empire, and I think, like you would say, he would make a certain argument about it and, you know, valuing it more like on the line of being a tech company. But it’s hard to escape the fact that it, you know, it still. I would say yeah, like primarily a media outlet point and whether it’s, you know, via cable or the internet or whatever, it’s like these are not, like, these are kind of tricky places to be, but you know, it does make sense. There is a demand for that kind of stuff and it’s a crowded marketplace, but, you know, he does have something different to offer and, you know, I think that there’s a reason why it’s still around and, you know, it’ll be interesting to see how it goes, how it proceeds as we enter like the next phase of this sort of media shake up in a amount of time.

[00:35:03] Dan Runcie: Yeah, definitely. And I think the other thing too, that I should have mentioned earlier is that given that this is a black owned media company, I know he’s been vocal and Byron Allen and others have been vocal about advertisers not contributing the same level of money into black owned media companies that they would to, let’s say, some of the Revolts competitors in the space that maybe started and run by white founders, white executives, but they’re commanding more money from that perspective. So I think that’s another tough thing there. But overall, like we said, this is a small piece of the overall pie. And yeah, it’d be interesting too. Especially the newer businesses, how many of them can continue that Ciroc magic, the bad boy flavor? And see? See where that lifestyle keeps going? Yeah. All right. Now let’s talk about the other big one on the list, Berner. And based on the response that I saw from people sharing the list of people talking about it, this is the one that surprised a lot of people. But I know it didn’t surprise you because you’ve been following this for a while. You’ve been talking to Berner, getting a better understanding of his business. So it’d be great to hear the breakdown because I think a lot of people out there may know Berner now more so for this product than they may actually know his music or anything else that he’s done in hip hop up to now.

[00:36:19] Zack Greenburg: Yeah, absolutely. So, you know, I think Berner is one of the most fascinating names on the list. Definitely the most surprising. But, you know, I’ve been following his work for a while and, you know, he is a master marketer and his whole journey about how he turned cookies, cannabis, You know, it is a billion dollar company and it’s just a little tricky to value, but, it is a billion dollar company and the way he did it, you know, I would say it’s a case study, but it’s actually pretty hard to emulate. It is sort of like a singular way of doing things. So, you know, for the people who don’t know the background, Bernard born in California and San Francisco grew up there, moved to Arizona as a teenager and, and would bring back good weed from California when, whenever, you know, would make trips back to his old stomping grounds. And that’s how he kind of got his start. He moved back to San Francisco, during the early, you know, weed legalization gold. Worked at a dispensary and, you know, kind of popularized this Girl Scout cookie, strain of weed. And so his thing would, at the dispensary, he would, you know, they used to sell things. It was sort of like an index car with the name of the strain. It was very clinical. But he would sort of like do these doodles and cookies and, you know, these like bright colors and stuff. And, and it started to get some tension. He became, you know, Wiz Khalifa’s weed man when he was in San Francisco. And on one occasion brought this fully butted six foot tall weed plant onto the stage at Khalifa’s show. And, you know, I think it was sort of instrumental in that Khalifa had created the Khalifa kush and all this. And so Bernard ultimately parlayed this sort of underground, you know, weed connoisseur image that he had as both on the legal and illegal markets into this brand. Cookies started opening stores, created a clothing line that, you know, kind of goes along with it. But the thing that he did with the way he set up this company is pretty, pretty unusual and very hard to value, but I think is quite brilliant. He started striking these partnerships with dispensaries and, you know, essentially it was a licensing deal where he would get a cut of revenue. And then the other part of the deal is that he could also buy out any of these partners. At market rate, at a time in the future, you know, in the future to be determined. And you know, like some of these numbers are out there, but you know, I think the system-wide sales are close to half a billion dollars now. And he gets a cut of that. But you know, at any time he could decide to roll all you could raise money, roll all these partnerships up into one giant weed company that’s, you know, making. You know that, that kind of revenue and, and suddenly, you know, all you need to do is you put a multiple on that and, and that’ll tell you what the company would be. If he rolled it all up and bought everybody out. And I talked to Wall Street analysts about this and covered the space and they said, you know, yeah, you could put like a five x multiple on this, so that would mean it’s you know, yeah, like about a $2 billion company. Then you have to factor in the cost of buying out all those partnerships. You know, long story short would probably be about half billion dollars because it is a very tricky business. In fact, you have to be very liquid when doing everything in cash. It’s kind of complicated. People I talked to, you know, bankers and stuff, said, yeah, you would apply a private company discount due to the uncertainty of the market, things like that, that’s operating in it, you know, you would knock 20, 30% off of that and you know, so that it brings it down to around a billion dollars and then Berner still owns about a third of it. And so there’s the bulk of his fortune right there, you know, so his stake is probably worth around $300 million. This point, I figure. And I think that’s pretty conservative. You know, you add in some other thing invested in the clothing line, which he owns, you know, a huge part of still, you know, some homes, cash stuff like. And you get to that 400, 2 million number.

[00:40:27] Dan Runcie: Nice. Yeah, I’ve been seeing people wearing the cookies hoodies, walking around San Francisco, walking around other places. But definitely seeing the apparel thing push and I feel like he has one of those brands there are probably seeing even more of that stuff. I think it was a couple weeks ago I was driving by and I saw the store in Hate Ashbury neighborhood here at San Francisco. So yeah, no, definitely making moves. A few things there that stuck out. So he of course has his own standalone stores. As you mentioned, there’s 55 of them across the country right now. And he also was selling them to other dispensaries. And I’m sure if and when weed does become legalized across the country, that will then just make things even easier from a distribution perspective from other places that he may be able to sell any otherwise. So in some ways the investment isn’t just based on what’s currently there or there’s also a speculative nature. As this underlying product becomes more and more legal, there will be more opportunity to further sell this and further have its reach to different places. 

[00: 41:36] Zack Greenburg: Absolutely. And the clothing line also builds the value of the cannabis brand. And you know, if and when it is federally legalized, you gotta think. I mean, you know, this is one of the top brands in the business. And in fact, you know, there aren’t really brands in this way in the cannabis space. There’s strains, it’s almost saying like in beer, you know, like, yeah, people like IPAs or people like those or whatever, but there isn’t really like a Budweiser yet or a dogfish head, you know, or something like that. And, you know, to go back to Diddy, there’s not really a champagne of weed. So, you know, I think that Berner has built up all this credibility in this space and, you know, if, when it goes legal, it’s like to be one of the top weed brands in this space that is going to, you know, potentially rival or, you know, at least kind of start to eat into alcohol business. I mean, you know, 2 billion is not a large number for a company. There’s a lot of potential for it to get a lot bigger and, you know, we can get into the whole. There’s definitely a lot of arguments, pros and cons, about the benefits of THC and Cannabis General. And, you know, we will be here all day on that. But just from a business perspective, you know, it seems like we’re headed toward legalization. Berner actually thinks that republicans are more likely to make federal legalization happen. He said, cause they’re all about their paper. So I’m not saying who he’s voting for anything. I don’t. You know. it was an interesting perspective and, you know, like I think that he’s really got kind of the key to where…..

[00:43:15] Dan Runcie: One of the other things that sticks out to me about him is that he’s someone who is much more known, at least on a general awareness perspective, for the business that he’s built as opposed to the music. I feel like his music was a bit more of a regional thing and he puts out a ton of music, but it never hit the same levels as some of the other artists who are having nine figure net worths as well. And I feel like there’s often this thought, and which I do believe generally is true, that the artists who tend to be the most successful with product sales and investing and some of the more lucrative business opportunities that artists have done, they’re more likely to be the household names who have been releasing music and touring for decades than a lot of times it’s because they’re releasing products that are lending their names, so they’re leveraging their influence to now sell things that have a larger stake in and can be bought time and time again. He’s a little different though because he doesn’t necessarily have that. I’m curious what you think about that piece of it, because I think so many of the hip hop cash lists over the years do have at least somewhat of a correlation as to who are the more well known artists or who are the more popular artists at the time, and not necessarily who is building the strongest business, you know, that is being worth the most, and that is not correlated with how much mainstream popularity that artists may have.

[00:44:44] Zack Greenburg: Yeah, for sure. I mean the funny thing is when you look at it, he is the most prolific artist on the list. But, you know, he has the least name recognition as well, right? I mean, Jay-Z, Diddy, Kanye, Dr. Dre, none of them are putting out music at the pace with which Berner is putting out music. But everybody knows who they are and not everybody knows Berner. You know, I think you could almost argue like, well, are you really gonna put him, you know, on the list with these guys who have that much more name recognition? But you could also argue, should we really be treating, you know, Diddy as a rapper anymore than we should be? You know, treating Richard Branson, as I know Richard Branson didn’t actually rap ever, but, you know, effectively Diddy is just focused on business at this point and you know, he puts out songs here and there. Music is an ancillary Berner also used. You know, the Music Chief boosts the weed business, but he’s in the studio like all the time, more than any of these guys. Yeah, it’s just kinda fun.

[00:45:48] Dan Runcie: I think another person that maybe thought of a similar way, someone like Chamillionaire who had one really large hit, mm-hmm. But wasn’t necessarily known for having classic after classic after classic album or touring the world in the same large ways as some of the other big names we did, but his investing journey is something that has been pretty well documented and I think as a result, he’s definitely further than a lot of the other artists that came around the same time as him that may have had even more commercial success. So I feel like even though there is a lot of a correlation between who are the most well known artists and who are the wealthiest artists, he is someone else who is a bit similar in that Berner way of, hey, yeah, there may have a smaller overall impact from the music itself, but was able to wisely use that and then now leverage that into something where, you know, the artist is making more money from the business moves and more known for that now. 

[00:46:49] Zack Greenburg: Absolutely. I mean a great example of Chamillionaire and, you know, the work that he’s been doing in the startup world. So at the same time, it’s like if he hadn’t had that one day hit, you know, would he have been able to get into, you know, the Silicon Valley kind of fear in the same way, you know, I don’t know, but I think all it takes is one hit to be in the mix. And certainly like Burner never had that one hit, right? He just had a lot of, you know, really solid albums and stuff, but he was doing it in San Francisco. And I think, you know, in that way that you see somebody like Jamon Green getting really involved in the startup world, would he have been that guy if he were in, you know, like Cleveland or something? You know, I don’t think so, but if you’re in the mix, in the Bay Area, you’re just gonna have access to a lot more opportunities, you know, in the startup world. And I think the startup world, cannabis world, you know, it. Kinda the epicenter. So in a funny way that the two have a lot of commonalities I think are familiar.

[00:47:51] Dan Runcie: Yeah. This is good. I’m excited to see what next year’s list looks like as well. And I know you may not be able to share publicly, but in order to get the five, you probably evaluated a few others. Are there any names creeping up, arising up that you think may make a  2023 appearance?

[00:48:08] Zack Greenburg: I think, you know, Drake is creep enough, big new deal. You know, he doesn’t have quite the same level of, you know, sort of like outside assets. Like he doesn’t have, like a Ciroc or a cookie or what have you. And, you know, I think he does have this whiskey, Virginia Black, but it’s like, never like still around, but it never really took off and it only tastes okay. It’s okay. I don’t think taste ultimately matters a lot of times with this stuff, but I’m kind of surprised that he wasn’t able to like boost a little bit more. But I don’t know. When I think Drake, I don’t really think whiskey. Maybe that’s just part of it. I mean, I could see him with more champagne maybe. 

[00:48:51] Dan Runcie: Yeah. I’m interested to see for him how this new deal he has and the music that he makes as a result ends up factoring in, because of course we know that music itself may not be the largest revenue stream for a lot of these artists. Drake has this huge deal with Universal and Republic now, and he’s releasing music more frequently than ever, and we can assume that it’s likely because he’s getting better upside and margins for the music he’s releasing. So if he keeps up at this, like two, three albums a year clip. I mean, the numbers are gonna speak for themselves. Last year he streamed more than all pre 1980 artists. Like it’s gonna catch up. 

[00:49:29] Zack Greenburg: Yeah. Yeah. I think the other thing with net worth less as opposed to. Is that, you know, it’s just harder to get on these lists if you are a big cash earner. Like if you are earning a lot on an annual basis, you know, things get factored into that, like taxes and cost of living and all that. And so, you know, you’re getting these huge outlays, but you know, it’s not in the same way that it was like going into this, this growing asset that can be valued. And in a way that’s kind of like a quirk of the system because, you know, I’m valuing Berner’s stake in cookies, you know, like it’s not tax, right? Like  if he were to sell it and he were to get $300 million, you know, whatever, a third half of that would be gone to the government. But that’s not baked into the formula until he sells it. So you know, this is how Bloomberg and Forbes do it. It’s just kinda what it is. But, it means that if you are holding assets, you know, the taxes aren’t taken out. Whereas if you’re a cash earner, that gets deducted before it gets added to your cash pile. So, it just means Drake is more likely to be at the top of, you know, let’s say top earning artist. And you know, it’s a little harder for him to get to the top…

[00:50:59] Dan Runcie: That’s a great distinction. No, we’ll definitely keep that in mind for next year. Do you think you’ll do another top earners of the year list as well?

[00:51:05] Zack Greenburg: I don’t know. Maybe, we’ll see how it goes. Being a new dad, and doing this full time program, you know, this fellowship at Columbia that I mention. It takes a lot of time. And you know, I don’t wanna put out a list unless I have the time to really dig in and get the numbers right. But yeah, you never know. I got this one out. So, there could be more. More to come.

[00:51:28] Dan Runcie: And I think on that note, just talking about dad life in general. Let’s close things out there. So by the time this comes out, your daughter will be six months old and we can both share one funny thing that our kids did this past couple weeks. So I’ll let you start.

[00:51:44 ] Zack Greenburg: Oh, man. Well, I think the thing that’s really most exciting is that she’s laughing now and the thing that she mainly thinks is funny is when I’m laughing. So like, we’ll get into this thing, I will make myself start laughing and then she’ll go, ha ha. I go, ha. And, and it’s very dorky, dad life. But, that is like one of my favorite things to do is have like, sort of a laugh off with Riley. So, yeah, I don’t know, man. I pick her up from daycare every day and she just gives me this huge smile and I know that she’s still really young, but I can tell that she’s specifically recognizing me, you know, and that we have this bond already. That there’s like a specific connection. I just had no idea that babies could sort of, like, differentiate people and start to have unique relationships in that way. And that, it’s like the best part of my day every day. So… 

[00:52:41] Dan Runcie: That’s awesome. That’s awesome. Yeah. How about you? 

[00:52:42] Zack Greenburg: Yeah. How about you? 

[00:52:43] Dan Runcie: Yeah. I feel like there’s something about that. Like yeah, the first couple of months I remember I would like, ask my wife, I’d be like, you think she recognizes us? Like, because she understands who we are. And I think over time there was like, yeah, no, we can get that in. Even things like now, The mirror is something that she is obsessed with. I’m sure you probably feel the same with Riley too. But yeah, the mirror. At first it was kind of looking at the mirror where there’s like, okay, what is this screen? Who is that person that I’m seeing? But I think now it’s like looking at us through the mirror and like seeing that it’s us. And maybe she’s starting to be like, oh well, I see them through this. Like she probably still isn’t at the point where it’s like, oh, I can see that’s looking at me. But she’ll look at that other person staring at her in the mirror and start smiling and stuff too. So I’m like, oh, that’s cute. So yeah, man. Wild time’s flying by. She’ll be five months by the time this comes out. Wild man. 

[00:52:35] Zack Greenburg: Yeah. . Yeah. Yeah. We do a lot of like….

[00:53:38] Dan Runcie: oh, yeah, yeah, yeah. Where’s that? Little, little peek-a-boo style games. 

[00:53:42] Zack Greenburg: Yeah. Yeah. In the mirror. Yeah, exactly. Exactly. We’ll have to have our kids together sometime soon. I guess, you know, but of course babies, not so interactive with each other yet.

[00:53:54] Dan Runcie: Yeah. No. We’ll get there. That’ll be fun. Zack. This is great, man. Good work as always. It was great to see the list and again. The fact that I think you got just as much coverage and buzz and recognition for this, doing it independently is a great sign. Not just for you, but I think in general for people that are always questioning, okay, you know, what’s the power of what I do elsewhere versus individually. So great job on that and we’ll definitely keep tabs on this coming years. But great work, man, as always. Appreciate that.

[00:54:25] Zack Greenburg: Thanks man. Same to you.


Dan Runcie

Dan Runcie

Founder of Trapital

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