Come on, the speakers are on, chains are sparkling and champagne is glistening in the music video. But who is hiding behind such Roles and rented houses? Usually there are just bills which have not been paid and looming for bankruptcy. Today we will explore the contradiction straight in our faces: how the rappers, who rap about the prosperity in their lyrics and music videos, can actually be broke.
The Flashy Facade vs. Financial Reality
From its inception the rap industry has always been defined by the art of persona. Money, cars, fashionable and luxurious items – they are not only additional attributes, but, rather, indispensable attributes in the given industry. But here is the thing: the car depicted in the music video is a Bentley. Probably rented for the day. Those diamond chains? Usual to be borrowed from jewelers solely for the shoot.
Some of the celebrities include rapper 50 Cent who paved way to bankruptcy in 2015 despite he registered huge financial might of $155 million. When 50 cent declared bankruptcy, fans throughout the world were surprised this fact – this was the same performer who titled one of albums “Get Rich or Die Tryin’” and bragged about his numerous businesses.
Predatory Record Deals: The Industry’s Open Secret
Recording companies especially have always been noted to infringe the rights of artists and rappers are no exception. and let us not mention those billions of shillings in contracts that we hear about occasionally? That is what they actually mean for analysis.
But in congratulating them and their labels when a rapper has signed a “million-dollar deal”, this money is not given a freehand. It’s rather a cost one has to invest with before getting the money back from albums, music streaming and concerts among other ventures. And guess what? The label demands its share of the booty and that cut it, which could be 90 percent or more, of anything that is made from the song.
Everyone is familiar with the story of the TLC, the 90s music group that succumbed to bankruptcy even with a record sales in the millions. Why? As Abe – Soffar et al. remarks, this contract left them with mere peanuts for their work.
Financial Literacy Gap: Mo’ Money, Mo’ Problems
Despite today’s successful feat, a good number of rappers hail from humble backgrounds where the concepts of sound money management were deficient. One of these worst things that can happen to any person is that a person is faced with ability to make a vast amount of money within a short time but lack knowledge all along how that can be done.
DMX was already involved in many controversies concerning his financial crises in his music career; he had four platinum albums but also had owed around $1.7 million to the government in taxes by the time of his death. He never received the help from someone with whom he could set up a proper accounting or setting up a tax plan.
Money management isn’t innate – it’s learned. When one comes from rags to riches and with very little or no advisor to guide him or her on the matter, it becomes easier to spend than to invest.
The Lifestyle Expense: Keeping Up Appearances
The desire to portray as a wealthy individual is perhaps one of the biggest expenses which affect rappers. Even friends and colleagues expect you to be at a certain level hence artists end up living a lavish lifestyle that they cannot afford.
MC Hammer squandered through his estimated $70m he made in the early 90s, on 200 people he called an ‘entourage’, a house that cost $30m and some fancy cars. Why? As he noticed that he had to uphold this image that he built for himself.
Recently in an interview Young Buck was asked how much he spends on ‘maintenance, suits, clothes, blings, and trinkets for appearance’s sake only for the sake of the Buckingham; and he confessed that he spends something approximately $300, 000 per annum.
Streaming Economics: The New Raw Deal
In today’s music ecosystem, broke rappers are even more common because streaming has decimated artist revenues. As much as they opened the gates to distribution, the current streaming platforms have greatly diminished earnings.
For an artist, one must perform 326 times on Spotify to earn $1. That means that no matter how many millions of streams, and the revenues is not very high – or even low – depending on what the label takes.
Celebrities such as Tekashi 6ix9ine who can brag about streaming appearance but in the real sense, they are broke. Ironically, all those plays do not guarantee sustainable income.
One-Hit Wonder Syndrome: Flash in the Pan
Big rap stars of today face the challenge of attaining a hit and then fading out quickly afterward. Trinidad James was stated to have been signed with a $2 million deal after he released the popular tune “All Gold Everything in 2012. The record label let go of him in the following year and he did not chart again in the same way.
These artists often spend as though their income will continue at peak levels indefinitely, only to find themselves broke when the spotlight moves on.
Entourage Economics: The Payroll Problem
Lucky rappers bes featured with friends, family, with people that were found hanging around them, and several assistants. This concept of festooning your day ones is commensurable at least from a fiscal point of view; it’s merely huge that undermines costly degrees in every loose way.
It was one of the well-established document that Lil Wayne once employed over a hundred people at his team and spending millions every year. The fact that Wal-Mart’s income has been fluctuating while its expenses have been high have posed serious problems for the company.
The Tax Man Cometh
This and many more are some of the typical pitfalls that affect so many rappers who either have little knowledge regarding their responsibilities in the aspect of taxation or simply prefer not to bother. The current generation artists are not exception; The list of celebrities who had problems with the Internal Revenue Service includes Ja Rule, Nas, and everybody else.
Lauryn Hill was incarcerated for tax evasion since she did not file tax returns on income of more than $1.8 million. The IRS could not give hoot about the street credibility or Billboard chart positions – they want their share.
Breaking the Cycle: The New Business-Minded Rappers
It is, however, important to note that not all artists are defined by these traps. Jay-Z changed from ‘Just a rapper’ to ‘The billionaire businessman’ because he realized that he has more in store in entertainment industry than just music. Music was not Diddy’s alone genre but he created an empire on it. Dr. Later, the company acquired half an interesting stake in Beats, and Dre became one of hi hip-hop’s richest artists thanks to his share of headphones.
These artists understood from then that nothing MAKES money like money or wealth and that wealth is not gotten through ostentatious consumption.
So What’s the Real?
The next time you get a chance to find yourself surrounded by an atmosphere of rappers and bright luxuries on Instagram, do not be surprised that the financial side appears completely different. They are designed to get the optimum value from musicians while the returns that they offer are minimum. Add personal spending habits, entourages, and image maintenance, and you’ve got a perfect storm that leaves many rappers broke despite their apparent success.
While there are rappers like Jay-Z and Rihanna, who sharpen their every financial move to the detail there is a myriad of entertainers who leave the business absolutely penniless. It is not only about earning it but also maintaining and increasing it, most importantly, creating wealth, wealth that cannot be easily eroded by time unlike the glamour of a newly released song, album or a hit single.
The image of mainstream rap is not just a set of images – but a financial suicide for performers who do not seek beyond the present satisfaction of fashioning oneself as a millionaire. Real wealth is created in investments and accumulated assets and not displayed in show-off pictures and so on, features of a music video.
The next generation of rappers would do well to learn these lessons before they find themselves on the growing list of formerly famous, formerly rich artists wondering where all the money went.
