Akon’s Recession-Proof Tune

March 2nd, 2012  |  Published in Uncategorized

Akon: A Cash King for any economic climate.

Akon’s Recession-Proof Tune
Forbes, 07.09.09
By Zack O’Malley Greenburg
One sweet-singing impresario is thriving amid rap’s recession.

Ten minutes before the start of a benefit concert at Harlem’s Apollo Theater, and rapper-singer-songwriter Akon is brawling with his deejay over how to hook a stodgy crowd of Manhattan philanthropists at the 2009 Do Something Awards.

“We gotta get it poppin’ from the giddyup,” Akon argues. His pick: Open with “Beautiful,” a synthesizer-drenched ballad whose upbeat chords make you feel like you’re falling in love at a beachside club in Dakar, where Akon grew up. Performing the song minutes later, he sprints and hurls himself headfirst into the audience, landing the arms of his waiting entourage–and a few surprised-looking yuppies. “When he does that in Senegal,” his publicist whispers, “they rip his clothes off.”

Here they just give him money. Akon is one of the only artists to increase his income in a year that’s been almost as cruel to hip-hop as it’s been to Wall Street. Rap record sales fell 20% in 2008, steeper than the 15% industry-wide decline. Worse, the corporate appetite has all but dried up for “360 deals” like last year’s $150 million pact between Jay-Z and concert promoter Live NationLYVnews people ). The 20 top earners in hip-hop combined to make $300 million from June 2008 to June 2009–40% less than last year’s half-billion.

Yet Akon’s earnings have nearly doubled. He’s tied with 50 Cent for fourth place on Forbes’ latest list of Hip-Hop’s Cash Kings with an estimated $20 million in pretax earnings over the last 12 months, up from $12 million over the prior year. His camp insists he’s made even more, thanks in part to his new album Freedom, on its way to platinum status despite the slow market.

“I think people lean more to music when they’re going through the hard times,” Akon says, lounging in a midtown Manhattan hotel the day after his Apollo appearance. “The recession is really impacting everyday people, and they want to try to get away from the troubles they’re dealing. Music is always a crutch.”

Selling albums–Akon has moved 9 million in his young career–is just one part of the business. Akon performed a staggering 100 concerts from Antwerp to Vancouver during the past 12 months. According to Pollstar, he grossed $230,000 per show on average, plus merchandise sales. Factor in declining record sales, and it’s not hard to see why touring is such a crucial moneymaker for artists like Akon–especially because they don’t have to split concert proceeds with record labels as they do on albums. “They just try to rape you,” says Akon. “You don’t see money till your second or third album because you’re so busy recouping.” He makes nearly half his money touring.

In addition to writing, singing, producing and rapping his own songs, Akon offers the same services to other artists–sometimes for a six-figure upfront fee, plus as much as half the royalties. He’s logged more than 160 guest appearances, working with acts from Gwen Stefani to fellow cash king T-Pain.

It’s paying off. “At the beginning of his career, like many artists, he did not have the infrastructure in place to handle everything that was coming at him,” says David Bolno, a co-director at Nigro Karlin Segal & Feldstein, which Akon hired to represent him last year. “Together we put a business plan in place in order to manage his current business ventures, the back-end administrative functions on invoicing and collections for his producing and songwriting.”

Akon also launched his own record label Konvict Musik, which includes KonLive Distribution, a 50/50 venture with Interscope. He gets half the profits from album sales and still keeps his own touring revenues, merchandising rights and ringtones. Last year Akon co-produced Lady Gaga’s debut The Fame, which sold more than 1 million copies and collaborated on the multiplatinum single “Just Dance.”

“He’s one of the most prolific producers around, period,” says Ryan Schinman, chief of Platinum Rye, the world’s largest buyer of music and talent for corporations. “Akon is one of the savviest businessmen in the industry. He’s not going anywhere.”

Akon got noticed five years ago with the release of “Locked Up,” a song about the time he spent jailed for auto-theft charges in Georgia and New Jersey. The multiplatinum single is one of many recognizable hits from his first album, Trouble. But the details of Akon’s life prior to 2004 remain murky.

New York State court records show that Aliaune Damala Thiam was born on April 30, 1973. Wikipedia lists his full name as Aliaune Damala Bouga Time Puru Nacka Lu Lu Lu Badara Akon Thiam. Asked if this is correct, Akon grins. “It might be,” he says. Age? “Twenty-young.” Marital status? “I’m very loved.”

What’s fairly certain is that Akon was born in St. Louis, Mo., sometime in the past 40 years and spent much of his childhood in the West African country of Senegal, which he describes as his “hometown.” The child of a dancer mother and a renowned percussionist father, Mor Thiam, Akon learned to play five instruments, including drums and guitar.

Akon spent his school years in the states and summers in Senegal. He moved to the U.S. full time for high school, settling in Jersey City, N.J., and later, Atlanta. After spending a semester at Clark Atlanta University, Akon says he dropped out to lead a Gone in 60 Seconds-esque car-theft outfit. “I was just the biggest hustler ever,” he says. “I just wanted to be rich, I didn’t care how. However I could get a break, or an opportunity to make money, my hands were involved in it.”

The law caught up with him in Atlanta in the late 1990s, when he claims cohorts ratted him out. Akon says he spent three years in and out of jail as penance for his car-related kleptomania.

The story took a hit last year when The Smoking Gun reported that much of Akon’s criminal background was exaggerated or completely fabricated, citing court documents that show his only automotive offense as a 1998 bust for possession of a stolen BMW in New Jersey. The report indicates that Akon served several months in Georgia’s DeKalb County Jail before prosecutors dropped all charges. He claims his criminal record was expunged as part of a settlement because it had been making it difficult for him to obtain visas when performing abroad.

Whatever his past, the future looks good for Akon. He’s collaborating with Lady Gaga and Lionel Richie and finishing a new album, due out this fall. He was also one of the last artists to work with Michael Jackson–last year the duo recorded the song “Hold My Hand,” which has since been leaked on the Internet. Akon says the song and other material recorded with Jackson will not be released without the consent of Jackson’s family.

Beyond music, Akon is producing a reality show–for a major network, he says–where members from different Los Angeles-area gangs are selected to be in a band together. He’s also putting the finishing touches on Aliaune, the more expensive counterpart of his Konvict Clothing line.

Perhaps his most ambitious project is Hitlab.com, launched last September, an online community where aspiring artists can promote and sell their music outside record-label auspices. The site offers proprietary technology that promises to predict whether or not a song has the potential to be a hit. “I call it the industry killer,” he says. “That’s going to be the future for music.”

If anyone would know, it’s probably Akon.

Video: Akon’s Business Empire

Video: Akon’s Forbes Remix Exclusive

In Pictures: Backstage With Akon At The Apollo

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Zack O'Malley Greenburg is a Forbes senior editor and author of the Jay-Z biography Empire State of Mind. His second, Michael Jackson, Inc, was released by Simon & Schuster in June. Zack covers the business of music in The Beat Report at Forbes, where he's investigated topics from public pension fund scandals to Justin Bieber's venture capital career to the inner workings of Diddy's empire. His writing has also appeared in the Washington Post, Billboard, Sports Illustrated, Vibe and McSweeney's; he's served as a speaker at Yale, Harvard and South by Southwest, and as an expert source for BBC, NPR, MTV, VH1 and CBS's 60 Minutes. Check out his full bio here.


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