From the May 2004 issue of Entrepreneur

Though music is what gave them fame, hip-hop artists have grabbed hold of mega-entrepreneur status with the same swiftness and style in which they bust lyrics on the mic. These savvy artists have built massive business enterprises, cashing in on their household-name status to launch everything from restaurants and clothing lines to beverage companies. Once negatively associated with violence, profanity and a culture that scared Middle America, hip-hop now reaches a receptive mainstream audience eager to embrace their diverse offerings outside of just music.

Do these artists have inherent common qualities that make it more conducive for them to start businesses? "The nature of hip-hop and the dynamic that spawned hip-hop is innately entrepreneurial," says Marc Ecko, founder of urban clothing and lifestyle label Ecko Unlimited, based in New York City. "It's something made from nothing."

Russell Simmons, godfather of hip-hop entrepreneurs, can attest to the opportunity in this niche. Co-founding Def Jam Recordings 20 years ago, Simmons' empire now includes multimedia Rush Communications Inc. and even a segue into Broadway with Def Poetry Jam. (His Phat Farm clothing empire was sold to clothing giant Kellwood Co. in January 2004.) "We are by far the best brand-building community in the world," says Simmons. "There's no reason why we can't build some brands that we own--that's what hip-hop culture and hip-hop entrepreneurship is."

Simmons' groundbreaking success has ushered in scores of hip-hop entrepreneurs hoping to tap into the same well with similar results. P. Diddy has also created a name for himself as a hip-hop entrepreneur. But will he and other artists shape how entrepreneurs in general are perceived? "Once there are a few success stories out of the context of hip-hop and media, yes," Ecko speculates.

Few doubt these hip-hop entrepreneurs will influence other entrepreneurs when it comes to business attitudes. "When new people get in power and find success, they bring a new energy and way of thinking to the table; that's what we're seeing right now," observes Jameel Spencer, chief marketing officer of P. Diddy's Bad Boy Worldwide Entertainment Group and president of his advertising company, Blue Flame Marketing. Nontraditional approaches to running a business and setting goals--whether it's the unconcealed ambition or the brazen manner in which the spoils are spent--can be shocking, but let's not forget Donald Trump. These entrepreneurs are inarguably successful at what they're doing and how they're doing it, and the younger generation of entrepreneurs is sure to take note.

Though many hip-hop artists project images of unchecked materialism in their music, Spencer says it's unfair to translate that persona to the artist as entrepreneur. "[Music is] their day job, but as entrepreneurs, they're extremely responsible and sensitive to what they're putting out," he says.

Ecko acknowledges that some artists do define themselves by wealth and success. "It's part of the journey," he explains, "a function of being nouveau riche and coming to terms with things."

Ultimately, business is still business. Ecko, who also founded Complex magazine and has partnered with rapper 50 Cent to produce G-Unit Clothing Co., knows that 50 Cent's attachment will help the business, but both realize it can't depend on it in the long run. "Celebrity doesn't make a business. Great product, marketing, fair value and knowing how to get it to the market makes great business," asserts Ecko. While both Eminem and Snoop Dogg's clothing lines resulted in disappointing sales, Ecko's $250 million men's clothing line has never used celebrities or his own likeness.

Devin Lazerine, 20, founder of Rap-Up magazine and Rap-Up.com, has no recording contract, only a passion for hip-hop. He launched his youth-oriented hip-hop site in 2000 and followed a year later with the magazine, projecting 2004 revenues of more than $550,000. Inspired by older hip-hop entrepreneurs, Lazerine is in talks to create a TV show based on his story, and dreams of starting a publishing company, record label and clothing line. "Hip-hop is to achieve more than what you have," he says. "Young people [now feel they] can be successful if they have a goal and work hard achieving it, going beyond their expectations."