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Hey. It's been bittersweet to think about DMX since he passed away. He gave us so much while he lived in pain. Hip-hop has never had anyone like Earl Simmons, and it may never see anyone like him again.

Unfortunately, the past week of reporting on DMX's life status has been a mess. There were too many rumors and incorrect articles on his condition. It's an unfortunate side effect of Twitter and the rush to go viral. This is one of the reasons why I'm glad Chadwick Boseman and MF DOOM's loved ones waited to disclose their deaths on their terms. Hopefully, we see more of that moving forward.

If you get a chance, read this great article on X's life by The Undefeated's Justin Tinsley.

​Last week's Trapital essay on Will, Jada, and Westbrook Inc. has gotten tens of thousands of page views, open rate well over 50%, and plenty of praise. Thank you! If you haven't checked it out, you can read or listen here.

Today's Trapital memo covers UnitedMasters' $50M investment, Diddy's letter to corporate America, and Scooter Braun's recent moves.

UnitedMasters Series B round led by Apple

On March 31, the music distribution platform raised $50 million in a funding round led by Apple, one of the company's strategic partner. This funding will be used to grow globally through promotion, marketing, and technology.

UnitedMasters was started to give indie artists a record label in their pocket. It distributes the artist's music on all the digital streaming providers and takes a 10% revenue cut or $60 per year.

The indie artist marketing stack. Music distribution has become a low-margin commodity. But UnitedMasters sets itself apart in two ways. First, the platform is a loss leader for Translation, the ad agency run by UnitedMasters CEO Steve Stoute. The most successful artists from UM are prime targets to get featured in a Translation project. Who wouldn't want to be up there with Drake from State Farm? Or with Chris Paul and Cliff Paul? State Farm is one of Translation's longtime clients.

Second, UM gives artists exposure through its marketing-driven partnerships. Since 2018, it has partnered with the NBA, ESPN, NBA 2K, Apple, Twitch, Cash App, TikTok, and more. It's building the indie artist marketing stack. These partnerships are both marketing for the artists that use its platform, and awareness building for potential artists looking for a distributor.

The model works best if UnitedMasters' customer acquisition cost is low and it retains top talent through either UnitedMasters or Translation. Some top artists may leave, like NLE Choppa in 2019. It's inevitable. It's a long-tail business model. The homerun hitters will subsidize the rest. But the more heavy hitters, the better.

The DTC opportunity UM's partnerships reflect the company's core competency in marketing. Stoute's a top advertising exec. But for the indie artists that the company supports, the 1-to-1 direct communication tools are more important than ever.

UnitedMasters can partner with a company like SuperPhone to help its indie artists text fans directly. It can partner with an email marketing platform like ConvertKit, which just acquired FanBridge, an email fanbase building platform for musicians. Or it could partner with Substack, its fellow Andreessen Horowitz portfolio company with a similar business model for independent writers.

Listen to Trapital's January 2020 interview with Steve Stoute here.

Diddy's letter and PR struggles

On April 8, Diddy wrote an open letter to highlight the low advertising revenue REVOLT gets from General Motors and how it reflects an inequity for Black-owned media companies. The message has gotten mixed reviews.

The push for equity. Diddy has been vocal about inequity for Black folks. Here's a timeline of his recent public statements in the past year and a half:

• Nov 2019: called out Comcast for unequal treatment of Black-owned cable networks like REVOLT
• Jan 2020: called out the Grammys for not giving Black artists an even playing field
• Oct 2020: launched the Black Political Party, charged to focus on the Black community's need
• Apr 2021: called out GM for lack of advertising with REVOLT and Black-owned media

I believe Diddy's heart is in a good place. Moguls like him should use their platforms like this. But Diddy's messages don't hit home as they should, and that's for two reasons. The first is a public relations challenge, and the second is an audience challenge.

The PR challenge. First, whenever Diddy calls out the business practices of others, his own history gets put under the microscope. It takes energy away from his statements. In 2020, Mase claims he tried to buy back his publishing for $2M, but Diddy refused unless he can match the market value. Otherwise, Mase has to wait till he turns 50 in 2027.

Diddy may feel justified. He took risks on Mase and other artists and signed them when they were unproven. He made money on those who succeeded and lost on those that didn't.

But who's "wrong or right" misses the point. Diddy's goal with his public statements is to gain leverage in the court of public opinion. This influences businesses to do better. But right now, the jury's riding with Harlem's boy Mason Betha. The public will almost always ride with the artist regardless of the details. It doesn't help that Black Rob, a former Bad Boy artist, has suffered from multiple strokes and bouts of homelessness. In those situations, it's hard for the public to feel for Diddy, a near billionaire who wants more ad dollars for his cable network.

The best solution is to sell Mase back his assets (even if it's at a discount), settle any disputes with past artists or business partners, and publicly apologize for not doing better. Again, this is less about being wrong or right. It's about the big picture and Puff's underlying goal.

The customer challenge. REVOLT's struggles with Comcast and GM are unfortunate, but not surprising. It launched as a cable network in 2013. 2013! It's hard to build a cable audience in the age of cord-cutting. The media company has wisely expanded into digital content and big events like REVOLT Summit, but the cable network at its core is an expensive load to carry.

Diddy's letter says that 1% of advertising in 2019 was spent with Black-owned media companies, even though Black people represent 14% of the population and 15% of Corporate America's revenue. But ad dollars get distributed to media companies based on audience demographics, not owner demographics.

But to Diddy's point, even if the demographics are controlled for, I bet that companies like REVOLT get less than their non-Black-owned competitors when controlled for size, CPM, CPC, or any other advertising metric. A study that breaks this down would be valuable for all Black-owned media companies that rely on ad revenue. We've seen how diversity and inclusion data has helped address inequity issues in the tech sector. It's far from perfect, but it helps push progress forward.

This challenge is bigger than Diddy though. When hip-hop's top superstars have exclusive interviews and stories, they don't necessarily go to outlets like REVOLT to break the story. They go where they believe they'll get the most traffic. And because of that, their fans will follow, which drives the ad spend.

Read Diddy's letter to Corporate America here.

Scooter Braun's wheelin' and dealin'

The 39-year-old music exec has been deep in the mergers and acquisitions game:

• Jun 2019: acquired Taylor Swift's masters
• Nov 2020: sold Taylor Swift's masters ($100M profit)
• Apr 2021: sold Ithaca Holdings for $1B+ to HYBE

Scooter has looked up to David Geffen, the longtime music mogul who is now worth north of $10 billion. Here's Braun in a 2012 interview with The New Yorker:

"David Geffen was a Bruce Wayne to me. He was extraordinary, but at the same time his talents were something that I could dream of and could fathom. I’m a normal Joe. But, with a lot of effort, I’ve got a shot at being Bruce Wayne.”

Geffen, who co-founded DreamWorks, told Braun to get out of the music business. A decade later, Braun has been making moves in that direction. He flipped Taylor Swift's masters at the peak of this shopping spree, and got out before the asset gets devalued by Taylor's Version of her albums. The biggest artists he manages, Justin Bieber, Ariana Grande, and Demi Lovato, have all stayed on top and stuck by Scooter through all his public disputes.

Like Geffen, Braun has made his deals, angered the biggest stars of their era, and accepted the backlash. Michael Jackson blamed David Geffen for ruining his career and had him on his famed 'enemies list.' And Taylor Swift has publicly called out Scooter Braun on more than one occasion.

The path to a B. There's been a longstanding debate about whether someone can become a billionaire without doing wrong by others in some way. It's a difficult question based on perception, which is subjective and influenced by those who publicly share their stories.

For every bad story about Diddy or Scooter Braun, there are good stories of those who ride by them. Even hip-hop's beloved moguls, like Master P, have had public disputes with business partners. It's not an excuse for their actions, but an understanding of how these narratives are built.

Read more about Scooter Braun's latest deal in Variety.

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P.S. - RIP Daunte Wright. He should still be alive.