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Hey! On Friday night, my wife and I watched The Shop's latest episode with Jay Z. I've been thinking about this Jay Z story about DMX at the Hard Knock Life Tour. Jay's storytelling is on point.

The voice inflections, the pauses, the delivery, everything. He had the whole room hanging on every word. That clip makes me want to go back to my Toastmasters meetings. Jay is a billionaire today because he can communicate like that in the moments that matter.

Trapital's weekly memo keeps you ahead of hip-hop business trends. My goal is to share insights that will help you make the best moves with your time and money. Someone recently emailed me to say that this newsletter helped them get a job at one of the major digital streaming providers! How dope is that? We're taking hip-hop to the next level. That's why this memo exists.

Today's Memorial Day memo is a breakdown of the current state of NFTs, the future of award shows, and France's hip-hop scene.

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Podcast: Tarik Brooks, Combs Enterprises

This week I re-ran my February 2020 Trapital Podcast episode with the President of Combs Enterprises, Tarik Brooks. He leads the team that manages Diddy's portfolio of brands including Ciroc, Revolt, Bad Boy, Sean John and more. Tarik has also worked with Bob Johnson and Ray Dalio.

This episode is even more relevant now since many people I know have their hands in multiple businesses. Tarik gets this better than anyone.

Listen on Spotify, Apple Podcasts, or wherever you get podcasts

NFTs aren't going anywhere

Last week, the new NFT music platform OneOf received $63 million in seed funding. A few weeks before that, NFT marketplace Bitski closed its $19 million Series A fund. NFTs aren't going anywhere. (And if $63M counts as a seed round then I officially have no idea what a seed round is anymore!)

Still popular after the hysteria. Despite the skeptics, NFTs are still here after the rush of attention they got in March. The landscape has evolved from cash grabs to a more realistic future. There will still be winners and losers, but there will more insights to gain from future success stories.

Several NFT platforms have emerged in the past month. The attraction is clear. Demand is high, and platforms have been the most lucrative tech startups of the past decade.

But artists don't need more NFT marketplaces. They need platforms that can integrate NFTs into an overall commerce strategy. NFTs don't have to be bought and sold in isolation. Water & Music's Cherie Hu had a great point about this a few months ago. Saying you're an "NFT company" is like saying you're an "internet company." Focus should be on the benefits, not the features.

A platform like Bitski can succeed because the vision is bigger than the product. It's a marketplace for all digital products, not just NFTs. It has the potential to be a Shopify for creators where fans can buy NFTs as easily as they buy a t-shirt. NFTs can then be used to their full potential. They can offer unique access to both digital and in-person events, VIP access, backstage passes, livestreams, and more.

OneOf can also succeed because it's focused on sustainability. NFTs use a lot of energy and have a huge carbon footprint, and OneOf's solution is more conservation-minded. If it has the data to prove it after its launch in June, that will make the Quincy Jones-backed company even more successful.

"NBA Top Shot for X" is not enough. It's a blunt reminder of all the unsuccessful "Uber for X" startups. More than that is needed—especially given the creativity that drives successful NFTs.

Read more on NFTs at Forbes' After The Hype: The Future of NFTs.

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How to Improve Low Ratings for Award Shows

Sunday, May 23 was the 2021 Billboard Music Awards, which suffered one of the biggest ratings blows yet for an award show. Ratings were down 36% from October's 2020 BBMAs, which were already down 62% from the 2019 awards.

It's not just the pandemic. In the past 15 months, entertainment execs have blamed the pandemic, streaming options, and 2020 election coverage for ratings declines across the board. But those are lazy excuses. Last year's NFL ratings dropped 14% during the season, and February's Super Bowl ratings dropped just 9% from 2020. The better question to explore is how the NFL kept most of its audience and award shows haven't.

Award shows sell what happened, not how it happened. And "what" is easy to disrupt. I can read tweets and posts on each winner from various accounts. If there's a noteworthy clip, those accounts will share it. Fans can stay up to date and join the commentary without turning on the TV.

Meanwhile, NFL viewership is high because the experience is to see how each play breaks down. Fans can still get the "what" score updates anywhere, but apps can't replace live viewership.

Broadcasts are made for the industry, not casual viewers. Entertainers win awards, thank people you've never heard of, and get awarded in categories with confusing distinctions. Do most people understand "song of the year" vs "record of the year"? Or sound editing vs sound mixing?

The "niche" audiences that watch award shows in a post-pandemic world fall into two groups. They're a) those who work in the industry or b) nerds like me who can recall past winners from random years. These broadcasts were never built for casual viewers, but the current media landscape has highlighted the disconnect more than ever.

Learn from American Idol. Twice as many people watched American Idol than the Billboard Music Awards that night. Idol, which hasn't produced a household name in over a decade, lapped the BBMAs like Captain America yelling "on your left" during The Winter Soldier.

The music competition show is no longer the rating juggernaut it was in the Simon Cowell days, but it's a broadcast built for casual viewing.

Build a connection, up the stakes. Before an American Idol singer's audition, there are those 3-min background stories on that person's life. Viewers build emotional connections, which increase the stakes. NBC's Olympic coverage is also great at this. I'll hear a touching story about a rower who sacrificed it all to make it to the summer games, then I'll start cheering like crazy for them to win.

But there's none of that in award shows. In March, Beyonce broke the record most awarded singer in Grammys history. But all we got was that awkward interruption from host Trevor Noah that took some shine away from Megan Thee Stallion's win. Imagine if Beyonce's potential win got same the coverage that Tom Brady got on potentially winning his seventh Super Bowl and first outside of New England?

There's a huge opportunity to improve award shows. These shows will never regain their late 2000s ratings dominance, but more can be done to slow the drip.

For more, check out this Twitter thread from media analyst Matthew Ball.

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Takeaways from "The French Hip Hop Economy"

Last week Tuesday I was part of a really dope Clubhouse session on France's hip-hop scene. I've read a bunch of good articles on French rap over the years, but I wanted to learn from the folks who make that culture what it is.

This chat was hosted by Ouafa Mameche at Face Cachées, Sébastien Darvin at Abcdr du Son, and Shereen Dbouk (who was kind enough to translate for English listeners), and several more speakers. They invited a bunch of speakers who work in streaming, record labels, management, media, and more. Here are some big takeaways:

The independent route is more popular. In the U.S., we've yet to see unsigned artists reach Taylor Swift or Travis Scott levels of stardom. This is why U.S. record labels still command attention from unsigned artists. But in France, it's (relatively) easier for unsigned artists to get to where Niska and PNL are at. It's still hard as hell to get there. But the relative difference from the U.S. makes the French indie alternative even more attractive.

Also, French major labels often offer advances at $10,000 - $15,000! That's low compared to the top-tier superstars, which makes the indie route even more attractive.

Streaming playlist placement matters more too. Getting on the biggest playlists can make or break an artist's career, even at the smallest stages. Especially in France, where the streaming, media, and curation economy is more concentrated. It's no surprise. U.S. centric-playlists like RapCaviar have been covered extensively for their influence. But in the U.S. that influence has become even more fragmented in the past few years.

The superstar culture is different. Many hip-hop markets outside the U.S. have "broken through" thanks to co-signs from U.S. artists. I have mixed feelings about this.

On one hand, I get it. Hip-hop is one of America's biggest cultural export. If a Drake co-sign is a rising tide that can lift all boats, why not let Mr. Houstatlantavegas himself rap-sing a few bars in a different language?

But relying on U.S. culture for breakout success is a never-ending cycle. The biggest artists in France have built their careers from the ground up. They haven't had that Bad Bunny type of rise, but I'm not sure they want that either. If it happens, dope. But if not, the artists will be fine without it.

Thanks again to Ouafa, Shereen, and Seb for making this event happen! If you want to learn more about France's hip-hop scene, read this DJBooth article.

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Coming soon from Trapital

• Podcast: Jonnyshipes - CEO and Founder of Cinematic. Jonny brings us behind the scenes on how he built one of the most influential indie record labels in hip-hop. Drops later this week!
• Essay: a breakdown on the big three major record labels in music. Coming soon!

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