About a year ago, most of the blogs and media sites were stating how Jay-Z’s purchase of Tidal was a terrible deal and would never work because of services like Apple Music and Spotify. Fast forward to this week and Jay-Z just inked a deal with Sprint for a 33% stake in Tidal for $200 million. That puts the value of the company at $600 million. Not bad for a $56 million investment.
There is a lot to be learned from the actions of the last year as it relates to Tidal. More than just a financial success for Jay-Z, this deal represents what is possible when you follow your vision in the face of adversity. While everyone was saying it would not work, Tidal just kept plowing ahead. Here are a few other lessons to learn from the deal.
- Don’t Believe the Naysayers – Although difficult, drowning out the opinions of what others think you are capable is essential for success. Everyone has an opinion. Many are not based on facts, but are often shared as if they are facts. If Jay-Z would have listed to all the “experts” that said turning Tidal into a success would be impossible, he would have missed out on a major payday. By continuing to move forward with the vision that he had, he was able to achieve success against the negative opinions of others.
- Influencer Marketing Works – Influencer marketing is when people with large audiences a certain level of influence are used to promote a product or service. Some examples would celebrity tweets which are used to promote products to their large social media followings. Jay-Z purchased Tidal, but did not go at it alone. He brought on major star power to help him Tidal into a success. He enlisted Alicia Keys, Kanye West, J. Cole, Usher, Daft Punk, Madonna and many more were all gifted 3% of equity within the company. This incentivized the artists to make a Tidal a success by spreading the word, but also limiting the number of songs that are on other platforms and are exclusive to Tidal.
- Stay The Course – If it was easy everyone would happily do it. The ability to continue on your path when adversity strikes will be a key factor in your success. In business and in life, challenges will come up. Not losing site of your purpose and your goals will help you through the tough times and the success achieved will be even greater. Stay The Course!
- Be Creative – Realizing that he was behind, Jay-Z used many of the resources available to him to turn into a success. In addition to the influencer marketing that was mentioned above, Jay-Z also held several concerts to promote the new service offering. In your own business, it is worthwhile to take a step back and analyze if there are more create ways to accomplish your goals.
- There Is Room for Competition – The main reasoning that was given of why Jay-Z’s Tidal music service would not success is because larger services like Apple Music and Spotify already had large parts of the industry and it would be too expensive for others to compete. What Jay-Z understood was that while those companies are large, there is still room to compete with them. He knew his service did not need all of the people in the world as customers only decent number to improve the balance sheet. Today, Tidal has 1.5 million subscribers and a monthly price of $19.99. Although $30 million pales in comparison to Apple Music and Spotify, it is a nice payday for Jay-Z. Just because there may already be larger companies performing the service or selling the product that you offer does not mean you cannot achieve success. Compete with them and beat them.
Do you have any additional thoughts on the significance of the Jay-Z deal?