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Why American Rappers Make A Lot Of Money

Rappers are known for living a life indulged with all the good things and, quite literally, tubs full of money. With that, you might ask how they do it when all they seem to do is party all day and night. Rappers earn money from a lot of ways. Here are some of them.

Album Sales

Popular hip hop website Hip Hop DX says that the top selling albums of 2013 averaged 304,400 units, with Kendrick Lamar’s “Good Kid Mad City” on top, with over 746,000 units sold. Trinidad James’ “Don’t Be Safe” sold the least with 11,000.

If a well loved mainstream rapper would sell 300,000 units on an album and each one would cost somewhere from $8 to $20 each, the average rapper could make somewhere between $2.4 and $6 million dollars in album sales alone. The only problem here seems to be that rappers rarely make 100% of the money that their album generates because most of them give up a large percentage to the label, distributor, manufacturer, the studio and others that contributed to the production. If these overhead costs get too high, a rapper might earn less than a dollar per album. This is also why rappers take advantage of their fame and earn from other means, as well.

Touring

A big chunk of the money lies in touring. The average concert attendance has gone up recently to about 9,000 attendees. If the same mainstream rapper would sell tickets for $25 and makes it to at least the average number, he or she can make $225,000 in one tour.

As to how many concerts a rapper can do, this depends on several factors. There are things that are beyond control, such as logistics and cancellations, but even with all this, they can still perform at a decent number of tours. This means that the average rapper can make around $6.75 million from touring alone.

Merchandise

Yeezys, Supreme Hoodies, and many more popular merchandise were built around the hip hop culture. An extreme example of a fashion line built around the era would be Sean John, which Sean “P Diddy” Combs released after being declared one of the richest rappers in the world. This is how popular rappers take advantage of their fame. They expand in a parallel manner. When they get popular enough, people will want more than just their music. They will want to walk and talk like their idols. This is why rapper merchandise sells really high and fast.

Investments

You might not have seen much of 50 Cent lately. This is because the popular rapper has been spending more time with his massive business empire which you might have patronized at some point. His most lucrative recent revenue stream is his deal with Vitamin Water. After being the endorser, 50 Cent signed on to become a stakeholder in parent company Energy Brands. When Coca-Cola bought the company, his stake earned him $100 million.

50 Cent also had a deal with Mark Ecko Enterprises which resulted to G-Unit Clothing. Under their agreement, G-Unit Clothing was responsible for 15% of Ecko’s revenues. The clothing line pulled in $75 million, and with his 8% royalty cut, he made $6 million from it alone. Other sources of income for the rapper include books, movie appearances and video games.

Legacy

Rappers can earn billions in many different ways, but the most valuable thing would be the music. When Vanity Fair asked Chance the Rapper why he gives his music away for free, he said that after meeting with three major record labels, he realized that his strength was being able to offer his best work to people without any limit on it.

“My first two projects are on places where you can get music for free” says the rapper. When asked to how he sustains this, he says that he makes money from touring and selling merchandise. “I honestly believe if you put effort into something and you execute it properly, you don’t necessarily have to go through the traditional ways,” he said. True enough, Chance the Rapper was recently nominated for seven Grammys for his work on “Coloring Book.” This made history as being the first album to top the Billboard chart solely from streaming.

Rapping is more than just rhythm and rhymes and when a successful rapper takes advantage of his or her popularity, this can result to a lot of money. What do you think of this list? Share with us your thoughts in the comments below.

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