After selling his gold-mine headphone company Beats by Dre last year to Apple for $US3.2 billion, rap mogul Dr. Dre’s net worth spiked to an estimated $US700 million. He’s the second-richest man in hip-hop, according to Forbes.
But the deal that helped make him so rich almost never happened.
According to an article by Wired, initially Dre’s lawyer recommended he sell sneakers instead of headphones.
But one day when iconic record producer Jimmy Iovine was hanging out with Dre, he suggested they get into the speaker business instead.
According to Wired, popular musician Will.i.am had been encouraging Iovine to get into the speaker industry, and he saw this as an opportunity.
“F— sneakers — let’s make speakers,” Wired quotes Iovine saying.
Dre initially didn’t think selling headphones would work, or that people even cared about sound quality. Competitors such as Apple had such success with cheap headphones Dre didn’t believe people would buy in.
But the sneaker industry has even bigger juggernauts. With Nike and Jordan still ruling the sneaker world, success in that field might have been unreachable — even for Dre. And it turned out there was a real need for high-quality headphones.
“It was crazy to see my kids listening to my music on these headphones,” Dre told Wired. “I was like, ‘This is not how it’s supposed to sound. This is not what I spent all this time in the studio for.’ We decided we had to do something about it.”
Billions later, it’s safe to say he made the right choice.
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