Paying Hip-Hop's Pioneers, and They Thought It Was a Scam
Some didn't even show up to collect, because they didn't believe it was real. In hip-hop you can't just hand out money — as Nas put it, you have to give recognition and dignity first, and only then can the money be accepted.
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A $10 album owed $5 million
The starting point is a debt Ben Horowitz owed himself: he bought the album Paid in Full for $10 back then, and over his career he got at least $5 million in value out of that record, with no channel to pay it back — and he felt he had to. He called Steve Stoute first, and Steve said the idea was not only good but overdue: everyone was saying these old rappers were broke and dusty, but nobody was actually doing anything. The second call went to Nas, who said Quincy Jones's Jazz Foundation model wouldn't work in hip-hop: you can't just give a person money, it has to be recognition of what he did and who he is, and it has to be more than money. So the shape became an awards ceremony and a Grandmaster Award, with Scarface and Rakim honored in the first class.
— Ben HorowitzSome thought it was a scam and skipped the award
The foundation's first obstacle wasn't money, it was that nobody believed it. Ben says the early disbelief was beyond what you'd imagine, and for a while they had real trouble actually getting money into people's hands — some didn't even come to collect the award because they thought it was a scam, and others said "I don't need anyone giving me money." He treats that disbelief as proof the design was right: it can't look like compensation, it has to be celebration and tribute, shining the light they're owed on them, and only then will it be accepted. Caz later put it more bluntly: the industry has shortchanged these people for so long that the first reaction can only be "why would anyone help us now."
— Ben HorowitzThe first hip-hop hit was stolen from him
Grandmaster Caz wrote the rhyme that became Rapper's Delight, his own name was even in the rhyme, and the first hip-hop hit was taken out of his hands just like that, with nothing due coming to him. Ben says everyone in the music industry knows this, but nobody ever did anything, and nobody ever said anything. The first time he met Caz in New York he was stunned: this man would change the energy of any room he walked into today, yet he carries no bitterness at all and still treats himself as a star. Steve added a line: it's not that nobody knew, it's that not enough people knew — the industry knew, the public didn't.
— Ben HorowitzDr. Dre needed an introduction to meet his idols
Steve Stoute tells a detail: Dr. Dre heard about Paid in Full and decided to come, then asked whether Steve could introduce him to Kool Moe Dee — Dre had never met him. Another time, in Las Vegas, Dre asked whether he could be introduced to Slick Rick, whom he had also never met. A Dre who has made it has to ask for an introduction to meet these legends, which shows how fragmented the scene is — and getting these people into one room was something only this foundation managed to do. Caz puts it more directly: the industry separates people by success, status, and who's hot right now; for years he only ran into Nas by chance, and now they see each other once a year and can call each other.
— Steve StouteThe Grammys botched it, so they did it themselves
Quincy Jones was the legend of legends to this group, but when he died the Grammy tribute was called, flatly, botched. The Quincy Jones Award wasn't conceived to fill a slot; it came from seeing the Grammys get it wrong, and Quincy's son QD3 saying fine, we'll do it ourselves — that's how it became a fixed annual award from the foundation. This year's recipient is Nile Rodgers. Steve mentions that George Clinton showed up last year with his "mothership" prop and, at 83, recited the lyrics to Rakim's Follow the Leader on stage — one man who changed music honoring another man who changed music.
— Steve StouteHip-hop has no social security
Caz explained what the money concretely means: a grant paid out over five years, with which he bought a house and moved out of the projects. He lived in the Bronx his whole life, and for the past ten to fifteen years his last thought at night was always "I don't want to die in the projects"; now he and his wife live in a house in Pennsylvania. He says hip-hop has no social security and no health insurance, you have to keep working, which is why you still see him doing radio, playing parks, doing hip-hop tours — because he has to. The money gave him something he'd never had: a buffer. He also makes a point of saying money is only part of it; the real thing is being put in the light.
— Grandmaster CazBrands came back from the dead on hip-hop
Steve Stoute uses business data to argue why "paying the debt" is justified: Adidas had only 2% of the U.S. market at the time, three-quarters of it from the Northeast, and the company just saw a bunch of people frantically buying the same shoe and throwing the laces away, with no idea why. Grand Puba's lyric "First things first, obey your thirst" later became Sprite's ad line. Tommy Hilfiger was selling ties that wouldn't move, drove through Harlem, saw everyone wearing their pants low with the Calvin Klein waistband showing, went back and made the underwear waistband wider and thicker with his own name on it, and only then did the brand take off. These brands exist because of what these people contributed.
— Steve StouteLove isn't writing a check, it's flying to Houston
Ben tells a story about his wife, who is also the foundation's chair, Felicia, to show how this organization differs from other charities: Scarface had a heart problem and needed open-heart surgery, but he came from a place where people barely even go to the doctor, he was afraid to go, and on the phone he said he wasn't going. Felicia flew to Houston and said no, you're going now. Just as they walked into the exam room, his aorta ruptured, and the doctors got him in in time and saved his life. Steve adds the everyday version: she'll suddenly call to ask how you and your family are doing, and if someone in your family gets sick, flowers show up the next day, or whatever was agreed shows up.
— Ben HorowitzIn their own words · checked verbatim
I think in life it's impossible to do anything great if you start with what's possible. You have to start with what's right.
Ben Horowitz0:02
that's not going to work that way in hip-hop because in hip-hop you can't just give somebody money
Ben Horowitz3:04
we had people who literally didn't get the award cuz they thought it was a scam
Ben Horowitz5:05
The first hip-hop hit was stolen from him and he didn't get what he deserved and everybody knew it but no one ever did anything about it.
Ben Horowitz10:07
It's putting a light on it on these artists. But it's not putting anything in their pockets.
I don't want to die in the projects.
Grandmaster Caz39:24
his aorta burst and they got him in just in time and saved his life.
Ben Horowitz48:31
Figures
| What Ben paid for the Paid in Full album | $10 | 2:04 |
| Career value Ben says he got from that record | at least $5 million | 2:04 |
| Edition of the Paid in Full awards ceremony | the fourth | 24:15 |
| Foundation's matching ratio | 2.5 to 1 | 37:23 |
| Number of paid staff at the foundation | 0, all volunteer | 37:23 |
| Payout period of Grandmaster Caz's grant | five years | 38:23 |
| Adidas's U.S. market share at the time | 2% | 44:26 |
| Share of that 2% from the Northeast | three-quarters | 44:26 |
| George Clinton's age when he recited Rakim's lyrics on stage | 83 | 32:20 |
Glossary
- Paid in Full
- The album name that comes up again and again in this episode, and also the name of the foundation; Ben says he bought it for $10 back then.
- Grandmaster Award
- The award the foundation gives each year to hip-hop's true originators; recipients join a committee that helps pick future honorees.
- Jazz Foundation
- The foundation Quincy Jones ran that sends money to old jazz musicians; Ben initially wanted to copy that model.
- dusty
- Hip-hop slang; Steve says people used the word to describe these old rappers, yet nobody actually did anything.
- the projects
- Public housing developments in American cities; Grandmaster Caz lived in the Bronx for most of his life.
How to listen
People working in the creator economy, music rights, or philanthropic funds — and investors who want to know what Ben Horowitz is concretely doing outside of a16z.
After 52:33, the chat about the casting tapes for The Color Purple and Nas's father has little to do with the main thread.