Rush Communications Business Information, Profile, and History

History of Rush Communications

Rush Communications is the most successful African American-owned media company in the United States, operating divisions in far-ranging segments of the entertainment industry, from advertising (Rush Media) to film (Def Pictures) and television (Russell Simmons Television). Rush was founded by Russell Simmons, a native of Queens, New York, and has grown in barely more than one decade to a company of national prominence, and one that not only successfully markets "hip-hop" culture to consumers, but helps to define it as well. An original founder of the phenomenally successful hip-hop label Def Jam Records, Simmons and his company are focused on the continued popularity and growth of marketable urban culture in all its forms. Although Simmons sold his ownership of Def Jam Records in 1999, his company continues to project itself as one with its antecedents firmly rooted in an African American ethos.

The Making of a Promoter: Russell Simmons and Def Jam in the Early 1980s

Growing up in a solidly upper-middle class African American neighborhood in Queens, New York, Simmons was the son of a college professor and was not exposed to the music that would so alter his life until his freshman year at New York's City College in 1977. At that time, hip-hop had yet to be known as any sort of coherent or definable musical form, but its beginnings were already in place: the sounds of Funkadelic, James Brown, and Al Green had popularized a new type of African American music, and small shows in which such music was played began cropping up in cities around the country. Simmons became instantly enamored with not only funk music, but the entire lifestyle--hip, edgy, and urban--such music represented, and he began frequenting New York clubs and parties to scout out new talent. As his knowledge of the music increased, Simmons recognized both an economic and artistic opportunity and began promoting small bands and shows around the New York area. Simmons proved to be a shrewd promoter, with a keen taste for what would and would not appeal, and within a couple of years he had turned to promotion full-time.

During this time Simmons became acquainted with Rick Rubin, a wealthy, young Long Island native attending New York University. Although he was not African American, Rubin had become deeply involved in the underground funk music scene and had started recording and producing local African American funk bands, using his NYU dorm as his studio. In 1979 Rubin founded Def Jam Records, using his family's money for backing, and was soon a ubiquitous presence at downtown clubs and shows. Rubin and Simmons, though from different backgrounds, were fast friends, and in 1983 Simmons joined Rubin as an equal partner in Def Jam.

Between the year in which Def Jam was created and the year Simmons joined as its partner rap music had begun to supplant the popularity of funk. Lyrics, some with a decidedly subversive, political edge, began to be spoken and rhymed instead of simply sung, and the instruments traditionally associated with popular music were usurped by record players and recording instruments that allowed a musician to splice and intersperse prerecorded tracks with his own voice. Rubin was especially quick to pick up on this trend, and he began seeking out rap acts to record for Def Jam.

Def Jam's First Successes: The Mid-1980s to the Early 1990s

In 1985 Def Jam produced its first recording that reached rap fans across the country and helped the label reach regional and, eventually, national prominence. That year, the label produced Curtis Blow's "Christmas Rap," which sold more than 50,000 copies, and made Def Jam a small but potentially powerful presence in the burgeoning rap industry. In addition to selling well, "Christmas Rap" caught the eye of CBS Records (a company bought a few years later by Sony Records), which, in an effort to keep current on urban, youth-oriented trends, offered to Def Jam a $600,000 distribution deal the following year. The offer was an enviable one by industry standards and gave Def Jam exclusive control over production, while CBS picked up the tab for marketing and distribution costs. The contract followed industry standards, however, in that CBS Records received all of the profits from Def Jam's efforts, with the latter receiving a set percentage of royalty payments.

In 1986 Def Jam premiered LL Cool J, an artist who was to become one of the label's most successful and ground-breaking acts. Only 17 years old at the time, LL Cool J epitomized the type of swaggering charisma and overt sexuality embraced by hip-hop artists, and within a year of signing with Def Jam he had skyrocketed to international fame. That year the label produced LL Cool J's version of the famous Aerosmith song "Walk This Way"--the video which is considered by some in the industry to be one of the best in musical history--and in doing so became a label of national recognition.

Soon after the success of LL Cool J, Def Jam began promoting the talents of three white Jewish boys from the Bronx--an incongruous trio in the world of rap--who were to become known as the Beastie Boys. The Beastie Boys' album "Licensed to Ill" created a national sensation and helped to make rap almost as popular in the white community as more traditional forms of rock.

Although the Beastie Boys and LL Cool J made free use of obscenities and, to some critics, misogynistic imagery, the two acts were fairly innocuous in their commentary on contemporary racial and economic issues. Def Jam, however, was not one to shy away from pushing the envelope, no matter who might be offended, and in 1990 began producing the controversial band Public Enemy. Led by the articulate and outspoken Chuck D., Public Enemy made headlines not only in the entertainment section of national newspapers; overtly political, and still more overtly angry, the band grabbed the attention of politicians and community leaders and became for some a symbol of violence and racial separatism. In addition, although even African American radio stations refused to play tracks from the band's album "Apocalypse '91," the release sold more than 500,000 copies in five days, making it one of the most successful rap albums ever produced. Def Jam, like its West Coast competitor Death Row Records, had by the early 1990s turned risk-taking into profit, with the company's revenue in 1991 totaling out at upwards of $34 million.

Such profit, however, did not come without compromise: without the financial backing of CBS, Def Jam had limited influence in the music industry, and its reliance on the major label made the company inherently less autonomous, in both the development of its artists and image, than it would be had it remained independent. The issue of independence--one that became increasingly important to the hip-hop industry throughout the 1990s--eventually became an untenable problem between Simmons and his partner Rick Rubin, and by 1990 the two had parted ways, with Simmons and CBS retaining control over Def Jam.

Simmons Branches Out: The Development of Rush Communications in the Early 1990s

After proving himself as a shrewd businessman in the music industry, and one who was capable of catering to the traditional needs of the financial world while simultaneously projecting a street-wise, youthful image, Simmons turned his focus to other areas of the entertainment industry. In the early 1990s the entrepreneur began developing several projects in different areas, all of which were controlled by an umbrella company called Rush Communications. The name was so chosen because "Rush" was Simmons's nickname from childhood and well reflected the pace at which he moved.

In 1991 Simmons's company joined forces with veteran Hollywood producers Bernie Brillstein and Brad Grey, and together the three men created the wildly popular "Def Comedy Jam" for HBO. The show initially consisted of eight half hour programs, each of which highlighted a young up-and-coming African American comedian. The show, which was hosted by Martin Lawrence, was so successful that HBO renewed the program's contract the following year for an additional 22 episodes. Paid $2 million for its efforts, Rush Communications managed to produce the episodes for less than $600,000; a handsome profit indeed for a television novice's first production effort. Proving itself popular on television also established that the image and urban culture Simmons wished to market went beyond the music industry and could be developed and exhibited and, therefore, sold in a myriad of contexts.

In the early 1990s, it became increasingly evident that what was becoming known as hip-hop culture had a definite appeal in the apparel market. Young men and women in growing numbers were imitating the looks they saw during hip-hop shows and videos: suddenly baggy, low-waisted pants, tight "baby tees" with prominent logos, and loose-fitting jackets were being seen in cities around the country. Simmons was not long in turning this trend to his company's advantage and began in 1993 to produce a small line of clothing called Phat Farm.

Initially sold in one boutique in New York, Phat Farm was an immediate success. The line was kept limited, with only one designer producing a few basic pieces, each of which carried prominently the Phat Farm logo, but within its first year of operation the label brought in about $2 million. Because of Simmons's connections within the music and entertainment industry, stars from Def Jam and television alike began to wear the label to public functions, and soon Phat Farm began to gain national attention.

Only one year after Phat Farm's inception the label began to be picked up at specialty stores around the country. Soon, Phat Farm became the brand of choice for young, fashion-conscious club-goers. Initially worn primarily by men, the brand branched out into women's apparel under the name Baby Phat, producing inexpensive, body-conscious pieces that were intended for casual day and evening wear.

The middle of the decade saw many changes for Rush Communications. In 1995 the company's most prominent operation, Def Jam Records, was sold in part to Poly Gram Entertainment, leaving Rush with a 40 percent ownership. That year, too, Rush had its first real success in film production, creating four films in one year, including the Eddie Murphy hit "The Nutty Professor." Far from believing himself spread too thin, Simmons soon thereafter started another company division, called Rush Media, which focused on print and television advertisement. During the next couple of years, Rush Media produced ads for such companies as Coke, HBO, and ESPN.

Rush Communications by the middle of the 1990s had branched out into almost every facet of the media industry and was by all appearances proving itself successful in whatever it endeavored to accomplish. Simmons, with his boundless energy and seemingly endless connections, controlled personally each of Rush's new operations and possessed the uncanny ability to appear present everywhere at once. Simmons's secret to growth seemed bound up in a threefold strategy by which the entrepreneur first sought out high-powered mentors with a great amount of expertise in one segment of an industry, next used this mentor to establish contacts on both the artistic and financial end of a business, and then actively courted partners who already had clout within the industry. Simmons utilized this method in his initial involvement in the music industry, and in television, film, and media production, as well as clothing design, making Rush Communications by the late 1990s the most visible African American-owned company in the country.

Rush Takes a Gamble: The Sale of Def Jam and Further Expansion in the Late 1990s

Although in the latter part of the 1990s Rush continued to receive the majority of its profits from Def Jam Records, with the label bringing in about 60 percent of the company's revenue, Simmons was restless, eager to focus on a broader array of operations. His clothing line, which after only two years in business was being distributed nationally to department and specialty stores, was doing particularly well at the time, with 1997 sales totaling out at upward of $10 million. In addition, Simmons had begun a television show and magazine called Oneworld, which devoted itself to every aspect of urban youth culture, and the two were gaining in popularity. The television show was especially trendy, as it was hosted by a popular Japanese American model named Kimora Lee, who later became Simmons's wife in a high-profile ceremony in 1998.

In 1999, after months of negotiation, Rush sold its 40 percent ownership of Def Jam to Seagram's Universal Music, leaving the company--and Simmons--free to focus on its other operations. The sale caused some industry experts and Def Jam fans to speculate about Simmons's sway in the hip-hop music world, but through careful publicity and the development of other projects the company continued to maintain its reputation as an industry leader, with 1998 sales at $70 million.

Principal Competitors: EMI Group plc; Time Warner Inc.; Universal Studios, Inc.

Chronology

• Key Dates:

• 1983: Russell Simmons becomes partners with Rick Rubin's Def Jam Records.
• 1985: Def Jam forms a distribution deal with CBS Records.
• 1986: Def Jam has its first international hit with the introduction of LL Cool J.
• 1991: Russell Simmons branches out into other segments of the entertainment industry through Rush Communications. Russell Simmons co~produces HBO's Def Comedy Jam.
• 1993: The clothing label Phat Farm is introduced.
• 1995: Poly Gram buys 60 percent of Def Jam.
• 1999: Rush Communications sells its 40 percent ownership to Seagram's Universal Music.