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Kanye West Is Not The Richest Black Man In America

Photo source: AP 4 mins read

Claim: Several social media posts and screenshots have been seen circulating with the Claim that American Rapper Kanye West is the Richest Black Man in the United States.

The claim that Rapper cum Entrepreneur Kanye West is reportedly the richest black man in the United States is Not True.

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Viral posts were seen across Social Media platforms in Sierra Leone and beyond with a photo of popular American Rapper Kanye Omari West with claims stating that the Rapper is the richest black person in the United States with an estimated net worth of $6 Billion. This claim, reported by multiple entertainment outlets like Complex, estimate that West’s Sneaker brand Yeezy as well as Yeezy Gap – a clothing deal, have a combined value of as much as 4.7 Billion.

This has been shared widely ever since on WhatsApp statuses and Instagram, without detailed information on the claim offered to the public. Several people are now using his situation to offer motivational notes to readers as Kanye West was faced with issues of huge debt a few years ago. This was before his deal with Adidas which stabilized his financial situation that was mired in debts accounting for millions of dollars. These claims were however ignited by the Bloomberg post which headlined “GAP has billion-dollar ambitions for Yeezy Deal with Kanye West.

Verification

It is no secret that Rapper Kanye West overcame his debt crisis and accumulated huge wealth on his  YEEZY sneaker deal with Adidas which is estimated by FORBES  to be worth around 1.7 Billion Dollars. However, all these accumulated wealth ranging from his Yeezy, Cash and other Assets, his music catalogue and Skims which happens to be a co-owned company with soon-to-be ex-wife Kim Kardashian did not bring him any way closer to the purported $6 Billion net worth circulating on social media. Forbes also maintains  it is less than a third of the purported net worth. Below is a rundown of his net worth as analyzed by Forbes:

  • Yeezy: $1.5 billion 

 Still the crown jewel of his fortune, sales at West’s sneaker brand, which has a 10-year long production deal with Adidas, climbed to $1.7 billion last year, up from $1.3 billion in 2019. As a result, West earned $191 million in royalties last year. It’s an impressive growth. While UBS predicts the brand will reach over $3 billion in sales by 2026, and valued it accordingly, we went with 2020 numbers: The operating income of Yeezy, which is owned 100% by West, was $214 million in 2020. With a 9x multiple and 20% private company discount, Forbes calculates that the Yeezy business with Adidas is worth $1.5 billion, about $250 million more than it was a year ago. 

  • Cash and other assets: $160 million

Thanks to the millions he’s made from Yeezy and his music, West has accumulated a nice-sized pile of cash, as well as homes and toys. He owns more than $100 million in real estate—including multiple ranches in Wyoming and homes in the Los Angeles area. According to a balance sheet sent over by his team, there’s also $9.3 million worth of artwork, $7.6 million worth of jewelry, $5 million worth of vehicles, $3.4 million worth of furniture and $1 million worth of livestock. Along the way, he has also racked up a significant amount of debt: $56 million. We couldn’t track down every horse, chair and necklace, so again applied a discount to the numbers provided. We also didn’t include any value for the website Yeezy Supply, which West’s camp claims is worth $1.5 billion. Forbes counts its value via royalties of the Yeezy shoe sales made through the site in the Adidas deal. 

  • Music catalogue: $90 million

While he may make most of his money as a fashion mogul, West started out as one of the world’s most popular rappers, and his catalogue of songs still brings in millions in royalties each year. Just like with Yeezy, he could cash out on that royalty stream, as musicians from Shakira to Bob Dylan have in the last year. 

  • Skims: $64 million

West and his soon-to-be ex-wife Kim Kardashian West, may have ended their marital relationship, but they maintain certain business ties. West has a small stake in his ex’s shapewear and loungewear company Skims, which has grown during the Covid-19 pandemic.”

The purported $6bn network was an estimation done by Bloomberg in relation to his Yeezy and Gap deal which is worth about 1.5 Billion. The clothing deal has a huge potential of doubling the rapper’s net worth but it is yet to make a single sale as it is not formally operational. Forbes therefore refuses to give it any value until the product starts to sell. Forbes  in its most recent analyses of the claim states that:

“The report that the celebrity is worth nearly $7Bn are based on magical thinking around sales that don’t yet exist. This is why he is currently worth less than one-third of that.”

The UBS report which Bloomberg referenced made assumptions based on future earnings thus the bank document did not confirm the estimation but stated them as future earnings that may result from the Yeezy Gap deal.

Conclusion

With the claim of Rapper Kanye West topping the list of richest black people in the United States circulating on social media space in Sierra Leone, Dubawa  decided to do a quick fact-check on the claim which has proven to be untrue. American based business magazine Forbes; owned by the Forbes Family and its globally recognized platform publish reports on a variety of issues but mostly connected to wealth and fortunes. Forbes maintained that the richest black man in the United States remains to be the Vista Equity Software Mogul Robert F. Smith who is worth around $6 billion. Dubawa through the analysis of Forbes and other thorough investigations on the issue from Dubawa, confirmed that Kanye West is not the Richest black person in the United States as claimed.

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