1540 Broadway, 30th Floor
New York, New York 10036
Telephone: (212) 381-1540
Fax: (212) 381-1599
Incorporated: 1992 as Bad Boy Entertainment
Sales: $500 million (2002 est.)
NAIC: 512210 Record Production; 512230 Music Publishers; 512240 Sound Recording Studios; 422320 Men's and Boys' Clothing and Furnishings Wholesalers; 722110 Full-Service Restaurants; 541613 Marketing Consulting Services
1992: Bad Boy label is founded by Sean Combs at Uptown Records.
1993: Combs leaves Uptown for a new distribution deal with Arista.
1994: First release by rapper Notorious B.I.G. tops charts for Bad Boy.
1995: Bad Boy is named number one rap label by Billboard magazine.
1996: Combs renegotiates his contract with Arista, becoming joint owner.
1997: The first Justin's restaurant opens; Notorious B.I.G. is murdered; a Combs solo album tops charts.
1998: Combs buys a stake in Notorious magazine; second Justin's is opened in Atlanta.
1998: Sean John Clothing line introduced.
2002: Combs buys out Arista's stake in record label.
2003: A new distribution deal is reached with Universal Music.
Bad Boy Worldwide Entertainment Group is owned by Sean Combs, an entertainment and media dynamo whose many business activities include record production, clothing design, and restaurant management. Combs, alternately known as "Puff Daddy" and "P. Diddy," has also dabbled in rapping, acting, movie production, magazine publishing, artist management, and concert promotion. Bad Boy's many divisions include Sean John Clothing, which accounts for more than half the firm's revenues; Bad Boy Entertainment, a record label that features rap and hip-hop artists like Combs, Faith Evans and the late Notorious B.I.G.; Justin's, which operates soul food restaurants in New York and Atlanta; and Blue Flame Marketing, an advertising and public relations agency.
Bad Boy's origins date to 1992 when 23-year-old record producer Sean Combs decided to found his own label, which he called Bad Boy Entertainment. Combs, sometimes called "Puffy" because of his short temper, was born in 1969 and at the age of three had moved from Harlem to suburban Mount Vernon, New York, after his father's death in a drive-by shooting. He was raised by his dedicated mother, Janice, a teacher and model, and attended a prestigious all-boys Catholic high school in New York City before enrolling at Howard University in Washington, D.C., to study business. In the summer of 1988, with the help of rapper Heavy D., Combs got a job as an intern at Uptown records, which was run by former Motown head Andre Harrell.
After his sophomore year Combs left college to work full time at Uptown, and he quickly moved up through the ranks until he was made director of Artists & Repertoire in 1990. His job included developing talent and producing records, and he successfully established the careers of vocal group Jodeci and Queens-based R&B/rap singer Mary J. Blige. December 1991 saw Combs involved in a tragic accident at City College of New York, when nine people were trampled to death before a celebrity basketball game he was promoting with Heavy D. The lawsuits that followed ended with Combs being found only partially liable, while much of the blame rested on the college's security department.
In December 1992 Combs's growing importance at Uptown was recognized by his appointment to the role of vice-president, at which time he also formed the Bad Boy Entertainment label. He had in fact shopped the idea around to other companies already, but was persuaded to stay at Uptown by the offer of the new title. Combs took the job of Bad Boy CEO, and former Orion Pictures marketing manager Kirk Burrowes was named general manager and given a 25 percent stake in the label, which would release records, manage artists, and do production work.
A few months after the label was formed, Harrell fired Combs, reportedly for insubordination, and Combs quickly found a new home for Bad Boy at Clive Davis's Arista Records. The approximately $1.5 million deal gave him creative control over the label's product, which Arista would distribute.
Bad Boy's first successes, which were produced by Combs, included Chris Mack and Notorious B.I.G. (a.k.a. Chris Wallace), a former drug dealer and friend of Combs. B.I.G.'s first album, Ready To Die, sold more than two million copies after its release in 1994, and Bad Boy soon racked up other hits with such artists as Wallace's wife Faith Evans, Ma$e, 112, and Total. In 1995 Billboard magazine named Bad Boy the year's number one rap label, and Combs the number two R&B singles producer.
The following year Combs renegotiated his contract with Arista, which reportedly gave him $10 million, 50 percent ownership in Bad Boy, and the right to buy back his master recordings and Arista's stake in 2003. By now he was being asked to produce music for other artists outside of the label, and he found success with records by Mariah Carey and Boyz II Men. In February 1997 Kirk Burrowes was named president of Bad Boy, though he soon afterwards left the company to be replaced by Combs' former boss Andre Harrell. Janice Combs was also reportedly deeply involved with the decision-making at her son's label.
1997: A Tragedy and a Chart Topper
In March 1997 Notorious B.I.G. was shot and killed while driving through Los Angeles. Combs, riding in the car ahead of him, rushed to his friend and remained with him until he died. The murder, which was never solved, was rumored to be the result of a feud between East and West Coast rappers. Combs and B.I.G. had been accused by some in the rap world of involvement with a 1994 assault and robbery of rapper Tupac Shakur (who was also murdered in 1996), and the killing of an associate of L.A. rap mogul Suge Knight at a party in 1995.
Combs had been preparing to release his first solo album at the time of the murder and already had a hit single on the charts, but he reworked the recording after Wallace's death to pay tribute to him. The album, which was retitled No Way Out and released in July, included appearances by many Bad Boy artists. It featured the hit song "I'll Be Missing You," which had vocals by Faith Evans and Combs (under his new nom de disque "Puff Daddy") mixed over a hit by the Police called "Every Breath You Take." The record was a huge success and was later awarded a Grammy. A critically-acclaimed posthumous release by B.I.G. was also a best-seller for Bad Boy. While all of this was happening, Combs had found time to open an upscale soul food restaurant in Manhattan's Chelsea neighborhood. Called Justin's, after his oldest son, the restaurant was later expanded to a second location in Atlanta.
In 1998 Combs approached Arista for more money, and reportedly received a $55 million advance against future earnings. He also embarked upon yet another sideline, marketing a line of clothing for men ages 12 to 40 that featured underwear, pants, shirts, sweater vests, and hats. Prices ranged from $22 to $35 for t-shirts and hats, to $65 to $90 for pants. Combs oversaw a staff of six designers who created the clothing, and a separate company, Sean John, Inc., was formed to run the operation. It was a joint venture between Combs, private label manufacturer CGS, and Jeffrey Tweedy, a former Ralph Lauren executive who was chosen to manage the new firm. Combs was following a long line of entertainers who had gotten into the fashion business, including label owner Russell Simmons and rap acts the Wu-Tang Clan and Naughty By Nature. Combs would wear the clothing for public appearances and also displayed it on the runway at fashion shows in New York.
During this time, not content to limit his endeavors to records, restaurants, and clothing, Combs was also spending $1.5 million to buy a majority stake in Notorious, a magazine aimed at young, upscale New Yorkers, and was formulating other plans that included movie productions, a TV cartoon series based on the life of the Notorious B.I.G., and a sports management firm which would be run in partnership with O.J. Simpson lawyer Johnnie Cochran. Combs, who was known to throw lavish parties and get very little sleep, also found time to sponsor a charitable organization and a computer camp for disadvantaged youth. His earnings for 1998 were estimated by Forbes magazine at $53.5 million, and in early 1999 he was featured along with comedian Jerry Seinfeld on the magazine's cover for a story that ranked him the 16th most powerful entertainer in the United States. The revenues of Bad Boy at this time were estimated at $35 million, with Combs' outside productions, live performances, and songwriting royalties contributing to his greater earning power.
In April 1999 controversy once again erupted when Combs got into an altercation with Interscope Records executive Steve Stoute over MTV's airing of a video by rapper Nas that featured a shot of Combs nailed to a cross. Though he had willingly participated in the video shoot, he later changed his mind and asked Stoute to delete the scene. When he later saw the original version on MTV, the enraged Combs allegedly barged into Stoute's office with several associates and beat him so badly that he required hospitalization. At this time Combs was putting the finishing touches on his second album, Forever, and another posthumous B.I.G. album, as well as laying plans to open several Sean John Clothing stores.
Combs was charged with felony assault and faced a possible seven-year prison term, but in September he pled guilty to a lesser charge and was sentenced to a one-day anger management class. He had also reportedly paid Stoute a cash settlement. Combs's recently released Forever album, the 19 tracks of which once again featured many samples of other artists' hits and performances by guest vocalists, sold significantly less than No Way Out, which had by this time shipped seven million units. Earlier in the year the Bad Boy label had lost contracts with the rap group The Lox and hitmaker Ma$e, who quit the music business to enter the church. Notorious magazine had also folded by this time.
1999 Nightclub Shooting Adds to Combs's Woes
Things got worse for Combs in December, when, three days after Christmas, he was arrested and charged with criminal possession of a weapon and possession of stolen property following a shooting at a Manhattan nightclub. Budding Bad Boy rapper Jamal "Shyne" Barrow was charged with attempted murder and reckless endangerment in the incident, which left three people wounded. The fight had reportedly started when Combs began throwing wads of cash into the crowd and one man threw some back at him, which some witnesses claimed caused Combs to brandish a gun and Barrows to start shooting. Combs and his girlfriend, actress Jennifer Lopez, fled the scene in an SUV, which was stopped by police, who found a stolen, loaded handgun under the front seat. Another gun had reportedly been thrown from a window of the speeding vehicle, which was driven by Combs's chauffeur Wardel Fenderson. Fenderson, who ran a number of red lights trying to evade the police, later struck a deal with prosecutors, and in February Combs was indicted on additional charges of trying to bribe him to take the rap.
Despite his mounting legal problems, which also included lawsuits filed by victims of the shooting and the nightclub's owner, Combs's business activities continued on course, with a hit Bad Boy album released by vocalist Carl Thomas, and a new marketing firm founded during the summer of 2000. In September Combs's Bad Boy Technologies unit formed a joint venture with Hookt.com, which would run badboyonline.com and puffdaddy.com. Later that month Jamal Barrow's debut album was released, and in November Combs took his act on the road for a week-long series of parties, fashion shows, and live performances. Sean John Clothing was now the biggest star in Bad Boy's firmament, accounting for about $100 million of the company's estimated $160 million in earnings for 2000. Bad Boy was also enjoying the success of new female pop group Dream and a number-one single by rappers 112, while it also prepared for the spring 2001 release of "Thank You," a gospel tribute album featuring a combination of Bad Boy artists and gospel performers.
In March 2001, after nearly two months in court, Combs was acquitted on all charges stemming from the December 1999 shooting incident, though Jamal Barrow was found guilty on several charges of assault. During the trial, Combs and Lopez had reportedly broken off their relationship, but the split did not sour him on the movie business, and he appeared in the spring release Made, then later as a death row inmate in Monster's Ball with Halle Berry and Billy Bob Thornton.
In the summer of 2001 Combs released his third solo album, P. Diddy & The Bad Boy Family ... The Saga Continues, which featured the artist sporting yet another new pseudonym. This album had fewer samples of other performers' music tracks, but again featured many guest artists. It was not a major success.
2002: Combs Becomes Sole Owner of Bad Boy
In early 2002, as his record distribution arrangement neared its end, Combs reached a deal to buy back the 50 percent stake in Bad Boy that Arista owned from its parent BMG for an estimated $20 to $30 million. Bad Boy had reportedly been losing money of late, after a profitable year in 2001, and Arista was rumored to be relieved to see the label depart. Combs would now be 100 percent owner of Bad Boy, its artist roster, and back catalog. The company had sold a total of 75 million records to date, and Combs had just released another new album, P. Diddy & Bad Boy Records Present. ... We Invented the Remix, which entered the charts at number one, though it slid rapidly downward and went on to sell a somewhat disappointing one million units. It was the label's only album release for the year.
In February 2003 Combs reached an agreement with Universal Records by which the latter would take over manufacturing and distribution of Bad Boy products for three years. Estimates of the amount paid by Universal varied widely, with sources putting it as low as $15 million or as high as $80 million. The latter figure was still well below the $100 million Combs had sought. The holding company under which his ventures were organized was now known as Bad Boy Worldwide Entertainment Group, with Sean John continuing to be its best performer, accounting for more than half of revenues and gaining Combs a string of nominations for fashion industry awards. Plans were once again on the table for a retail division that would market the clothing at stores in several major cities. Combs was also now appearing on a popular MTV program about a hip-hop talent search called "Making The Band."
In the spring of 2003 Combs announced plans for a series of "Bad Boy Weekends," which would feature music, clothing, parties, and celebrity basketball games. Combs's new political agenda was a subtext for the events, which would take place in Detroit, Atlanta, Washington, Miami, and Chicago. Members of his inner circle hinted that he might be considering a U.S. Senate run. He was also heading back to the big screen, having been cast as 1930s blues legend Robert Johnson for the HBO movie Love In Vain.
Combs was called back to court in July, when Kirk Burrowes sued him for $25 million. The former Bad Boy president alleged that Combs had reneged on an agreement to share Bad Boy's profits with him after he was forced out as head of the firm. He also alleged that Combs had used a baseball bat to make him sign over his 25 percent stake in the company. A Combs spokesman dismissed the allegations as "fiction." Later in the summer, Bad Boy had the number-one album on the Billboard Top 200 with the soundtrack for the coincidentally-named film "Bad Boys II," featuring material by such artists as Mary J. Blige, Nelly, Justin Timberlake, and P. Diddy himself.
Combs's accomplishments in the areas of record production, clothing design, restaurant operation, and a host of other fields had brought him great success, despite a string of tragedies and brushes with the law. Still in his early 30s, P. Diddy, as he was known on record, would no doubt find more opportunity in the years to come.
Principal Divisions: Bad Boy Entertainment; Sean John, Inc.; Blue Flame Marketing and Advertising; Justin's Restaurants; Bad Boy Marketing; Bad Boy Productions; Bad Boy Films; Bad Boy Books; Bad Boy Technologies; Janice Combs Music Publishing; Janice Combs Management; Daddy's House Studios; Daddy's House Social Programs.
Principal Competitors: The Island Def Jam Group; Interscope Records; Tha Row Records; Tommy Hilfiger Corporation; FUBU; Phat Fashions LLC.
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Source: International Directory of Company Histories, Vol. 58. St. James Press, 2004.