Troy Carter: Get out of your own bubble

Hello and thank you guys for having me today. Just fresh off the Red eyes. So fresh as a daisy right now. So I wanted to talk to you guys about a few lessons that I learned throughout my life and throughout my career. A little bit about me. West Philadelphia born and raised. Our playgrounds looked a little bit different from Fresh Prince's though. But I grew up in West Philly, hip hop head, a kid who just fell in love with music from a very early age. So from the time I was about 10 or 11, I would start buying records here and there, borrow my friend's records, borrow my cousin's records. I would read every single liner note, I would know every recording studio, every engineer. I was kind of like the Rain man of hip hop and being able to spit back every single thing there is to know, it just was something I was obsessed with from a really age. And I used that as a form of escapism. We grew up pretty poor growing up single mom, we lived over top of a small hardware store in West Philly. My dad had gone to prison when I was seven and a half years old for murder and was in jail for about 12 years until I was about 20 years old. So basically my mom raised me and my two younger brothers, my one older brother, one younger brother. And basically we learned a lot from just the neighborhood and the streets. In ninth grade, because I love music, I had this big idea that I was going to form a rap group with my best friend that I met in class named Jaz. And the rap group was called Two Too Many, because we only used to have money. It was three of us, we only had money for one of us. So it was always two too many. And at that age, my best friend taught me this idea about how thoughts become things. And he had this thing, if we ever meet Jazzy Jeff and Fresh Prince, those guys are going to give us a record deal. And we worked hard at our music. So hard that in 11th grade I actually dropped out of school. And my mom was pissed. And she basically took me, dragged me to this center called Job Corps and said, you're gonna get a GED and you're gonna come home with a piece of paper. And if you want to do music, you gotta graduate first. And for those of you guys who don't know Job Corps, it's kind of like jail meets college. And it was on an old naval base in Port Deposit, Maryland, and I wanted to get out of there as fast as possible. So within record time, I got my ged, I went back out to Philly and started working on my music again. And this is actually the train that we used to take downtown every single day. And we used to hop the turnstiles because we didn't have money to get on the train and wait outside at DJ Jazzy Jeff's studio every single day. We waited out there in the cold. We waited out there in the rain. And then finally one day, we saw friends who just happened to be in a recording studio, and they let us in. And we met these guys, Jazzy Jeff and Fresh Prince. So these were, like, the first successful guys to really make it out of our neighborhood that we grew up in. You know, Will had gone to LA to do Fresh Prince of Bel Air. These guys had won Grammys. They had become big and famous. So it kind of gave us the idea of if they could do it, we absolutely could do it. So we snuck into their studio session, popped in our cassette, quickly found out we sucked. But Will saw some potential in us. He gave us a little record deal, really respected our hustle. Also. We danced for him, showed all of our talents, and he said, how are you guys getting home? We said, we have no idea. But he drove us home that night and he told us, he said, you, lives are gonna change forever. And actually they did, but just not that quickly. We ended up getting. We got dropped from our record label, put out a little record, got dropped within, like, six months. Super disappointed because this was, like, one of the first things that I worked really hard for in my life. I put everything that I could put into it. I sacrificed school, sacrificed my mom's happiness, and for this, quickly failed rap career. But Will saw potential. Jeff saw potential. His manager, James Lassiter, saw potential in these young guys. They gave me a job as an assistant in the recording studio. I washed cars for them. I picked up homework for their kids. So basically, whatever I could do to get on, I actually did to get on. And then. But I hated la. I moved to la, hated la, ended up going back to Philly with my tail between my legs. But it was one of the things that my grandmother said, you can't fall off the floor when you start from nothing, there's nowhere to go but up. So I went back to Philly. I started promoting shows. It was like back then, promoting shows. There was no Live Nation or big conglomerates, and everybody was scared to do hip hop shows because they always ended in some act of violence with a fist fight or a gunshot. And it was only, like, one crazy guy in Philly that was willing to take that on and it was me. And I used to collect money from guys in my neighborhood who would help me put together these shows because I didn't have an investment fund or anything like that. So guys from the neighborhood would actually pull together cash to help me do these little concerts. So they started off at the local YMCA and then got a little bit bigger. I was the first guy to bring Wu Tang Clan into Philly. A 16 passenger minivan from Staten island with Method man and Old Dirty Bastard in the back playing at a local like sort of bingo hall. And the Old Dirty Bastard's leg was broken, so he just rapped like this the whole time. I actually got fortunate enough, I bought Foxy Brown, a rapper down from New York, and she bought a guy who she was doing music with down. And it just happened to be Jay Z. So it was Jay Z's first concert in Philadelphia. So I was starting to build these relationships. But it was one show that helped shape my life and my career. But it actually was a show that never happened. So I was doing a show. It was the biggest show to date, and it was at the University of Penn's campus and Notorious B.I.G. was the headliner. And then I get a call that Notorious B.I.G. was not going to be able to make it down before the show. I'm panicking, I'm nervous, I'm thinking it's going to be a riot. I get on the phone with his manager and then he puts the head on the label on and he said, we're in New York right now shooting a video called Big Papa, but we're going to try to make it down before it's over. And we get into a big fight on the phone with the record label and BIG doesn't show. But they still come down to Philly. And the guy I was arguing with on the phone was P. Diddy. So we go to an after party at a club called Fever. And Puff was like one of the first guys that was within my age range in the music industry who had a similar background. He lost his dad to violence as a kid. His dad was killed. And of course, like I said, I lost my dad. Both come from similar backgrounds. And here was a guy who was building this company that I admired. So I'm sitting in the club, I'm watching him hold court, and he's kind of commanding the room. And I said, you know what? I want to come work for you. He said, okay, I'll give you your first job. Get me the girl from behind the bar. So I got him the girl from behind the bar. And two weeks later, I was working for Bad Boy Entertainment, and I was an intern. So basically anything that Puff needed, taking out the trash, doing the marketing plans, work my way up to the assistant to the president of the company. But I was able to learn a lot because working for Will Smith, I saw the business at 30,000ft. But working for Puff, it was more hand to hand combat, bootstrapping, entrepreneurship, how to do a lot with just a little. And it really. That was my training ground for how to become an entrepreneur. And I have to thank him for that. In 1999, I got a call from somebody who was from our neighborhood. A girl who I'd known since she was 16. And she was just recently, at that time, discovered by Dr. Dre. And she asked if I could help her find a manager. And so I took her to meeting after meeting and meeting after meeting. And finally she said, you know What? After the 11th meeting, she said, why don't you just do it? And of course I said, yes. Never knew, never was a manager before. Was very nervous actually about doing it. How am I going to screw this girl's career up before it actually starts? But I learned really quick. You fake it till you make it. First day a tour. Cash money. Rough Riders tour. We're getting on the tour bus, and I'm walking up on the bus. It's my first real thing as a manager. And. And it's this old guy who's the bus driver, and he walks on the bus and he says, you got the float? And I said, yeah, I'll be right back. And I get on the phone and I called up Will Smith's manager, James, and I said, james, what's the float? He said, idiot. It's the money you give the bus driver to pay gas and tolls and buy food. So I went back and I gave him the money, and I said, here's the float. And then I floated my way through the rest of the tour. Floated my way for about the next couple of years, But Eve trusted me. And the whole thing was I learned about how to trust my own instinct, trust my gut, trust the fact that I'm going to protect my friend who gave me the shot with everything that I have. And we built something special. So over the next few years, we did apparel lines, we did TV shows. I was able to sign some more clients. I ended up building probably one of the premier boutique hip hop talent management companies in the country. And I even made enough money to open up an unfancy office. In the basement of a downtown building because I needed the fancy address because I didn't want people to think I still worked out of my apartment. And actually it had no windows, it was like a casino. So you never knew what time of day it was. So you get to work and next thing you know it's 2 o' clock in the morning when you're coming out. But we built an incredible culture, me and my partner at the time. We signed artists from London, we signed artists from New York. And sooner than later I got a call. Somebody wanted to buy the company. First opportunity to make some real money. Every entrepreneur is looking for that exit, looking to take their business to the next level. And I jumped on it, sold the company, opened up their LA office, moved out, bought a house for my family. And we hear a lot about buyer's remorse, but in this case it was more like seller's remorse. Eighteen months into the deal, I realized I made the worst mistake of my life. It was painful. While they were doing their diligence on us, I wasn't doing my diligence on them. I wasn't looking at the culture of their company. I wasn't looking at the quality of people. I wasn't looking at how my career was going to change. And instead of that connection that I had with the clients and that love of music, I was uninspired. I was able to get out of that deal. And I said, I'm going to start a new company. I'm going to take Eve with me. Ended up buying this. I rented a fancy office on Wilshire Boulevard, all glass, beautiful, reinvested everything back into the business, had everything planned out. And then one day Eve walked in and she said, I think I want to go in another direction. You're fired. You want to talk about devastation? The definition of devastation. Somebody who I felt like I invested my career in my life in somebody who had been at my wedding, somebody who saw my kids grow up, Somebody I didn't even I trusted enough. We didn't even have a contract and sort of left me out there high and dry. And it was right as the world was falling apart financially. So no banks were lending, no friends had money. Commissions dried up, I had to lay off my staff. Notices started coming in. The mail couldn't pay the vendors. But even worse, what was happening at home was falling apart. My house was being foreclosed on where my wife and my mother in law basically had to pawn their wedding rings to save my house. The buzzer on the doors ringing in the middle of the night because the banks were repossessing our cars and were coming in the middle of the night. And I remember sitting down with the head of school at my kid's school, begging him to actually keep the kids in school because I couldn't afford to pay tuition at that time, but I couldn't allow my kids to get kicked out of school. And I remember when the bill came for breakfast, wondering whether the credit card was going to go through for a couple of bowls of oatmeal that day and ended up moving out my office. Will and James, you know, I told them what was going on. They said, we have an empty office next to ours right now. Just come and crash here if you like. And I remember one day, it was like shortly after the Christmas holiday. It was probably one of the worst Christmases a dad could have. I'm driving down Ventura Boulevard and I just pulled over and cried my eyes out. Not one of those ugly cries. It was a really ugly cry, but it was cleansing. And it was just that moment of, you can't fall off the floor. What are you going to do? I don't have a plan B. My dad wasn't part of a country club or didn't work at Goldman Sachs. My mom couldn't call anybody from a sorority. I was the sole people in. My family depended on me. So I had to figure it out. But I also had to have faith and find that quiet place and really learn how to get to that quiet place. One of my mentors told me, you can use failure as a headwind or a tailwind. And this was something that stuck with me for a very, very long time. Because failure breeds fear. And a lot of times fear paralyzes people. And then you just go into that downward spiral. But how can you use that same exact energy to. To propel you forward, to make you get out of bed in the morning, to make you fight against whatever's holding you back. And it's this old story that I just love, but it's a simple parable. It was A and B were having a fight and they were in this all out brawl. Both of them were getting tired, both of them are knocking each other out, and both of them wanted to quit. A decided to quit, but B decided to throw one last punch and B won. And how can you treat failure that same exact way? Can you find it in you to throw that one last punch? And for me, sometimes treating people good comes into play because I got a phone call from a very old friend named Vincent Herbert and Vince is a guy I've known since I was a little kid getting in the industry. We were the same age, and Vince was this prolific music producer at like 16 or 17. Whitney Houston, Barbra Streisand, Boyz II Men, you name them, Vince produced for him. And Vince and I had never done business together, but I always took his calls and I always called him, you know, just to check in on him. And Vince called me and he said, troy. Well, he called me Carter. And he said, Carter, I saw this girl on MySpace. You guys are probably too young to know what MySpace was, but I'm flying her to LA tomorrow. I want to bring her by the office. But I think you're going to like her. Make sure you're there. And so Vince is like, really, really big guy and with this very soft voice. So the next day, I see him coming into the office and he's walking in, and behind him appears this girl. And she walks out. She played some music, song after song, hit after hit. She looked nothing like this, by the way. She had these big black sunglasses on, fishnet stockings, no pants. Looked like she landed from another planet. But she was wise and, like, she knew exactly what she wanted. And she said, I want to be the biggest star in the world. And I said, vince, make sure you bring this girl back. Like, I love her. Make sure you bring her back. And a few months later, she came back to la. I took her to the fanciest restaurant I could find, Spaghetti Warehouse. I wasn't balling at that time. And we went to Spaghetti Warehouse and we sat down for three hours and we talked about life, about career, and what was interesting. She had gotten signed to Def Jam Records and Def Jam dropped her four months after they signed her. And this was her dream. She worked all of her life to become this superstar. And four months later, she gets dropped from Def Jam Records. She went to West Virginia. She's sleeping on her grandmother's couch. And her grandmother said, get off the couch. If you're going to do it, go do it. Her dad said, you got one year or you need to go back to school, but you need to figure this out. So between what was happening in my life, what was happening in her life, we connected in a way that. That you don't usually connect with artists. We connected right away and we went out on this journey and she started writing songs for other people. She wrote songs for Pussycat Doll, she wrote songs for Britney Spears, for this person, for that person. But we couldn't get her career started to save our Lives. And it took one year for her first song to get played on the radio. We shopped this thing everywhere. Nobody would play it. They would say it was too European, it was too gay, it was too this, it was too that. And then finally it was this radio station in Toronto that took Toronto. I love you guys. Thank you. Did you request it? They played the record. And then of course I hit up the station in Buffalo and said, hey, you know how hot we are in Canada right now. And Buffalo started playing the record. And then other stations started playing a record. And then within a year, Just Dance went to become a number one record around the world. But radio didn't help. And this was Lady Gaga after. What I learned was perseverance. What I learned was how to make that shift. Because at the time in our business, the music industry, we had gone through the worst possible change that we could ever go through. And we were the canaries in a coal mine when it came to disruption, transformation. And we ignored it. The mecca of the music business was Tower Records. And this is what it looked like. We ignored the customer. The music industry completely ignored what was happening. We stuck our heads in the sand and completely ignored it. What's interesting, it wasn't that people wanted to steal music, it was the fact that the music industry was. We had a terrible product. First of all, we charged $17.99 for a CD with two good songs and probably 10 bad songs. It was like a forced bundle. And then we made the packaging so hard to open, you needed a blowtorch and like a jackhammer just to get the CD out. So of course, when Napster came along and gave you choice of songs and made it easy for you, it gave you the ability to test it and carry with you on your new MP3 player. People just. People went for it. It was an early model, but we still didn't listen to the consumer at that particular time. In fact, the music industry is probably one of the only industries that suit its customers. That's how bad we were. But here we were with a new artist from a new generation who didn't have any of that historical baggage. And where we also got lucky were guys like this. Because Facebook was coming out of Edu at the time and all of a sudden, democratized communication. YouTube was on the rise. And prior to YouTube, you had to wait for Saturday Night Live to book you, you had to wait for Ellen to call you, you had to wait for Good morning America to call you. Now all of a sudden you had an audience that could see Your personality. And we would shoot these sort of flip cam videos of Gaga and her art school friends doing these like weird downtown videos and. But we distributed it around the world from YouTube for free. And all of a sudden people started catching on. And radio was late, the gatekeepers were late. Twitter took out all of the middlemen. So all of a sudden instead of having to go through a publicist, instead of people speaking on your behalf, you can talk directly to the audience. And tech companies paid attention to what we were doing because at that time the, there wasn't a bridge between technology and media companies. They were suing each other. It was this misunderstanding. The people in LA thought Silicon Valley were pirates and didn't get content. People in Silicon Valley thought that people in LA were dinosaurs and didn't want to move forward, which was right in most of the cases. But for me it was an eye opening experience and I started getting a lot of phone calls. But one of the lessons that I learned was if you work in a fish store long enough, you stop smelling the fish. You get caught up in your own bubble and it's important. You got to get out of your own bubble. You got to have some outside perspective. And working with these technology companies gave me a lot of outside of perspective. We get. Sometimes you get stuck in your own rut just because a lot of our businesses that we are in just have historically do things in a certain way that makes no fucking sense at all. But because it's been done that way, we just continue to do it. So sometimes it takes looking at other businesses, looking at other verticals, and you learn ideas from those other verticals. And that's what we were able to apply to the music industry and really disrupt the music industry from the inside out. So being able to look for inspiration in other places and other ideas. And for me, technology was one of those fields that showed me how to do that. And most recently in Spotify, I was able to blend those two worlds together. And from those experiences I've been able to invest in a lot of startups and kind of learn about a lot of different spaces and learn from a lot of different types of entrepreneurs. Where Uber and Lyft investing in those companies who reinvented transportation. It just showed me how consumer behavior was starting to shift and how I needed to pay attention to this generational shift. My generation, we were brought up on stranger danger. You don't get in a car with another guy, you don't sleep on a stranger's couch. Like, you know all of these things that we saw very early on in these generational behavior shifts really changed my outlook on how I was looking at things and how I can apply that to my own business. Companies like Yume and wonderschool that we invested in showed me this new category that we named the unperfect parent. And this new generation of parents that are different from their own parents. How are behavior shifting between that generation to the other and what are the opportunities there? Lindup and Lynn street were two companies that we invested in. That's basically bringing dignity back into banking, where banking used to be about community, about dignified loans, about transparency. And then also, like, one of my favorite categories is just seeing what's been happening in the multicultural space. Because a lot of times, you know, showing up in the Valley, it was nobody in the Valley that looked like me at all. Where it was in the music industry, it's a lot more diverse than Silicon Valley. And I'm being nice. And I learned terms like unconscious bias, which I'm like, that sounds like racism to me. New name. Dress it up, Put a bow on it. Okay, fair enough. But companies like Maven that we invested in, a young entrepreneur from Oakland who basically looked at the beauty industry and saw that African American Women over index and it's $19 billion in just the hair industry alone and in that space. But that's an opportunity that traditional VCs wouldn't see because they didn't come from that space. How do you find entrepreneurs who understand the value in investing in different hues? And then us, we're looking at entrepreneurs of different hues that are going to understand those opportunities. So that's been a fascinating space that I learned a lot from. And so I'm learning a lot from these companies, but I think even more, I've learned a lot from observing artists. I learned a lot from watching Gaga, who's better than any CMO that I've ever met in my life. I learned a lot from watching Beyonce, who manages her business and her brand just as well as any Fortune 50 company. By the way, she has a lot in common with Nike, the way she manages the details of her brand. And then you. It's something that we're seeing that customers, they're willing to wait in line for, they're saving up their paychecks to make purchases. And I remember seeing the first 50 fans sleep outside of a show at the Wilton Theater as we were breaking Gaga. I remember seeing girls who were having body shaming issues when we were working with Meghan Trainor, write her letters and say, hey, you saved my life. And I think a lot of it has to do with authenticity, Making that connection, being real as you possibly can be, and also being able to operate off script in a way where people feel connected to you, whether it's customers or. Or whether it's actual fans. And for me, I've been able to apply that to multiple businesses that I've invested in, being able for them to be advocates for you to be like the Beehive, Beyonce's crew or Beliebers, Justin Bieber's crew or whatever, Taylor Swift's calling them now, Swiftonites, whatever. But people who are willing to fight your battles for you, how do you build that authentic relationship? How do you make that connection in a way that feels real to them, even so loyal that they get really painful tattoos on their forearm? That takes commitment right there. If you could get fans like that that's willing to do that, that takes real commitment. That shows a lot of loyalty. For me, this has been an incredible learning experience. And whether I'm learning from companies like Nike or people like this waiting out in line for their shoes who are really thinking about, how do we make that connection? The Colin Kaepernick thing this week was trend like. To me, that was mind blowing. That showed a company that's willing to take risk. That showed a company that's willing to put it all on the line. That's showing a company that's willing to speak up for what they stand for or stand next to somebody who's willing to speak up what they stand for. And for me, a kid from West Philly, that's where my values stand. It's like, I'm gonna speak my mind and I'm gonna tell my truth. And being able to align with artists or align with brands that do the same exact thing is important. And as marketers and business owners and entrepreneurs, you know, are you finding that truth? I think companies like this, whether it's Nike or whether it's Beyonce or whether it's Gaga, you think about it, they listen, they learn, they got open ears, but you got to be quiet to learn. That's what's hard. We live in an age where there's a lot of noise out there, there's a lot of opinions. You're gonna piss one side off if you say this, but where do you stand? Listening to your consumers are important, but. But I think listening to yourself is even more. One of the challenges that I do have working with technology companies is we live in an age of data, data, data Data. Data. I'm so sick of the word. I'm sure we have data scientists in here, but in all fairness, what data told Beyonce to pick up her microphone? What data told Phil Knight to build a shoe? What data told John Lennon to write imagine there's no data there? I think great ideas, inspiration songs, inventions. To me, it's like they're all downloads from God. There's no data informing you that. So the question is, can you quiet yourself from the noise? Can you quiet yourself from opinion? Can you move yourself out of that crutch of data? For me, I opened myself up to learn that data doesn't lead to creativity. I still trust that same instinct as that kid that got on that train sitting outside of the studio waiting for Will Smith. I still trust that instinct of being able to ask Puffy to get a job or being smart enough to get him the girl from behind the bar. I don't think they're still together, by the way, but I still trust it. Absent of data, I've opened myself up to learn from failure. I opened up myself to learn from the genius of makers. I opened up myself to learn from the flow of artists. And hopefully I'm quiet enough to get that download from God. Thank you.