Long before sneaker lines became a prerequisite for music moguldom, the King of Pop launched his own multimillion-dollar L.A. Gear shoe. Though his endeavor didn’t enjoy the success of subsequent footwear ventures by other entertainers, Jackson blazed a trail in business just as he did in music—just ask 50 Cent.
By Zack O’Malley Greenburg 50 Cent isn’t known for being giddy. Born Curtis Jackson, the Queens native put himself on the hip-hop map with the 1999 hit “How to Rob,” in which he outlines his plans to relieve stars from Jay-Z to Will Smith of their cash. He rose to international superstardom after releasing Get Rich or Die Tryin’ in 2003; on the album’s cover, his face is contorted into a fierce scowl, perhaps a consequence of getting shot nine times at close range a few years earlier. These days, he’s more concerned with entrepreneurial ventures (though he still keeps a framed photo of a pistol in his office, behind a gold placard that reads “CJ Enterprises”). He took home $100 million on a single deal in 2008—payment for a stake he’d taken in vitaminwater parent Glacéau in lieu of a one-off endorsement fee—when Coca-Cola bought the beverage company for $4.1 billion. He’s launched his own video games, record label, sneakers, clothes, headphones and energy shots. Yet it still comes as something of a surprise when, a few minutes into an interview in his Manhattan penthouse office, he jumps up from his plush leather chair and begins bouncing around the room, gesturing with cartoonishly muscled forearms and smiling uncontrollably. The topic responsible for his good humor? Michael Jackson, the man whose early shoe and clothing lines helped open the door for the brand extensions of the next generation of entertainers, 50 Cent included. “When he did ‘Billie Jean,’ I had that poster on my wall,” says the rapper. “Like, he could have sold me penny loafers . . . the showmanship that was involved in his presentation was so much more advanced than the things that we’d seen in the past.” Long before 50 Cent created his G-Unit sneaker for Reebok or Jay-Z launched his S. Carter line, Nike had MJ. To be clear, those initials don’t refer to the King of Pop, but Michael Jordan. In 1987, the Chicago Bulls legend became the first entertainer to be paid on a scale commensurate with today’s stars when he inked a seven-year, $18 million contract with Nike to launch his Air Jordan brand. The agreement marked the apotheosis of the rapidly growing athlete shoe deal, which was virtually nonexistent just ten years earlier. In the 1970s, Nike’s first signing was University of Oregon track star Steve Prefontaine. He agreed to wear the fledgling company’s shoes for a then-whopping $5,000. The scales quickly shifted when Adidas signed Kareem Abdul-Jabbar to a $100,000 deal in 1982; shortly thereafter, New Balance spent $1.2 million to lock up fellow basketball star James Worthy before Nike upped the stakes by another order of magnitude with Jordan; the company’s revenues soared from $10 million to just shy of $1 billion over that span. Athletes were finally getting paid to wear shoes, but musicians didn’t begin to break into the market until Run-D.M.C. released the song “My Adidas,” an initially uncompensated ode to shell-toes. In 1986—after a handful of Adidas executives showed up to a Madison Square Garden show and witnessed some twenty thousand onlookers raise their own sneakers toward the rafters at the behest of the rappers—Run-D.M.C. signed a deal worth more than $1 million. By 1990, upstart sneaker purveyor LA Gear was desperately looking to grab a bigger piece of a multibillion-dollar market. So the company’s chief, Robert Greenberg, turned to cofounder Sandy Saemann and said, “Let’s get Michael Jackson.” Saemann, a loquacious Californian who later resigned from the company after amassing millions in stock holdings—and now runs a high-end hot dog stand in Manhattan Beach—thought this was a bad idea. Even without a big-name endorser, he believed LA Gear had a shot at eating into its rivals’ domestic market share. The way he saw it, Michael Jackson’s image was still smarting from recent tabloid fiascoes and wouldn’t necessarily help sell sneakers in the United States. Greenberg saw things differently. Even if the singer couldn’t help with their domestic efforts, he was still huge overseas, as the Bad Tour had shown. If Jackson could sell over 4 million concert tickets—with more than half his tour dates occurring abroad—why couldn’t he move a million sneakers worldwide? Thus began the relationship between Jackson and LA Gear. When Greenberg and Saemann finally reached out to his camp, they found the singer was amenable to doing a deal as long as his financial conditions were met: $20 million. That surpassed even the seven-year, $18 million Nike deal signed by Michael Jordan in 1987 (though the basketball legend would earn far more after receiving a royalty on every Air Jordan shoe sold). But Jackson knew his worth, even when it came to sneakers. “He wanted it to be the biggest deal known to man,” recalls Saemann. “He was very conscious of where the scale was. . . . That’s the side of him that nobody understands. He knew where he was. He wanted to be number one and he wanted to stay number one, he wanted to be the largest entertainer with the most deals.” During early conversations over the venture, Saemann and Greenberg told Jackson and his attorney John Branca, who was negotiating the deal, that they wanted to launch the shoe abroad only. That way, they figured, it wouldn’t be such a gamble. But Jackson refused. If he was going to launch his own sneaker, it had to be the biggest and the best—bigger even than Jordan’s—and there was no way he’d settle for an overseas-only deal. LA Gear agreed, and Jackson accepted the offer of $20 million, about one-fifth of the company’s annual advertising budget, to help launch a line of co-branded sneakers that would be sold both in the US and around the world; he’d get half of that sum up front. The press release announcing the shoe would refer to him as the King of Pop, and his agreement with LA Gear would be described as “the largest entertainment endorsement ever made.” In return, says Saemann, Jackson promised he’d shoot television commercials for LA Gear and wear the sneakers in the promotional materials for his upcoming album, Dangerous, which was supposedly almost finished. When Jackson showed up at a press conference in Los Angeles on August 6 to announce the agreement, it seemed a perfect match. “The theme of our ad campaign is ‘unstoppable,’ ” said Saemann, introducing the singer. “This word epitomized what LA Gear and Michael Jackson represent. . . . I want to tell the competition, we’ll up you a Jackson.” “Thank you very much,” said Jackson, looking spiffy as ever in sunglasses, a sleek dark suit, and a purple dress shirt. “I’m very happy to be a part of the LA Gear magic.” Around the same time, Jackson hired a new manager, Sandy Gallin, who won the job after bonding with the King of Pop over the scope of their shared dream of making Jackson as big in the film world as he was in music. “What he thought he could become and what I thought he could become were very similar,” says Gallin. “Michael thought of being the biggest, the best . . . to repeat the great success of Thriller and to be able to have more people attend your concerts, to be able to have the most successful short films at the time, to be able to do movies, and to succeed more than anyone else in any form of entertainment that he entered into, whether it was writing, producing, singing, acting, directing. It was innate to his personality.” Despite the managerial changes, Jackson’s business career was chugging along at a healthy clip. To help promote Jackson’s shoe, Saemann directed a commercial that features the King of Pop spinning through a dark, steamy street in his new kicks. His face appears for only about three seconds toward the end when, after destroying a street lamp with the sheer force of his mojo, Jackson looks up to find a young girl smiling and clapping from an upstairs window. Saemann and Jackson also developed a close working relationship. They’d go to record stores and sales meetings together; on one occasion, Jackson elevated the moods of seven hundred sales reps by dancing on a table. He and Saemann would even edit videos together late into the night. “He was no slouch,” recalls the former LA Gear executive. “When Michael went to work on something, it might take two weeks to get ahold of him, but he’d give you five hours.” Jackson, however, still hadn’t completed his new album. Whenever Saemann broached the subject with Jackson, the response was the same. “I’m a creative guy,” he’d say. “You can’t force it.” In the end, LA Gear had to move forward with the launch of the sneaker line though neither the album nor the promised product tie-in had emerged. Retailers were expecting the shoes to be delivered on schedule—but they were also expecting the footwear to make an appearance in promotional material that accompanied Jackson’s new record. When that didn’t materialize, the results were disastrous. The shoes sold hundreds of thousands of pairs, says Saemann, but there were also hundreds of thousands that had to be returned to the manufacturer after languishing too long on the shelves. Jackson hadn’t held up his end of the bargain, and LA Gear was suffering. The day Saemann introduced him at the press conference, the company’s stock stood at $20.75 per share, down from a high of $50.38 the previous year. By January 1991, the stock had plummeted to $2.88; it lost 21.5 percent on a single day, thanks to the announcement that the company expected to lose $4 million to $6 million in the fourth quarter. Jackson’s deal factored heavily into that figure. In June of 1991, Saemann voluntarily resigned from the company “to pursue other business interests.” Roy A. Disney’s Trefoil Capital bought 30 percent of the slumping company around the same time. LA Gear would go on to sue Jackson in 1992; after the singer countersued, the two sides settled for an undisclosed sum. Saemann suspects the company let Jackson keep what they’d already paid him—the first half of the promised $20 million—but didn’t have to fork over anything more. And despite the damage to Saemann’s stock options and reputation, he still has some fondness for the singer. “I enjoyed every minute around him; we talked as equals and friends,” recalls Saemann. “But, genius or not, he didn’t deliver.” Back in 50 Cent’s office, the rapper is done pacing. Now he’s sitting down again, musing on his shared connections with Michael Jackson. There were plenty of those on the business front, given that the King of Pop proved it was possible for an entertainer to start his own clothing label, shoe line, and record company long before the birth of 50 Cent’s G-Unit empire. But he connects with Jackson on another level. Right or wrong, many people define both men by their most successful album—Get Rich or Die Tryin’ was the rapper’s Thriller. Like Jackson, he had many other hits, but the album remained something of an albatross because of the inevitable comparisons it evoked whenever a new effort was released. “[Reviewers] go, ‘Yeah it’s cool, but it’s not as good as it was when you came the first time,’ ” he explains. “And you can’t have a second chance at a first impression. No matter who you are.” Despite spending more than a decade trying to top Get Rich, it’s still his bestselling album and most critically acclaimed. 50 Cent doesn’t seem too distressed, though; he’s turned his attention to new business ventures like his SMS headphone line and SK Energy drink. The specter of success took a seemingly heavier toll on Michael Jackson. One need only consider how much time and money he spent on subsequent albums to see how badly he yearned to top Thriller—a perfectionist’s longing that caused him to drastically delay the launch of multiple works—sometimes at the expense of interconnected business ventures like the LA Gear shoe line. He did all of this in an effort to achieve something that was, by definition, basically impossible: to make an album more successful than the most successful album of all time. And Jackson was spurred on over and over again by reviewers and listeners who continued to hold his work, both sonically and commercially, to the standard of Thriller. “They just put you up against yourself,” says 50 Cent. “If they give you an opponent, you can analyze and figure out their weaknesses and beat them. But if it’s yourself, how do you win? How do you top that?” Adapted from Michael Jackson, Inc.: The Rise, Fall, and Rebirth of a Billion-Dollar Empire, by Zack O’Malley Greenburg. The book will be published by Simon & Schuster in the U.S. on June 3.