Entrepreneurship and Endorsements
Celebrity endorsements have proven very successful around the world where, due to increasing consumerism, an individual is considered a status symbol when they purchase a celebrity-endorsed product. On August 1, 2007 laws were passed banning health care professionals and public figures such as movie stars or pop singers from appearing in advertisements for drugs or nutritional supplements.
Numerous celebrities have become budding business moguls and established themselves as entrepreneurs, idolizing many well known business leaders such as Bill Gates, or Warren Buffett. For instance, basketball legend, Michael Jordan became an active entrepreneur involved with many sports related ventures including investing a minority stake in the Charlotte Bobcats, Paul Newman started his own salad dressing business after leaving behind a distinguished acting career, or rap musician, Birdman started his own record label, clothing line, and an oil business. Other celebrities such as Tyler Perry, George Lucas, and Steven Spielberg have become successful entrepreneurs through starting their own film production companies and running their own movie studios.
Various examples of celebrity turned entrepreneurs included in the table below are:
| Celebrity | Net worth (2011–2012) USD | Sources of wealth |
|---|---|---|
| Oprah Winfrey | US$2.7 billion | Main sources are television, radio, and film. Additional business holdings in Harpo Productions and the Oprah Winfrey Network with interests in film, television, magazines, books, motivational speaking, and publishing. |
| 50 Cent | US$100 million | Main sources include music, film, and television. Various ventures include sports endorsements with Reebok, video games, record labels: G-Unit Records and G-Note Records. Additional holdings in fragrances and cosmetics, fashion designing and clothing, books, radio, television and film production, talent management, real estate, and other investments. |
| Jay-Z | US$450 million | Main sources mainly in music with business holdings in a record label that include Roc Nation, sports teams (including a significant stake in the Brooklyn Nets NBA team and a potential stake in Arsenal FC), bars and nightclubs, books, clothing line Rocawear, real estate development, music touring, publishing, casinos, advertising, and other investments within his conglomerate (Gain Global Investments LLC). |
| Diddy | US$500 million | Main sources mainly in television, film, and music. Other holdings include the record label Bad Boy Records, fashion designing and the Sean John Clothing Line, restaurants, vodka, television production, business education, and fragrances. |
| Martha Stewart | US$638 million | Main sources mainly in radio, television, film, and her conglomerate Martha Stewart Living Omnimedia, which includes interests in television production, magazines, cookbooks, and household cooking products. Others sources include internet related ventures, blogging, publishing, books, and retail merchandising. |
| Magic Johnson | US$500 million | Main sources primarily in television and sports. Other holdings include the promotion and theater chain Magic Johnson Theatres, movie studios, food services, sports teams (minority stake in the LA Lakers), and motivational speaking. |
| Arnold Schwarzenegger | US$100–$800 million | Main sources include film and bodybuilding. Minor holdings in various global businesses, restaurants, real estate, Planet Hollywood, and other investments. |
Tabloid magazines and talk TV shows bestow a great deal of attention on celebrities. To stay in the public eye and build wealth in addition to their salaried labor, numerous celebrities have participating and branching into various business ventures and endorsements. Many celebrities have participated in many different endorsement opportunities that include: animation, publishing, fashion designing, footwear designing, fragrances and cosmetics, consumer electronics, household items and appliances, cigarettes, soft drinks and alcoholic beverages, jewelry design, fast food, credit cards, video games, writing, and toys.
In addition to various endorsements, a number of celebrities have been involved with some business and investment related ventures also include: and toddler related items, sports team ownership, fashion retailing, establishments such as restaurants, cafes, hotels, and casinos, management related ventures such as sports management, model management, and talent management, record labels, film production, publishing, salons, health and fitness, and real estate.
Although some celebrities have achieved additional financial success from various business ventures, the vast majority of celebrities are not successful businesspeople and still rely on salaried labored wages in order earn a living. Most businesses and investments are well known to have a 90 to 95 percent failure rate within the first five years of operation. Not all celebrities eventually succeed with their own businesses and other related side ventures. Some celebrities either went broke or filed for bankruptcy as result of dabbling with such side businesses or endorsements. Though some might question such a validity since celebrities themselves are already well known, have mass appeal, and are well exposed to the general public. The average entrepreneur who is not well known and reputable to general public doesn't the same marketing flexibility and status-quo as most celebrities allow and have. Therefore compared to the average person who starts a business, celebrities already have all the cards and odds stacked in their favor. They can have an unfair advantage to expose their business ventures and endorsements and can easily capture a significant amount market share than the average entrepreneur.
Read more about this topic: Celebrity, Celebrity Wealth