Aly Weisman / BusinessInsider.com 4/30/12
Justin Bieber is 18 years old and worth over $100 million.
At just 18 years old, Justin Bieber is worth a reported $105 million and is ranked No.3 on Forbes’ list of “The World’s Most Powerful Celebrities,” behind Lady Gaga and Oprah and just ahead of U2.
That empire is managed by Scooter Braun, who spoke with Business Insider last Friday to tell us how it happened.
The scale of Bieber Inc. is daunting: The newly legal teen’s 2011 concert documentary film “Never Say Never” raked in $100 million globally. His live shows around the world bring in $600,000 in gross ticket sales per night.
This month alone, Bieber has used his newfound funds to buy a $20,000 limited edition Ducati motorcycle (even though he doesn’t have his license yet) and a $6 million Calabasas mansion.
But none of this would have been possible if Braun, a young club-promoter-turned-talent agent, had not plucked Bieber from YouTube obscurity.
As the oft-told story goes, in 2008 Braun tracked down Bieber after seeing his online videos and realizing the kid with the voice and the hair had “it.” The rest is teen pop history.
Fast-forward four years and Braun, now 30, is still managing Bieber; from clarifying he is not engaged to girlfriend Selena Gomez to helping the superstar manage his new fortune.
The Bieber Trust
Since Bieber was still a minor when he started to earn the big bucks, Braun put in place a system of checks and balances for the teen.
“We have a business manager, we have two portfolio managers, we have a lawyer, his mom, myself,” Braun explained to Business Insider after accepting an award for breaking the music industry mold at the Tribeca Disruptive Innovation Awards ceremony in New York on Friday.
“We set up a trust with a board of advisors and basically created an element where the amount of money he’s made at this point, he would have to be a complete idiot to go broke if he doesn’t invest wisely,” says Braun bluntly.
After the financial bootcamp he is being put through, it’s doubtful Bieber, unlike most child stars, will lose what he has earned as a minor.
“Justin is very involved. Once a week I make him spend an hour with his business manager or his lawyer because my whole thing is, the only way this is all going to fall apart is if people allow fear into his life. And through education there is no fear,” explains Braun. “So I want him to be very educated. He’s a really smart kid, he’s very aware. He asks a lot of the right questions and we make sure he’s extremely well educated so he never has any doubt what’s going on.”
But Ducatis and mansions aside, Braun is training Bieber to think big picture
Braun is working to make Bieber wealthy, not rich, explaining “Wealthy is when you have enough money to take care of your children who don’t even exist yet.”
“Now it’s just playing for legacy and making sure he’s protected,” says Braun. “I always tell him, ‘being rich is not good enough, you want to be wealthy. Wealthy is when you have enough money to take care of your children who don’t even exist yet—and their children. So you can’t think of your money as your own money, you have to think of it as you’re making money today to take care of them tomorrow.”
As for where Braun learned such savvy business sense, he credits his own upbringing.
“I had really great parents who guided me, so I’m just passing it on,” says Braun, whose brother Adam is the founder of a charity called Pencils of Promise—which Bieber often donates to.
Bieber’s Charitable Giving
Part of that “passing it on” includes necessary charitable giving.
“I don’t do a deal unless there’s a charitable component. Not one deal,” reveals Braun. “I started a fund and two percent of every deal has to go to charity if not more.”
Bieber is the first artist on the Universal Music roster to have part of his album sales benefit charity.
With this principle in place, one dollar for every ticket sold on Bieber’s entire tour goes to charity, a majority of the money from the Christmas album went to charity and Bieber makes sure to meet with a Make-a-Wish kid at every single concert.
Not to mention, Bieber’s fragrance is a $120 million business annually and that money also goes to charities such as Pencils of Promise and the Make-a-Wish Foundation.
Bieber’s Personal Engagement with Fans
But Bieber tries to do more than just donate his money, he also uses the internet to connect with his fans.
“I don’t think that I would be here without the Internet,” Bieber told the crowd while accepting his award at the Disruptive Innovation Awards. “The fans feel connected to me,” he said.
Braun further explained how Bieber uses the internet to engage his nearly 21 million Twitter followers and 41 million Facebook fans personally. “If Justin presses the ‘follow’ button on Twitter, some people say ‘oh he’s following all these people’ but I look at it as some girl in Iowa may be sitting in her bedroom late at night and see she’s followed and that moment she’ll never forget. And that’s a one-on-one engagement and the power of the internet.”
As for the 18-year-old Bieber and his big bro-like manager Braun, the 30-year-old says their relationship “is always personal first.”
“I made a commitment to him when he was 13 that I would never leave him, whether he was singing or not,” says Braun, who gifted Bieber a $100,000 Fisker Karma car for his 18th birthday last month. “So that’s family for me. I love the kid to death, I’d take a bullet for him.”
Tags: Justin Bieber