Forbes has dismissed earlier reports that indicated celebrity rapper, Kanye West, to be the richest black man in US, the report estimated the worth of US business mogul to near $7 billion.
Multiple news outlets had reported that Kanye West is the richest Black person in America, worth as much as $6.6 billion.
The news comes after Bloomberg reported that his sneaker brand Yeezy — as well as Yeezy Gap, which has yet to sell one item of clothing — have a combined value of as much as $4.7 billion. The publication mentioned, without going into full detail, an additional $1.7 billion in assets.
But reacting, Forbes in a report said such estimates are based on the magical thinking around sales that don’t exist yet, adding that the former US presidential hopeful is currently worth less than one-third of that.
“It’s not true, based on our calculations. Forbes estimates he’s worth less than a third of that, or $1.8 billion. That’s a big jump from last May when Forbes first pegged his net worth to be $1.3 billion, but nowhere near as much as the purported $6.6 billion. Vista Equity’s Robert F. Smith remains the richest Black person in the US, worth an estimated $6 billion, while Aliko Dangote of Nigeria, worth $11.8 billion, is the richest black person in the world.
“The sky high estimate is the latest of West’s attempts to inflate his net worth—in the past he’s said that Forbes was “purposely snubbing me.”
“In actuality, it’s nothing personal. Forbes’ much more grounded number is based on that old-fashioned idea of current revenues — not theoretical future expectations. Yeezy Gap has brought in no revenue, let alone any profits. Who knows if the line will be popular. Maybe another hip-hop star will create the next trendy sneaker in a year or two, and Yeezys will be old news. The same thinking goes for Yeezy Supply, West’s ecommerce platform. He has high hopes to turn it into a fashion destination — as of now, it just shills his shoes.
“As for Yeezy sneakers, they’re selling crazy well. The company’s revenue grew 30% last year. and its most recent limited drop, the 450 in Cloud White, sold out in under a minute. Analysts with whom we spoke agree there’s growth left in the business, and if that occurs, his net worth will continue to climb. But even that’s not 100% certain, so for now, we are sticking with 2020’s numbers,” the Forbes report said.
“Forbes is treating West the same way we do everyone else with similar royalty-based businesses: we take the most recent year’s licensing income and apply a multiple to it to account for the fact that this is an ongoing revenue stream. This is how we value Donald Trump’s licensing businesses and Jay-Z’s music catalogue.
“West’s wildly optimistic approach to his net worth mirrors the approach used by Donald Trump, who insists the value of his name be included in any net worth estimate. Trump, who we value at $2.5 billion, says his brand has an intrinsic value, regardless of actual revenue. West and his camp are making a similar argument for businesses attached to the Yeezy name,” it added.