Ye had the keys to a multibillion-dollar fortune. Then he self-destructed

For years, it was an open question just how much Ye, the mercurial rapper formerly known as Kanye West, might be worth. He said he was a billionaire multiple times over thanks to a handful of lucrative corporate deals, most notably his Yeezy brand with Adidas.

It was hardly a stretch: The Yeezy business alone earned more than $US500 million ($781 million) in total royalty payments and marketing fees over the first four full years of the Adidas deal through 2020, according to a document prepared by UBS Group. He had partnerships with Gap and Kering SA’s Balenciaga fashion label, while an unaudited balance sheet of his finances reviewed by Bloomberg in 2021 showed that he had $US122 million in cash and stock.

Ye’s complex fortune soared thanks to a string of lucrative corporate deals with retail giants like Adidas and Gap.Credit:AP

The one big risk to any net-worth estimate — which is now playing out in real-time — was that he would self-destruct.

Adidas announced it would halt all payments to Ye and stop the Yeezy business immediately after a wave of offensive behaviour, including antisemitic comments on social media. The German sports company, already weighed down by the controversy, made the move after weeks of internal deliberations and will absorb a hit to earnings of up to €250 million ($391 million) this year.

After the Adidas announcement, Forbes said Ye would no longer be included on its billionaires list. His net worth was estimated to be around $US2 billion but the publication now estimating it has plummeted to around $US400 million following the decision by Adidas.

While Gap and Balenciaga previously dropped Ye, the largest chunk of his fortune is housed in the Yeezy brand. Bank of America estimated in 2019 that it was on track to generate $US1.3 billion of shoe revenue in 2019, a 50 per cent increase from a year earlier. Ye, 45, would earn $US147 million in royalties from those sales, and the preliminary analysis found that the value of future footwear royalties could range from $US1.75 billion to $US3 billion.

Ye said in an interview with Bloomberg last month, before his breakups with Gap and Adidas, that his royalty rate with Adidas was much higher than his previous deal with Nike a decade ago but he wasn’t satisfied. He said he wanted to renegotiate to a 20 per cent lifetime agreement.

“I’m going to make sure that we get totalities off every one of my designs in perpetuity forever,” Ye said at the time.

Ye didn’t respond to a request for comment.

The saga of Ye’s finances is complex, going back several years to when he said he was saddled with millions in debt and rapped about dying broke. He has vastly turned around his fortunes since then, and he previously approached Bloomberg News about being included on the Bloomberg Billionaires Index.

While Gap and Balenciaga previously dropped Ye, the largest chunk of his fortune is housed in the Yeezy brand.Credit:AP

In his interview with Bloomberg in September, Ye said he was fed up with his corporate partners and would branch out on his own.

“Now it’s time for Ye to make the new industry,” he said.

“No more companies standing in between me and the audience.”

Bloomberg

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