Chaos, Antisemitism, ‘White Lives Matter’ — And Steady, Unbothered Sales

Hateful rhetoric isn’t putting a pinch on resales of Adidas’ Yeezy sneakers — at least not yet.

Ye, the billionaire music entrepreneur and fashion designer previously known as Kanye West, is having quite a few months. He’s unleashed hateful rhetoric against Jews, worn clothing that mocks the Black Lives Matter movement and used social media to harass his ex-wife and her then-boyfriend — a trifecta of nauseating behavior.

Add persistent chaos in his own management team — one member characterized the game of corporate musical chairs as a “reorganization,” but still — and you have a case of a billionaire polluting his own brand with hate, mockery and harassment. Right? Apparently not.

On StockX, a popular online resale marketplace for sneakers, there’s been no change in the number of Adidas Ye-branded Yeezys traded or their average price, according to spokesperson Katy Cockrel. Six of the top 25 shoes on the resale market remain Yeezy, according to data collected by WANTD, an online sneaker platform.

“Sales are the same. We fly through Yeezys,” said one reseller.

The chaos doesn’t seem to matter to Yeezy customers. Take Jon Schaefer. After he fell out of a tree taking down Christmas lights last year and lost the ability to work as a mechanic, he decided to try his hand at buying sought-after sneakers and flipping them for a profit on eBay. It has worked better than he imagined. Among his most lucrative offerings are Yeezys, which have generated a third of his $2.3 million in annual sales.

People are still going crazy for the shoes, he said. “It’s Kanye West,” said Schaefer, 25. “The guy has made ridiculous comments for the last ten years. I think the whole world is used to him and what he’s doing. People do not care about the words that come out of his mouth.”

Adidas, the German shoe company that’s worked with Ye since 2013, said October 6 it was putting its contract with the rapper “under review” and has said nothing about his behavior since. Yeezy products account for between 4% and 8% of Adidas’ annual revenue, according to Cowen, an investment bank. That means that Adidas, founded by brothers with Nazi ties, may be prioritizing sneaker sales over other considerations. The company didn’t respond to a request for comment.

If Adidas does drop Ye, it would mean he would no longer be a billionaire, according to Forbes estimates. His Adidas deal is worth an estimated $1.5 billion, based on a multiple of annual earnings. In 2021, Ye pocketed $220 million pre-tax. We view the royalties Ye receives from Adidas as similar to income streams generated from music publishing or film residuals. The income stream, industry experts have told Forbes, can be sold off much like musicians, including Bruce Springsteen and Bob Dylan, have sold their life’s work for hundreds of millions of dollars. Gary Young of catalog marketplace Royalty Exchange said in March that Ye’s Adidas deal could fetch at least a 9x multiple.

Without the sneaker deal, Ye’s net worth would drop to an estimated $500 million including cash, investments, real estate and his music catalog and royalties along with an estimated 5% stake in ex-wife Kim Kardashian’s shape-wear firm Skims. Ye did not respond to requests for comment.

All this doesn’t mean Ye has skated. Twitter and Meta’s Instagram have suspended him. Ye severed ties with the GapGPS
clothing chain in September, and he and JPMorgan Chase, the biggest U.S. bank, announced they were no longer doing business with one another.

There’s also been repercussions inside the House of Ye. Turnover has plagued his team.

Among those departing have been public relations executive Tammy Brook; a financial and real estate advisor who requested anonymity to preserve a possible future relationship with Ye; and Def Jam, his recording home at Universal Music Group. “He fulfilled his recording contract,” a source close to Def Jam told Forbes. “He’s a free agent.”

The former financial advisor characterized the turnover as an ongoing “reorg” within Ye’s team. “I think that he’s actively focused on just building a pretty incredible team for a lot of big ideas that he has and companies he wants to buy,” the advisor told Forbes.

Brook’s firm, FYI Brand Group, confirmed to Forbes via phone that it no longer represents Ye. He does have a chief of staff, though — Lauren Pisciotta, a social media influencer with 1 million Instagram followers. She’s serving in that role for Ye and, in a text message, said that “I’m the best contact at the moment” for anything related to public relations. That means that Ye currently has no PR agency of record.

Previous departures included a senior communications executive, entertainment lawyer Miles Cooley, and Michael Cohen of Trump fixer fame.

Still in Ye’s camp: Gee Roberson, founder and co-CEO of artist management agency Blueprint Group. Roberson is Ye’s current manager, according to a person who answered the phone at Foundation Management, Blueprint’s partner firm. Jay-Z and Drake are among the artists Roberson has managed. Roberson did not respond to a request for comment.

Ye’s hateful shenanigans may still have a cumulative effect on fans, who may suddenly find themselves the demographic targets of Ye’s derision or who otherwise decide they’re finally tired of him. WANTD CEO Rick Nariani said that when Yeezys went up for sale during a live auction for sneakers this week on the resale marketplace, several people said they were going to leave in protest. That’s the first time that’s happened, Nariani said.

“Every time he makes a comment, a small chunk of his fan base drops off,” he said. “There’s a lot more negative sentiment than I’ve seen before.”