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Jonathan Hay and Mike Smith, the founders of SMH Records, are at it again. In their latest move, they have offered Jay-Z $15 million dollars to produce his next album. In a recent interview at Yo Raps, the duo proclaimed:

Jonathan Hay: We want to produce for Jay-Z. It would be a dream of mine for us to produce a Jay-Z album. It would be even more of a dream if we were the only producers for the entire album. We could call the album “Continuity” and really stretch Jay-Z’s sound musically while still keeping it hip-hop. I’m going to put this out in the universe, we would give Jay-Z $15 million upfront to produce it.

Mike Smith: He’s serious about that. I will write Jay-Z a check for $15 million today as an advance for us to produce an album for him.

This isn’t the first time SMH appears to be buying their way into the music industry. And on the surface, this looks like just another attempt at doing exactly that. However, even if you disagree with their strategies philosophically, you have to admire the craftsmanship with which this latest move has been designed and executed.

Let’s start with the setup. I first came across SMH Records while researching their group, Pink Grenade. The members appeared to be dilettantes. Their lyrics were shallow. And the videos were chock full of graphic, highly sexualized imagery.

A closer look at the Lipstick video frame by frame reveals numerous subliminal messages embedded within it. The messages referenced things from masonic initiations to “The Piper at the Gates of Dawn” by Pink Floyd. At first, I thought the founders were either simple or stupid. But they were clearly clever boys. Underneath the disposable veneer, Pink Grenade was an orchestrated stimulus designed to trigger lowest common denominator responses to Sex, Drugs, and of course, Money.

It occurred to me that maybe Jonathan Hay and Mike Smith were just having a laugh. But if Pink Grenade was the punch line, what was the joke?

Armed with a new perspective, I went back to my original research. Every other article about Pink Grenade seemed to focus on money. They either dwelled on the fact that Bim Fernandez, one of the members, was a billionaire heiress or that SMH Records had raised $30 million dollars in startup capital. It made sense. People are addicted to money and infatuated with those that have it. Wealth implies success, and success implies legitimacy.

So, if people know you’re rich, they might also think you’re legit. However, letting people know you have money has another much more obvious side effect: it lets people know you have money. That critical set-up move is what gave their Jay-Z offer credibility. Some people have criticized SMH by saying, “This is just PR 101, try to use other people’s names to draw attention to yourself.” But there’s nothing basic about it. Had they not prepared the field months in advance by letting everyone in the world know about their big pile of cash, this latest stunt would have gone nowhere fast. And then, there’s the offer itself.

As far as SMH Records is concerned, it’s a win-win situation. If Jay-Z accepts the offer, they go platinum and achieve instant credibility. All of their goals as a label are achieved in one fell swoop. But what if he doesn’t accept? In that case, they get a ton of free publicity just for making the offer. And without spending a dime. Even better, it puts blood in the water. Maybe Jay-Z doesn’t want the $15 million, but there are a lot of other artists – and even more managers – that do.

Now that the scent of money is the air, you can bet that they will start reaching out. So maybe you shoot for a Jay-Z, but you land a Nas. Is that really a loss? I don’t think so.

3 Responses

  1. harveywilkinson

    Thanks for another hilarious article about two broke goofballs posing as a “record label.” Mr. Hustle, it sounds like you just believe everything these clowns say without bothering to do any fact-checking. What evidence or sources do you have that they ACTUALLY have 30 million dollars? By “sources” or “evidence,” I mean something other than Hay and Smith’s own big mouths.

    Here are a few questions for you to consider: where are the SEC filings? Where is the statement or press release from their equity partner? Who is their equity partner? Why are they incorporated as a member-managed LLC, with Mike Smith as the only member and their “headquarters” listed as a kids’ dance studio?

    Why are the only people identified as the “staff” of this supposed thirty-million dollar venture ALSO the current staff of Mike Smith’s medical “business?” That part’s actually a little sad and hilarious. “Yes, I’m head of artist relations for SMH records, and I’m also a receptionist making ten bucks an hour in a strip mall urgent care clinic.” Employees who multi-task!

    The bigger questions: why are they releasing albums and NOT spending a single dime to advertise them? Why are their music videos of such low production value? Why are they trolling through social media to find “volunteers” willing to work for free to “promote their artists” instead of hiring actual professionals? Good luck answering these questions. This list goes on and on and on, every single thing about what they’re doing and how they’re doing it indicates they don’t have any real capital behind them, just a clown with a beard who likes to drop provocative press releases every now and then and see who pays attention.

    It costs zero dollars to go around telling people you have 30 million dollars and make fake “offers” to superstars via the internet. However, it costs ACTUAL MONEY to run a real label — to properly promote an artist, to release an album, to advertise, to shoot professional videos. Hmm these guys are doing the former but are doing NONE of the latter — but you still think it’s even remotely possible they’re sitting on tens of millions of dollars to offer Jay Z when they can’t even afford to promote their own albums or their own artists?

    Go do some actual reporting on these jokers. Arrange some in-person interviews with SMH “staff” (maybe they’ll take your blood pressure too!), interview their equity partners (guarantee they won’t let you), find out who their supposed equity partners are (guarantee they won’t tell you), tour their “facilities” (a.k.a. Mike Smith’s basement), do something besides acting like a parrot and repeating that they have thirty million dollars just because Hay & Smith are blabbering that they have thirty million dollars.

  2. harveywilkinson

    Ha ha btw you can tell how amateur these guys in their own words. Hay says we’ll “give” Jay Z 15 mil, then Smith hops in and is like whoa whoa we’ll give him 15 mil AS AN ADVANCE. In case you don’t know an advance is RECOUPED by the label. They take the money back when they start selling records (that’s why they call it an “advance”).

    Please, like Jay Z needs to use these guys as a bank…these guys are such amateurs.


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