Dr. Dre and Jimmy Iovine’s School for Innovation

Dr. Dre and Jimmy Iovine’s School for Innovation

After the runaway success of Beats—recently bought by Apple for $3 billion—the duo is launching a new academy at the University of Southern California with the goal of inspiring the next generation of entrepreneurs

The duo behind the success of Beats, recently purchased by Apple for $3 billion, has launched a new dream factory at USC.

 

By Josh Eells in the Wall Street Journal

IF JIMMY IOVINE has a trademark, it’s his hat. For decades, the record producer turned label boss turned headphones magnate turned all-around music-biz oracle has rarely appeared in public without something atop his head, be it a casual wintry wool knit number or a navy blue baseball cap featuring the logo of his multi-billion-dollar corporation, Beats. What Steve Jobs was to mock turtlenecks or Phil Knight is to the swoosh, Iovine is to hats. And yet, it was still slightly incongruous to see him last May, standing at a podium in front of the University of Southern California’s graduating class of 2014, sporting a poofy doctoral tam with a gold tassel dangling from its side.

Iovine was there to deliver USC’s commencement speech, in which he regaled the graduates with a story about making tea for John Lennon and quoted lines from his “favorite poet,” R. Kelly. But he also took the opportunity to promote his latest project: an interdisciplinary program called the USC Jimmy Iovine and Andre Young Academy for Arts, Technology and the Business of Innovation. A joint venture between Iovine and his business partner, Andre Young—better known as the hip-hop super-producer Dr. Dre—the academy, which matriculated its inaugural 31-member freshman class in August, features a curriculum that weds its three titular disciplines (art, tech and commerce) in a way that befits the current cultural landscape. They want to create a dream factory, Iovine said in his speech, that will “inspire, challenge, and satisfy the curiosity of the next wave of game-changers.”

Iovine and Dre know about changing the game. For two and a half decades, Iovine, 61, was the head of Interscope Records (later Interscope Geffen A&M), where he helped oversee the careers of U2, Lady Gaga, Gwen Stefani and the Black Eyed Peas. Dr. Dre, 49, is a legendary producer with six Grammys and hundreds of millions in sales to his name, who has helped guide proteges such as Snoop Dogg, 50 Cent and Eminem. Together, they launched their company, Beats Electronics, in 2008, building it from a start-up headphone manufacturer with cool celebrity endorsements into a technology brand so lucrative that Apple recently paid $3 billion for it. Now Dre and Iovine are using $70 million to fund their school.

As Iovine explains it, the school is as much an investment in their own future as it is philanthropy. “We wanted to build a school that we feel is what the entertainment industry needs right now,” he says. “There’s a new kid in town, and he’s brought up on an iPad from one and a half years old. But the problem with some of the companies up north [in Silicon Valley] is that they really are culturally inept. I’ve been shocked at the different species in Northern and Southern California—we don’t even speak the same language. The kid who’s going to have an advantage in the entertainment industry today is the kid who speaks both languages: technology and liberal arts. That’s what this school is about.

“The problem with the school system is that a lot of it’s cookie-cutter,” he adds, “so what we’re trying to do is disrupt it a bit.”

In other words: They’ve revolutionized hip-hop. They’ve revolutionized headphones. Now can they revolutionize college?

ON A BLAZING AFTERNOON at the end of August, Iovine and Dre are at a mansion in Encino, California, watching a fake pool party take place. The mansion doesn’t belong to either of them; it’s a location for a movie about Dr. Dre’s old hip-hop group, N.W.A., which is filming now and scheduled to be released next year. Production assistants scurry from room to room, and scantily clad extras drift by in early-’90s-era swimwear. Dre’s wife of 18 years, Nicole, is also on set. “This is a big deal,” Dr. Dre says with a sly grin. “We got Jimmy to the Valley.” (Iovine, who’s not a fan of inconvenience, jokes that he almost founded the academy at UCLA instead, because it’s closer to his home in Santa Monica. “I could walk there!” he says, laughing. “Every time I’d drive to USC, I’d be like, how much is this costing?”)

Growing up in Compton, California, Andre Young attended Centennial High School but was a so-so student and dropped out in order to pursue music. He spent his college-age years DJ’ing at clubs, until he and his friend Eazy-E formed N.W.A. (Ice Cube joined soon thereafter.) Although he grew up just 10 miles from the USC campus and was a big Trojans football fan, it was never a real possibility for Dre to go there. “I would have loved to go to that school,” Dre says wistfully. “But I didn’t have that opportunity.”

Iovine was raised similarly far from academia, the son of a longshoreman in Red Hook, Brooklyn. He spent a year and a half at Manhattan’s John Jay College of Criminal Justice, but it was “a complete bust.” “School was not my thing,” Iovine says. “I put down the wrong thing on the application—I checked off five city schools, and that was the one they sent me to. There were 48 people in the class, and 46 were cops. The only thing I knew about criminology was Batman.” At 19 he got a job sweeping the floors at a Manhattan recording studio, and from there worked his way into a gig as a recording engineer for John Lennon. Within a few years, he was engineering albums for Bruce Springsteen and Tom Petty.

Dre and Iovine met in 1992, after Dre had put the finishing touches on his first solo album, The Chronic. Iovine had co-founded Interscope two years earlier, and he was looking for some talent. “I wasn’t a fan of hip-hop,” Iovine recalls. “They were playing me hip-hop because Interscope was going to be in the hip-hop business, but it all sounded muddy to me. I’m a recording engineer—it just offended me sonically. Then Dre brought in his record, and it sounded as cool as Pink Floyd or Sgt. Pepper’s. I said, ‘Who mixed this?’ and he said, ‘Me.’ And I said, ‘No, no, but who engineered it?’ And he said, ‘Me!’ And I said, ‘OK, I’m getting into business with you.’ ”

Dre went on to form his own subsidiary of Interscope, Aftermath, which launched the careers of 50 Cent and Eminem. He and Iovine say the qualities that made them mesh well as record executives also helped them succeed with Beats: “We just trust each other,” Iovine says. “He’s as good a producer and engineer as Michael Jordan is a basketball player. He has an incredible patience that I don’t. And he’s a good touchstone for me. Every time we start going off one way, he’ll say, ‘Nah, man—we’re getting corny.’ ”

Beats started with a chance run-in on the beach. Iovine was in Malibu, at his friend David Geffen ’s house, when he decided to go for a stroll. He happened upon Dr. Dre, who was out on the balcony of his own house nearby. Dre told him he’d been approached a few days earlier by an athletic company about doing a shoe line; his lawyer wanted him to do it, but Dre wasn’t sure. (“I’m not into fashion,” he says. “I wear the same s— every day.”) He asked Iovine for his thoughts. Iovine’s immortal response: “F— sneakers—let’s make speakers.”

“It’s a good thing they didn’t want to sell aluminum,” Iovine jokes now. “I’m not sure what rhymes with that.”

Beats headphones have been criticized by audiophiles who insist they’re far from the best headphones on the market. Yet helped by Dre’s musical cachet, Iovine’s marketing savvy and a raft of celebrity endorsements ( Justin Bieber , Lady Gaga, LeBron James), the company earned $1.2 billion last year alone. It can make a pair of headphones for $40 that sells for over $200; one Swarovski-studded model retails for more than $1,000. And Marc Jacobs incorporated Beats headphones into his runway show this fall.

Earlier this year Beats expanded its mission, unveiling a music-streaming service, Beats Music, designed to compete with the Pandoras and Spotifys of the world. It’s not immediately obvious that headphones would lead to streaming; after all, it’s not like Nike ever broadcast a basketball game. But Iovine has been an advocate of streaming for years. “Streaming was actually first,” he says. “I couldn’t get it done. I didn’t have the platform. But once I had Beats, I had the platform. It’s a piece of equipment, a piece of hardware. And I wanted to build a piece of software that worked with it.”

When Apple announced it was acquiring Beats, it was the culmination of a long flirtation between the two companies. Thirteen years ago, Iovine was one of the first people Steve Jobs showed iTunes to, when Jobs was trying to get the music industry on board with the idea. And Iovine had been shopping a subscription music service to Apple, including to Jobs personally, within a couple of years of the launch of iTunes. (Jobs, long a skeptic of subscription services, passed.) “Every deal I made, I offered to Apple,” Iovine says. “I only wanted to work with Apple.”

‘The problem with the school system is that a lot of it’s cookie-cutter. So we’re trying to disrupt it a bit.’

—Jimmy Iovine

Since the acquisition, analysts have focused on three possible explanations for why Apple wanted Beats. One is that it’s buying the hardware: As Apple expands into more wearable products (e.g., its new smartwatch), Beats gives it a valuable foothold, especially in the youth market. Second is that it’s buying its software: the proprietary algorithms and expert-curated playlists that it hopes will position Beats ahead of its streaming rivals. The third theory is the most intriguing: What Apple is really buying are Iovine and Dre. Since Jobs died, the thinking goes, Apple has lacked the kind of magnetic personality who can serve as the company’s face—someone with creative vision, deep industry ties and the ability to close a deal. In musical terms, it needs a frontman. As Jobs’s biographer Walter Isaacson recently speculated to Billboard, Iovine, especially, might be that face.

For his part, Iovine shrugs this off. “I’m just the ornament on the hood—and I don’t mean because I’m sexy.”

Iovine and Dre won’t, or perhaps can’t, share many specifics about their new roles at Apple just yet. But listening to them talk, it’s clear that what’s occupying their thoughts right now is the idea of integrating the people who create art with those who distribute it. “I think what you’re seeing more and more are companies that are designed to do multiple things,” Iovine says. “If you look at the Beats model, there’s software and hardware. Look at what Amazon is doing; look at what Google’s trying to do. It’s technology and content in one.” As both an example and a cautionary tale, he cites Sony. “They had it,” Iovine says. “They had the Walkman, they had the PlayStation. And they bought Columbia Pictures and Columbia Records, so they had the content. But they never finished the thought—and Apple ended up with the products. Where do you think Steve got the idea?”

At heart, this is what the Iovine and Young Academy is about—creating the kind of student who can design the next PlayStation and sell it, too. Iovine and Dre aren’t exactly drawing up lesson plans or keeping office hours. (As Iovine likes to point out, David Geffen doesn’t teach surgery at his medical school.) But they are scheduled to appear at the academy’s lecture series, and Iovine recently hosted a barbecue for the incoming freshmen at his house.

“Dre, how did you find talking to the kids the other day?” he asks.

“I mean, I was the one doing most of the talking,” Dre says.

Iovine chuckles. “They were terrified!”

“There are a lot of other programs around the country that marry business and technology,” says Erica Muhl, the dean of USC’s Roski School of Art and Design and the Iovine and Young Academy’s first executive director. “But they’re all missing that arts and cultural component. The difference with us is we start with the arts part.” Says Iovine: “We want kids who can work at Beats or at Apple.”

Iovine and Dre are reluctant to make too many predictions about where the entertainment industry is headed. (“I don’t want anyone stealing my ideas,” Iovine jokes.) But they’re also banking on the fact that they won’t always have to be the ones coming up with the ideas. On the third day of class at the Iovine and Young Academy, the freshmen are gathered in the main classroom/lounge—a futuristic, high-ceilinged space they’ve dubbed The Garage. One of them is the inventor of a jacket he called “the swag suit,” which harnesses its own friction to generate electricity; another is an accomplished guitar player whose audition video, Dre says, “gave me chills.” On one wall—which is lined with MakerBot 3-D printers and covered in write-on “idea paint” for brainstorming purposes—hangs a poster with Iovine’s face on it. Below it, the caption reads: “Think you’re as innovative as this guy? He’s betting on it.”