How a 22-Year-Old ‘Straight Outta Compton’ Built a $10 Million a Month Startup

Eric “Eazy-E” Wright, a founding member of the seminal rap group N.W.A. and “
Responsible for putting West Coast hip-hop on the map, the N.W.A.-fueled Ruthless Records easily had the potential to become one of the greatest independent record labels in history, if not for squabbles over money and the alleged violence and ill intent of rival record companies.

Eazy-E Starts in Compton

Eazy-E, who was raised in Compton, California, was a high school dropout who supported himself by selling drugs. Jerry Heller, Eazy-E’s producer, friend and manager, described in his book, “Ruthless: A Memoir,how Eazy used the image of a “gangsta” to survive growing up:
“The hood where he grew up was a dangerous place. He was a small guy. ‘Thug’ was a role that was widely understood on the street; it gave you a certain level of protection in the sense that people hesitated to fuck with you. Likewise, ‘dope dealer’ was a role that accorded you certain privileges and respect.”
After the murder of his cousin, Eazy-E decided to make a better living through the hip-hop scene and began recording songs in his parent’s garage.
In 1986, 22-year-old Eazy-E and Heller founded Ruthless Records in Compton, California, as a platform to release music for N.W.A., the now iconic Compton rap group assembled by Eazy-E that included Arabian Prince, Dr. Dre, DJ Yella, Ice Cube, and later in 1988, MC Ren, who replaced Arabian Prince. Eazy-E used his own money to pay for studio sessions for the group and spearheaded the label’s marketing campaign.
In a Billboard interview with rapper Kendrick Lamar, the four living members of N.W.A. described their relationship with Eazy-E. DJ Yella said of Eazy, “He was ahead of his time.”
“He took all of that street knowledge and hustling on the streets and brought it to this thing we were doing. [He was] super smart, creative.” Dr. Dre said.
“Straight visionary … he wanted that rough, hardcore shit,” Ice Cube added.

N.W.A.’s Massive Success

Ruthless Records began with only $7,000 of Eazy-E’s own money and 5,000 12-inch copies of his single “Boyz N the Hood,” which was written by Dr. Dre and Ice Cube, according to Billboard.
In 1988, Eazy-E released his debut album, “Eazy-Duz-It,” followed by N.W.A.’s first full-length album, “Straight Outta Compton,” which became wildly successful with their controversial single “Fuck Tha Police.”
At the time, Ruthless Records only consisted of Heller and the five members of N.W.A. that he managed. Heller described the state of Ruthless Records at the time to “Murder Master Music Show:
“ … we’re doing $10 million a month with six employees. We don’t even have a typewriter in the office.’ I said, ‘We’re the most successful start-up record company in the history of the music business … “
Adjusted for inflation, N.W.A. was generating over $20 million a month by today’s standards. Disputes over money threatened to tear the startup company apart, however. The disputes were further fueled by the presence of hired bodyguard and friend of Dr. Dre, Marion Hugh “Suge” Knight. Heller said of Knight to the “Murder Master Music Show”:
“I looked at him as a guy that had a lot of potential that I probably could help in the management business … Eric knew he was a problem from the beginning.”
Image via BET

N.W.A. Begins to Fall Apart

Ice Cube left over royalty disputes in 1989, forcing N.W.A. to continue as a four-man group. Despite the loss, Eazy-E continued to grow the company by signing over 30 artists from the late 80s to the early 90s including The D.O.C., hip-hop’s first major white female rapper, Tairrie B, and Will 1X and the Atban Klann — Will 1X would later change his name to, and along with, Taboo and Fergie, go on to form The Black Eyed Peas.
Singer Michel’le Toussaint, ex-wife of both Dr. Dre and Suge Knight, was also originally signed to Ruthless Records. Bone Thugs-n-Harmony, who joined Ruthless Records in the early 90s, found overwhelming success with their debut E.P. “Creepin on ah Come Up” in 1994.
Heller said of Bone Thugs-n-Harmony:
“If Eazy wouldn’t have passed away … they probably would have been the biggest group in the world … They should have wound up as rich as Jay Z.”
In 1991, Dr. Dre, who had issues with his contract and payment, was advised by The D.O.C. and Suge Knight that he should leave the label to avoid being ripped off by Heller and Eazy. Allegedly, Suge Knight threatened violence against Heller and Eazy-E’s family to release The D.O.C., Dr. Dre and Michel’le from Ruthless. 
Death Row Records was soon founded by Knight, The D.O.C., Dr. Dre, producer Dick Griffey and convicted drug kingpin Michael Harris.
In the following years, Eazy-E and Dr. Dre’s feud was musically documented in Dr. Dre’s debut solo album “The Chronic” and Eazy’s EPIt’s On (Dr. Dre) 187um Killa,” which featured the popular tracks “Real Muthaphuckkin G’s” and “It’s On.”
Image via Instagram
Eazy-E, who had watched the situation unfold, initially sought a streets-inspired solution to the threat that Suge Knight and Death Row Records posed to Ruthless. Jerry Heller told the “Murder Master Music Show:
“I think, even more so now, that Suge Knight is an evil human being.
Eazy said, ‘You know this guy Suge Knight?’
I said, ‘Yeah.’
He says, ‘Well, I’m going to kill him.’ He said, ‘This guy is gonna be a problem and I think I should kill him.’
I said, ‘Let me think this thing through. I said, ‘First of all, we’re doing $10 million a month with six employees. We don’t even have a typewriter in the office.’ I said, ‘We’re the most successful start-up record company in the history of the music business and you want to kill this guy?’ I said, ‘That just doesn’t make any sense to me.’
You know something? I should have let him kill him. I would have done the world a favor. He would have done it, for sure, by himself. He always rolled by himself and he was fearless … I think that he was going to go do it. I shouldn’t have talked him out of it.
Ruthless would probably still be around. Dr. Dre. and Ice Cube would probably still be with Ruthless. It would have been an empire.”
Death Row capitalized on the void left by the fractured Ruthless Records. Dr. Dre would go on to discover the artist first known as Snoop Doggy Dogg in 1992. In 1995, Death Row signed one of their most iconic artists, Tupac “2Pac” Shakur, who was murdered the following year amid unsolved gang violence.
Dre eventually left Death Row Records in 1996 over contract disputes around the same time Suge Knight was indicted for racketeering. A year later, Dre discovered Marshall ‘Eminem’ Mathers and signed him to his own label, Aftermath Records.
Eazy-E’s Sudden Death
On February 24, 1995, Eazy-E was admitted to Los Angeles’ Cedars-Sinai Medical Center with what he thought at the time was asthma — Eazy was instead diagnosed with AIDS. By March 26, 1995, Eazy-E had passed away due to complications for AIDS.
Suge Knight infamously joked in an interview with Jimmy Kimmel that injecting someone with AIDS and killing them slowly was a great way to avoid “going to jail forever,” saying that was “The Eazy-E thing, you know what I mean?”
Eazy-E’s stake in Ruthless was passed on to his wife, Tomica Wright, after his death. In his absence, however, the company’s signed artists eventually departed. Ruthless Record went defunct in 2009.
Death Row filed for bankruptcy in 2006 and was eventually auctioned off to WIDEawake Entertainment Group, Inc. for $18 million in 2009. In the aftermath of the struggle between the two competing record labels, both ended up losing.
In no small part, Eazy-E established the foundation for rap music’s top talent to thrive. Led by a Compton-raised business genius, the success of N.W.A. alone was a testament to Eazy’s ability to combine the industry’s top talent to disrupt the music scene and propel a genre that still thrives today. If it weren’t for the violence caused by industry power struggles and contentions over wealth, Eazy-E’s pioneering Ruthless Records could potentially have grown into the empire that Heller imagined.
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