16) Luther Campbell Talks Luke Entertainment Group

Status Ain't Hood has a great interview with Luther Campbell, aka Uncle Luke, about his history in the industry and how he views going public with the Luke Entertainment Group on the Pink Sheets as part of a process of building a major Southern label.

I want to focus on the topic of going public but the interview is worth checking for some hip hop history as well as Luke's take on emphasizing visual elements in marketing.

Luke wanted to go public but the long road to a Nasdaq IPO was not for him:

"I started doing a little bit of research on companies like Nestle and Volkswagen...Knowing that the traditional way is a long process, having more conversations with different people who are familiar with the stock business, I wanted to know if there's an easy pink-sheet way to go about it and build from there and hopefully end up on the senior boards."

Yet he still looks at the process as one of long-term building:

"Knowing that we're trading on the pink sheets right now, as we're growing this thing, it's beautiful. People tell me horror stories about pink sheets, and I say there are some horror stories because certain individuals went into pink sheet companies to use the system, to be unscrupulous. That's not me."

"I look at all these successful pink-sheet companies, and I say that's me right there. Grow from there to the next point. I'm excited about it. I'm happy. It's like starting all over again. I got to prove to everybody all over again that I'm creative enough in the things that I feel the public wants. We're going to fight to make the company successful."

I think he's got a great attitude and all power to him.  While it's true that one of the downside of penny stocks is the lack of transparency allowing crooked operators to build on smoke-and-mirrors, any penny stock is vulnerable to market manipulation in the form of pump and dump schemes  Asking Luke what they're planning to do when something like that breaks out would be a good thing.

What seems clear is that the entry of celebs like Luther Campbell is changing the hip hop penny stock scene:

"I always like to teach people and educate people. So even right now, by me going public and it getting the press that it's getting, it's brought more awareness of the stock market, that whole game, to the hip-hop audience. I get email, kids and adults saying "I'ma buy stock! Where do I buy it?" Or "This is historic, this is great, this is history." And you know they're not familiar with the business."

"We have a firm handpicked to deal with a whole different audience. You got to school them on how to purchase stock and where to purchase it from...If I have to stop or close up today, I feel like it's already did what it needed to do because I brought a whole different set of people, educated those different sets of people to the stock market."

From my own experiences of trading on the stock market, I know just how easy it is to convince yourself you know enough about the company and the state of the market to make smart choices when you're really making emotional choices.

If Luther Campbell's serious about building a great public company, one of the first signs will be transparency in their financial reports that exceed the standards of whatever level of disclosure is necessary to be on the Pink Sheets because the lack of publiclly available audited data is one of the biggest dangers with such stocks.

Previous ProHipHop Coverage:
Luther Campbell's Luke Entertainment Group Goes Public on Pink Sheets, Not Nasdaq

Over at Hip Hop Press:
Luke Entertainment Group Launches UncleLuke.tv
Luther Campbell Makes Appearances on Fox Business Network