When a potentially life-altering business deal suddenly vanished, Roy Scott didn’t get mad — he got funded.
“Disney thought they were going to snuff us out, but all they did was put gasoline on this fire,” said Scott, founder of Kansas City-based H3 Enterprises (Healthy Hip Hop).
Starting his company with a live performance-based business model in summer 2010, Scott — also known as Rappin’ Roy — had a simple goal for Healthy Hip Hop, he said.
“Take that same urban hip hop beat, along with the pop culture sound, and marry it with a positive message that focuses on education, health and wellness,” Scott said.
It quickly became clear, however, that relying on live shows with his performance partner, magician Reggie Gray, ultimately wouldn’t be sustainable nor would the brand reach its revenue goals, he said. Healthy Hip Hop had to evolve.
“We did a TV pilot for a show called ‘Keep it Moving,’ like a contemporary ‘Sesame Street,’” Scott said. “We had two puppets, Hip and Hop, kind of like Bert and Ernie. We created some curriculum around the music and did some merchandising.”
It was a children’s media brand in the making.
“We knew during that process we were going to have to raise more money to really scale our offerings and take the business to the next level,” he said.
That quest for capital led Scott and Healthy Hip Hop to a season 7 appearance on “Shark Tank,” successfully pitching a deal to entrepreneur-investor Kevin O’Leary, aka Mr. Wonderful, Scott said.
It was going to be a game-changer, he said, with O’Leary committing $500,000 for a 50 percent stake in Healthy Hip Hop’s children’s TV show.
“We knew that more importantly than the 50 percent in the kids TV programming, once the ‘Shark Tank’ episode airs, this is going to be our national exposure. It’s going to open lots of doors for us,” Scott said.
Healthy Hip Hop’s segment was filmed in September 2015. “Shark Tank” producers called in March 2016 to tell Scott his episode was amazing, but wouldn’t be airing, he said.
It got worse.
“Our deal was pulled off the table — because ABC, the network where ‘Shark Tank’ airs, is owned by Disney. And Disney looked at our children’s programming as competition,” Scott said. “’Welcome to Hollywood,’ they told us.”
“You could call us green,” he added. “We were thinking that if Disney saw us, they would pull us in. Obviously we were wrong.”
Tapping KC resources
After a two-week slump, depressed on the couch, Scott said, he asked himself, ‘What’s my next move?'”
“We had to have a realistic business model because that experience was basically the best and worst validation — best that we were a threat to Disney, but worst because our life-changing moment was thrown in the trash can,” he said.
It was time to get in the trenches, Scott said. The founder turned to Kansas City’s entrepreneurial support network to take advantage of any and all resources they had to offer.
With Thursday’s $25,000 win at Lean Lab’s Launch[ED] Day pitch event, Scott now has secured more than $100,000 through the programs to develop Healthy Hip Hop, he said.
“Lean Lab has really helped us with our business model, on how we’re going to turn H3 into a sellable and scaleable product. It’s been one heck of a learning process,” Scott said. “We’ve been fortunate to get the support of Kansas City and the support of these programs to get some funding to get our product where we can officially launch.”
Scott’s hope with the business’ newly focused direction is to generate at least $500,000 annually with Healthy Hip Hop’s focus being on scalable, digital-based efforts, he said.
“As an entrepreneur you have to be able to pivot by the minute,” Scott said. “Things change all the time, and you have to be willing to switch on a dime.”
He envisions the brand becoming like “Sesame Street” meets Angry Birds, he said.
“We want to be able to gamify this. We want kids to have fun as we grow the brand,” Scott said. “We want to be able to monetize it so we can make money while we sleep. More than that, we want to have a positive impact on young lives.”
Keep it moving
Healthy Hip Hop’s future is most clearly defined as a teaching tool, Scott said.
“On our journey, we found success in the education space where teachers were using our music and video concept in the classroom to get their students focused and ready to learn,” he said. “One of the problems we identified was that schools are cutting back on physical activity, PE and recess, which is leading to an increase in behavioral incidents and a loss of learning opportunity.”
That inspired the company’s digital solution: innovative music video content in the form of a Brain Break, which can be streamed directly to a teacher’s smart board. A physical product, the Keep It Moving Map, encourages kinesthetic learning. And a Classroom Live option also offers live interaction.
“We developed the first phase of our technology and we’re currently doing some beta testing with Kansas City schools,” Scott said.
One of the Healthy Hip Hop test sites is Operation Breakthrough, an early childhood development center that serves children from families in poverty. Scott originally came to the center for live performances, said Mary Esselman, president and CEO of Operation Breakthrough.
“It was a huge hit with kids. Not only did it generate a lot of movement, but the kids loved the language,” she said. “So we’re actually excited now that the new platform is launched, because that will give teachers even more access.”
Why does it resonate?
“Hip hop music is transcending race and economic backgrounds,” Scott said. “It’s in every market. Turn on your TV, watch sports or whatever, and you’ll hear a hip hop beat. Look at the Top 40 right now and it’s all country and hip hop.”
“It’s mainstream, but a lot of times that message is crap,” he added. “Kids love that vibe, that energy of music, but we want to at least provide a positive alternative. We don’t water it down. Parents listen to it too because it’s about the beat. The beat is just as strong as other popular beats out there.”
In addition to entertainment and education, Healthy Hip Hop also can be transformative for impressionable youth — especially those struggling to understand their place in the community, said Luis Cordoba, Kansas City Public Schools chief officer for the division of student support services.
Cordoba, Scott’s mentor who introduced Healthy Hip Hop at the Lean Lab’s recent pitch night, currently is advising the company on the development of a bilingual video message aimed at DACA (Deferred Action for Childhood Arrivals) students.
“A hip hop music video of this caliber may promote a sense of inspiration and hope, as well as reduce the anxiety, hopelessness and depression that they experience through this DACA conversation on immigration,” Cordoba said.
Future iterations of Healthy Hip Hop’s brand likely will also include a direct-to-consumer play that focuses on families experiencing and interacting with the content together, Scott said.
“It would allow parents to stream Healthy Hip Hop music directly from their phone, but also allows parents and students to create custom video content based around the Healthy Hip Hop that could then be shared on social media,” he said.
With a business plan now firmly in hand, Scott said, he isn’t slowing down for Disney or anyone else.
“Being an entrepreneur, there’s a lot of sacrifice and risk,” he said. “But you’ve got to go for it. You’re either in or you’re out.”