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Combs Global transition ‘a reflection’ of who Sean ‘Diddy’ Combs is, company president says

Combs Global President Tarik Brooks joins Yahoo Finance Live to discuss rebranding, global expansion, diversifying the company’s portfolio, and the outlook for investing.

Video Transcript

[AUDIO LOGO]

BRAD SMITH: Sean Diddy Combs expanding his enterprise, rebranding his company to Combs Global, and expanding his business portfolio as the company makes plans to go more international. Combs Global President Tarik Brooks joins us now. Great to have you here with us this morning. And thanks so much for taking the time. Talk to us a little bit about this expansion and what some of the first areas that you're really prioritizing within this expansion more globally will entail.

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TARIK BROOKS: Good morning. Thank you so much for having me. The transition at Combs Global is really a reflection and a reminder of who Combs Global is and who our founder is. Sean Combs has been a global celebrity for many years. Our brands, from Ciroc to Sean John have all been global brands that have helped to drive culture.

And so the change of the name is really a reflection of who we are and a reminder of one of the key values that Sean Combs instills throughout the organization, which is to dream big. So when we think about everything we do, we think about the ability to have a really global impact.

So we're excited to continue to expand our portfolio that already includes two spirits brands, Ciroc Vodka and DeLeon tequila, a global TV and digital media platform in Revolt, two record labels bad, Boy Records and Love Records. And our first new artist Jazzy on Love Records will release her first EP on Friday. Super-excited about that. And the platform goes on and on.

So we're super excited to continue to build and grow. And even as recently as November, we announced the potential acquisition of cannabis assets to bring us into that space as well. So growing in a number of different directions that we're really excited about.

JULIE HYMAN: Yeah, Tarik, it's Julie here. I mean, this is a really diverse portfolio of different kinds of businesses, right? As you were just talking about, you got some record labels in there. You have alcohol brands. You're going to have a cannabis brand. There's a charter school business as well. How do you think about them as one business? And how do you think about opportunities for synergies between them, et cetera?

TARIK BROOKS: Yeah, and before I answer that, it's actually a charter school network, three schools serving over 4,000 students every day across two different states-- Connecticut and New York. But the ecosystem that you're referring to is one where we develop a competitive advantage to be able to find synergies and opportunity to glean data and insights that other folks that we compete with just don't have, because we're able to leverage the insights that come from businesses that are seemingly disconnected to help create broader pictures of the consumers we serve.

And in that case, we like to say we don't play fair because we learn from our media business about our tequila customers. We learn from our Ciroc business about our potential fashion customers and so on and so forth. And so we think that gives us a meaningful insight in all the spaces we compete.

BRAD SMITH: I think it's been amazing, especially over the course of my lifetime, being able to watch Sean Combs, the man who has been an absolute wrecking ball across music and entertainment, been able to diversify investments in himself as well, in starting fashion clothing lines and going even more into other ventures. So when you think about-- because I remember wearing the Sean John clothes wearing up-- growing up.

When you think about now, looking at other ventures out there and deciding how to invest in founders and in businesses that may be recession-proof, what do you look for?

TARIK BROOKS: Yeah. Well, listen, part of what we look for is the same as any other VC or private equity shop. We look for an amazingly strong founding team. We also look for ideas that are disruptive, that have protected moats, and have the ability to grow very fast.

The layer we add onto that is we look for opportunities to leverage those same investments with our current portfolio companies. So as we go through our process of evaluating a company, we think about whether or not there are applications that exist in our current platform so that we can be a kind of use case as well as an investor as the business grows and develops.

BRAD SMITH: And I know in your own personal background as well, you had worked with Bridgewater in the past. Of course, many of our viewers know that and ex-Ray Dalio to that in the past as well. Given that kind of investment history that you have-- and the venture capital arm, one thing for Combs Global. But then additionally, do you look at the equity markets at all and say, you know what, there's an opportunity to have our own Combs Global portfolio of equity market investments, considering where the markets are at right now?

TARIK BROOKS: Yeah. I mean it's interesting. Look, we look at all possible investment opportunities. But one of the things we always think about is, where do we believe we can generate outsized returns? And where are those highest returns to be found?

And for us, when we think about the developmental opportunities within our own platform, we feel very confident about our ability to generate meaningful returns continuing to build and grow that platform. And so while we'll always look at any investment that can make sense broadly, we think about what we could do with capital in our ecosystem, exploiting the synergies we have, growing and developing the new markets that we see as potential.

For as big and as broad as our portfolio is, there's still a ton of great growth opportunities, including taking DeLeon tequila international, launching the e-commerce platform that we're developing with Salesforce to help revolutionize the way Black businesses participate in e-commerce, and so on and so forth. I mean, they're just great ideas that we feel like we are uniquely suited to exploit that, beyond being impactful to society, will generate great returns for us as well as our investors.

JULIE HYMAN: And Tarik, finally, again, going back to this portfolio that you guys have, you also get a lot of intel on what's going on out there in the economy through a lot of different avenues. So what are you seeing? Do you see signs of recession? How is consumption of your brands? Tell us what's going on.

TARIK BROOKS: Well, what's interesting, when we talk to our partners and our advertisers, we definitely hear concern. And we are worried, just like everyone else, about the softness in the advertising market, which drives several of our businesses.

But one of the things that we're acutely aware of is that advertisers in the post-George Floyd era made commitments, as well as investors made commitments to the African-American community. And what we don't want to allow to happen is to have those advertisers, those investors take this opportunity where there's some softness in the economy to backpedal on those commitments. So we're going to hold folks accountable to delivering the investments and the advertising dollars that they said they would, despite the fact that there is some softness in the economy.

JULIE HYMAN: That is a great reminder for a lot of folks who maybe it's dropped off the radar, and it shouldn't have. Combs Global President Tarik Brooks, thank you so much. Appreciate it.

TARIK BROOKS: Thank you very much for having me.