The Billionaire Behind The K-Pops Biggest Bands

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Morning! It's Tuesday, June 6th - Today we delve into the multi-billion dollar entertainment machine that catapulted BTS to their global prominence.


The Billionaire Behind The K-Pops Biggest Bands

Pop music from boy bands may not be your thing, but it’s all the rage in Korea and entertainment company Hybe Corp is looking to spread its K-Pop influence globally.

Don’t underestimate the business model around K-Pop– Hybe is currently valued at $9.2B!

What’s the Business?

Hybe’s business model revolves around the talent they’ve hand selected and trained into stardom. These K-Pop stars don’t just serve as musical talent, but brand ambassadors and merchandise salesmen.

While it may be hard to believe that a company that produces K-Pop starts can be worth billions of dollars, everything starts making sense when you look at Hybe’s various revenue streams that brought in $1.37B in revenue last year.

Artist Direct Involvement

Like other entertainment companies and record labels, Hybe’s largest revenue stream comes from albums, concerts, and artist appearances.

In just the last quarter, Hybe generated $178M from direct artist involvement. 

Artist Indirect Involvement

This is where things get interesting and Hybe breaks from the rest of the music industry. While this line of revenue includes the traditional merchandise and fan clubs, unlike other music stars, Hybe K-Pop celebrities have almost no involvement.

In the truest sense, Hybe doesn’t acquire musical talent but produces it by forming musical groups for mass market appeal through intensive pop star training. As such, they own the IP of their artists’ music.

With the rights to the music being produced, Hybe can freely create spin-off content around their stars.

One example of Hybe’s IP expansion is their online concert “Bang Bang Con”, which featured cartoon characters of the seven BTS boy band members. These cartoon characters are then used in advertising and have caused Wangta toothbrushes, Downy detergent, and other products to sell out in Korea.

Though direct artist involvement may generate more revenue, it isn’t by much. Last quarter, artist indirect involvement brought in $133M for Hybe.

How They Win: Global Expansion

Hybe’s founder, Bang Si-Hyuck, is already executing on a three-step plan to grow K-pops influence globally:

1) Acquire foreign entertainment companies: Hybe expanded into the US by purchasing entertainment company Quality Control for $300M and Ithaca Holdings for $1B and plans to make similar purchases in Latin America.

2) Replicate celebrity training model: Founder of Ithaca Holdings, Scooter Braun, believes Hybe will change the American music industry forever by implementing its curation and training programs early on in artists careers. Ithaca holdings manages stars like Justin Bieber and Ariana Grande.

3) Expand platforms to monetize fan-artist interactions: Hybe’s mobile application Weverse has 10M downloads and allows fans to interact with K-pop stars and easily access concert tickets and merchandise. They plan to launch a similar platform that will connect American musicians and fans.