Modern Entertainment Companies & The World of K-Pop7 min read


K-POP, A Colourful 5 Billion Dollar Industry

In South Korea, K-Pop is no joke. It’s a 5 billion dollar industry. A genre of popular music that, since its development in the 1990s, has entered the lexicon of people all over the world. We have all heard of this phenomenon. It’s quite difficult to display the influences of Korean traditions in K-pop. It’s more of a fusion between pop, rap and R&B, but to say that K-Pop is only music, would be to restrict the concept.

Although music is considered to be the start of the movement, the Korean wave comprises many art movements, and as a part of pop culture, has a direct impact on the construction of identity. Mostly in Korea, where TV and fashion are ruled by the boy/girl bands.

Brand collaborations between K-Pop brands and Western brands have become increasingly more popular and frequent over the last few years. There are a few examples, such as France’s LVMH investing in Big Bang and BLACKPINK’s label YG Entertainment in 2014.

All around the globe K-Pop groups have been advertising an array of different products, contributing to the financial power of these Korean powerhouses. Apparel and product sponsorship is widespread as the industry heavily relies on lucrative advertisements to fund its artists’ careers. Modern day music merchandising is a lucrative form of spreading an artist’s brand identity.

The day after Mattel, the company who gave us Barbie, announced its collaboration with BTS, the companies stockpile increased by almost 9%.

How Did This Avenue of Pop Music Emerge?

K-pop has always been a strange hybrid of Korean and Western culture. The music has drawn on US genres, but the extreme work ethic and management system are yet again a product of Korean culture and economy.

It started out as a music genre and spearheaded towards a bigger cultural movement and lifestyle called “Hallyu” or the “Korean Wave”, that comprises not only music but also film, fashion, beauty and food. K-Pop has been growing exponentially over the last three decades and was brought into the international media limelight for the first time in 2010, through Psy`s viral dance megahit Gangnam Style.

There is also the recent record-breaking international success story of the 7 member boy group “BTS” and girl group “Black Pink” with millions of teenies in Asia, the US and Europe going nuts for their songs and performances, garnering international attention and accolades.

How Does A K-Pop Entertainment Company Work?

There are a few K-pop bands that dominate the business, that has drawn the attention of both traditional- and social media. To be able to get that far, a big inversion, influence and know-how on the part of entertainment enterprises are needed. This is truly a crucial point: it’s not about labels, but rather about entertainment companies.

These companies usually have a really fixed training mechanism. Boys/Girls live and train together for years before their first performance. They start in their early teens so that they have enough time to learn, not only how to sing and dance (which are both skills of equal importance for a Korean Idol) but also stage presence, communication skills and foreign languages. Later, once the teens are ready to become idols, the entertainment company is ready to unite the artists in order to create the new bands that will try to hit the market.

A huge part of this business has a lot to do with the acquisition of talent. This is why talent shows play a big role in the system. Talent shows, however, have a completely different meaning in South Korea than that of places like Ireland and the UK, where shows like X-Factor and The Voice see civilians compete for a chance at stardom. In South Korea, talent shows are platforms for the K-pop companies to showcase groups they have already spent years training and curating. These K-Pop idols are put through training schools, then combined into groups and marketed with minutely planned release schedules through these shows.

Children as young as 11 years old are given long term contracts that have been labelled as “slave contracts” by some. This has seen young individuals being tied down to contracts that could last up to thirteen years. Variety reported in 2017 that South Korea’s Fair Trade Commission had demanded that the companies revise the terms. The ruling has seen the thirteen-year contract being reduced to seven years.

It seems like a high price to pay for fame and fortune, but fortune normally isn’t in the picture. One key term of many “slave contracts” is that the idols must repay the companies the cost of their decade of intensive training once they become profitable. The bill can easily amount to millions, meaning the idols have very little to show, financially, for their pain.

If you are interested in all this, we highly recommend you to watch this video:



This rigid system may have disadvantages but it is, for sure, an effective system that is working in the Korean Music Market. We can also see this from the protocols that dictate the rules of a band. For example, the band leader is usually the oldest member and the maknaeis, the name that receives the youngest member of the band (who is well known by being the shiest and let’s say the cutest member). Also, in terms of marketing, there are a lot of rules that are already written: The debut stage is a presentation of the band, generally in a music programme.

Which Are The Top K-Pop Entertainment Companies?

There are three companies that are known as the “Big Three”. They have been at the top of their game for years now and, currently, they are the biggest companies in terms of sales and revenue. That shows that they have faced both the short and the long term challenges and that they are masters when it comes to adapting. If you are interested in the Music Business, then you should know a bit more about these three companies: SM Entertainment, YG Entertainment and JYP Entertainment.

From right to left: Lee Soo-Man (SM), Yang Hyun-Suk (YG) and Park Jin-Young (JYP)

However, we must not forget that there are other entertainment companies that are starting to dominate a part of the market. This is particularly the case of Big Hit Entertainment, who in their artist portfolio, has one of the most popular K-Pop bands in the history of “genre”, BTS. They have actually won, during the last two editions, the most important prize in the Golden Disc Music Award Ceremony. Their album Love Yourself: Answer is the 10thbest-selling album in the history of South Korea.


SM Entertainment

Lee Soo-Man is a very important person in the Korean Music Industry. During his thirties, he was a member of a heavy metal band, but her future plans cut short with the censorship of the media promoted by the Government of Chun Doo-hwan. For this reason, he decided to leave Korea for a while. He moved to California in the United States. He witnessed the American entertainment revolution of the MTV music video scene… and felt that there was enormous commercial potential back in his country. When he came back to Korea he founded SM Entertainment. It was 1995: the beginning of the K-pop industry.

SM Entertainment is the biggest entertainment group in Asia with an estimated Net Worth of $1.2 billion. They continue to localize and expand their business in China and, at the same time, they are establishing joint ventures in other countries (right now they have more than 800 composers in their global network). They have 172,000 applicants at their auditions each year. What are they currently aiming for? SM Entertainment aims to touch people’s hearts and promote Korean culture in every corner of the world. If everything goes as they expect, they will become the best digital content provider to lead the internet and mobile markets.


Selected artists: Girls’ Generation, Super Junior

YG Entertainment

Seo Taiji and Boys were one of the cultural icons of Korea of the 90s. Their first four albums had each sold over 1.6 million copies. After the group disbanded, Yang Hyun-Suk, who was one of the members, founded YG Entertainment.

YG Entertainment has an estimated Net Worth of $900.5 million. During the last few years, YG Entertainment started to focus more on Japan as they wanted to expand within the Japanese market. YG is also a pioneer in the domain of new contents business and they are working with a business model in the world concerning advertisements, broadcasting, characters, games, etc.


Selected artists: 2AM, 2PM, Wonder Girls

JYP Entertainment

It seems to be a story that is frequently replayed. Park Jin-Young also started his career as a musician when he debuted as a solo artist in 1994. Only three years later he founded his label and agency. Once again, the name corresponds to the initials of the creator.

JYP Entertainment is the third most profitable entertainment agency in South Korea. It has an estimated Net Worth of $720.5 million. During the last few years, the company has experienced great success. They aim to expand their business into online and mobile segments and compete with the other companies in order to become number one.

JYP’s rise to the top can be further explained by their slightly different approach than that of their counterparts, SM and YG, by adopting a more relaxed demeanour accompanied by integrity. A lot of K-Pop Entertainment companies have been criticized in the past for their tight control over artists paired with rigorous work structures.

Selected artists: Gummy, PSY

Black One Entertainment Takes The Best of K-Pop & More

Top talent in music, dance and performance in the West is massively “underserved” or left out alone to navigate a complex and fragmented career path, compared to positives talent could get in an entertainment company driven ecosystem like South Korea.

Although these companies apply a modern approach to artist development and inspire innovation within the music industry, there are still some areas that could benefit from improvement. The world of pop music is divided into two camps, those who love k-pop and those who don’t love it yet, but why have we only seen this successful approach to artist development be done in South Korea?

By now you’ve probably gotten a good feel for the direction we’re heading. It’s safe to say that there is a lot of exciting progress being made. Yet, sometimes it can still be a bit difficult to really visualize what new concepts like this look like. Imagine the combination of talent discovery, actual talent development, long-term management as well as regular label services into one holistic system.

This is the exact concept that’s been missing in the modern world of entertainment for quite some time now. So far companies over in Asia have paved the way. Now it’s up to us to learn from them and adopt their best practices.

Black One Entertainment is on the mission to become the ultimate one-stop platform for talent in music and one big creative playground for talented individuals from diverse fields. Our DNA consists out of a blend of the best practices from the West and the Far East, that in detail combine K-pop with professional sports and high growth start-ups. Our mission? To create the ultimate holistic approach to artist training, development, production and careers.

Want to know more? Then learn more about the unique BLACK ONE APPROACH & The Magic Triangle.

You Might Like These Aswell…

Welcome to 2020 – Announcement & Recap

Welcome to 2020 – Announcement & Recap

Welcome to 2020. A lot has happened and so much more will this year! So have a look at the materials provided and find out how YOU can get involved.   Re-Cap and 2020 Outlook 2019 was a very successful year for us. We received widespread awareness for the Black...

Exploring Our Two Tracks – Accelerating vs. Building

Exploring Our Two Tracks – Accelerating vs. Building

It’s no secret that providing the right structure, training and resources to an artist advances their career. However, rarely do you come across a platform or system that does just exactly that. In some cases, you have institutions that provide a framework where one...