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This story is part of Billboard‘s K-pop Issue.
As one of the few non-English-speaking students at an American international academy in Singapore, the artist born Lee Seung-joo rarely talked to his peers, and he would often skip lunch to avoid eating alone in the cafeteria. Even his stage name is an anagram for “loner,” and his Instagram handle is “lorenisalone” — but as he laughs over Zoom through coughs of smoke while puffing on an orange vape in his Seoul studio at 1 a.m. local time, he says that listeners shouldn’t take those gestures seriously. “Some people DM me like, ‘You’re not alone.’ And I’m like, ‘Yeah, it’s just my Instagram ID.’ ”
Still, LØREN says being dragged to the academy “kicking and screaming” by his parents — and having to learn English — planted the seed for becoming a global star. “I think being miserable at school is not a necessity,” he explains, “but I feel like if I had been very happy, I wouldn’t have been so eager to make something of myself.”
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Instead of playing basketball and beer pong with his more popular peers, LØREN spent his time learning to play instruments in the band room and listening to Green Day and Red Hot Chili Peppers. Too shy to form a band of his own, after graduation in 2013, he forged a more insular musical path: making beats as an EDM producer. He soon connected with other musicians by DJ’ing on the Seoul nightclub circuit and found mentors within The Black Label, an associate company of YG Entertainment, founded by producer Teddy Park. With his help, LØREN leveraged a career as an in-demand producer-songwriter, scoring major credits with K-pop sensation BLACKPINK on tracks like “Lovesick Girls” and “Pretty Savage.”
Saint Laurent sweater, pants and shoes.
Ssam Kim
But his attention kept drifting back to rock music. “It kind of got tiring for me,” he says of his start in EDM. “Not that I don’t like [that music], but I grew up so heavily on rock, there was dissonance between what I created and what I really liked. I had an epiphany: Being a frontman of a band doing rock music has been my dream all my life.”
In 2021, he launched his solo career with a pair of singles: the bilingual, early-2000s-inspired rock tracks “NEED (ooo-eee)” and “Empty Trash,” followed by the more pop-facing “All My Friends Are Turning Blue.” LØREN self-released the three songs on his independent label, Fire Exit Records, in partnership with The Black Label.
Now, at 28 years old, the artist is committing to his vision. He signed a record deal with 88Rising earlier this year (still in partnership with The Black Label), saying he knew he needed to be on its roster, which is full of Asian artists with global reach like Joji, NIKI, Rich Brian and more. “I like how their artists, you can just tell they’re doing their own thing without being pressured to create something they don’t f–k with,” he says.
But none occupy the punk-rock lane like LØREN. As he points out, the genre isn’t as popular in South Korea as it is in the United States — and, in a previous interview, went as far as to call rock “dead” in his home country. He now admits that might have been a slight overstatement, though he’s eager to lean on 88Rising’s expertise in finding a larger audience to connect with.
After discovering LØREN’s string of singles, 88Rising executive vp John Yang knew the multi-instrumentalist would fill a sonic gap on the label’s lineup. He says he wasn’t even aware of LØREN’s work with BLACKPINK until after the deal was done. “When we sign artists, we always vibe out with them. What really matters is the person, their personality,” says Yang. “We’re not in this business just to become big or make money out of it. We’re here because we love music, and we want other people to enjoy music, too. LØREN’s character, his storytelling and his passion really got us into him.”
Saint Laurent top, pants and shoes.
Ssam Kim
LØREN’s first 88Rising release, the raucous five-track EP Put Up a Fight, was finished by the time he signed his contract. After polishing touches and strategy talks, the project arrived March 24 — and he’s already looking ahead. He has “five or six” tracks completed for his upcoming full-length and is in the throes of practicing something entirely new: playing with other people, for other people.
One of 88Rising’s first orders of business for LØREN was to book a series of U.S. shows, including sets at Coachella and Head in the Clouds, a two-day label-curated festival in New York. He has been hard at work translating his songs for the stage with a band of close friends, which he reveals can be difficult at times, given he records every guitar and drum line on his songs without writing anything down. “Sometimes [my guitarist] asks me, ‘How did you come up with this sound? What pedal did you use?’ I’m just like, ‘I don’t know, dude,’ ” he says with a grin.
But even as everything around him — from his team to his band to his fan base — grows, the inward focus that shaped LØREN early on keeps him grounded. He holds out his hands, nails chipped with black polish, seemingly visualizing the vastness of his future: “I’m a musician at the end of the day,” he continues. “I just want to put out as much music as I can in my lifetime, literally until I die.”
Ssam Kim
This story originally appeared in the April 22, 2023 issue of Billboard.
This story is part of Billboard‘s K-Pop Issue.
When J.Y. Park and Monte Lipman announced their forthcoming competition series A2K — standing for America to Korea — in July 2022, the respective founders of JYP Entertainment and Republic Records vowed to jointly produce “the first American artist made out of the K-pop system.” It was something of a full-circle moment for Park, who has eyed South Korean-to-American crossover success since JYP’s Wonder Girls became the first K-pop act to enter the Billboard Hot 100 in 2009. American artists are now clamoring for Park and other top Korean labels to notice them — and help them achieve their big break — in what has become a global race to launch a first-of-its-kind K-pop act.
While K-pop is short for “Korean pop,” genre fusion has always been one of its pillars and a big part of what has helped it reach new audiences — as has cultivating groups with members from countries outside of South Korea. Today, it’s common for trainees to come not only from China, Japan and Thailand but also countries like Australia, New Zealand, Canada and, now, the United States.
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“The whole strategy often started with having a member able to speak the language for the targeted market,” says John Yang, a U.S.-based entertainment executive who has spent 15 years in the Korean music business. “The K-pop industry realized the power of having members of that nation propelling more of the engagement among the fans and a much quicker local expansion.”
Now, with the genre’s growing popularity in major markets, K-pop stars are defined not by nationality, but by industry standards: years of rigorous training, contracts signed under a Korean agency, visual hallmarks (glossy videos, coordinated choreography) and release strategies involving multiple album drops each year.
“K-pop means ‘Korean popular music,’ ” Yang says. “I see this less as where it’s made, but more of who made it and how it’s produced. I may compare this with the restaurant business: It’s not the location defining it as ‘American,’ ‘Italian’ or ‘Korean,’ and also not about the ethnicity or race of its CEO, managers or even customers that defines cuisine, but more of cuisine consisting of the ingredients, recipes and techniques developed across that respective country.”
Despite the growing number of countries represented in K-pop, nearly all the artists are from Asia or of Asian descent. But the expanding definition of who can be a K-pop star is now seeing Korea’s industry leaders incorporating America’s diverse young talent into their system, regardless of race or ethnicity.
Initially, HYBE was the front-runner in this global gamble. A month before Big Hit Entertainment rebranded as HYBE in March 2021, chairman and then-CEO Bang Si-hyuk, alongside Universal Music Group chairman/CEO Lucian Grainge, revealed a strategic partnership that included assembling a “global” K-pop boy group in the United States under a new joint-venture label between Big Hit and Geffen Records. The plans to air worldwide auditions in 2022 with a “major U.S. media partner” changed a bit: HYBE and Geffen subsequently announced five American cities holding auditions for a “global girl group” in March and April 2022 before expanding the auditions to Japan, Australia, the United Kingdom and South Korea for December 2022-January 2023.
In that time, A2K launched its own American Idol-style auditions, bringing Park to Atlanta, Chicago, New York, Dallas and Los Angeles to select contestants to attend an L.A. “boot camp” reminiscent of The X Factor’s, with semifinalists then flying to JYP Entertainment’s Seoul headquarters for what A2K described as “intensive training” with music, dance and business executives. Winners will be part of a supergroup under JYP and Republic Records for all music releases — just like TWICE, Stray Kids and ITZY, which have earned seven top 10 albums on the Billboard 200, including two No. 1s by Stray Kids, since the companies partnered in 2020. TWICE, Stray Kids and JYP’s Japan-based girl group NiziU were all created on similar competition shows and officially debuted three to six months after their respective finales.
While JYP and HYBE worked directly with label partners, SM Entertainment connected directly with MGM Worldwide Television Group for its global venture. SM announced a partnership in May 2021 with MGM and its then-chairman, Mark Burnett, for a competition series forming NCT-Hollywood, a U.S. offshoot of SM’s boy band collective NCT, which has splinter groups across Korea, China and Japan. At the time, an insider told Billboard the show had been in development even before the pandemic — but Burnett’s late-2022 exit from MGM, Lee Soo-man’s controversial ousting from SM earlier this year and an announcement from SM’s new CEOs that the NCT system would halt expansion after a Tokyo-based team launches in 2023 raise questions about the project. (SM declined to comment for this story, as did Republic Records and Geffen Records — a reluctance likely born out of the high degree of competition and similar timelines to launch that they’re operating on.)
While no major U.S. label has made an earnest attempt, American and British “K-pop” groups have been launched before. Dubbed “the world’s most controversial ‘Korean’ band” by the BBC, EXP EDITION began in 2014 as Columbia University student Bora Kim’s master’s thesis that explored the meaning of K-pop music. Kim held auditions to form a band of six non-Korean men who would undergo a truncated version of the years of rigorous training K-pop hopefuls commit to in Seoul with voice coaching, dance rehearsals, language lessons and media training. Supporters donated $30,000 through Kickstarter and, with the help of a private investor, Kim and four of the six EXP EDITION members moved to Korea.
EXP EDITION booked prime K-entertainment TV slots like Mnet’s M Countdown and KBS2’s Immortal Songs, but experts criticized its inability to achieve captivating, onstage perfection — and the group’s 2018 debut EP, First Edition, was its sole release.
KAACHI, created by Frontrow Records and branded as the first London-based K-pop group, faced similar criticism. Unlike EXP EDITION, KAACHI did have one Korean member. Its 2021 music video “Get Up” was sponsored by a Seoul theme park, and the group performed publicly alongside top K-pop stars at the time. Still, the group disbanded in less than two years.
But crucially, today’s ventures to create global K-pop groups have the backing of some of the most powerful companies — Korean and American — in the music business. Whether or not the artists these initiatives yield break through on the Billboard charts, Yang sees future group launches as the ultimate indicator of a healthy, locally grown K-pop presence in America — much in the same way SM, JYP, HYBE and their counterparts have done for decades now in Asia.
“The most obvious indicators of the success of these projects would be Billboard charting, which will only result with the support of their fans without doubt,” he says. “However, the longevity of these partnerships and the birthing of more groups consistently will be the significant historical marker.”
This story originally appeared in the April 22, 2023, issue of Billboard.
This story is part of Billboard‘s K-Pop Issue.
For the multitude of K-pop acts amplifying South Korean culture on the global stage, it’s fair to say BTS and BLACKPINK have set the bar, with BTS in particular achieving many records. Now as both bands open new chapters with their members’ solo careers, they’re establishing more precedents.
Ten years ago, solo debuts from within such groups might have signaled trouble: perhaps an imminent disbanding, or one member being considered more successful than the others. But for BTS and BLACKPINK, solo projects are additive, supplementing the groups’ journeys while highlighting new artistic dimensions. For BTS, solo ventures have given the members room to experiment sonically, visually and lyrically (including expletives largely avoided in group releases). And in 2018, BLACKPINK’s Jennie upended the norm for when a band’s first solo act might break out when she released her debut single, “Solo” — two years before BLACKPINK dropped its first studio album.
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The path to solo stardom hasn’t necessarily replicated the levels of success the bands have achieved. No member of BLACKPINK has cracked the Billboard Hot 100 above No. 70. And when BTS’ Jimin recently debuted at No. 1 on the chart with “Like Crazy,” it was a first for a solo member of the group. But as these artists explore their individual identities, single releases are far from the only metric defining them. Here, a look at both bands and their recent solo endeavors.
It cemented its stake in the K-pop zeitgeist with viral hits like “DDU-DU DDU-DU” and “BOOMBAYAH,” but BLACKPINK didn’t release its first studio album until 2020, four years after debuting. Album track “Ice Cream” (with Selena Gomez) became the group’s highest-charting U.S. single, peaking at No. 13 on the Hot 100. After making history in 2019 as the first K-pop group to perform at Coachella, BLACKPINK just became the first such act to headline the festival.
Jisoo
Although she was BLACKPINK’s first member to try acting (with a role on JTBC series Snowdrop in 2021), Jisoo was the last to make her official solo debut, following Jennie (2018), Rosé and Lisa (both in 2021). Released in March, ME is a two-track set featuring “(FLOWER),” blending pop and trap with traditional Korean melodies, and the upbeat “All Eyes on Me.” “(FLOWER)” debuted at No. 2 on Billboard’s Global 200 and Global Excl. U.S. charts.
Jennie
Jennie’s solo journey broke the traditional K-pop model: Her debut single, “Solo,” was released in November 2018 — before BLACKPINK’s own debut studio set, The Album, arrived. “Solo” topped Billboard’s World Digital Song Sales chart for one week, and less than a year later, Jennie became the first Korean solo artist to perform at Coachella. Her follow-up, “You & Me,” was first heard in October 2022, when she performed it during BLACKPINK’s Born Pink World Tour; it has yet to be officially released. Next, she’ll make a foray into acting on HBO’s The Idol.
Lisa
The charismatic rapper-singer released her debut two-track project, LALISA, in September 2021. The eponymous lead single entered the Billboard Global 200 at No. 2 and the Hot 100 at No. 84; B-side “Money” received some radio airplay but peaked at No. 90 on the Hot 100. In 2022, Lisa became the first solo K-pop winner at the MTV Video Music Awards and the first female soloist to win the best K-pop artist category.
Rosé
The second member of BLACKPINK to release solo material, Rosé put out the two-track R in March 2021. “On the Ground” debuted at No. 1 on both the Billboard Global 200 and Billboard Global Excl. U.S. charts, staying there for one week. (It peaked at No. 70 on the Hot 100.) “Gone” reached No. 17 on Global Excl. U.S. and No. 29 on Global 200.
BTS
Courtesy of BIGHIT
During the last decade, BTS released nine albums and over 230 songs (many of which it co-wrote or produced), making history along the way as the first Korean group to hit No. 1 on the Hot 100 (“Dynamite”) and the act with the most No. 1 hits on the Hot 100 this decade. Proof, BTS’ most recent album, was its sixth to debut atop the Billboard 200.
Jin
When late 2021’s “SUPER TUNA,” an unofficial gag gift for fans, went viral, Jin was so embarrassed that he asked listeners to stop dancing to it. Days after BigHit Music announced BTS would fulfill its military service — starting with Jin — the song (along with “Tonight” and “Abyss”) was officially released. The week his single “The Astronaut” debuted, Jin topped Billboard’s Emerging Artists chart for the first time, the sixth BTS member to do so; co-written by Jin and Coldplay, the song peaked at No. 51 on the Hot 100 and debuted at No. 1 on the Digital Song Sales chart.
V
V has yet to announce an album and released one single, “Christmas Tree,” for K-drama Our Beloved Summer’s original soundtrack; it peaked at No. 79 on the Hot 100 and No. 1 on Digital Song Sales in January 2022. Recently, he joined famed Korean actors Park Seo-joon, Choi Woo-shik, Lee Seo-jin and Jung Yu-mi to film tvN reality show Jinny’s Kitchen, in which they open a pop-up Korean restaurant in a small Mexico town.
SUGA
The only member to go solo under an alternate name, Agust D — a portmanteau of “D-Town” (his hometown of Daegu) and “Agus” (SUGA backward, and an abbreviation of “shooting guard,” his favored basketball position). The prolific producer-songwriter has penned tracks for popular Korean artists like IU and PSY. His mixtape, D-2, was a runaway hit with fans, though it was only released digitally. His full-length debut, D-DAY, just came out with an accompanying documentary, SUGA: Road to D-DAY. SUGA is the first BTS member to embark on a solo tour; his nine-city trek across the United States and Asia begins April 26 in New York.
Jung Kook
He hasn’t released a solo album yet, but Jung Kook has been busy. His “Stay Alive,” produced by SUGA, was released as the theme for Korean webtoon series 7Fates: Chakho. (It peaked at No. 95 on the Hot 100.) In summer 2022, he featured on Charlie Puth’s “Left and Right,” which reached No. 22 on the Hot 100. At the 2022 FIFA World Cup opening ceremony, he sang “Dreamers,” part of the tournament’s official soundtrack, and since then has been highly visible on billboards worldwide as a global brand ambassador for Calvin Klein Jeans and Calvin Klein Underwear.
RM
On his solo endeavors (including features with Balming Tiger and So!YoON!), RM has made a concerted effort to showcase the diversity of Korea’s non-mainstream artists. His debut, Indigo, featuring collaborators ranging from Erykah Badu to Epik High’s Tablo, arrived on digital and streaming on Dec. 2, 2022, two weeks before a physical version was released. Fans worried its chart prospects would suffer, but Indigo still peaked at No. 3 on the Billboard 200 — setting a record for the highest album charting position for a K-pop artist at the time — and at No. 1 on the World Albums chart.
Jimin
In April, Jimin became the first Korean soloist to top the Hot 100 with “Like Crazy,” the lead single from his March debut album, FACE, which explores loneliness and finding freedom. He co-wrote all five tracks on FACE, which entered the Billboard 200 at No. 2, making it the highest-charting album by a K-pop solo artist. (Previously, RM held the record.)
j-hope
The first Korean artist to headline Lollapalooza, j-hope dropped his debut album, Jack in the Box, in July 2022 as a digital-only release. Fans claimed the lack of a physical version put him at a charting disadvantage; nonetheless, the album peaked at No. 17 on the Billboard 200 and No. 4 on Top Rap Albums. Tracks “Arson” and “= (Equal Sign)” peaked at Nos. 1 and 2, respectively, on World Digital Song Sales. He recently released “on the street” (with J. Cole), a role model of his, and has confirmed he will be BTS’ next member to enlist for military service.
This story originally appeared in the April 22, 2023, issue of Billboard.
This story is part of Billboard‘s K-Pop Issue.
In March, HYBE founder/chairman Bang Si-hyuk issued a dire warning: “K-pop,” he concluded, “is in crisis.” HYBE is the music company behind BTS, the group that spearheaded K-pop’s dramatic international growth in recent years, but Bang sounded alarmed about the genre’s health. K-pop’s momentum was faltering, he said, claiming fewer tracks from the genre charted on the Billboard Hot 100 in 2022 than in 2021. The following month, BTS’ Jimin released his solo debut album, and the single “Like Crazy” arrived at No. 1 on the Hot 100. Still, his comments dovetailed with general industry anxiety about the dearth of new acts breaking into the mainstream and the challenge of maintaining growth in a ferociously competitive landscape, where around 100,000 new songs hit streaming services daily.
Within K-pop, some executives are concerned about the extent to which the genre can continue to produce massive international hits without BTS’ firepower while the group is on hiatus. “Although I wouldn’t go so far as calling it a ‘crisis,’ I do share [Bang’s] underlying sense of urgency that the Korean music industry is very much at an important crossroads,” says Bernie Cho, president of DFSB Kollective, a Seoul-based artist and label services agency.
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K-pop’s ascent to global prominence was, Cho says, “inextricably linked [with] and heavily reliant on the singular artistic visions” of executives at a few key companies — notably SM Entertainment, YG Entertainment and JYP Entertainment. “It has become an open source of debate these days, from boardrooms to chat rooms, that steadfastly sticking to this single-lane approach may no longer be the right direction” if the industry hopes to “futureproof” K-pop.
Executives who work in and around the genre are quick to pinpoint one big reason for the recent lack of K-pop in the upper reaches of the Hot 100: In June 2022, BTS — which has topped the chart four times on its own and twice more as a collaborator with Western artists — announced its potentially yearslong hiatus. “Their vacancy is definitely going to put a bit of a hole in the market,” says Eddie Nam, CEO of EN Management (Eric Nam, Epik High).
But there’s disagreement on whether hit singles in the United States are the best gauge of the genre’s health in the first place. On the Billboard 200, K-pop albums continue to hit No. 1 thanks to robust physical sales of CD variants; last year, K-pop groups topped the chart four times — Stray Kids twice and BTS and BLACKPINK once each — setting a new high-water mark for K-pop. “Most K-pop groups are built on a strong fan base, and their loyalty and support for their artists is much more organized than in the past,” says YG Entertainment USA’s former president Joojong Joe. “These fandoms know that Billboard chart positioning is important to their artists, and they organize album purchases and promotion within their fandom in the first week of an album’s release in order to get it to the top of the charts.”
But recently, K-pop acts haven’t scaled the same heights on the Hot 100. The biggest recent non-BTS K-pop hit was BLACKPINK’s “Pink Venom” last year, which peaked at No. 22. In the United States, the genre’s singles often perform phenomenally on the downloads chart — mirroring their dominance in physical sales — but less well on the streaming and radio rankings. “Like Crazy,” for example, sold 254,000 downloads, easily topping Digital Song Sales, but clocked in at No. 35 on the Streaming Songs chart. BTS’ previous No. 1, the Coldplay collaboration “My Universe,” also topped Digital Song Sales in its first week but landed at No. 21 on Streaming Songs.
Getting airplay in the United States remains K-pop’s biggest challenge: BTS has spent 17 cumulative weeks atop the Hot 100 but hasn’t made it past No. 5 on Billboard’s Pop Airplay chart, and BLACKPINK hasn’t even cracked the top 20 on Pop Airplay. The airplay audience for “Like Crazy” is the lowest for a Hot 100 No. 1 this decade. “I don’t think we’ve seen Korean music take over U.S. radio in any way,” Nam says. This remains true even as most of the biggest K-pop acts now work with American major labels, which have long-standing radio promo teams.
As Joe points out, K-pop artists aren’t necessarily so different from others outside the United States when it comes to that airplay disadvantage. “You’re in the country for promotion for only a short amount of time,” he explains. “You have to prioritize — you have a late-night show on TV; you have a concert; you have a photo shoot. It takes a lot of time to build relationships at radio, and it has not been easy for Korean artists to do that in the short amount of time they have here.”
In addition, many K-pop singles are only partially in English, which may make them a tougher sell at radio — a medium not known for taking risks. (Bad Bunny is one of the biggest artists in the world, but he has never made it past No. 19 at pop radio as a lead artist.) Three of BTS’ biggest hits were entirely in English; two others were collaborations with prominent Western acts singing in English.
Others, like Michael Martin, senior vp of programming for Audacy, the second-largest radio company in the United States, dismiss the idea that language might be limiting K-pop’s airplay. Representatives for two other prominent radio conglomerates, iHeartRadio and Cumulus, declined to comment on K-pop airplay, though iHeart has been supporting rising acts like NewJeans, especially in cities on the West Coast, and had some of the few stations that played “Like Crazy” during its debut week.
However, there’s also an argument that in an increasingly global music marketplace, hits are no longer the most important indicator of a genre’s health — and that K-pop’s difficulty getting U.S. radio play ultimately doesn’t matter to its momentum. “I don’t think K-pop groups must have hit singles in the U.S. to succeed globally,” says Inkyu Kang, an associate professor at Penn State and the author of K-Pop: The International Rise of the Korean Music Industry. “K-pop had already been enjoyed by people around the world with diverse backgrounds before it reached the U.S.”
Those listeners continue to seek out music from the genre: K-pop groups accounted for four of the top 10 albums in the world last year, according to the most recent report from IFPI, up from two in 2020. Looking just at sales rather than overall consumption, K-pop acts have a whopping eight out of the top 10, up from four in 2020. “Last year, the K-pop industry had the highest album sales overseas in history,” though growth in album sales slowed significantly, says Stephanie Choi of SUNY Buffalo’s Asia Research Institute, who is working on a book on K-pop. Japan, China and the United States were the three biggest importers of K-pop albums.
“You have to look at the whole pie,” says Lucas Keller, who manages Jenna Andrews, co-writer of BTS’ runaway hit “Butter.” “K-pop has one of the most committed fan bases in the history of music. You have to look at the touring, the merchandise and the audience, not just the charts.”
“When I speak to folks in the industry,” Keller adds, “we all believe that Korean pop acts have a real seat at the table now — including a shot at Western success in a way that was more difficult in past years.”
This story originally appeared in the April 22, 2023, issue of Billboard.
CARATs are worldwide, and SEVENTEEN‘s recent sit down with Billboard News is proof. The K-pop group stopped by to play a quick game with Billboard News host Tetris Kelly, in which they revealed some of the strangest and most interesting places where they have met their dedicated fans.
According to Joshua, the weirdest place he’s ever met a fan was at “Disneyland. I went with my parents too,” he told Kelly, adding that he’s had a spontaneous fan meet at an Apple Store as well. “I met a CARAT on the Ferris wheel in Seattle,” Hoshi said, with Mingyu stating that he “actually run[s] into them quite often.”
When asked who the members of the group are fans of, Hoshi proudly shared that he’s a Justin Bieber fan, while Jun loves KARA and Mingyu is a fan of Billie Eilish. The group also stated that live performances from Bieber — as well as John Mayer, Taemin (of SHINee) and their producer Bumzu — are some of the best they’ve ever attended.
SEVENTEEN is currently in album promotion mode — the group is gearing up to release its 10th mini album, FML, on April 24. The set, which contains a total of six tracks, comes nine months after the release of the group’s repackage album, Sector 17 (which charted at No. 4 on the all genre Billboard 200). The mini album features two tracks, “F*ck My Life” and “손오공 (Super),” which will hit streaming after the album’s formal arrival.
Following the release of FML, the SEVENTEEN 2023 JAPAN FANMEETING ‘LOVE’ will hit Japan in May, taking over Kyocera Dome Osaka and Tokyo Dome across four dates.
SEOUL — South Korea’s SM Entertainment appointed Jang Cheol-hyuk as the company’s new CEO on Friday (March 31), as the K-pop giant vowed to turn over a new leaf by bringing on a fresh leader and board of directors. Jang succeeds outgoing CEO Lee Sung-soo.
“I feel a great responsibility to assume the position as a CEO when SM is about to take a big leap forward,” said Jang in a statement. “We will establish a sound [and] transparent governance structure and faithfully implement the SM 3.0 strategy so that SM can become a fan-and shareholder-centered global entertainment leader.”
The landmark corporate shakeup is part of SM’s bid to improve corporate governance as well as its production system, which in recent years lagged behind rivals and invited investor scrutiny. Friday’s appointments also put an end to the weeks-long drama that gripped the K-pop world, pitting industry giants HYBE, home to boyband BTS, and South Korean tech giant Kakao against each other.
A certified accountant and professional manager, Jang joined SM in early 2022 as CFO and has been involved in creating the blueprint for SM’s future. Dubbed SM 3.0, the plan is to diversify the company’s artist portfolio and delegate more creative control away from the single-pipeline structure helmed by SM founder Lee Soo-man.
For years, Lee hasn’t had an official role at SM — which developed K-pop groups EXO, NCT and Girls’ Generation — but he had nearly unchecked powers as its largest shareholder. He was being paid millions of dollars a year in production fees, a setup that ended late last year following a shareholder revolt.
At Friday’s meeting, Kim Kyung Wook, a former SM CEO and now shareholder, pressed the agency to recoup the production fees, but outgoing CEO Lee Sung-soo — who is Lee Soo-man’s nephew — said the company was not ready to consider that step.
Cracks began to show at SM in February after management, without Lee Soo-man’s approval, signed a partnership deal with Kakao. The founder retaliated by selling most of his shares to HYBE and laying the groundwork for a possible merger between the two largest K-pop agencies.
Friday’s shareholder meeting had been hyped as a spirited battle between HYBE and Kakao before HYBE abruptly threw in the towel last week and ceded some of its SM shares to its rival.
Together with subsidiary Kakao Entertainment, Kakao has now secured nearly 40% of shares in SM, becoming the company’s largest stakeholder. Jang Yoon-Joong, executive vp/global strategy officer at Kakao Entertainment, as well as Align Partners CEO Lee Changhwan — who led the shareholder revolt — have now joined the board as non-executive directors.
Three SM executives, including incoming CEO Jang, were also appointed to the board, while five outside directors were also approved: Kim Kyu-Shik, chairman of the Korean Corporate Governance Forum; Kim Tae-him, attorney at Pyeong San Law Firm; Moon Jungbien, professor at Korea University Business School; Lee Seung-min, partner at Peter & Kim; and Sung M. Cho, CEO of music analytics company Chartmetric.
Before BTS conquered the world, Lee Soo-man was the most famous face of K-pop in Korea for reasons both good and bad. He has been lauded as a visionary but criticized for his harsh treatment of trainees and artists. While he treated stalwart artists like family, keeping them on the roster even after their career peaks, he also was accused of excessive control over the acts’ professional and personal lives. He has also been convicted of embezzlement, though he later received a presidential pardon for his contribution to K-pop.
Lee Soo-man still holds over 3% of SM’s shares but hasn’t disclosed his future plans regarding the company. A representative sent to Friday’s meeting on his behalf stayed silent at the gathering.
“Today marks an end of an era at SM, a company I founded in my name,” said Lee, in a statement emailed to reporters shortly before the shareholder meeting. While not commenting directly on the proceedings, he said he was staying outside the country and is “deeply immersed in the world of global music.”
SEOUL — The bitter battle for control of K-pop’s fabled agency SM Entertainment has spilled out publicly like an episode of HBO’s Succession. K-pop’s largest agency, HYBE — home to boy band BTS — is pitted against the management of SM, which for years was South Korea’s dominant K-pop company. But as SM’s Lee Soo-man sided with HYBE against the company he founded, a corporate shakeup has turned into a battle royale.
SM sought to maintain its independence through a partnership with Kakao, a South Korean internet giant that has acquired several entertainment agencies. In February, Kakao said it would buy a 9.05% stake in SM against the wishes of Lee, SM’s charismatic founder and rock singer-turned-mogul, whose equity in SM allowed him to challenge the purchase in court.
About a week later, Lee — a controversial figure who helped build the K-pop business over the last three decades but has been convicted of embezzlement in the past — privately approached HYBE founder and chairman Bang Si-hyuk, offering to sell about 80% of his SM shares to HYBE, with an option to sell the remaining chunk at a later date, according to a person with direct knowledge of the matter. As a result, HYBE now has a 15.8% stake in SM, making it the company’s largest shareholder.
Since then, the companies have traded almost daily salvos.
After a March 3 provisionary injunction upheld Lee’s court challenge to the Kakao acquisition, Kakao announced it had canceled its investment in SM and launched a tender offer seeking to buy 35% of SM from minority shareholders. HYBE is now appealing to SM shareholders to back its board nominees and vision for the company. SM sees the move as a hostile takeover and is asking shareholders to appoint independent directors. The clock is ticking before a March 31 annual shareholder meeting.
Both HYBE and SM have grand ambitions to expand K-pop and take on the major labels globally. HYBE increased its revenue 125% to 1.78 billion won ($1.41 billion) from 2020 to 2022, largely by acquiring Ithaca Holdings in 2021 for $1.05 billion and giving its founder, Scooter Braun, the reins to its U.S. operations, HYBE America. In February, HYBE America made its first major move, purchasing Atlanta-based hip-hop company Quality Control Music for $300 million.
SM hopes to more than double its 2022 revenue of 850 billion won ($644 million) to 1.8 trillion won ($1.36 billion) by 2025 through a mix of partnerships and acquisitions, which include acquiring a U.S. management company and, by the second half of 2024, launching its first U.S.-based artist. “Our plan is not limited to local activities of Korean artists,” co-CEO Tak Young-jun said in a Feb. 23 video.
The company plans to spend 350 billion won ($266 million) on a music publishing company and 300 billion won ($228 million) to acquire record labels, with two-thirds of that amount ($152 million) targeting U.S. companies “with a solid local network that can support Korean artists’ global expansion and have global production capabilities in genres complementary to SM,” Lee Sung-soo, SM’s chief creative officer and co-CEO, said in the same video.
But minus its powerful founder, SM doesn’t intend to take the world stage with HYBE’s help. It had envisioned Kakao as its preferred partner in a mission — dubbed “SM 3.0” — it has said it will still push forward with in order to expand outside of Korea and build outposts in Japan, Southeast Asia and the Americas.
A HYBE acquisition of a controlling interest in SM could potentially face regulatory scrutiny from South Korea’s Fair Trade Commission since it exceeds 15% of SM’s stock ownership. In 2022, HYBE was behind 26.8% of albums sold in Korea, while SM was behind 19.1%, according to Korea chart company Circle Chart.
As Lee Dominated, SM’s Luster Was Fading
Though few had predicted such a dramatic unraveling, SM was overdue for a transformation. Once the leading K-pop innovator, SM has debuted just one completely new act, Aespa, in the last five years. It continues to operate through a single pipeline with Lee at the helm of artist management and production, while rivals like HYBE and JYP Entertainment have diversified their portfolios, relying on multiple teams that produce more acts with more independence.
SM’s shares have been chronically undervalued, industry observers say, due to an arrangement where the company paid producing fees to a separate entity owned by Lee. SM paid Lee 24 billion won ($18.1 million) in 2021, equivalent to more than a quarter of SM’s operating profit that year. Even in years when SM produced a loss, Lee took home a sizable paycheck.
The board of directors, packed with Lee allies, allowed the practice to continue for years, until Align Partners Capital Management, a private equity firm, led a shareholder revolt last year. Lee, who now holds about 3% of SM shares, appears headed out the door. HYBE and SM say his role will be reduced if not completely phased out.
“It’s hard to put up a resistance in Korean culture,” Lee Changhwan, CEO of Align Partners, says about the difficulty in over-riding a founder and company’s biggest shareholder. “The governance structure has to go through fundamental changes.”
South Korean stocks are often undervalued, analysts say, since some companies can seem to be managed for the benefit of founders and families to the detriment of general shareholders. Still, in the HYBE-SM power struggle, SM shareholders appear to have won either way: The March 7 share price of 149,700 won ($113.84) is up over 116% since SM announced it would terminate Lee’s contract on Oct. 14.
A K-Pop Pioneer With A Criminal Past
The 70-year-old Lee, who founded SM in 1995, has been credited with making K-pop what it is today. Inspired by early MTV music videos and New Kids on the Block, which he watched during his master’s degree studies in California in the 1980s, he paved the way for K-pop to win overseas fans with a signature formula of visually striking performance and dance pop.
Lee crafted BoA, the female singer who SM scouted in 1998 when she was 11 years old, into the first K-pop artist to break through in the Japanese market; she went on to sell millions of singles and albums. Groups from TVXQ and Girls’ Generation to EXO and NCT have followed suit with international stardom. In 2000, SM became the first K-pop agency to list its shares publicly.
Even before PSY and BTS became global household names, Lee was lecturing publicly about K-pop conquering the world — and about a future when non-Korean singers would join the fray and be trained and managed by K-pop production teams.
Lee’s artistic vision and drive didn’t make up for the company’s corporate governance problems, however. Shareholders have in recent years slammed SM for losses from non-music businesses such as a winery and restaurants while Lee was still getting his producer’s fees. Several SM acts have seen members leave acrimoniously over what they called harsh training and “slave contracts,” resulting in government intervention, including shorter contracts for K-pop trainees and stars.
In 2002, Lee made headlines when he fled the country to escape prosecution while facing embezzlement allegations. After a brief stay on Interpol’s wanted list, he surrendered to Korean authorities and was convicted for siphoning off 1.15 billion won ($892,000 at the time) in company funds during a recapitalization round, which he used to buy shares in SM. (He served three years of probation, and in 2007 he received a presidential pardon — and then returned to the company.) SM has also paid fines for tax evasion, most recently in 2021.
In recent weeks, Lee Sung-soo, the co-CEO who is also nephew to founder Lee’s late wife, leveled a series of accusations at his uncle, which range from previously undisclosed tax evasion through a shell company based in Hong Kong to making “arbitrary” changes to SM bands’ musical direction to advance his own business interests.
While the elder Lee has not directly addressed the allegations, HYBE has responded that it was unaware of such an arrangement during the deal’s signing. In a statement to Billboard, HYBE says its SM acquisition was made “following research on the corporate fundamentals, including publicly disclosed information about SM.”
SM Entertainment shareholders have until the end of the month to weigh two competing visions for the South Korean music company’s future before its annual general meeting on March 31 — one from SM and Korean tech company Kakao and another from K-pop rival HYBE.
Despite SM Entertainment’s announcement Monday that it had canceled plans due to a court injunction to issue new shares and give Kakao a 9.05% stake in the company, making it the leading shareholder, SM and Kakao are pushing forward with their strategy to maintain control. On Tuesday (March 7), Kakao launched a tender offer to buy a 35% stake from SM’s minority shareholders by March 26 and, if successful, could soon own nearly 40% of SM and hold significant voting power.
SM — home to such K-pop acts as NCT 127 and Aespa — has nominated a slate of independent directors and laid out a plan for adding 260 billion won ($200 million) of revenue by 2025 by setting up operations in the U.S., Japan and Southeast Asia, and making acquisitions — including a publishing company — in the coming years, according to a company presentation to shareholders. If the roadmap is successful, SM believes it can double its annual sales from an estimated 770 billion won ($690 billion) in 2023 to 1.5 trillion won ($1.14 billion) in 2025.
Much of SM’s road map stems from its battle with founder Lee Soo-man. In late 2022, an activist investor, Align Partners Capital, convinced SM’s board to appoint a new auditor and terminate a contract with Lee’s production company, Like Planning. Now, SM is attempting to remake itself under revamped corporate governance and a more decentralized organization than Lee’s hierarchical control of artist development.
The current inside directors — including Lee’s nephew, Lee Sung-soo — will resign their positions “in order to take responsibility for the problems of the [Lee Soo-man] system,” the company stated. In their place, SM is recommending its own slate of three executives: CFO Jang Chul-Hyuk; Kim Ji-Won, head of marketing center; and Choi Jung-Min, head of global business center.
To ensure an independent board of directors, SM has proposed the chairperson be one of its outside directors, not one of its own executives. Among the company’s picks for outside directors are Kim Kyu-Shik, president of the Korean Governance Forum; Moon Jungbien, a professor at Korea University that specializes in environmental, social and corporate governance matters; and Sung M. Cho, CEO of music analytics company Chartmetric. For part-time directors, SM recommends Lee Changhwan, the CEO of Align Partners, and Jang Yoon-Joong, Kakao’s global strategy officer.
Lee Chang-hwan
Courtesy of Align Partners
HYBE, home to the wildly popular boy band BTS, has different ambitions for SM’s future. HYBE acquired a 14.8% stake in SM from Lee, the SM founder, on Feb. 22, and an additional 1% through a tender offer, according to a March 6 regulatory filing. It has blasted “the bias and irrationality” of the SM management that approved the Kakao partnership.
“HYBE has been considering the acquisition of SM for a long time and gave much thought into how the two companies could work together,” Jung Jinsoo, HYBE’s chief legal officer, wrote in a letter to SM shareholders on Thursday.
In the letter, Jung argues HYBE solved two problems when it acquired Lee’s equity. First, HYBE acquired Lee’s shares in two SM subsidiaries: SM Brand Marketing and Dream Maker Entertainment Limited. That solves what Jung called “leakage in SM’s profits” to Lee. Second, HYBE alleges SM still owes Lee fees for three years even though it terminated the Like Planning contract as of Dec. 31.
Jung says HYBE structured the stock purchase agreement so payments to Lee stop “upon the execution of the agreement.” HYBE also added a clause to terminate any transactions from SM to Lee that HYBE did not know about.
While SM sees Kakao as the partner for its transformation into a larger, more global entity, HYBE calls it an “unfair partnership” that would give Kakao permanent and exclusive rights to distribute SM’s music, protect SM’s equity at the expense of other shareholders and create conflict of interests that favor Kakao’s interests. “We believe that these details demonstrate the bias and irrationality of the current SM management who approved such arrangements,” Jung writes.
Beyond SM’s relationship with Kakao, HYBE is concerned with SM’s roadmap to increase the number of artists on its roster by expanding production in Korea and building overseas outposts. Jung is questioning SM leadership’s understanding of the time and resources required to develop and break successful artists.
“It goes without saying but you cannot generate profit in K-pop just by having a longer artist roster,” Jung writes. “What’s important is to nurture artists who are loved by fans and provide a creative environment.”
HYBE has submitted a competing slate of inside director recommendations featuring a handful of HYBE executives: Jung; Lee Jaesang, president of HYBE America; and Lee Jin Hwa, HYBE’s chief of management and planning.
For outside directors, HYBE has recommended Kang Namkyu, managing partner at GAON Law Group; Hong Sounman, professor of public administration at Yonsei University; and Lim Dae Woong, a representative of the United Nations Environment Program Finance Initiative. HYBE’s recommendation for part-time director is Park Byungmoo, managing partner at buyout firm VIG Partners; and Choi Kyu Dam, a former NCSOFT finance executive, for part-time auditor.
SM portrays the battle with HYBE as a fight for its independence from a large company. A HYBE takeover would put its interests over SM’s artists, SM says, and could force SM to downsize or divest assets to meet regulatory approval. What’s more, HYBE might not receive a warm welcome: 85% of SM employees who voted on the workplace app Blind oppose HYBE’s “hostile takeover” and want to “protect the culture diversity of K-pop and the unique identity of SM,” according to SM’s investor presentation.
Ultimately, the two sides have competing visions for a board of directors that will best serve SM shareholders and lead the company. To SM, HYBE’s recommended directors are either tied to Lee, employed by HYBE or hurt shareholder value in their previous corporate tenures. To HYBE, SM’s proposals could result in a board controlled by Align Partners that lacks the experience to expand SM and reach the company’s lofty targets.
“[I]t is questionable whether the current management has a sufficient understanding on these circumstances,” writes HYBE’s Jung.
Korean tech company Kakao will launch a tender offer to acquire up to 35% of SM Entertainment’s outstanding shares. The move came a day after a court injunction forced Kakao to cancel its plan to acquire a 9.05% stake directly from SM, whose roster includes NCT 127 and Red Velvet; a court injunction scuttled SM’s plan to issue new shares and give Kakao the stake, according to reports by Bloomberg and Reuters.
Kakao and its subsidiary Kakao Entertainment are seeking to become SM’s largest shareholder and partner, to help rebuild the company after SM’s board of directors terminated a production contract with the company’s legendary founder, Lee Soo-man, on Dec. 31. Lee sold most of his SM shares to HYBE, the home of BTS, on Feb. 22 and won a court injunction Friday that prevented SM from issuing new shares to Kakao. As a result, Kakao has been forced to seek shares from existing SM shareholders instead.
HYBE had sought an additional 25% stake in SM through a tender offer but was able to purchase slightly less than 1% of outstanding shares, the company revealed in a regulatory filing Monday (March 6). That increased HYBE’s ownership stake in SM to 15.8%. With Lee’s 3.65% stake, HYBE has voting power of 19.4% of outstanding shares. The next-largest shareholder, Korea’s National Pension Service, owns 6.2% of SM’s shares.
Kakao and HYBE are locked in a battle for control of SM’s board of directors ahead of the company’s annual general meeting on March 31. “Kakao has strong trust in the excellent competitiveness of SM Entertainment’s current management, employees, and artists, and the current management’s efforts to resolve the factors that hinder SM Entertainment’s growth,” the company said in a statement.
HYBE sees itself as the more skilled, experienced company to guide SM’s global ambitions and has criticized its competitor’s “utterly irresponsible contract” with Kakao.
Kakao and its subsidiary Kakao Entertainment, which raised $966 million from the sovereign wealth funds of Saudi Arabia and Singapore in January, will offer 150,000 won ($115.46) per share — a 25% premium over the 120,000 won ($92.36) per share HYBE offered.
SM’s share price rose 13.8% to 148,100 won ($114.09) on Tuesday morning in Seoul following news of Kakao’s tender offer.
Additional reporting by Jeyup S. Kwaak.
HYBE’s plan to control competing K-pop company SM Entertainment and thwart a partnership with tech company Kakao took another step forward on Monday when Kakao, responding to a court injunction, announced it had canceled its stock purchase agreement to acquire a 9.05% stake in SM Entertainment.
Last week, the Seoul Eastern District Court granted a provisionary injunction against SM’s plan to issue new shares and convertible bonds. The judge ruled that SM had made its decision without shareholders’ consent. It was a remarkable win for SM’s controversial founder, Lee Soo-man, and for HYBE, the reigning K-pop company and home to boyband BTS.
For weeks, SM’s management has been trying to wrest control of the company from Lee, who has been found guilty of embezzlement and exercised iron-fisted control over the company he founded in 1995. After SM made a deal with Kakao, Lee turned to HYBE, which became SM’s largest shareholder on Feb. 22 after it acquired a 14.8% stake from Lee, whose production contract with SM was canceled as of Dec. 31.
On Monday, HYBE sent a letter to SM demanding that “the current [SM] Board of Directors should fulfill its duty of care and duty of loyalty towards SM and actively exercise the right to terminate the business cooperation agreement, which contains clauses that are disadvantageous to SM and advantageous to Kakao,” according to a statement that described the letter.
With the injunction in place, HYBE also called for SM to exercise its right to withdraw the recommendation of the director candidate nominated by Kakao. SM had put forward Jang Yoon-Joong, Kakao’s global strategy officer, as a part-time director.
SM and HYBE are pushing competing visions for SM’s future before shareholders vote on a new board of directors at SM’s annual general meeting on March 31. SM wants to partner with Kakao – owner of the Melon music streaming service and KakaoTalk messaging service – to better monetize its intellectual property and launch a joint venture in the U.S.
Called “SM 3.0,” the road map calls for SM to break from the single-producer system maintained by Lee until his removal. Instead, SM wants to develop artists through multiple labels and production centers in Korea, Japan, Southeast and the U.S.
HYBE calls an SM-Kakao tie-up an “unfair partnership” that would give Kakao permanent and exclusive rights to distribute SM’s music, protect SM’s equity at the expense of other shareholders and create conflict of interests that favor Kakao. “We believe that these details demonstrate the bias and irrationality of the current SM management who approved such arrangements,” Jung Jinsoo, HYBE’s chief legal officer, wrote in a letter to SM shareholders on Thursday (March 2).
