Agency Behind K-Pop Phenomenon BTS Goes Public In Blockbuster IPO, Mints New Billionaire

Big Hit Entertainment, the agency behind BTS, K-pop’s most popular boy band, raised 963 billion won ($840 million) from 7.13 million newly issued shares, marking South Korea’s biggest IPO since 2017, when Celltrion Healthcare raised 1 trillion won. The IPO was oversubscribed by more than 1,100 times by institutional investors. The company’s shares began trading on Thursday, making its founder, Bang Shi-hyuk, South Korea’s newest billionaire. 

 Shares opened at 270,000 won, above its IPO price of 135,000 won per share, boosting Big Hit’s valuation to more than 9 trillion won. Bang, 48, who now owns just under 35% of the company, currently has a net worth that Forbes estimates at $3.2 billion.

The seven members of BTS, all in their twenties, also got a windfall: Each of them are now multi-millionaires through shares given to them earlier by Bang.

Big Hit’s mega listing has taken place amid the country’s second wave of the coronavirus outbreak; in March the pandemic forced BTS to postpone all of its live concerts for the remainder of the year, including those in April for which tickets had already been sold. In 2019, the band’s eight-month Love Yourself World Tour reportedly pulled in more than $196 million.

Thanks to the band’s worldwide success, Big Hit is now South Korea’s most profitable entertainment agency reaping $63 million in net profit on $507 million of revenue in 2019, besting K-pop agency incumbents SM, YG and JYP Entertainment, known as the “Big Three”. That same year, BTS debuted on the Forbes Celebrity 100 list and became Asia’s highest earning band before taxes. 

 Bang worked as a composer for JYP before starting Big Hit in 2005. The company enjoyed early success with 8Eight, a vocal group trio, and 2AM, a four-member boy band it co-managed with JYP. In 2010, Bang signed BTS’ first member, RM, then a 15-year-old rapper.​

With catchy beats, lyrics that explored societal issues and a strong social media presence, the band took off, garnering fans in nearly every corner of the world. 

In 2018, the band’s album, Love Yourself: Tear topped the Billboard 200, the first Korean album to sit atop the U.S. ranking. The following year, the seven-member act scored three No. 1 albums on the same list—the first band to achieve the feat since the Beatles released their archive tracks 25 years ago. 

From 2016 to 2019, Big Hit’s annual revenue grew more than 1,500% while net income jumped eightfold over the same period. But as live events, a major revenue driver, remain at a standstill, sustaining that momentum will be challenging. In April, Yoo Sung-man, an analyst at Hyundai Motor Securities, slashed his earlier forecast of $616 million in revenue to a mere $277 million for the agency this year. 

Bang’s distant cousin, Bang Jun-hyuk, founder of online gaming firm Netmarble, is also a billionaire with a net worth of $2.8 billion. The company was an early investor in Big Hit and remains one of its largest shareholders with a 20% stake.