Bang Si-Hyuk cut his teeth in the music industry as an artist—a songwriter. But lately, as founder and now Chairman of HYBE, the South-Korea-based talent agency and technology company behind supergroup BTS, Bang has become better known for his canny strategies and vision as the ringleader of one of the world’s most potent culture companies. Just launched on Korea’s stock exchange in 2020, HYBE is now worth more than $9.5 billion.
In a lengthy Zoom interview with TIME, Bang shared his thoughts on his company’s recent evolution, his sense of personal legacy—or lack thereof—and his responsibility to the people who have buoyed HYBE’s success: the fans who support artists and are invested in their work.
This interview has been edited and simplified for clarity.
HYBE has seen a lot of changes in the past two years. You rebranded Big Hit Entertainment as HYBE and acquired Ithaca Holdings, a U.S. company, and went public on the Korean stock exchange. What have been the most significant changes in the business’ history?
While the vision is not changing, many things have changed over the last two years to implement that vision. First of all, we went from a label that managed one team called BTS to an entity that manages various solution businesses and artists—what we call 360-degree businesses. Further, we’ve merged several IP [intellectual property]Companies and purchased a platform. We were able to create a place that we call our “base” in Korea of course, as well as Japan and the United States. Our territorial expansion has been achieved with three offices.
What did publicizing your work do for you?
Going public can be a great opportunity for any company to obtain resources to pursue its vision and to get social recognition for all the achievements it has made. However, it is not an easy task to deliver the results the market wants and the perception that they are always watching. It can be hard, particularly in Korea, where the market is driven more by its current share and future earnings than it is about potential. Sometimes, the obligations of public companies in Korea are more difficult than they seem elsewhere.
My opinion is that you should not try and match the market’s demands. This would lead to the company making short-term, moment-to–moment decisions, rather than following a vision. And this may not always produce positive results over the long term. Jiwon, our CEO was present when I spoke to him about the IPO. [Park]: “Starting today, I will not look at our stock prices. It seems that your job is to track stock prices, generate annual results and satisfy the market. Presenting our company’s long term vision and moving at times against what the market wants seems like my job.”
In terms of how the market looks at us—before going public, Big Hit Entertainment was a very veiled company. Although it seemed like they were doing something interesting, many didn’t know what we were doing. We looked like a management company that ran a huge IP called BTS, but then started to buy big IPs which were taboo in Korea at the time, while simultaneously operating solution businesses that were originally structured to be subcontracted, even claiming that we’re an IT company, making our own platform and competing in that space. People were curious to know what type of business we ran, but it was hard for them to understand what we did. As we went public and many things literally became public, people’s understanding of us increased significantly.
Because HYBE is still moving so fast, what I’ve been emphasizing to our staff as of late is that the HYBE that the market understands today is the HYBE of a year prior. “We’re doing something completely different on the global stage but there doesn’t seem to be that understanding, so please prioritize that effort,” is what I’ve told them. Because I was interested in attracting attention, Instagram is what I used. [through social media]It could also be an easy way to communicate the ideas. I also thought that if I show who I’m meeting and what I’m doing visually, it could perhaps quickly increase public understanding of our company. To be honest I personally don’t like social media very much, but I made this Instagram account.
What innovative projects is HYBE working on right now?
The market welcomed our announcement that we would pursue NFT trading, while fans expressed concern and sometimes aggressive feedback. All I’d like to say to fans is: As of now, we haven’t announced anything. We haven’t discussed what kind of product we would service or what type of product we would make, although I fully understand the concern. We decided to explore an NFT exchange because we wanted to be able address the concerns ourselves. The artist management company can answer fan concerns directly, rather than being a platform that only moves in their favor. I’m thinking a lot about policies and technical measures that can reflect these concerns as well.
We are doing our best to provide more value and experience to fans while trying to satisfy the market’s quick demands, which can be difficult. However, it’s been quite some time. We have some interesting projects in the works and I think we’ll be able to show them to you soon. And when that happens, I’d like to say cautiously, that perhaps you’ll find yourself not thinking, “These guys don’t understand why we hate this.”
In the last decade, global music has seen some significant changes. Which is your biggest concern for the music industry?
This isn’t an easy question for me to answer because our company structure is so unique—we’re dealing with issues that are quite different from those the global music industry is dealing with. As a businessperson, I typically focus on problems I must deal with, so I’ve never thought deeply about what challenges the global music industry is facing. Personally, I feel that the music industry is suffering in many areas of the value chain. The music business should make more money, and the value they provide as a service should also be acknowledged more. However, the growth of streaming and the ability to record music have been good news for the industry.
Artists today are often frustrated by the pay structure on streaming platforms and traditional labels. What does HYBE do to keep its artists satisfied?
It’s clear that streaming is giving IP holders a considerably smaller amount compared to the pre-existing structure of selling albums, and that this amount has to be even smaller when it then goes to the artists. But if you ask, “Can this be improved in a short time?” looking back on the history of digitalization over the past few decades, it doesn’t seem that easy to me. Platforms that have grown with a basis in music—when you consider how much music played a role in their success, the amount paid to music rights holders is comparatively minuscule. It’s such a small amount that you’d faint if you knew. Can all these problems be solved in a matter of hours? I’m quite skeptical about that.
To be successful, the industry has to have its own power. Making the industry successful has to be a priority, so what we are doing now is expanding the territories that we can control, securing the IP holder and artists’ authority, and building a platform for people who can support themselves without the help of management companies or labels. Weverse, an NFT-exchange. [HYBE’s social media platform]People can choose to pursue music or e-commerce in specific forms. It is possible to reorganize the entire music business in this way, I think. Through that, the valuation of the entire industry should go up—to speak in market terms, the EBIT [earnings before interest and taxes]OR PER [price-earnings ratio] should go up—and then only after that I think the negotiating power regarding streaming and the recorded music business would increase also.
That being said, it can sound like I’m some hero saying I can change everything. I’m frankly answering this question with some embarrassment. Nevertheless, I do think what I’m claiming is quite reasonable. The Korean market’s attitude toward the entertainment industry completely changed within a year since we went public; similar things can be done globally. I also think if other music companies benchmark or compete with the industry models we’re presenting, the overall value of the industry will increase. That’s my point of view.
Finally, I want to address what you specifically mentioned about artists. When artists feel they are being deprived of their rights or that they deserve more from their label or management, I think it’s very case-by-case. In some cases, those sentiments are extremely reasonable, but that’s something the artist has to negotiate through party-to-party deals.
Which values will guide your leadership decisions as a business leader?
For me, the important thing when making a decision about something is the “why”. More often than you’d expect, in a lot of cases, people just do things because that’s the way things have been. This has been the industry’s tradition. This is how albums are made. This is something that I find difficult to accept. So, when I run a business, my focus is always on the question: Why do we do this? What is the purpose of our work? How does this structure reflect the work’s essence? Communicate that information to your staff. I personally think you need to know the “why” in order to determine what to do, and it’s OK to think about the “how” later.
I’m a person who believes companies in general are good. Companies can create wealth and jobs, as well as provide value for society’s problems. However, to make this statement I believe there should be the assumption that the company doesn’t do any negative things beyond what society has allowed. For companies survival is essential. It’s not like our company is a [charitable company or NGO]. [But]My belief is that businesses should be able to operate according to the rules set by society. And I want my company to remain within those guidelines. That’s something I tell my staff a lot as well. Particularly when we think about how young people love our products, artists, and services, we believe it’s a duty to thank them and show the right values for our company.
What legacy would HYBE leave you?
This is always the most difficult question for me to answer, because to be honest I’m not someone who wants to leave something behind. HYBE must continue its independent existence after my departure from HYBE. HYBE should not fall because I’m no longer there, nor should it waver between paths out of consideration for my legacy. Never have I ever thought about leaving a legacy. I’m sure there are cooler things I can say instead, but if the word “legacy” itself implies a time after I’ve already left, I feel that’s their responsibility.
—Translation by Sangsuk Sylvia Kang
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