BTS management buying up smaller talent agencies to diversify income and build its brand

People talk about ‘the next BTS’, but for the supergroup’s label, it has become something of a priority

Big Hit Entertainment is acquiring smaller companies to avoid being dependent on the band

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BTS earned hundreds of millions of dollars for their label, but Big Hit Entertainment needs to diversify to remain strong.

Published: 2:30am, 28 May 2020Updated: 2:30am, 28 May 2020

K-pop superstars BTS are undoubtedly a huge financial blessing for their record label/management agency Big Hit Entertainment. Thanks to the smash hit album Map Of The Soul: Persona and sell-out concerts worldwide, Big Hit posted record sales of 587.2 billion won (US$472.2 million) in the 2019-20 financial year, with net earnings reaching 72.4 billion won.

At the same time, it could be argued that Big Hit’s heavy reliance on BTS poses a risk for the company as well. It presents a fundamental hurdle that the company must address to grow bigger and remain strong going forward, to prove that its achievement isn’t just tied to the success of a single artist or a franchise.

Clearly aware of this situation, the company, founded by producer Bang Si-hyuk in 2005, has been on course to methodically reduce such risk by acquiring smaller but strong talent agencies, investing in and developing new projects, and expanding into non-musical businesses.

Big Hit’s latest acquisition is Pledis Entertainment, a mid-sized talent agency that manages popular boy bands NU’EST and Seventeen. Pledis, established in 2007 by Han Sung-soo, is a seasoned entertainment company, responsible for popular artists, such as After School and Son Dam-bi.

BTS perform on ABC's Good Morning America in New York in 2019. Photo: Scott Roth/Invision/AP

The deal announced on Monday had been an open secret within the industry for some time, with media reporting on the upcoming purchase since January. Big Hit had denied the reports.