YG Entertainment

Y.G. Entertainment Inc.
YG 엔터테인먼트

Type	Public
Traded as	KRX: 122870
Industry	Music Entertainment Fashion
Genre	Hip-hop R&B Electronic Dance Pop
Founded	February 24, 1996
Founder(s)	Yang Hyun-suk
Headquarters	Seoul, South Korea
Area served	Worldwide
Key people	Yang Hyun-suk (CEO) Yang Min-suk (CEO)
Products	Albums Concerts
Services	Publishing records, Entertainment agency
Revenue	US$91 million (2012) [1]
Operating income	US$17 million (2012)
Net income	US$15.6 million (2012)
Owner(s)	Yang Hyun-suk (35.7%) M&A Fund (11.9%) Yang Min-suk (7.3%) CJ E&M Corp. (4.1%)
Employees	254
Subsidiaries	YGEX
Website	Official Website Official Ebay Store Official Youtube

YG Entertainment (Korean: YG 엔터테인먼트) is a record label and talent agency founded by Yang Hyun-suk based in Seoul, South Korea. It produces and markets music recording/publishing, record manufacturing/sales, artist management, concert production, and new artist discovering/training. YG is an abbreviation for "Yang Goon", a nickname given to the Executive Director Yang Hyun-suk.

Once the home of hip-hop groups Jinusean and 1TYM, its current roster of recording artists are known to be some of the biggest K-pop acts internationally. Big Bang, 2NE1, Epik High, Lee Hi, and PSY have proved to be the front runners.

Today, YG Entertainment is known as one of the "big three" record companies in South Korea, along with S.M. Entertainment and JYP Entertainment, for their large market share. Official contents by YG Entertainment and its artists have cumulatively garnered more than 4 billion views and are subscribed by more than 10 million users on YouTube, making them the most viewed and most subscribed artists and entertainment agency in Asia-Pacific.

YG Entertainment's records are distributed by KMP Holdings in Korea, WMG in Taiwan, and Japan operations are managed by YGEX, a collaboration label between AVEX and YG Entertainment. The company officially became a publicly traded company on November 23, 2011. In 2012, YG Entertainment's share prices saw a year-over-year increase of more than 60% due to the increase in publicity following the achievements of multiple artists on the label.^[2]

History

Hip-hop roots

On March 1996, Yang Hyun-suk, a former member of legendary Korean band Seo Taiji and Boys, founded YG Entertainment along with his younger brother Yang Min-suk. During their early years, the company put out groups such as Keep Six, Jinusean, and most notably 1TYM (pronounced "One Time"), who was credited with bringing hip hop to the Korean mainstream. In 1999, the company's artists released their first collaboration album under the name "YG Family".

The label followed with releases from Perry, Swi.T, Big Mama, Lexy, Gummy and Wheesung, with Wheesung eventually becoming Korea's highest selling artist of 2003. The YG Underground label was also created to contain 45RPM and Stony Skunk. In 2001, a second YG Family album was released, on it featured a 13 year old G-Dragon .

The company grew with signing its first idol singer Seven, who found success in both Korea and Japan and was dubbed Rain's rival at the peak of his career. However, a dating scandal in 2004 with then labelmate model/actress Park Han-byul caused his career to plummet, which led to his 4 year hiatus in Korea and ultimately his US debut without much success. It was revealed many years later that YG Entertainment had many secret relationships amongst its artists. In addition to Se7en and Park Han-byul, CEO Yang Hyun Suk eventually married Swi.T member Lee Eun Joo after secretly dating for nine years. Jinusean's Sean and YG actress Jung Hye Young also tied the knot. Teddy Park of 1TYM and Lexy; as well as Wheesung and Gummy, all dated for a prolonged period of time when they were under the label.

Mainstream success

The company then turned its focused on creating its first idol group Big Bang. Trainee G-Dragon and Taeyang had been with the company since they were just twelve years old. However, Wheesung felt neglected and left the company in 2006. 1TYM and Seven were both inactive. Big Bang debuted as the youngest group at the time (average age of 17) with lukewarm reception. YG's future looked to be bleak, until Big Bang skyrocketed in popularity during 2007 and 2008 with G-Dragon's self composed songs such as "Lies" and "Haru Haru", which stayed at #1 on the charts for eight consecutive weeks, the longest since, ironically, Seo Taiji and Boys. Girl group 2NE1 debuted in 2009 and quickly set out to break boundaries and become one of the industry's leaders.

Big Bang branched out into Japan during this time while still focusing on solo activities whether it be film, television, and/or theatre. Taeyang was the best selling solo artist of 2008. G-Dragon had the highest selling album of 2009, beating out groups with 10+ members and industry veterans. All members of Big Bang have now released one or multiple albums as a soloist and/or duo, and the group completed their first full fledged world tour with over 800,000 attendees in early 2013.

In 2010, YG made a highly publicized move into a luxurious new building, while the old building became a training facility. YG first applied to the stock exchange in mid 2010 but was rejected. It is suspected that the reason was because YG Entertainment had too few active music groups and an unstable cash flow, despite increasing earnings in Korea and Japan in 2009. To put things in perspective, every year since Big Bang's debut (2007–Present), they have attributed to more than 60% of the company's revenue.

Business expansion

The label expanded by signing already established acts such as Psy, a renowned rap artist; and Tablo, a lyrical savant from the group Epik High. In Korea, both were known to be rebellious independent acts and dealt with large controversies. YG, a personal friend of Psy, offered to help when Psy struggled financially. However, Psy was hesitant to sign unto the label due to its extravagant image and young roster. It took convincing from his wife to revitalize his career and ultimately create the phenomenon known as the "Gangnam Style". Tablo at the time was suffering from depression, as over 200,000 Korean netizens in an online community called Tajinyo accused him of forging his identity and Standford academic degree. His first meeting with YG representative was set up by his wife, then YG actress Kang Hye-jung.

CEO Yang Hyun Suk made his television comeback after ten years as a judge on the reality singing competition K-Pop Star in 2012, and signed the runner up of the show, Lee Hi, to her own record deal. She released her first solo album in 2013, at age sixteen. CEO Yang Hyun Suk has also participated in the second season of K-pop Star 2, and have signed an exclusive contract with the winner and runner up of the show, sibling duo Akdong Musician and Bang Yedam respectively. The label currently has over 30 trainees, and is slotted to debut a multi-membered boy group later this year.

YG Entertainment eventually passed the Stock Exchange Commission’s screening to go public on the KOSDAQ on November 23, 2011. The stock price opened at double the anticipated value. The company filed its first annual report in 2012 with a net gross of over 50%.

Partnership

During YG Entertainment's early years, the company often collaborated with other Entertainment companies to introduce new artists. They have had partnerships with M-Boat Entertainment, EunGun Entertainment, Yamazone Music, and Booda Sound. Big Mama and Soul Star were collaboration projects with EunGun Entertainment and M-Boat Entertainment. When the artists' contract terminated, their respective Entertainment partners ended their activities with YG Entertainment as well. Today, YG Entertainment has become a top agency in Korea for their abundant resources and financial backing.

YGEX

YGEX logo

YG first expanded into the foreign market with Se7en, in a partnership with Nexstar Records, a Nippon Columbia label that managed Japanese releases for Se7en.^[3] In 2008, Big Bang signed a 3-year exclusive contract with Universal Music for the promotion and distribution of their Japanese Releases.^[4]

On April 12, 2011, YGEX was established as a partnership between AVEX and YG Entertainment for the promotion and release of all YG Entertainment's material in Japan. Current artists under YGEX include all active YG Entertainment artists.^[5] YGEX operates as a joint-label venture between the two companies. Since the partnership, YGEX has already released Japanese material for: GD & TOP, Big Bang, 2NE1, Se7en, Gummy, and Daesung. There was also a noticeable increase in promotional activities in Japan. Seungri and Daesung were also given the opportunity to host their own Japanese programs.

KMP Holdings

KMP Holdings (acronym for "Korean Music Power") (Hangul: KMP홀딩스) was established on March 2010 via a joint venture between YG Entertainment, SM Entertainment, JYP Entertainment, Star Empire Entertainment, Medialine, CAN Entertainment, and Music Factory. KMP Holdings encompasses many fields including: music service, digital music distribution, and TV program production. It is a service platform that works to provide a more reasonable digital music system.^[6] Many believe this is held to challenge the duopoly on music distribution by Mnet Media and LOEN Entertainment.

KT Music acquired KMP in November 2012.^[7]

United Asia Management

SM Entertainment, YG Entertainment, JYP Entertainment, KeyEast, AMENT and Star J Entertainment are under a joint management agency named "United Asia Management". Established on April 2011, this joint corporate was created in an effort to push Korean and Asian music using a database system that manages intellectual property rights. UAM also acts as a global agency for artists' advancing or promoting overseas. There is a theory that UAM was created to allow less leverage for trainees under these companies.^[8]

Live Nation

YG Entertainment first teamed up with Live Nation in 2012 to produce Big Bang Alive Galaxy Tour 2012. Plans for a world tour were in place in 2011 until several members of Big Bang faced problems with the law, causing it to be postponed until the following year. This marks the first time Live Nation has worked with an Asian artist. Their goal is to stage a production, in which the performance is not the only important piece, and set a new standard in the global industry.

Subsequently, Live Nation also directed "2NE1 New Evolution World Tour 2012", and G-Dragon 2013 1st World Tour: One of a Kind. Live Nation first approached YG Entertainment with the idea as they have seen the confirmed the growth potential of K-Pop. Mats Brandt, General Manager of Live Nation Asia, said in an interview: "...of all the artists we have decided to focus on the talents of BIGBANG. BIGBANG has the talent, thus they have the best chance at becoming a global artist."^[9]

Cheil Industries

YG Entertainment and Samsung’s Cheil Industries announced a partnership on June 28, 2012, with the two companies looking to launch a new global young fashion business. According to the two group’s plans, they will work to create new products that combines cultures, music, and design. YG Entertainment is known for their luxurious and bombast fashion, and G-Dragon and CL are both highly regarded fashionistas in Korea. The launching of the new brand is targeted for the spring season of 2013, and it is assume that YG artists will be personally involved.^[10]

eBay

YG Entertainment became the first company from Korea to open its own store on eBay on July, 2012. Big Bang became the first Asian artists to have their exclusive store on eBay. The company worked with eBay Korea to create a new way for international fans to buy musical albums and official merchandise of YG artists. On its first day of opening, the store sold over US$70,000 worth of goods and broke eBay Korea's record for highest sales in a 24 hour span.^[11]

Asiana Airlines

As one of two of Korea’s major airlines, Asiana Airlines signed a deal with YG Entertainment on January 2013 to provide transportation to its artists to and from domestic and international destinations at no cost. In return, YG Entertainment will be placing the airline’s logo throughout their international concerts and tours.^[12] Big Bang is currently the endorser for Jeju Air.

Philanthropy

Headed by Sean of Jinusean and wife/YG actress Jung Hye Young, YG Entertainment is heavily involved in their community service campaign WITH. The company pledged donate 100 won for every album sold, 1% of all merchandise sales, and 1,000 won for every concert ticket, to charities. In 2009, they raised US$141,000, only to surpass it the following year with US$160,000. Of the total, US$87,000 went towards a scholarship for Holt Children’s Services while US$69,000 went towards children with rare diseases. YG Family have also directly delivered US$4,400 worth of charcoal to families in need during the winter time.^[13] The company has also announced that it would be donating around US$500,000 for disaster relief to Japan after the 2011 Tōhoku earthquake and tsunami.^[14]

All YG artists have been known to ask their fans to donate money to charity instead of buying them gifts, and they would match the amount fans have donated. As a company, they have jointly participated in many charity auctions. For K Auction's ‘Love Sharing Auction’, Psy‘s famous sunglasses, tickets to his Seoul concert, Big Bang‘s T.O.P, G-Dragon, and 2NE1‘s CL‘s stage outfits, were all available to the highest bidders. For Sean and the Purme Foundation's "The 10,000 won Miracle Project" that asked people to donate 10,000 won a day for 365 days (approx US$3,370), many artists donated 20,00 won a day, or even 100,000 won a day in order to raise US$33.7 million to help build the hospital.

A portion of the profits from BIGBANG’s Alive World Tour, 2NE1's New Evolution World Tour, and G-Dragon's One of a Kind World Tour, were all donated to the Korean Committee for UNICEF to fund for vital vaccinations for around 600’000 children.

In 2013, founder and CEO Yang Hyun Suk, made headlines when he donated all of the dividends he receives as a shareholder of YG Entertainment to help young children needing surgery. His dividends totals to around 1 Billion Won, or approximately $1 Million USD.

YG Family

Recording artists

¹Psy was formerly part of LNLT Entertainment before transferring to YG Entertainment in 2010. He released his fifth album through his new label. Psy's sixth album which contains the international hit Gangnam Style is his second album under YG Entertainment.
²Epik High transferred from Woollim Entertainment after their contracts had expired. Tablo had previously joined YG Entertainment in 2011, where he released his first solo album, Fever's End. The remaining members of Epik High, DJ Tukutz and Mithra Jin were signed on the following year (2012) where they also released their seventh album 99.