YG Entertainment: The Rise and Fall of a K-pop Empire
Published February 10, 2025
It’s no secret that YG Entertainment has been a dominant force in the K-pop industry, but in recent years, it seems like the company has been facing a few hurdles. From the closure of its actress management division to the shutdown of various other business ventures, it’s clear that YG is going through a rough patch. Let’s take a deeper dive into the company’s recent challenges and what the future might hold.
The Rise and Fall of YG’s Side Ventures
YG Entertainment has always been known for thinking outside the box. Back in 2017, they ventured into the food industry, launching restaurants and cafes not just in Korea, but around the world.
They even built a massive K-pop theme park in Jeju Island, complete with rides and a museum showcasing G-Dragon’s art. This location, which was blessed by G-Dragon himself before his military enlistment, aimed to become the “Disneyland of K-pop,” with a vision of creating a high-end entertainment experience.
Unfortunately, things didn’t go as planned. By 2018, the food business started to struggle, with a deficit of 3.2 billion KRW in its first year. The scandal involving former BIGBANG member Seungri didn’t help matters, and the losses continued. Despite an ambitious expansion, the business began to close its locations, including the last one in Malaysia. It was a tough pill to swallow for YG, as they’d hoped to position themselves as the “Nike of Southeast Asia” in the sports industry with their golf business. However, this venture also struggled financially, and by 2023, it was shut down too.
YG’s Struggles with Entertainment
While YG is best known for its hit-making abilities in music, their foray into TV production also had its ups and downs. The production company Studioplex produced some notable hits, such as Mr. Queen, a historical drama that garnered high viewership, but also some flops like The Exorcist that was cancelled after only two episodes
By 2021, YG’s revenue took a significant dive, dropping by about 95% by 2023, and with a debt-to-equity ratio of 800%, the company had no choice but to close Studioplex.
Now, the latest move from YG is the closure of their actress management division. This change doesn’t mean they’re firing their actors; rather, they’ll let current contracts run out without renewals. This leaves YG with only a few active groups—BLACKPINK, Baby Monster, and Treasure—while WINNER is largely inactive.
The Blackpink Dilemma
As YG’s most successful group to date, BLACKPINK’s future is crucial to the company’s survival. However, with the members starting to focus on their individual careers, there’s growing uncertainty about the group’s future together. Rosie, who has already launched a successful solo album, could likely continue her career on her own, but the other members may need more time to establish their solo personas. If BLACKPINK members can’t fill arenas on their own, YG might have to reconsider their plans for a group comeback.
YG’s reliance on BLACKPINK’s success has proven to be a double-edged sword. The company’s strategy of positioning their artists as exclusive, high-end superstars worked—until it didn’t. The market’s appetite for this type of positioning is starting to fade, and YG hasn’t been able to deliver another major hit group to fill BLACKPINK’s shoes. Baby Monster, the next hope, may take some time to build momentum, and it’s unclear whether their image will be enough to recreate the magic of BIGBANG or BLACKPINK.
The YG Way: A High-End Gamble
What sets YG apart from companies like SM Entertainment or HYBE is its philosophy on quality over quantity. YG’s strategy has always been about producing fewer, high-impact groups and creating a luxury brand. The problem is that this exclusive approach has its limits in a market that demands constant content. While companies like SM and HYBE have managed to diversify and produce multiple groups at once, YG has stuck to its “quality” mantra—and the results haven’t been as profitable as expected.
As we watch the decline of some of YG’s business ventures and the uncertain future of BLACKPINK, it’s clear that they need to rethink their strategy. The company that once aimed to be the “Disney of K-pop” is now struggling to maintain relevance in an ever-changing industry.
What’s Next for YG?
The future of YG Entertainment is unclear. With its current roster of groups and business ventures facing challenges, the company might have to pivot to stay afloat. Whether that means embracing innovation like HYBE’s foray into gaming and IP development or rethinking their exclusive positioning, YG will need to find a way to evolve and connect with a new generation of K-pop fans.
YG has a history of making bold moves, and only time will tell if they can turn things around. For now, fans can only hope that their favorite groups—whether BLACKPINK or the new talents emerging—continue to shine, even if the company that brought them to the world is facing turbulent waters.
In the ever-evolving world of K-pop, companies like YG must constantly adapt to stay relevant. While the company’s attempts to diversify have faltered, it’s not all doom and gloom. The talent is still there, and with the right strategy, YG could make a comeback. Let’s hope they find a way to turn the page and enter a new era of K-pop innovation!
FRESH POSTS
