For many Korean expatriates, says Sohee Kim on Bloomberg , 2024 is the year when the “Hallyu” – Korean wave – went global. “K-pop stars and Korean actors now habitually beam out… from billboards and vitrines” in a way unimaginable a decade ago. TikTok has fanned a new “global fandom” with “localised” idol groups popping up everywhere. The renowned Korean K-pop agency, SM Entertainment, will shortly “launch its first UK boy band”. The K-pop events market alone was valued at $8.1 billion in 2021 and is predicted to reach $20 billion by 2031, notes Asia Fund Managers . South Korea’s cultural “export hit” is having “a huge economic impact on the country”.
Brian Kim: the mastermind behind Kakao
Against this backdrop, news that billionaire Brian Kim – the force behind South Korea’s ubiquitous Kakao messaging app and the country’s most prominent entrepreneur – has been arrested in a “K-pop stock manipulation case” has proved sensational, says the Financial Times . Kim, 58, who is currently in jail in Seoul, won a takeover battle last year to secure the prize of SM Entertainment. He now stands accused of manipulating SM’s stock price to hinder a rival, Hybe (which manages supergroup BTS ), from acquiring it. Kakao’s chief investment officer is also on trial. Both deny the charges.
The case poses a problem for the authorities, says Reuters Breakingviews . They can’t look weak on financial crime . On the other hand, “a tough crackdown risks… jeopardising the country’s new breed of promising global businesses”. Kim is an undoubted figurehead, having risen from poverty to become one of South Korea’s few self-made billionaires – “a rare feat”, says the FT , in an economy still “dominated by a handful of big conglomerates” known as “chaebol”. The Hindu recently dubbed him “a rags-to-riches visionary”.
Kim certainly grew up in poverty, “at one time sharing a single room with seven family members”, says Bloomberg . Born Kim Beom-soo, to a pen factory worker and a maid, he was the first of his siblings to attend college – studying engineering at the prestigious Seoul National University and offering private tutoring in his spare time to help pay for his tuition. On graduation, he joined Samsung’s IT services unit as a developer specialising in online communication, before launching his own company, Hangame, in 1998, originally as an internet café. The company later evolved to become South Korea’s first online gaming portal. After a stint in Silicon Valley in the 2000s, Kim returned to launch a messaging app, striking gold with KakaoTalk in 2010. The messenger service has about 53 million users globally, 88% of whom are in the domestic market, where Kakao enjoys a 93% penetration rate.
What made Kim super-rich was leveraging this “massive user-base” to expand into a host of new sectors, says Reuters . Kakao moved into online banking , music streaming advertising, shopping and transport . Having floated the group via “a backdoor listing” in 2014, the conglomerate now has roughly 124 affiliates – many of which have been profitably floated. Kakao peaked in 2021 when the pandemic spurred demand – sending shares soaring 90%. Kim, then worth $13 billion, chalked up a remarkable milestone, says Tatler Asia . His “exponential rise” saw him “unseat Samsung heir Jay Y. Lee as the richest person in South Korea”. Kakao shares have since lost some 77% of their value.
Kim used to see getting rich as the measure of a good life, says Bloomberg . “However, after achieving the wealth I aimed for, I was left feeling rudderless and lacking direction,” he said. A life-changing court case should focus the mind.
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