The best way to start a new kpop company: debut a known solo artist, not a group

There have been threads pointing out how rare kpop solo debuts are, especially from the big companies (SM, JYP, Hybe, YG), because it is more profitable now to stick to groups.

Solo artists have their negatives, but one good thing about them is that they are much easier to start up, especially if the idol is already known. This can be great for new companies because it takes years to develop trainees (with large up-front costs), and it is hard to compete for the best trainees when you are just starting. This lowers the quality of the first group and sets the company up for a downward spiral.

One obvious example of this strategy is The Black Label. Teddy needed an act to put TBL on the map in the kpop world, but couldn't use a group because the company just started (so it didn't have the mature trainees) and he was focused on Blackpink. Of course, TBL could just fall back on Teddy's name as BB/2NE1/BP's producer, but that would only get TBL so far. Teddy needed a way to establish TBL and attract top trainees for his planned next GG. He was even competing with YG, unless he wanted their rejects.

So Teddy recruited Somi as TBL's first kpop act. Now Somi is basically TBL's ambassador with how she promotes the working environment at TBL on TV and in her YT 'I am Somi' vlogs as well as her other social media. Plenty of potential trainees probably had no idea TBL existed before Somi. Now it seems like TBL is preparing for the next step (debuting a group) with their recent expansion, including hiring staff from the big 4.

P-Nation had a similar approach, but with more solo artists, before eventually debuting a group.

Quote from stan12345

I disagree and I don't think the examples you use work either - companies such as P-Nation and The Black Label already had large capital behind them and intangible assets due to who runs them. The Black Label is a subsidiary of YG so very different as well.

There's never a dearth of talent leaving the bigger agencies or who might be enticed with debuting sooner. If you have the ability to get one singular known idol I'm not sure why you wouldn't just get 4 and make a group, or get 1 known one and build a group around them. Initial costs will be higher yes but soloist on average bring in less money and multiple idols in a group means you spread your risk and there are also more avenues to Revenue.

Somi's debut was hardly some massive success, so if you're genuinely a new kpop company you'd already be questioning the value of the product. You'd need this imaginary soloist (or Somi in this example) to make enough money consistently to build up your assets over a few years. I'm sure Teddy could have got good talent together to debut a group but for him I can imagine the restriction more than anything is how long it takes him to make music nowadays. There's no point having the payroll of 5 idols on your books when you're taking 2 years to come up with music.

People not knowing The Black Label existed when Teddy is one of the biggest names in kpop doesn't really work for me either. You think idols are more likely to go to The Black Label now because of Somi, more so than having arguably the most prolific producer in kpop history? Makes no sense to me. Same with Psy's label, he's one of the biggest names in music in SK.

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The benefit of a soloist(s) is not only that they are a much cheaper initial investment, it's also that they can fail with a lot less at stake. For big names like Psy and Teddy (and many companies are started by big names in the industry), a failure of a group will be seen as the company's and/or their own failure, whereas the failure of a soloist will be more likely to be seen as the soloist's failure since they are under their own name. A group failure could shake confidence in them and their company more so than a soloists'. So soloists are safer when a company is going through the early growing pains, particularly if they are careful about overspending on promotion and have modest expectations, at least at first.

Even in the worst-case that the soloist(s) are not making any money after expenses, they are still promoting your company. So it's only a bad idea if they are losing so much money that other forms of advertising would be cheaper. It is easy to control spending on soloists though, since almost all of the cost is in promotion, which is easy to change.

This advertising is important, even for names like Teddy, because there is so much competition. It makes a big difference to see the name of the company behind a known artist on TV or on social media, especially for young potential trainees (12-16) who might not even know the CEO/producer. Psy is a bit different because he is still a popular artist himself, so he could take the place of the soloist in this example, but that makes the first point is even more important because reputational risk is higher.

Getting multiple known soloists is difficult. Getting multiple known idols to join a group, together, is much more difficult. Even with Gfriend's disbandment only one group was formed with only three of the members, and that's near the best-case scenario. Veteran idols don't tend to want to join a new group. The other main source of known idols are from survival programs, and that's not a bad idea, but you almost always need to train them and other trainees for at least a year, so you still have the up-front cost problem. The new companies that do this tend to rush it as a short-term cash grab before the next program comes along, which is not the type of company I'm talking about.

Quote from stan12345

Soloists are also much more likely to make less money. I don't think the margins or profit for either will be inherently different, but as kpop as a genre is built around groups it will bring ore attention.

Soloists promoting a company is irrelevant in this comparison, why can a group not do that. You're overstating the importance of Somi way too much to something like Black Label. Producers have an immense amount of pull and we've seen BEP have success through StayC with it.

If you're a company looking to go into kpop, you're going to have capital and investment.

Groups have much greater upfront cost and much greater fixed costs (housing, food, training etc. for multiple people vs. some training, maybe, and a loan, "music advance", that the soloist usually needs to pay off). Wonder why Western labels don't usually bother with groups? That's why. They don't lose much if the artist fails. They only lose if they attempt, and fail, to make an artist big by heavily promoting them and pushing them on radio, which is rare.

Low risk, low reward is better for a new company than high-risk, high reward. Eventually, once you have built up a competent staff with experience working together, established your company's name beyond industry insiders, and built up a strong roster of trainees, you debut a group.

StayC was risky. If they failed BEP may be fine, but would the company have survived?

If Somi failed, and she did partially fail at first, TBL would have been fine, and they would have learnt something from the failure. For now they are making very good low-risk income from a equal mix of music and endorsements.