The world of Scott “Scooter” Braun, PvNew’s Music Mogul of the Year, is a whirlwind, with pop stars like Justin Bieber and Ariana Grande relying on him for professional and personal guidance, a staff of 39 who look to him for leadership and an industry that banks on him for hit songs, TV shows and movies. And his workload is about to get heavier, thanks to a megamerger agreement between Braun’s Ithaca Holdings and South Korean entertainment conglomerate HYBE earlier this year.
A polarizing figure amid the changing dynamics in the music business (just ask Taylor Swift fans), Braun has wrestled with how he’s viewed by his peers and the populace. First touted as a Svengali figure with a magic touch for making young artists pop, Braun became the rare industry insider with a public persona, accumulating more than 7 million followers across Twitter and Instagram. As his social media reach and net worth ballooned, critics (and competitors) might contend that ego got the best of Braun.
If one were to dissect the self-made industry titan’s path to success, Braun has clearly been a calculating figure in his years-out development of artists’ careers, but he’s also demonstrated a Forrest Gump-ian quality of being in the right place at the right time and, more recently, an understanding and appreciation that the universe lets the chips fall where they may.
“When Scooter finds something he is passionate about, he dives all the way in,” Bieber tells PvNew.
A recent example of Braun’s good fortune: when opportunity met preparation in the form of the $1.05 billion acquisition of his Ithaca Holdings by HYBE, the entertainment giant that brought K-pop sensation BTS to the world.
Ithaca is home to 15-year-old SB Projects, a management company with Bieber, Grande, Demi Lovato and J Balvin among its two dozen clients; Big Machine Label Group, a record company and publishing concern; a wide range of content businesses, from documentaries to TV series to VR; and apparel and wellness ventures.
Braun wasn’t looking to sell, but one mid-pandemic walk with former Disney executive Kevin Mayer triggered a rumor, which led to a phone call from Bang Si-hyuk, or “Chairman Bang” as the Seoul-based entrepreneur is known colloquially. Within weeks, the deal had quietly closed and Braun officially entered the exclusive billion-dollar dealmakers’ club.
Braun is believed to personally have netted more than $400 million in the transaction merging the two companies under HYBE, which trades on the Korea Exchange. He also worked into the deal $50 million in stock disbursements to longtime clients (Bieber and Grande both received the equivalent of $10 million in HYBE shares) as well as SBP executives (like Ithaca partner and SBP president Allison Kaye, an equity participant) and friends “who helped along the way.”
That gesture, too, had a little something to do with the universe. Following his 2019 purchase of Big Machine, and with it the rights to the master recordings of Taylor Swift’s first six studio albums, Braun faced a public drubbing from the pop superstar and her legion of fans, who, arguably at the singer’s behest, took to social media to label him a “bully” for stealing her hard-earned IP without reasonable terms for its return. (Swift has been fastidiously — and very publicly — re-creating her older albums one by one as rerecording restrictions expire.)
Braun’s defenders say that it’s all just business. And certainly that factored into his decision to sell the Swift assets to Shamrock for north of $300 million last year. The deal yielded him more than $160 million, and equally valuable, Braun was able to divest himself of the Swift drama and relentless trolling.
Others have come after Braun, but he prefers to focus on planet-aligning, full-circle experiences, like one he had recently. After SB Projects won the race to sign 17-year-old Australian sensation the Kid Laroi, Braun marveled when he learned that the artist’s lawyer, Robert Allen, was the same person who handled the first major deal of Braun’s music industry career: a $1 million publishing advance for the artist Asher Roth based on the rapper’s breakout 2009 hit “I Love College.”
Then 28 and living in Atlanta after dropping out of Emory University, Braun was weeks away from “going broke” when he booked successive dinners on the same night with two major music publishers at nearby restaurants and made sure both decision-makers saw each other as one left and the other arrived. As Braun recalls, “What was going to be a $250,000 deal went up to $1 million with a bidding war within three days, and the commission saved the company.”
Indeed, were it not for Braun’s $150,000 cut, Bieber may never have made it outside Canada. As the story goes: One night in 2007, Braun happened upon a YouTube video of a 12-year-old kid busking in a Stratford, Ontario, street — he was singing a Ne-Yo cover — and was blown away by what he heard. Today, Bieber is the most followed musician on Twitter (with 113 million and counting), notching world tours and platinum-plus sales for each of the six studio albums he’s released since 2010. Bieber’s current single, “Peaches,” is the latest in a string of undeniable cross-format hits, with 2 million song project units, or 276 million streams, consumed since its March release, according to Alpha Data.
“Scooter’s creativity and ingenuity have helped so many artists chart new paths to success, and opened avenues for others to follow,” says Daniel Ek, co-founder and CEO of Spotify. “It’s that visionary approach, and dedication to creating lasting opportunities, that makes him an unparalleled force.”
Adds Chairman Bang: “When we first made the deal with Ithaca Holdings, I thought I was simply acquiring a company. However, as I began having deeper conversations with Scooter, I came to the realization that I was gaining a valuable partner with the deal. I’m older than Scooter, but I take away a great deal of wisdom and life lessons from my conversations with him.”
But while Braun has relished growing his empire, giving his all to his clients for the better part of 15 years, for the first time in his adult life he pressed pause in 2020. The coronavirus pandemic, coupled with his own self-work (including a weeklong digital detox), resulted in what he describes as “a clearing,” and he’s turning the page to an as-yet-unwritten chapter.
In a series of interviews conducted over three days, just ahead of his 40th birthday, Braun laid bare his business philosophy, addressed misconceptions about his character and revealed details of his future plans with HYBE.
The HYBE deal was somewhat of a spring surprise, although it did follow rumors that you were in talks with Kevin Mayer about a possible transaction. What was the genesis of the HYBE talks?
I got a call from JP Morgan saying Chairman Bang of Big Hit Entertainment, now HYBE, would like to talk about our companies coming together. I was open to the conversation. I’ve always admired what Chairman Bang built. He and I started Zooming together weekly, and we barely talked about the business. We talked about our interests, meditation, music, family, and we really became friends. At one point, he said, “In the West, you guys are very transactional — it’s about what the deal looks like, how do we make money on this deal — and in the East, we’re about relationships and how we work together. Throughout this entire process, you haven’t talked to me about the transaction; you’ve talked about the relationship. And that makes me want to do business with you.” We came to a deal very quickly and privately.
You’ve described the arrangement as more of a merger than an acquisition. How do you see the two entities working together?
There’s a tremendous amount of synergies. Our branding teams are talking to each other; artists are meeting each other; they have a top-notch gaming division. I was looking for what can give us a bigger platform, and this was an opportunity to make a worldwide company overnight. It’s business as usual, but with more firepower.
BANG! The new chapter is here. #HYBE X #ITHACA
