VCs who bet on RESCENE before the breakout are now eyeing a jackpot

The venture capital firms that backed The Muse Entertainment — the agency behind girl group RESCENE — before the group had made a name for itself are now on the verge of reaping their rewards. Their early bets on an unproven startup agency, placed when its commercial prospects were far from clear, are drawing fresh attention as RESCENE's market performance has vindicated those initial calls.

Institutional investment in The Muse Entertainment began in earnest in 2023, before RESCENE's debut. The company raised 1 billion won ($718,000) in a pre-Series A round in April of that year, with Smart Study Ventures and Byfoem Studio among the participants. By October of the same year, Amantani Partners, Venture Square and BDC Labs had joined the shareholder register as major investors. An additional 1.5 billion won followed in October 2024. Across four rounds through 2024, the company raised a cumulative 3.34 billion won.

Of those investors, Venture Square was the earliest to spot The Muse Entertainment's potential. Through its "Venture Square BDC Startup Investment Association No. 1" fund, the firm put in 50 million won in March 2021, when the company's valuation stood at just 800 million won. Venture Square CEO Myeong Seung-eun said the venture capital industry now values The Muse Entertainment at around 100 billion won — roughly 125 times the level at which his firm first invested.

Myeong said The Muse Entertainment CEO Lee Ju-heon had built strong industry connections through his own career as an artist and his involvement in producing music for acts including T-ara, Davichi and DIA. "We also took note of the fact that Lee, a Berklee College of Music graduate, could handle planning, composing and producing himself," Myeong added. He said RESCENE's recent success "means the production capabilities and ability to develop artists through digital channels that we expected back then are now being validated by the market."

Smart Study Ventures, a venture arm of The Pinkfong Company, also invested in The Muse Entertainment in April 2023. Its "Baby Shark Next Unicorn IP Fund" held a 12.5 percent stake in the company as of October 2023, representing an investment of around 100 million won.

Smart Study Ventures built its track record by turning character intellectual property such as "Baby Shark" into global content franchises. Its decision to back The Muse Entertainment appears to have been driven by the belief that the agency could develop its artists not merely as singers but as scalable content IP. RESCENE has in practice done exactly that — turning each member's individual personality into YouTube content to build a following, a strategy that helped spark the chart comeback that brought the group to wider attention.

Entertainment remains one of the hardest sectors for venture investors to call correctly. According to the Korea Creative Content Agency, as of August 2025 there were 6,760 registered companies in the popular-culture arts planning business, a category that includes talent agencies. With thousands of companies launching new artists every year, the statistical odds of any single startup agency breaking through are close to one in 6,000.

The entertainment industry is also inherently difficult to forecast. Unlike conventional industries where a product can be tested against the market after launch, content requires producers to judge commercial viability and commit production budgets before audiences have had any say. Korea Venture Capital Association Chairman Kim Hak-gyun said predicting what people will want at any given moment involves too many variables. "I understand that returns from entertainment funds are not high — which means there are a lot of failures," he said.

Project investments targeting unproven startup agencies or specific artists carry even greater uncertainty. Kim said that while investing in an established company at least offers a track record and existing business performance to assess, project investments require betting on commercial potential alone, making them far more speculative. "It is very unusual for a startup agency — not even a major label — to grow to the point where project investors can actually recoup their money," he said.

Attention among early investors is now expected to shift toward exit strategies. While the exact timing will vary depending on when each fund was formed and when it matures, the typical venture fund lifecycle suggests exits will begin rolling in from this year through the early 2030s. Actual returns will ultimately depend on the price at which each investor sells its stake.

The rapid rise in The Muse Entertainment's valuation has also reshaped its fundraising strategy. The company recently closed a Series A round with participation from K-Net Investment Partners and JB Investment, raising about 2 billion won. The original target had been more than 5 billion won, but as RESCENE's momentum accelerated, the company chose to close the round early. Industry observers see this as a deliberate move to avoid diluting equity at current prices, positioning the company to command a higher valuation in a subsequent Series B or later round.