Since its IPO on the US stock market, WEBTOON Entertainment, the world's leading Korean webcomics platform, has been battling a series of escalating crises. The company's stock price plummeted 50% and disgruntled shareholders filed a class-action lawsuit. Now, just months after its initial public offering (IPO), the company faces an even more serious threat—a growing internal labor dispute that could disrupting the entire business operations of the company.
In early October, WEBTOON Entertainment's labor union filed a Request for Labor Dispute Mediation with the Kyunggi Provincial regional labor committee, signaling the first step toward a possible strike. Korean media quickly raised the possibility that the company, which publishes popular webcomics such as Hellbound, Sweet Home, All of Us Are Dead and Itaewon Class, could face its first major strike. For a company rooted in creativity and beloved by fans around the world, the mere prospect of a strike would send shockwaves throughout the industry.
WEBTOON's Korean site Battle for compensation at the core
A deep rift over employee compensation following WEBTOON Entertainment's June 2024 IPO lies at the heart of this labor dispute. Despite six months of negotiations, the company and the labor union have yet to reach an agreement. The crux of the problem? There is a big gap between how senior executives and employees are paid. Tensions flared when founder and CEO Joonkoo Kim was awarded $30 million in cash and stock options—allowing him to buy 3.4 million shares at a low price of $11.04 each. much higher than the IPO price of 21 USD.
When a company goes public in Korea, it is customary—and often required by law—for a portion of the company's stock to be distributed to employees. For entities listed on KOSPI, the country's largest stock exchange, this amount can be up to 20% of the total shares. Naturally, WEBTOON Entertainment employees expected a significant profit once the company was listed on NASDAQ. However, their hopes were dashed when no such generous stock allocation materialized.
Speaking anonymously to Anime News Network, a key union official expressed disappointment: “Employees worked tirelessly to bring the company to an IPO as expected of fair compensation, but Instead, management unilaterally decided to allocate shares without any real negotiations.” Despite hopes that the union could broker a deal on stock compensation, the official said: “There are no negotiations.” According to the union, WEBTOON Entertainment did not even try to agree on this important issue.
Joonkoo Kim's cash grab
The eye of the storm is Joonkoo Kim himself. Many employees were angry to learn that Kim, who had led the company to global success, had received a $30 million cash compensation package at a time when stock options were being considered. To them, this was not only a bad look, but also a signal that Kim lacked faith in the company's future. “If he really believed in WEBTOON's long-term prospects,” one employee commented on BLIND, a popular anonymous forum for professionals, “he would choose stocks, not cash .”
As criticism of Kim and other top executives intensified, Kim called for an all-hands meeting to address the growing discontent. Instead of quelling the unrest, things took a dramatic turn. According to WEBTOON staff's post on BLIND, Kim was said to have been so emotional while defending her actions that she broke down in tears. However, many employees consider this nothing more than a drama. The incident quickly became a subject of ridicule on BLIND, where Kim's tears were called “crocodile tears” by a CEO who had secured a huge salary.
Who is Joonkoo Kim?
Joonkoo Kim has not always been the target of such widespread criticism. He joined Naver, one of South Korea's largest technology companies and the parent company of WEBTOON Entertainment, in 2004. Within two years, fueled by his love for comics—Kim was said to be the owns nearly 10,000 books—he started developing Naver's webtoon platform. Under his guidance, the platform flourished and eventually became its own company, WEBTOON Entertainment. His leadership and deep connection to the webcomic community were key to the platform's growth into a global giant, earning him a seat on Naver's board of directors.
Kim's influence was so great that he became a legend in the film world. Korean comic industry. He's even appeared in popular webcomics like The Sound of Your Heart, Lookism, and Doona!, a testament to his strong relationship with the creators and his status as an icon. cultural statue. For many years, his close relationship with webcomic creators and his business acumen were considered keys to the platform's success. His career path from low-level employee to CEO has become a role model for many employees at NAVER.
But today, the workforce that helped fuel WEBTOON Entertainment's growth is increasingly suspicious of him, viewing his actions as selfish and out of touch.
Strike on the Horizon?
The labor union has been careful not to comment directly on the possibility of a strike. There are ongoing negotiations between WEBTOON Entertainment and the union currently brokered by the regional labor committee. For now, both sides appear to be holding out hope that the talks will lead to a compromise. But the union is not ruling out more aggressive measures.
“We cannot predict whether a strike will occur but if negotiations fail we will contact our members and begin to escalate from protests to strikes comprehensive,” a union official warned.
When WEBTOON Entertainment IPO'd in the US, many expected the move to solidify the company's position as a global leader in Korean content. After all, WEBTOON is a creative powerhouse, adapting its wildly popular webcomics into successful films and television series. However, just three months after the IPO, the company was on the brink of its most serious crisis. And this time, it wasn't just disgruntled shareholders who sued—it was the employees who drove WEBTOON's success.
For a company whose greatest asset is the creativity of its workforce, this growing labor dispute poses an existential threat. If the rift between management and employees continues to deepen, it could shake WEBTOON Entertainment's core, jeopardizing the company's once bright future.