My History
I was part of the founding team of our company in 1991, at a time when mergers and acquisitions (M&A) were still poorly understood in Japan and carried a predominantly negative reputation. Selling companies viewed it as something shameful, while buyers were often seen as aggressive and disruptive. Despite these misconceptions, we committed ourselves to educating businesses, consistently promoting the idea that M&A offers valuable opportunities for both sellers and buyers.
Reflecting on our journey, I identify two key turning points for the company. The first occurred about ten years after our founding. While we were managing well, our growth was limited, and we hadn’t yet established a strong position in the industry. We were functioning more like traders than a full-fledged business, even though we took pride in the quality of our work up to that point. That’s when I decided to initiate a change, announcing both internally and externally that "Nihon M&A Center is evolving." Our goal was to shift from merely conducting business to building a true enterprise. This transformation proved successful, culminating in our IPO on the Tokyo Stock Exchange Mothers in 2006 and our subsequent listing on the TSE First Section in 2007. Additionally, we were selected for the JPX-Nikkei 400 index, marking our second major turning point. Being recognized among Japan’s top 400 companies made me realize that we needed to think beyond our own growth and consider our broader role in contributing to Japan’s economy. After evolving from a business to an enterprise, our next objective was to establish ourselves as a vital component of the country’s social infrastructure.
The Present
Japan is currently grappling with a serious challenge: an increasing number of businesses are lacking successors. Among the approximately 3.8 million small and medium-sized enterprises (SMEs) in Japan, around 2.45 million are led by owners aged 70 or older, and approximately 1.27 million of these have no one ready to take over. If this trend continues, many business owners will face a difficult choice between selling their companies or shutting them down. The disappearance of a company affects not only its suppliers, who lose sales, but also consumers, who may struggle to find goods, potentially leading to a decline in local economies. Beyond these economic consequences, there’s a risk that unique skills, regional specialties, and cultural heritage could vanish along with these businesses. In light of this situation, we have observed a significant increase in the number of companies seeking M&A solutions compared to the past.
As Japan's working-age population declines due to falling birth rates, its GDP is also projected to decrease. A smaller share of global GDP could diminish Japan’s influence on the world stage, raising concerns about the future of its safety and national defense. Therefore, I believe that preserving Japan’s many SMEs is crucial for maintaining and boosting our GDP. To tackle this issue, we are utilizing databases and AI to facilitate numerous business matches. Our "Batonz" service, in particular, connects potential buyers and sellers through an online platform, providing essential support for M&A and business succession.
For the Future
I am dedicated to supporting SMEs through M&A. To achieve this, I believe collaboration among the public, private, and academic sectors is essential. In fact, in 2022, I played a key role in establishing the SME M&A Research and Education Center at Kobe University. This academic initiative focuses on SME M&A, addressing topics ranging from company valuation methods to post-merger integration (PMI). Historically, studying SME M&A has been challenging due to confidentiality agreements that kept much information undisclosed, resulting in a lack of scholars dedicated to this area. Without research opportunities, the industry struggled to evolve. Motivated by the need for academic inquiry, we developed a grant system and established the center at Kobe University.
Looking ahead, our objective is to evolve into a comprehensive M&A firm. We aim to manage all aspects of M&A while also emphasizing business succession, growth strategies, and the administration of three distinct funds, including a search fund. A key initiative is to identify and empower talented young professionals to assume leadership roles in regional areas. This presents a significant challenge for us over the next decade. By placing capable young leaders in each prefecture, we can positively impact local communities and promote sustainable growth. Our vision is to foster thriving companies each year, ultimately creating standout enterprises throughout Japan. As we progress, I remain committed to realizing the ideals and goals I have set for our business.