Polaris Capital Group Co., Ltd.
Founder, President & CEO Yuji Kimura
- Osaka, Japan
I was born in Asahi Ward, Osaka. Panasonic, Sanyo, and Daiei were all founded around this area. As my father owned a business when I was born, I became familiar with the ideas of entrepreneurship and business management as I grew up. But I chose to pursue academic and professional careers in Tokyo rather than in Osaka. After graduating from Tokyo University, I took a position with The Industrial Bank of Japan (IBJ).
What I learned at IBJ formed a strong basis for my career in later years. IBJ's business model was quite different from those of commercial banks, which collect deposits from customers and lend money to companies in need of cash. IBJ assisted companies operating in promising fields to grow their businesses by extending loans, advising them on business management and operations, and even having IBJ officers sit on the board of directors of the borrowing companies. In the process, IBJ became deeply involved with their day-to-day operations. IBJ firmly believed that it was doing a public service by helping accelerate industrial development in post-war Japan. IBJ's DNA is still running in what we do at Polaris Capital Group.
When IBJ became a part of the Mizuho Financial Group in 2000, I was assigned to the private equity department with Mizuho Securities. In 2004, Polaris Principal Finance (currently Polaris Capital Group) was established as a carve-out from Mizuho Securities and I assumed the position of president and CEO soon thereafter. At the time, the Japanese economy was showing early signs of recovery from a prolonged downturn, and it was time to say goodbye to the once-prevalent practices of foreign-affiliated vulture funds buying out one struggling Japanese company after another at bargain prices. Instead, it was time to anticipate the emergence of new types of funds adapted to the reality of the Japanese economy. I was confident that the approach once taken by IBJ in helping startup businesses grow over time should be the way to go.
Polaris Capital Group's business is to invest in mid-sized private companies, including non-core businesses of large corporations, to support realigning and restructuring of their businesses, through management buyouts and leveraged buyouts. Our profit sources are capital gains from the sale of the shares of portfolio companies through initial public offerings, or trade & sales to large corporations. We do not pursue short-term gains from trading stock. We opt to increase the value of portfolio companies over five to ten years.
We are interested in investing in companies bound tightly by old ways of thinking and doing things. Some Japanese companies have been stuck with old-fashioned business models for a long time, reluctant to move away from their founders' philosophies from the early days, their business-as-usual ways of doing things and their deep-rooted connections with suppliers and affiliates. Those companies offer a tremendous opportunity for growth if managed properly. When we acquire stakes in such a company, the first thing we do is to get rid of all the old ways of doing things and then we build a new business model to increase the value of the company. The greater the challenge, the greater the reward of overcoming it.
Our approaches will play an important role in the government's initiative to economically revitalize regional communities. In Japan, many aging owners of small and mid-sized businesses in local cities face the pressing challenge of finding successors for their businesses. If we spot promising small and mid-sized companies around the country, invest in them and place them on the right track, it is likely to have a positive impact on the Japanese economy as a whole.
The talent we look for does not include those who are interested only in trading stocks. Our employees have diverse experience and expertise in accounting, financing and investment banking services. However, having such technical skills alone is not enough to carry out our day-to-day business. It also takes human skills to be successful in our business ? the skills to maintain close communication with executives and employees of a company in which we invest, to monitor the performance of the company and, if something goes wrong, to come up with and patiently implement corrective actions. By working with people who have a deep interest in business management and the will to rise to many challenges, we would like to play a role in creating new values and contributing to a better society.
- Polaris Capital Group Co., Ltd.
- Fund management to assist companies in realigning and restructuring their businesses