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Tuesday, July 10, 2007

TAKING A CHANCE

BANKING ON A SCOOP, 99% RISK

Publisher gets writers to open up, bets on element of surprise


Staff writer

It was an amazing scoop, surprising even the tabloids.

News photo
Toru Kenjo, president of Gentosha Inc., talks about his unusual way of doing business in the publishing industry during an interview last week in Tokyo. SATOKO KAWASAKI PHOTO

Popular celebrity couple Hiromi Go and Yurie Nitani were divorced April 9, 1998, but no one in the press saw it coming. The only way to find out what had happened was to read Go's book, "Daddy," published on the very day of the divorce.

The publishing coup had been meticulously orchestrated by Toru Kenjo, 56, president of publisher Gentosha Inc. He had asked the couple to act as if they were still getting along until the book hit the stores, and to make sure not to leak the split to the media.

The book takes the form of Go telling the couple's two daughters about the difficult days of the failed marriage.

"The impact was tremendous," Kenjo said in a recent interview. "A hardcover book, a medium that takes four or five months to publish, delivers a big scoop with all the details on the day of the divorce."

To add a little color to the excitement, Kenjo printed an unprecedented 500,000 copies for the book's first edition to give the media a side story to write about.

It became a million-seller.

"Making an astonishing move means you need to take a 99 percent risk," said Kenjo. "But 80 percent of it can be covered with the tremendous amount of effort you make.

"If you succeed in doing something people think is bold and impossible, that will become the brand of the company."

Since Kenjo formed Gentosha in 1993, his focus has been to amaze the public and jolt the publishing industry.

When Gentosha, which started with six employees, debuted with six hardcover titles written by best-selling authors in 1994, Kenjo ran a full-page advertisement in the Asahi Shimbun that cost 36 million yen.

If the books hadn't sold, he would have gone bankrupt.

On April 10, 1997, Gentosha entered the paperback market with 62 titles totaling 3.5 million copies, again an unusually large number, and in such a short period following the company's establishment.

The last time a publisher had introduced a new paperback label was in 1984, when Kobunsha Co. entered the market with 31 titles.

"If a newcomer doesn't do something bold, how would anything change?" Kenjo asked, quoting the language he used in the ads promoting the first 62 paperback titles.

In the 14 years since it was established, Gentosha has published 13 million-sellers.

Kenjo's magic touch for producing best-sellers comes from his personal connection with authors rather than his business tactics.

"Writers are a business tool" for publishers, Kenjo said. "But to make them a business tool, you have to have a strong trusting relationship with them."

Editors need to make writers write what they don't want to write about the most — the negative feelings they hide inside, he said.

"We peel off that scab and rub salt into the wound to get into a story," Kenjo said. "If we don't writhe in agony, they won't do so either. . . . It's exhausting."

To gain the writers' trust, Kenjo writes them letters, wines and dines them until dawn and does whatever he can to comply with their requests, however selfish.

"But it's all worth it when you lay your hands on a great work that moves people's hearts and changes their lives," he said.

Before Gentosha was established, Kenjo was already a well-known editor at Kadokawa Shoten Publishing Co.

At 41, he became the youngest member of the publisher's board of directors, had access to unlimited expenses for wining and dining, a lucrative salary and the fame that comes with producing five prestigious Naoki Prize winners for popular fiction.

But with fame came complacency. He refused to work with difficult writers and was reluctant to sniff out new talent.

"I knew I was becoming rusty," Kenjo said. "To start from scratch, I had to abandon the Kadokawa brand."

But his loyalty to Kadokawa's charismatic president, Haruki Kadokawa, who had taken him under his wing and promoted him to the director's post, discouraged him from leaving the company.

That all changed when Kadokawa was arrested in August 1993 for smuggling cocaine from the United States. Two days before the arrest, Kadokawa Shoten's board, including Kenjo, unanimously voted to sack him as president.

"I voted for his resignation because I thought he should step down," Kenjo said. "But at the same time I felt like I was being disloyal to him."

He submitted his resignation and left the company with five editors to start a new publishing company of his own — Gentosha. It was as if his leaving Kadokawa was a rebooting process.

Kenjo listed Gentosha, which expanded to 61 employees, on the Jasdaq Securities Exchange for venture firms in 2003 for the same reason — "to rub away the old skin and rust from the company" that had accumulated over the past decade.

Going public has proved a tough task for Gentosha, as it had to disclose the details of its financial standing and reward shareholders. In the business year that ended in March, the company's net profit plunged 48.9 percent to 712 million yen on sales of 10.9 billion yen, down 0.4 percent.

"It's tough," he said. "But it's a good way to scrap off the dead skin. If I become slack, the company becomes slack, too."

Kenjo acknowledged that a creative industry like publishing is not obviously suited to going public because of its volatile nature.

"Being creative means constantly taking risks and gambles," he said. "On the other hand, running a company means to aim for stability."

Although the mastermind of many book-promotion campaigns, Kenjo said he has no clear vision of his own future.

One thing he knows is that he will continue to change what is perceived as "common sense" in publishing and change the rules in his own way.

"You become the victor when you change the rules," Kenjo said. "And then you overturn that rule and make a new rule. That is how a company survives."

In this occasional series, we interview entrepreneurs whose spirit may hold the key to a more competitive Japan.


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The Japan Times

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