US startup Teamshares tackles Japan's business succession headache
Teamshares has announced its expansion into Japan, marking its first international foray.
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The backstory: Japan's got quite a big problem on its hands. Being a country with one of the world's oldest populations, passing on the reins in small businesses to a successor has long been a headache, especially with fewer children interested in taking on the family business once their parents are ready to retire. And, despite efforts like the M&A Research Institute's AI-powered matchmaking initiatives, the problem's been tough to crack.
This is where Teamshares, a US startup from Brooklyn, comes in. The idea? Helping workers become shareholders of a business by providing financial support. Essentially, Teamshares buys out the company from the start so the owner can retire, and then it hires new management and gives the employees an 80% stake over a timespan as long as 20 years. The goal is to boost the value of the business by making its workers part owners.
The development: Teamshares has announced its expansion into Japan, marking its first international foray. With backing from Mitsubishi UFJ Financial Group, Japan's top bank, it aims to shake things up for Japanese owners struggling to find a successor. The startup has been reaching out to brokers and business owners across Japan to scope out partnerships and potential acquisitions.
Kevin Rikio Shiiba, the co-founder of Teamshares and head of its Japan business, has said he's optimistic about the move. With US$245 million in funding locked down, Teamshares is ready to tackle Japan's succession conundrum head-on. The company has its sights set on different industries nationwide, banking on Japan's aging population and government backing for succession initiatives to fuel its growth.
Key comments:
"We genuinely believe that our business in Japan can grow to the same size as our US business," said Kevin Rikio Shiiba, co-founder of Teamshares and head of its Japan business, in an interview.
"If they're a strong general manager in that business, we may look for a CFO type to help them take the business to the next level," said Shiiba. "We will be looking for really talented people who want to run and ultimately sit across many different small businesses here in Japan."
"There are a huge number of small companies with aging founders with no obvious successor that are increasingly open to selling their business," said Tim Morse, the director of Asymmetric Advisors. "Traditionally, selling out hasn't been seen as a culturally positive thing, but that's changing."
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