Japanese Millennials Close to Billionaires as AI Firm Shares Soar

AI For Business

Shunsaku Sagami is the founder and CEO of M&A Research Institute Holdings.
M&A Research Institute Holdings

  • M&A Research Institute founder and CEO Shunsaku Sagami is worth $950 million as of Tuesday.
  • He founded this brokerage firm in 2018 to help match Japanese SME sellers with interested buyers.
  • In Japan, where the population is aging, many SMEs are forced out of business every year due to a lack of successors.

Japanese millennials have achieved great success in using AI to solve the problems of a rapidly aging society.

Since listing on the Tokyo Stock Exchange in June 2022, the stock price of M&A Research Institute, a company that uses AI to match Japanese managers and successors, has more than tripled its initial price.

The stock is up 47% this year alone.

Thanks to the surge, Shunsak Sagami, a 32-year-old entrepreneur who owns a 72% stake in the company, was worth $950 million as of May 16, according to the Bloomberg Billionaires Index.

Established in 2018, the M&A Comprehensive Research Institute aims to support aging small business owners who have no choice but to go out of business due to lack of successors. In April, the company announced that about 620,000 profitable companies in Japan were in danger of going out of business due to a lack of successors.

Sagami told Bloomberg in a recent interview that he got the inspiration to start the business from his grandfather. His grandfather retired in the 1980s without finding a successor for him, forcing him to close his real estate company.

“In his office, he had a framed real estate license on the wall,” Sagami told Bloomberg. “It was sad to see it removed and thrown away.”

Sagami’s company is able to complete M&A deals within six months, a process that normally takes a year or more.

The M&A Research Institute currently employs about 160 people and focuses on companies with annual sales up to 500 million yen, or $3.7 million.

By leveraging AI and proprietary data, the company said on its website that it can close M&A deals within 49 days to six months. Such deals typically take more than a year from request to completion, the Tokyo-based company added.

M&A Research Institute does not charge a commission until the transaction is completed. We charge a commission of up to 5% for successful deals.

At other M&A consulting firms, the start-up fee can reach tens of millions of yen, even if the deal doesn’t go through in the end, the M&A Institute said on its website.

The company said it closed 62 deals in the six months to March 2023. This is more than double the 26 cases in the same period last year.

M&A brokerage is not the first business for Sagami. According to Bloomberg, he graduated from Kobe University with a degree in biology and agriculture, and worked as a designer, software developer and marketer before going independent.

In 2017, Alpaca, the women’s fashion and makeup company he founded, was acquired by a Japanese PR agency.

According to Bloomberg, Sagami realized that the trading process was inefficient and set up a system with AI algorithms to simplify the flow of business.

Shares of M&A Research Institute closed 0.4% lower at 9,270 yen on Tuesday.

The company did not immediately respond to an insider’s request for comment.

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