Allotting ¥4.5bn of shares to Keyence — 40% of the votes and control (2009)

What ¥4.5bn bought

The ¥4.5bn of 2009 was sufficient as a sum to fill the funding gap. What was handed over in exchange, however, was 40% of the shares and a majority of the board. The investment the same company received from Sony in 1998 was about ¥1.2bn, the shareholding stayed at 6.7%, and independence was preserved. That eleven years later it could not extract the same terms was because several years of development spending on xfy had gone unrecovered when it ran into the funding environment after the financial crisis. The depth of the crisis, one may read, simply set the terms.

For the founder, the fork in the road was not the shareholding ratio but the treatment of the basic-research team. Ukigawa Kazunori, believing he could not let his engineers go, left the company, and set up a new one the day after resigning. The JustSystems left behind squeezed its costs back to profit and over the following decade grew correspondence education and corporate cloud services until revenue had tripled. The company that stepped down from carrying basic research in-house grew; the man who decided to carry it rebuilt it at another company. What ¥4.5bn bought and sold was shares, not a verdict on which of the two choices was right.