My First Peer CEO
Not far from Akihabara, in the Iwamotocho area, was a newly founded company named “Togo.” Its president, Tomoyuki Takada (pseudonym), was the same age as me. He had a polite manner on the phone and left a good impression. I actually looked forward to conducting the investigation.
The company was located on the 7th floor of an office building, and its impressive furnishings and meeting space made it hard to believe it was a start-up.
Takada, a tall man, gave off a great first impression—just as I expected from our phone call. He was dressed casually in a T-shirt and jeans, which made my suit and tie feel stiff and outdated in comparison.
“Nice to meet you, Mr. Nakamura!” he greeted me. But wait—he was holding that thing under his arm! A Let’s Note laptop!
Through personal experience, I had developed a superstition: every overly-complicated CEO I’d ever met used a Panasonic Let’s Note. Back then, it was considered rude to bring out a laptop during meetings instead of taking notes by hand and maintaining eye contact. I used to wonder if Japanese professionalism was slipping.
At the time, progressive CEOs always seemed to have a Let’s Note. It meant they were the type to challenge convention. In my mind, it became shorthand for “difficult personality.”
Takada, true to type, opened his laptop and eagerly explained his e-commerce business, which sold PC memory, flash drives, and other peripherals. He was determined not to lose out to players like Tsukumo and Shanghai Donya. He highlighted how highly rated his site was by customers, though he admitted supply and logistics were ongoing challenges. Before I knew it, an hour had passed.
“Thank you, Mr. Takada. Lastly, may I get your personal profile?”
He was from Nagoya, and the same age. He’d launched the company with his own savings and help from his parents. Humble, hardworking, and yes, a Let’s Note user. Meanwhile, I was a salaryman whose only excitement was drinking in Kabukicho every Friday with college buddies. The sense of inferiority hit me hard.
As soon as we realized we were the same age, the atmosphere relaxed. We exchanged jokes and wrapped up the first investigation.
“That’s a great company,” I thought. “It’s going to grow.”
Since it was a new company, Japan’s credit rating system would score it low. So I made sure to highlight every positive point I could in the report.
30 Million Yen
Less than six months later, I was assigned a second investigation on Togo. I noticed their capital had increased from 10 million yen to 30 million. Maybe a VC got involved? I visited Takada again.
He was visibly thinner—worn out.
“Mr. Takada, you look tired. Are you okay?”
“I’ve just been incredibly busy. I raised the capital to 30 million yen with my own money.”
“Wait, you personally paid in that much?”
Yes, he was fighting alone in Tokyo. Literally working day and night. I felt tears welling up from admiration.
“This isn’t even a new fiscal year yet, and you’re busy—I’ll handle the report on my side.”
“Thanks! Oh, by the way, I’ve hired a tax accountant who advised me to restructure the company. I’ll tell you more next time.”
Oh no… a tax accountant.
Some small business owners treat their accountants as absolute business consultants. Many companies that refuse to disclose financials to credit bureaus are doing so on their accountant’s advice. Perhaps for tax-saving reasons. Japanese reviewers may laugh at the alleged unreliability of Chinese financials, but even in Japan, SME statements can be a mess depending on the tax advisor.
Bad Advice
Soon after, a third investigation was requested. That was odd. Even for a growing company, this frequency was unusual. But since it was year-end, the goal was likely to obtain financials.
“Mr. Nakamura! Long time no see. This is our CFO.”
Wait, CFO?
Around the time Carlos Ghosn reshaped Nissan, Japanese businesses started copying Western executive titles. Suddenly even small firms wanted CEOs and CFOs.
“Yeah, the tax accountant told me to delegate more. It’s helped free up some of my time.”
The so-called CFO wasn’t a founding employee, but someone recruited through the accountant. When I asked him about the financials, he couldn’t explain a thing. Takada eventually stepped in and said, “You’re failing as a CFO,” and explained the numbers himself.
“By the way, Mr. Takada, did you create other C-suite roles too?”
Oh yes. Chief of Marketing, Chief of Something-or-Other… the list went on. For a company with only 10 employees!
The first-year financials showed increased retained earnings from the capital injection, but also heavy start-up losses. Meanwhile, the C-suite kept growing.
No. Takada’s hard-earned money shouldn’t be wasted on trendy, unnecessary exec titles pushed by some accountant.
Why? Tears.
One day, I got a call from a colleague who tracked bankruptcies.
“Nakamura, your buddy Togo—just filed for bankruptcy. Thought you should know.”
No. I couldn’t believe it.
Takada’s tired face, his parents in Nagoya, the highly-rated website, the useless CFO—it all flashed through my mind.
No way.
I dialed the mobile number Takada gave me, hoping he’d answer in his usual cheerful voice:
“Mr. Nakamura! Takada here!”
Click.
“This is NTT Docomo. The number you have dialed is no longer in service…”
I left a message anyway.
“This is Nakamura. I’m so sorry to hear the news. Please take care of yourself, eat something good, and rest.”
I wiped the tears from my cheeks.
