Most CEOs are daredevils

Masayoshi Son: The Japanese daredevil

The Japanese wireless operator Softbank bought the chip manufacturer ARM for $ 31.4 billion. Masayoshi Son, an unconventional manager atypical for Japan, is behind the deal.

What should a mobile operator do with a company that produces semiconductors? The man with the thinning hair, who usually wears the top button of his shirt open, has been asking himself this question for a few days. "I see synergies here," explains Masayoshi Son. "But I can't talk more about them yet."

At the beginning of the week, his voice, which is unusually loud for Japanese standards, echoed through a London conference room: “In the future there will be no more devices that are not connected to each other and to the Internet.” And: “By 2040, an average of 1,000 devices will be connected to each person be connected to the Internet. ”What could be more obvious for someone like him than to swallow a chip manufacturer quickly? Masayoshi Son snapped. He wants to be one of the pioneers of the Internet of Things.

Third most expensive takeover. For 31.4 billion US dollars, the Japanese wireless operator Softbank, Son's company, is therefore buying the British developer ARM. Globally, that's behind Bayer's takeover of Monsanto and China National Chemical Corp's purchase of the Swiss company Syngenta AG. the third largest acquisition this year. From a Japanese perspective, it is the largest international takeover ever. Since the purchase price was almost half higher than the stock market value of ARM last week, Masayoshi Son once again made a topic of conversation. At a time when more and more people prefer not to risk anything, the billionaire attracts attention for his daring.

58-year-old Son is an entrepreneur who is in short supply in his home country. Hardly any industrialized nation is more risk averse than the Japanese, and hardly anywhere else are companies founded so rarely. Japan's development in recent years could also be a glimpse into the future for European countries. Similar to Europe since the financial crisis in 2008, the Japanese economy has been experiencing phases of deflation since the bursting of a speculative bubble in 1990, i.e. falling prices because demand and investment stagnate. Economic growth in the world's third largest economy has been minimal since then, at least in absolute terms. And the majority of Japanese don't think they'll be any better in the future.

Because the Japanese government's economic policy has failed to bring about a noticeable recovery in the labor market, Prime Minister Shinzō Abe has been trying for a long time to make people like Masayoshi Son good examples. He wants to evoke the entrepreneurial spirit of the Japanese through charm offensives and funding programs. Abe has repeatedly demanded that young people should trust themselves more. The calculation is clear: If current employers do not create new full-time jobs, people should create them themselves and hire more people with their new companies.

However, most Japanese don't think like Masayoshi Son, who once made a fortune of $ 14 billion as the son of a Korean fisherman. Most of the Japanese want a permanent job with social security. The fear of social decline is greater than the appetite for wealth. No wonder in a country where the proportion of irregularly employed people has increased to almost 40 percent in recent years and where these jobs are paid a third less on average. A trend that Japan shares with most European countries. Can a daunting labor market kill, rather than encourage, entrepreneurship?

It looks like it in Japan. Entrepreneurial activity has not increased noticeably in recent years, despite government efforts. Only 3.8 percent of the working population are founders of a start-up, so Japan is lagging behind in an international comparison - and is even behind Austria (8.7 percent).

According to data from the analysis institute Global Entrepreneurship Monitor, which compares countries according to their environment for start-ups, only three percent of the Japanese are considering starting a business. 55 percent say they are afraid of failure. This value is also higher than in other countries. In recent years, in the midst of economic stagnation, the number of Japanese students who dared go abroad for a semester has even declined. Not to mention foreign degrees. Studying abroad is considered daring by many because it still does not correspond to the classic curriculum vitae.

Scintillating counterexample. Masayoshi Son is the dazzling counterexample. He's a gamer who has ignored the prospect of big losses several times, reached deep into his pocket and was mostly right. The story of the second richest man in Japan (behind the head of the clothing company Uniqlo, Tadashi Yanai) would be imagined in the US business economy. In fact, part of his biography took place there. As a high school graduate, Son went to the United States to study English and business on the recommendation of a successful entrepreneur. There he made it to the elite University of Berkeley. When Son returned home with the broad chest of a graduate student in the early 1980s, he repeatedly risked more than others thought was wise.

In 1981 he founded the company Softbank, with which he initially sold PC software and soon became a wealthy man. In the early years of the Internet, he got involved in what was then a small company called Yahoo. The trend is well known, Yahoo becoming one of the world's largest search engines before it failed to Google and was bought by Verizon this week.

Earlier this week, when he announced the deal with ARM, Son described his investment strategy in a supposedly simple way: "I buy when paradigm shifts begin." Back then, Yahoo was the Internet as it is known today. Now it is the Internet of Things, the networking of all devices.

Investing in Alibaba. The list of major investments is much longer. At the turn of the millennium, when hardly anyone knew anything about online shopping, Son invested in the Chinese web retailer Alibaba. In 2005 he increased his stake to one billion yen, which has multiplied significantly since Alibaba's IPO two years ago, the largest in history. In 2006 Son and Softbank announced the takeover of Vodafone Japan in anticipation of the triumphant advance of the mobile Internet. In addition, he secured the exclusive distribution rights for the iPhone in Japan for a few years. Most recently, Softbank also bought the French robot developer Aldebaran, whose know-how brought the intelligent assistance robot Pepper onto the market last year - and was sold out within a short time.

The story of Masayoshi Son is also famous in Japan because it has always been atypical. Since the boom decades after the Second World War, lifelong full-time employment in the largest possible company has been considered a career ideal. Even today, most young people strive for this security, even though the labor market is less and less able to provide this for job starters. The alternative of trying it on your own like Masayoshi Son has so far only been popular in very small groups. This may also be due to the fact that there is a lack of venture capitalists and banks hardly give loans to young entrepreneurs.

An extravagant figure like Masayoshi Son can also be daunting in a risk-averse society like Japan. After all, the billionaire is no longer just risking his own prosperity if he risked a lot of money with an expensive deal like the one from ARM.

In addition, Son has already failed terribly, most recently in 2012: At that time, Softbank bought the US wireless company Sprint for more than 20 billion US dollars. The takeover has remained a losing business to this day. Whatever paradigm shift the entrepreneur may have seen in the American wireless communications industry - it seems to have failed to materialize.

Promotion not important. Fundamental change does not seem to be within reach in the Japanese world of work either. Just this month, a survey by the Japan Productivity Center showed that the majority of Japanese job starters prefer to be like everyone else. Almost 60 percent said they didn't want to work harder than their colleagues. Getting as many promotions as possible in the job was not important to the majority. That doesn't sound like the kind of entrepreneurship the government wants. More like paralysis or satiety.

Characteristics

Masayoshi Son
was born in Tosu, Japan in 1957. His parents are of Korean descent.

1981
he founded his first company, Softbank. With this he bought into various Internet companies, including Yahoo in 1995. Before the internet bubble burst, Softbank was worth $ 140 billion.

2006
took over Softbank Vodafone Japan and secured the exclusive rights for the iPhone.

Notice

("Die Presse", print edition, July 31, 2016)