Peers Corporation‘s IPO Backstory.

Left: Circulation Consultant Yoshiaki Takahashi, Center: Partner Toru Fukuda, Right: Peers Corporation President Takashi Kuwano

Founded in 2005, Peers Corporation started out in the relatively legacy area of staffing and consulting for cell phone sales agents. As the company continued to grow while flexibly changing the shape of its business in accordance with the trends of the times, it decided to go public in 2017. In order to achieve an early IPO, Representative Director Takashi Kuwano (hereafter, President Kuwano) invited Mr. Toru Fukuda (hereafter, Fukuda), who had established the IR consulting division of Nomura Securities and had been involved in supporting IPOs for 25 years since then. What was the key to achieving an early IPO in just two years?

1、Decided to go IPO for future corporate growth. In the absence of knowledge and experience, sought advice from experts from many fields.

We provide consulting services specializing in the telecommunications industry and support stores in a supervisory capacity.

President Kuwano: In a word, our main business is consulting. Originally, we started out by providing support to the telecommunications industry in the areas of staffing, campaigns, and promotions. As time went by, the products eventually changed to smartphones, and the services became more complex. As the number of stores struggling with how to sell their products increased, we are now entering the market in a supervisory role.

In terms of company culture, we place importance on ease of working. For example, employees who are raising children are allowed to bring their children to work. It's not a problem for us. If it is not safe to take the train to work with children, they can take a cab or stagger their work hours. I don't really feel that we are making any special efforts, but simply that the company is helping employees with childcare because we want excellent employees to work. As our philosophy states, "We are not bound by meaningless common sense, but pursue 'meaningful insanity' and engage in valuable social activities," we act with a mindset that captures the essence of things.

We decided to go IPO as a means of raising funds and improving our credibility to attract talented people and funds.

President Kuwano: If all we wanted was to make a profit, we could have continued to manage the company as before, but our employees are very young, with an average age of around 30, and unless we grow and change as a company in the future, our employees would not find us attractive. We also thought it would be healthy for management to have high goals.

However, we have a very niche business model. While we have no major competitors, our future growth potential is limited at present. If we wanted to do something new, we would need people and funds.

Therefore, we chose IPO as an effective means to achieve this goal. If a company's brand value is created by going public, it will attract talented people, and if the company's credibility is enhanced, it will be easier to raise funds. Moreover, we thought that the public's attention would encourage the company to seriously tackle new business.

We wanted to make sure we were well prepared by having experienced IPO personnel join us from an early stage.

President Kuwano: Although we had set a goal, we had a mountain of issues to overcome in order to go public. I felt that a smooth listing would not be possible without first clarifying "which issues needed to be resolved first. However, I had no experience in IPOs. However, I have no experience in IPOs, so I could only understand certain aspects of IPOs by listening to what securities firms and auditing firms say, which is insufficient information. I thought the best way to find out what is the most accurate information would be to listen to senior staff with listing experience and analysts from various fields.

We originally had professional personnel come to us, so we considered several professional sharing companies. Among them, Circulation introduced us to someone who was perfect for our situation and timing, and that was Mr. Fukuda.

We asked Mr. Fukuda to strengthen our administrative division, focusing on IR, from the perspective that we wanted his wealth of knowledge. Mr. Fukuda's background shows that he has worked as an IR consultant for a wide variety of companies. We decided to ask him to come to our office well in advance of the examination in order to make the most of his knowledge and prepare well.

Some members of the management team said that they would prefer someone who would be hands-on and work with them, but it would be meaningless if we relied on them to do so. We thought it would be best to invite Mr. Fukuda, who has a wealth of experience, as a professional, because we should be the ones who are taught the knowledge and put it into practice.

2、Mr. Fukuda, who has been involved in IR for many years, places importance on "quick output“

Fukuda: I have been an IR consultant for 25 years, so I have a lot of experience anyway. It is probably the longest career in Japan. I started as a consultant when I set up the IR consulting department of Nomura Securities, and at that time I was also involved in the listing of Uniqlo. After working in consulting sales at Sony Life Insurance, I became an independent consultant. Currently, I am involved in many projects that are fundamental to management, including strategic planning before and after a company goes public, M&A brokerage utilizing my personal connections with financial institutions, and support for fundraising from VCs and banks. Since we meet with business owners on a daily basis, we sometimes provide support related to management strategies.

What is important to me when providing support is to output quickly. As the saying goes, "A soldier should be quick. The world moves very fast, so I think it is important to work quickly, even if the answer is half-hearted.

3、Scheduling according to Peers' situation and advice that emphasizes hands-on experience are the key to support.

Drawing a schedule from a blank sheet of paper, the president and members were given a lecture outlining the IPO

President Kuwano: The support lasted about a year, with two-hour meetings held twice a month. The main counterparts were the director and head of the administration department and about five members of the administration department, all of whom were young and inexperienced employees. It was like we were highly motivated amateurs being taught from scratch by an expert like Mr. Fukuda.

First, we had him design the overall schedule, clarify what we needed to do in the future through meetings, and then ask what we needed to do again by doing our homework before the next meeting. ...

Fukuda: The schedule design required differs from company to company. For example, some companies have already completed their capital policies, while others have a target peers company and aim to raise their stock price higher than the target company. We change the roadmap accordingly, but in the case of Prees, we started from scratch.

Therefore, we also told them what kind of activities awaited them over the next year once they went public. There are briefings, analyst meetings, investor relations, and finally, the general shareholders meeting. Since there is no point in preparing for the shareholders' meeting too early, I told them that they need to prepare for it right before the meeting.

President Kuwano: I also received personal guidance during the first month. I received a documented list of what elements are required to become the president of a listed company, and I studied it. What impressed me was the advice that I should go to shareholder meetings to create an image of what kind of activities a listed company is engaged in.

Fukuda: There is a big difference in the amount of information you can get from just reading about a company and actually seeing it with your own eyes.

President Kuwano: To be honest, there were many troublesome things because we had to start something new that would not be necessary if we were just running a normal company. I realized that a publicly listed company has to be more solid as a corporation than we thought. Now that I am actually in a position to receive money from investors, I realize that it is indeed necessary.

There were a great many regulations that needed to be cleared up, but I asked Mr. Fukuda to show me examples of other companies in this regard as we proceeded. It was great to have the know-how of how other companies do things and what the usual format is.

From the establishment of an organizational structure to the teaching of key techniques for shareholder meetings, Mr. Fukuda provided us with careful guidance like a private tutor.

President Kuwano: I also consulted with Mr. Fukuda about the organizational structure. As I mentioned earlier, the members were complete amateurs, and there was no corporate planning or CFO.

Fukuda: We needed someone in charge of creating IR materials, so we designed what kind of structure and roles would be best.

President Kuwano: Currently, we have established a Corporate Planning Department, and within that department, we have changed to a structure in charge of IR.

Also, Mr. Fukuda's knowledge of the operation of shareholders' meetings has been quite helpful. Of course, trust banks also provide knowledge on how to manage shareholder meetings, but it is not practical know-how, and the timing is a little late to prepare ahead of time.

Fukuda: I have been observing shareholder meetings for more than 20 years, so I understand the differences between the past and the present. What requires some technique today is how to handle questions and motions. I told them that is important.

President Kuwano: After the support ended, I proceeded with the listing by communicating with the securities company on a replacement basis, using what Mr. Fukuda had taught me for a year as a foundation. If the securities company taught me how to prepare for exams at a prep school, Mr. Fukuda was like a private tutor who taught me how to study for the future.

4、The input of many other companies' case studies helped us to achieve a smooth and error-free listing.

President Kuwano: The achievement this time is that we were able to successfully go public on Mothers in exactly the two years that we had targeted. I think the main point of our successful listing was that we were able to avoid making minor mistakes by having Mr. Fukuda teach us case studies of other companies. Personally, I got the impression that the listing examination was based on a point deduction system, rather than an appeal to the good points.

IPO know-how is not something you can find in books, so I think that seeking professional assistance early on was also a success in itself.

Fukuda: The situation changes in real time. We have to respond as needed.

President Kuwano: We are at the stage of becoming a publicly listed company, and what Mr. Fukuda taught us about how to deal with investors was also a great asset. If I didn't know anything, I would be anxious and overconcerned. Of course, if we were too well versed in the subject, we would be distracted, but I learned that it is more important than knowledge to know what we are dealing with investors for.

Another asset is that I was able to learn about various examples of shareholder meetings in the past. I learned for the first time that some companies are taking various interesting approaches. I feel that it is not a matter of which one is the right answer, but rather the ingenuity of companies that have their own ideas of how they want to appeal to the public. Of course, if it becomes a topic of conversation, it will be reflected in the stock price.

Fukuda: I think that the fact that we gave people a general idea about IR before listing on the stock exchange has been helpful.

For me personally, I had never worked with such a young company before. Everyone was young in age, but very motivated to learn. I was glad that I was able to work with them with the feeling that I had to keep up with them. I was also able to renew my knowledge.

5、The benefits of having professional personnel with human qualities that match your company's are great.

He shared his knowledge in accordance with the corporate culture and the young members, and that's why he was able to motivate us within the company.

President Kuwano: While we talk about IR and going public, but have only young amateur members, I am grateful to Mr. Fukuda for his flexible response tailored to them. In this respect, I thought that human nature is also important in pro-sharing. I believe that Mr. Fukuda had a deep understanding of our company culture, which motivated our members.

Fukuda: I have also been lecturing at universities for about 15 years (laughs). I am always dealing with young people.

President Kuwano: In that sense, there is no absolute "this kind of person is good for professional personnel. Unless you understand the company's issues at the time and its corporate culture, it is hard to know who is good. I think Circulation is very good in this respect even among pro-sharing companies, and the consultant in charge, Mr. Takahashi, is still very good at grasping this aspect. He did not just list a large number of professional personnel, but he accurately grasped my concerns and suggested, "There are people like this.

We want to move forward as a "problem-solving company" in a broad sense, not just in the telecommunications industry.

President Kuwano: With the IPO, we are making a major change in the way we manage our company. In the future, we would like to play an active role not only in the telecommunications industry, but also as a company that solves issues in Japanese society. There are a wide variety of fields and industries, but what I would like to focus on is "people. I would like to grow into a pioneering company that solves issues such as reforms in the way people work. I feel that only after achieving this goal can we turn our attention to the global market.

Fukuda: I think Peers will be popular not only with institutional investors but also with individuals. If you can build a fan base, you can increase volume and stabilize the company over the long term, so I hope that you will expand your shareholder base in the future. ESG is now attracting attention from investors, so I recommend that you mention ESG in your financial statements and securities reports, even if only a little. I expect the share price to rise more and more in the future.

Peers's invited Mr. Fukuda from an early stage to become a publicly listed company and accumulated preparations, which resulted in a smooth IPO. I felt that the highly motivated members of the team, who were highly motivated to tackle an unknown area, absorbed Mr. Fukuda's teachings well, which led to a definite success.

6、Summary in IR and administrative enhancement projects for IPO.

Issues/Overview

The goal was to list the company on the Mothers market in two years, but there were so many issues that they had no idea where to start or how to strengthen the administrative and investor relations departments. There were calls from the field for hands-on support, but Mr. Fukuda, who had a wealth of experience and knowledge, was assigned to the project so that the members could acquire the know-how themselves.

Details of Support

1. Meetings were held twice a month for about 2 hours. Through regular visits, a roadmap was created to ensure that the tasks were completed.

2. Designed an overall schedule for the first month. We also taught the necessary tips for the president of a listed company.

3、From the second month onward, he gave lectures on IR to members of the administration department and also developed various regulations. He also observed an actual general meeting of shareholders.

4、The organizational structure was also designed, and an IR manager was placed under the Corporate Planning Department.

5、Mr. Fukuda provided guidance on practical know-how that trust banks and securities companies do not teach, such as techniques for managing shareholder meetings.

Results

Successfully listed on Mothers within 2 years as targeted.

Satisfactory public offering price was achieved.

Successfully accumulated sufficient know-how for future shareholder meetings and investor relations

Key points of support

In a sense, advice from securities firms and trust banks is prescriptive. Since it is not possible to cover all factors, it is valuable to have professionals who can provide support based on a flexible and broad perspective, as well as examples from other companies.

There are very few people in the market who can raise the level of the entire administrative department to a level where it is possible to list a company on the stock exchange. To hire such a person in-house requires a considerable annual salary, so professional personnel who can be utilized on a spot basis are an effective means.

Planning and editing: Miyu Arai、Photography: Takahiro Higuchi

https://circu.co.jp/pro-sharing/mag/article/3262/ textual sources