Taihei Kobayashi has gone from sleeping on the streets of Tokyo to heading a technology startup whose market value topped $1 billion.
His rags-to-riches story is among the most remarkable to emerge from a small-cap stock boom that’s minting fortunes in Japan. Kobayashi’s company, which helps startups and other firms to design and create new businesses and products, went public in July and its shares have since more than tripled.
It’s an outcome that few could have imagined two decades ago. As Kobayashi tells it, his parents kicked him out at 17 when he quit a prestigious high school to focus on his band. He played music during the day and mostly slept outdoors, using cardboard boxes to keep warm during freezing winter nights. He was homeless for a year and a half.
A series of encounters got him off the streets and eventually into a job as a software engineer. He was one of the core members in establishing the predecessor to the company now known as Sun* Inc., pronounced Sun Asterisk, in Vietnam in 2012. He’s now Sun*’s chief executive officer.
“The winters were cold,” Kobayashi, 37, said of his experience on the streets. “There may have been times when things felt like hell. But I’ve overcome those times.”
According to Kobayashi, his parents wouldn’t accept his decision to drop out of high school. They had made financial plans to allow him to get a university education, he said. Attempts to contact Kobayashi’s parents were unsuccessful.
“They told me to leave, so I left, and that was that,” he said. “I wanted to live my life doing what I enjoyed.”
Kobayashi ended up spending two winters on the streets of the Shinjuku and Shibuya districts of Tokyo.
Mostly Outdoors
“I might have died,” he said. “I slept anywhere I could,” he said. “About 80% of the time it was somewhere outside.”
Yushi Fukagawa, a close friend since Kobayashi’s school days who currently works at Sun*, recalls the time the entrepreneur became homeless.
“I didn’t think too much of it,” Fukagawa said. But “my parents seemed worried.”
At 19, a manager of a live-music club took pity on Kobayashi, offering him a job and saying he could crash at the club. He did so for about six years.
Eventually, Kobayashi decided it was time to move on. First, he made some money trading music records online. Then he came across a job advertisement that didn’t require any qualifications or experience. All you had to do was take a test, it said.
The six-hour examination tested applicants on areas including mathematical skills, logical thinking and IQ. Koyabashi passed and started working at the firm, which trained him to become a software engineer.
Start Company
That’s how he met Makoto Hirai, one of the founders of Sun*. The two agreed there were many software engineers who excelled in programming, but few who could use those skills to come up with working business models. They decided to start a company to bridge the gap.
Kobayashi moved to Vietnam in 2012 to hire staff from the country’s pool of young engineers. In March 2013 the founding members incorporated Framgia Inc. in Japan, which changed its name to Sun* in 2019. The idea was to deploy the engineers to help Japanese startups that were struggling to build a viable business.
“Our stance was to commit ourselves to the growth of those startups, regardless of whether it left us mired in losses,” Kobayashi said.
Over the years, Sun* grew its business, and now has more than 70 clients. The company listed in the Tokyo Stock Exchange’s Mothers market for startup firms in July. Its shares rose almost sixfold to a high in September, taking its market value above $1.4 billion. They’ve since dropped 38%, with the company’s market capitalization dipping back below $1 billion. Kobayashi’s 7.9% stake is worth about $71 million.
Sun* posted net income of 649 million yen ($6.2 million) on revenue of 3.97 billion yen for the nine months ended September.
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