Over on Japan Probe, which, incidentally, I had featured yesterday, there is a bit of a discussion chain going. What’s funny is that it’s within the larger piece about Arudou Debito’s book, “In Appropriate”. The other poster, who has identified themselves as “Maid in Japan” there and as “Bruce Spencer” here, keeps focusing on telling stories about Japan-side businesses that use the internet or internet publicity as part of their strategy.
It’s hard to tell what private companies are worth. But based on pieces of evidence, you can guess what they’re not worth. The item that Terrie Lloyd had reported last December is the thing that I feel is setting off “Maid in Japan”. Lloyd had said, and let me put the screen shot here:
He said that the business sold for $22 million (US). When he originally reported the sale, in September, he put some doubt on that number–as it would mean that the buyer, EN-Japan, paid 5 years’ worth of earnings for a company that is smaller than itself. But now, this $22 million figure is out there as an example of what “Maid in Japan” calls a Gaijin Success Story.
Other than having a resume with them from 2010, I have no interest one way or another with the firm. But to me, it doesn’t sound like the kind of firm that would go for $22 million, and so I challenge that number. Truthfully, I think it has an extra zero tacked on, if the deal is valued to cash-equivalent. (Meaning, it could a $2 million sale.)
When I had been in the Tokyo market, I was told by other recruiters that Wall Street Japan was “just a website”. Well, no, that’s not true. There is an office in Ginza, and they do have staff. It is not one of these entrepreneurs who is running a business from their 1K apartment, or sharing common space with a microbrewer. (I don’t know if I ever blogged that one.)
Do you realize how much business Wall Street would have to do, to make $22 million of capital invested generate a decent return? They would have to have haken staff in the hundreds, or alternatively, be doing a ton of headhunter business. You have the overhead, and the staff. Most of these are either foreigners or Japanese with OK English. People in those categories move around a lot—and for the foreigners, usually in the direction of home.
Most recruiters in Tokyo–the midlevel people–are ex-Eikaiwa. That’s how they got to Japan, not because of headhunting. Their rolodex, or computer equivalent, is their ex-Eikaiwa buddies and girlfriends. Plus Japanese whose English is OK.
Do you see what I am describing as a $22 million business? (Meaning, a company would pay $22 million for it. NOT $2 million, which would be my guess, but ten times that.)
I joke about how I move Alexa stats, and I know that Alexa is not full proof, but check this recent one:
There you see, again: “Relatively popular in the city of Harrisburg-Lancaster-Lebanon-York (#1,246)”. That’s no Photoshop. That’s me checking once a day for the Flyjin Index. Eight hundred something listed jobs, 32 contract positions.
Arianna Huffington’s website went for over $300 million when AOL sold it. It gets an incredible amount of readership. A career advice and recruitment services site that one person hits in South Central Pennsylvania is not scoring $22 million. No way. I’d have to see that deal in print.
Terrie Lloyd said that he was surprised that no one in the Japanese media picked up on the story. Maybe because it wasn’t really a story. Many real business reporters now require that they be shown proof of what a party to a transaction is looking to publicize in a story. Otherwise, it gets reported as “claimed to be” or “seller purports that”.
I’ll take the negativity brush-off as coming with the territory of being a professional accountant. (FYI, it’s objectivity.) But I’m not going to be fooled by someone putting out a story that isn’t really true. I’m going to say what I think, and not attach “Media” into the name of the blog to try and convince people that my opinion is something more than what I describe it to be.