Japanese Startup Surges 300% on Demand for Cloud-Based Accounting

(Bloomberg) — Daisuke Sasaki has seen his cloud-based accounting company’s valuation swell to $3.7 billion despite having yet to show a profit, but he’s not letting that pressure him.

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Shares of Freee K.K. have quadrupled since going public on the Tokyo Stock Exchange in December, along with rising demand for cloud services amid the remote-working trend.

“We don’t have a set timeframe for when the company will swing to profits,” Sasaki, founder and chief executive of Freee, said in an interview on Aug. 17. “Our business is about subscription.”

The Tokyo-based firm’s stock is one of the many technology names that have surged during Covid-19, fueled by investor euphoria over stay-at-home and DIY themes. While the pandemic roiled the outlook for companies around the world, U.S. accounting software giant Intuit Inc. beat recent earnings estimates, helped by better-than-expected growth for its cloud-based service for small businesses.



chart: Shares of cloud accounting firm have nearly quadrupled since IPO


© Bloomberg
Shares of cloud accounting firm have nearly quadrupled since IPO

Freee has the top shares of the Japanese cloud accounting and human-resources software markets, according to an August report from Daiwa Securities Co., with competitors including Money Forward Inc. Subscriptions to Freee’s flagship accounting service stand at over 220,000, having grown at more than 50% annually over the past five years. Its sales surged 53% in the year ended June 30.

Acquiring new users takes priority over near-term earnings, said Sasaki. He estimates that Japan has a total of about six million small- to medium-sized enterprises, with only 15% of them currently using cloud-based accounting. Freee’s goal is to outpace market growth to be the dominant player.

“We’re still extremely small in terms of where we could be,” Sasaki said, whose resume includes stints in marketing at Google and as an analyst at CLSA.

Market expert views on Freee are

Japanese Esports Team Can Start Receiving Its Pay In Cryptocurrency

KEY POINTS

  • SBI e-Sports players in Japan could opt to receive their salaries in XRP
  • This decision is part of the deal with SBI VC Trade, a venture firm who also sponsors the e-Sports team
  • XRP currently has a market cap of $10.9 billion

Japan-based SBI e-Sports recently announced that players on the team could receive their salaries in the cryptocurrency XRP as part of a deal with SBI VC Trade, a venture firm established by Japanese financial conglomerate SBI group, and who also sponsors the e-Sports team.

First announced in a press release on Sept. 30, the sponsorship entails SBI VC Trade’s logo on the official website, with plans to put this logo on the players’ uniforms as well. The players have the option to receive their salaries in XRP moving forward.

Through the support of VC Trade, SBI e-Sports aims to continue building a strong team that will encourage the global fans to further appreciate e-games, the Japanese press release said.

XRP, the cryptocurrency of financial firm Ripple, currently has a market cap of $10.9 billion, making it the fourth largest cryptocurrency by market cap. Cointelegraph notes that Ripple has been a partner of SBI e-Sports and had, in 2019, established a $100 million fund to support game developers.

The Roppongi-based SBI VC Trade is engaged in cryptocurrency related services, such as exchange, translation services, and information offering. Its mission is to establish and nurture a digital asset and cryptocurrency market based on its customer-centric principles. The company has been registered as a Virtual Currency Exchange Service Provider since 2017.

In June 2019, SBI Holdings announced the establishment of SBI e-Sports, signalling the conglomerates entry into the eSports business. Citing the remarkable rate of development of the eSports industry, SBI said eSports has already been adopted as part