Takafumi Horie’s comeback; The controversial entrepreneur remains popular, brash and ambitious

August 30, 2013 Leave a comment

Takafumi Horie’s comeback; The controversial entrepreneur remains popular, brash and ambitious

Aug 31st 2013 | TOKYO |From the print edition

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IN 2005 Takafumi Horie, then president of Livedoor, an internet firm, joined the X PRIZE Foundation, a charity which gives cash for innovative projects such as space tourism. Joining forces with the likes of Larry Page and Elon Musk, co-founders of Google and PayPal respectively, was a typically bold move by the self-styled boy billionaire from Fukuoka. Instead of going into orbit, however, Mr Horie went behind bars. He was arrested in Japan’s biggest financial scandal of the decade. Now, however, he is out on parole, and says he will soon launch a low-cost space-tourism business using a Russian capsule. He has completed several test launches. A large Japanese firm is on the verge of sponsoring a flight next year, he says. Other investors, he claims, are standing by.This time the money will come not from inflating the earnings and shares of Livedoor, for which Mr Horie was sent down, but from a dedicated following of 20- and 30-somethings who pay to hear his thoughts via a monthly digital magazine. He has almost a million followers on Twitter. Social media and crowdfunding platforms, he says, make it far easier now to launch new businesses.

Not even 21 months in a Japanese prison, including solitary confinement, freezing temperatures and forced labour, were able to stop him entertaining an audience. From his cell he published two well-received books with gritty manga strips describing his new life: cleaning pubic hair out of toilets, being farted at by the senior prisoners he had to tend to, and having to surrender porn magazines to prison guards.

He also dreamed up dozens of new-business ideas. Among the 30 or so earthbound plans are a new reality show where fans will pay to put their “idols” on television, a celebrity-chat smartphone application and a scheme to undercut the price of livestreaming video to phones. Nothing too radical, then: Japan, after all, is already awash with social-media and smartphone start-ups.

As for his reception back into business life, Mr Horie jokes that “everyone has welcomed me, except for the chairman of Fuji TV.” Many people reckon the entrepreneur was punished harshly mainly because he tried to win control of the big broadcaster, and because he flaunted his wealth. The authorities usually treat accounting fraud more leniently. In July a group of executives at Olympus, a camera-maker, received suspended prison sentences for a far larger scheme.

Mr Horie, now 40, says he is trying to forget what happened. It will be hard for his generation to do likewise. William Saito, a serial entrepreneur who travels the country encouraging graduates to start new businesses, says he has spent the past five years trying to undo the dispiriting effect of Mr Horie’s fall and punishment on young people. A successful new venture would help greatly.

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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