strategic acquisition of yayoi · launched cloud-based software 2014 bcn award 2014: ranked no.1 in...

Copyright © 2014 ORIX Corporation All rights reserved.

Strategic Acquisition of Yayoi

November 2014ORIX Corporation

Copyright © 2014 ORIX Corporation All rights reserved. 1

Overview of Yayoi

Company Name

Address

Business Activities

No. of Employees

Representative

Capital

Yayoi Co., Ltd.

SIA Kanda Square, 17 Kanda Konya-cho, Chiyoda-ku, Tokyo

Development, marketing, and support of business management software “Yayoi Series” and related services for small businesses

Established 1978

50 million yen

Koichiro Okamoto, Chief Executive Officer

541

History

1978 Established Nihon All Systems KK

1980 Established Milkyway KK

1987 Released the first version of “Yayoi Series”

1997 Established Intuit KK as a result of merger

Opened Osaka Customer Center

2003 Changed company name to Yayoi Co., Ltd.

2007 Opened Sapporo Customer Center

2009 Launched business help desk service

2012 Achieved 10 billion yen in revenues

Reached 1 million in registered users

Launched cloud-based software

2014 BCN AWARD 2014: Ranked No.1 in business

management software category for 15

consecutive years


Four Characteristics

No. 1 Share in the Business Management Software Market

Business Platformthat Generates Strong, Stable,

Recurring Income

High Growth Potential

Robust Customer Base Centered on Small Businesses


Business Model Lead customers who purchased the products to join annual fee-based YSS

membership program Recurring income (service income such as annual membership fee) comprise

about 80% of revenues

Business Model Trend in Revenues

Note: YSS is an abbreviation for Yayoi Support Service. Customers are able to receive product support and business support services by joining YSS and paying annual membership fees

Purchase product

User registration

Purchase of associated

supplies

UpgradesYSS member registration

Updates for regulatory changes/free updates Software help desk Data backup service using cloud system Business Helpdesk on accounting, tax filing, etc.

Unit: JPY Bn

Recurring income (Annual membership fee, etc.)


Rational for the Acquisition

Acquisition of new business platform-Stable, long-term revenue base-

Acquisition of new customer base-Access to small businesses-

Expansion of service lineup-Growth support services for small businesses-


Acquisition of New Business Platform Market share of around 60%. Lead new customers to join YSS with retention

rate of about 90% ORIX acquires new service business platform that generates recurring income

Market Share Trend in Number of YSS Members

Note: The market share is Yayoi’s share among business management software (units sales) sold at electronics retailers and leading online retailers (value packs are counted separately as individual products)

Source: Calculated by Yayoi based on the data from GfK and BCN during FY10.9 to FY12.9, and data from Gfk during FY13.9 and FY14.9

9 out of 10 companiesretain the contractNew customers join YSS

Unit: Thousands of members


Acquisition of New Customer Base

Yayoi has robust customer base of over 1,250,000 companies centered on small businesses

Creates access to small businesses which ORIX was unable to approach

Note: Small businesses refer to companies with less than 20 employees (Less than 5 employees for wholesalers, retailers, and service providers). Registered users refer to customers who purchased Yayoi products that became registered as users.

Source: White Paper on Small and Medium Enterprises (FY2014)

Small BusinessesApprox. 3,340,000 (87%)

No. of employees: 11,920,000

Large/Medium-Sized CompaniesApprox. 520,000 companies (13%)

No. of employees：46,140,000

More than 200,000 companieslaunch their business every year

Registered usersMore than 1,250,000

companies

YSS members410,000

companies

Creates access to the customer base that comprises 87% of the

domestic businesses


Expansion of Service Lineup

Enhance services that are tailored to the needs of small businesses by combining the capabilities and knowhow of the two companies

Support small businesses’ growth and improvement of business efficiency

×

Leasing/finance Rental/sharing Insurance Benefit program Cost reduction Risk management

Existing services

Business managementsoftware

Business support

Existing services

New service lineup

Registered usersmore than 1,250,000

YSS Members410,000

Support the growth of small businesses

Copyright © 2014 ORIX Corporation All rights reserved.

About Yayoi

November 2014Yayoi Co., Ltd.


About Yayoi

Aims to be the infrastructure for start-up and growth of small businesses in Japan

Customers include small corporations, individual business owners, and entrepreneurs

Support customers by providing both products and services

Aims to be the infrastructure that is accessible and affordable to everyone

Dominant market leader

Double award winner in the BCN AWARD 2014*

• No.1 in business management software category for

15 consecutive years

• No.1 in tax filing software category for 10 consecutive years

Award winner in the 9th GfK BEST1**

• No.1 in business management (accounting) software for

9 consecutive years* Based on the POS data of PC and electronic retailers nationwide (2,431 stores) during 2013.1 to 2013.12** Based on the sales data of leading electronic retailers nationwide (approx. 4,000 stores) during 2013.1 to 2013.12


Develops, Sells, and Supports the “Yayoi Series”


Yayoi - Dominant Market Leader

Market share in units (FY14) : 57.8%

Note: The market share among electronic retailers and leading online retailers (value packs are counted separately as individual products) FY14: 2013.10-2014.9Source: Calculated by Yayoi based on GfK data


Share in Value Exceeds 80% for Accounting Software

Market Share in Value (Accounting Software)

Market Share in Units (Accounting Software)

Note: The market share among electronic retailers and leading online retailers (value packs are counted separately as individual products) FY14: 2013.10-2014.9Source: Calculated by Yayoi based on GfK data


Expanding Cloud Application Lineup

“Yayoi WhiteTax Filing Online”* Released January 2014

“Yayoi Blue Tax Filing Online”* Released October 2014

*The products above serve to support tax filing for small businesses. Users can select between the products depending on the format in which they submit their tax filing.


Yayoi’s Growth Strategy: Five Pillars

Evolve into “Business Concierge”

From software infrastructure to business infrastructure

Product Enhancement and Response to Regulatory Changes

Aptly respond to large-scale regulatory changes

Strengthen Relationships with Existing Customers

Build sustainable relationships with more customers

Develop New Customer Base

Continue to focus on small corporations and individual business owners

Use of Cloud-Based Services

Provide customers with improved usability through cloud-based solutions


Four-Stage Boosters to Realize Growth Strategy

Capture special demand stemming from consumption tax raise

Lead customers into YSS by offering first-year for free

Cultivate the untapped market with cloud applications

¥10bn

Time Line Revenues

Provide new value-added services

2

1

3

4

¥16bnFY14

FY13


3 Values by 2 Companies Combined: ORIX and Yayoi

Finance Service IT× ×

×


Becoming the “Only One”

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strategic acquisition of yayoi · launched cloud-based software 2014 bcn award 2014: ranked no.1 in...

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