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20th anniversary
History of Nanophoton 5 – Interview with the fourth president

This is the final installment of a series of interviews with past officers and directors to unravel the history of Nanophoton as part of its 20th anniversary commemorative efforts. In this final installment, we interviewed Dr. Satoshi Kawata, Nanophoton’s fourth president (current president) and chairman. He talked about what he has not talked about in previous interviews. (Newsletter Editor / Ryo Harada)

Satoshi Kawata, 4th President and Representative Director (2019.1-)

ー What was the reason why you and Mr. Takahiro Ode started the company and Dr. Kawata was not appointed president at that time?

Kawata – – I had no intention of becoming president. I had no corporate experience, and I was too busy teaching classes to have the time. In the first place, at that time, university professors were not allowed to become president, so there was no option for me to become president.

ー At the time, entrepreneurship was widely covered on TV and in various other media, and university-launched ventures were attracting attention as doing great things. Did you have any desire to be in the limelight?

Kawata – – Creating a company is a simple matter. All you have to do is register it at the Legal Affairs Bureau. I didn’t think it was important whether or not I was the president of the company, because my goal was more to make the company needed by the world, to sell products, and to contribute to society.

ー What are the differences between the roles of chairman and president?
Did the chairman and president ever clash over different management policies?

Kawata – – The president is responsible for the day-to-day management and operations of the company. The chairman, on the other hand, is the chairman of the board of directors. I recognize that this is to organize the company’s major policies and activities for the outside world. Our roles are different, and since I respected each of the past presidents, we never clashed with each other.

Mr. Ode, the first president, was an engineer who was a manufacturing geek, repairing and modifying anything mechanical himself, in addition to his main business of making laser microscopes, and was complementary to me, an artist-like scientist. However, we may have had different visions (dreams). Mr. Ode’s business model was to design and manufacture products on a daily basis to order, and he may have been aiming for a company that met the needs of individual customers in a meticulous manner. I wanted to develop standard products that everyone in the world would use.

ー How did the second president decide to hire Mr. Rinto Nakahara? I believe you did not know each other at first, but why?

Kawata – – I used a headhunting firm to interview several excellent people from large companies, but I didn’t feel comfortable with them. I did not feel a sense of crisis or preparedness for the risk of bankruptcy that small and medium-sized companies experience on a daily basis. And they were very demanding in terms of salary and had a businessman’s mindset. I realized that I needed to find someone who wanted to build a company, not someone who came from an ordinary corporate salaryman background.

So I went to consult with the Osaka representative of the Graduate School of Management, Globis University, which trains MBAs. He refused, saying that the school could not help me find someone, so I said, “Then I will wait outside the school’s entrance and talk to students,” and he introduced me to Mr. Rinto Nakahara (at that time, Lin Xie) haha. I heard that Mr. Nakahara had earned a doctorate at the University of Tokyo, worked as a researcher, then moved to the private sector, and was a leader at GLOBIS. I thought that having overseas experience was also a prerequisite, but I was also attracted to the fact that Mr. Nakahara was not only from overseas, but also from China, and that he was a hard worker who had earned his doctorate in Japan, where he did not even understand the language.

ー The third president, Michael Verst, is a German national, How did he come to be appointed to this position as well?

Kawata – –Michael Verst is in charge of Asia for an overseas company and is a Japanophile who loves miso soup. He was so eager to come to Japan that he sold himself to us instead of us finding him, but in the end it didn’t work out. Selling is not good.

ー Five years ago, Dr. Kawata was finally appointed as the fourth president. Why didn’t you choose a president from among others at that time?

Kawata – – The previous presidents had been great people, but the company still did not succeed, and after 14 years and three generations of company presidents, I recognized that the presidency of this company was very difficult. I thought that only someone who had either started his own company or had experience in bringing one to bankruptcy could manage a startup. However, there are very few start-ups in Japan, and such a person cannot be found. I thought that only I, as the founder and the person with the greatest responsibility, would be able to turn this company around. Even if someone with the same spirit and determination had existed in the first place, he or she would probably have been too concerned about me, the largest shareholder and founder of the company, to do anything bold.

I believe the same reason why all of Japan’s giant start-ups that have surpassed today’s companies are unable to successfully find a successor president. In our case, the business situation was so perilous that I could not afford the salary of a president, so I had no choice but to do it myself in the first place.

How do you feel now that you have assumed the position of president? What are some of the advantages of serving concurrently as chairman?

Kawata – – Having me in a dual role concentrates authority and responsibility. I think that is both an advantage and a disadvantage.
Even now, I want to find someone who can take charge of the president as soon as possible…The fact that I am leaving the chairmanship and holding a concurrent position with the president is a message that I am looking for a president.

As president, I established various fundamental systems, such as outsourcing manufacturing operations and distributors, cost reduction, SG&A cost reduction, head office relocation, several M&A negotiations, conversion from a seniority-based lifetime employment system to a success-based wage system, public relations reforms such as updating the website and starting distribution of e-mail newsletters, and so on. These reforms could only have been made by the founder.

ー Generally speaking, it is difficult for a researcher to be involved in the management of a university-launched venture business, which is not his/her specialty. However, Dr. Kawata has worked on various reforms such as the ones you just mentioned, paid back debts, and restructured the company. Now that the company continues to grow and you are running it so well, how did you develop such a sense of management?

Kawata – – I thought it was impossible for a scientist who thinks in terms of reason and a professor who must not say the wrong thing to run a company. If even one symbol or number in a formula is wrong, the final conclusion will be different, so it is an occupational hazard to check every single detail. I thought that I could not be a manager who could not serve without allowing a few mistakes or boasting.

However, I believe that my experience as a professor at Osaka University for 25 years and as a principal investigator at RIKEN for 13 years, managing and growing an organization with more than 25 students and research staff, respectively, has been useful in my role as president. As a scientist, it was also helpful for me to repeatedly discuss and create 3-year and 5-year plans with my team in order to obtain large project budgets, and to successfully complete them. It has also been helpful that I have invited many international conferences and served as president of domestic and international academic societies.

I hope that professors will start their own companies and become presidents to contribute to Japanese industry and academia. I started my own company at the age of 52 and became president at the age of 66. There are still many opportunities in life to take on new challenges.

ー Finally, what is your message for the next 30 years?

Kawata – – Thirty years ago, no one could have imagined today’s wars of aggression in Ukraine and Palestine, or the decline of Japan. The next 30 years are yet to be determined; not 30 years, but 10 years from now, the human desire for domination may have turned this world into a “1984” dystopia. Population explosion, food crisis, water shortage, environmental pollution, and infection explosion (pandemic) in developing countries will occur in less than 30 years. Japan’s population will be cut in half much sooner than currently estimated, and I will be over one hundred years old when I am alive. What we can predict is not thirty years from now, but three years at most.

Three years from now, Raman microscopes made by Nanophoton must be sold all over the world.

ー Thank you, Chairman Kawata.
I was impressed by his last words, “Three years from now, Raman microscopes made by Nanophoton must be sold all over the world. I was impressed by his strong wish that “Raman microscopes must be sold” instead of “I want to make sure that they are sold.
In addition, while talking with Chairman Kawata, I was struck by his genuine venture spirit. I wondered, “How can a professor who is a researcher run a business?” I was impressed by his willingness to take risks and take on new challenges, which is not unlike a professor, and he is truly a venture business manager.
Toward Nanophoton 2.0, Nanophoton will continue to challenge the world with Chairman and President Kawata at the helm.

(Translated by DeepL)