COLUMN

“Leaning in closely to the vision of business leaders”
Realizing a Venture Ecosystem through M&A

D-POPS GROUP has 25 group companies that we call partners (at the time of publication).

For this article, we interviewed Takahiro Kato, the Managing Director, Operating Officer, and Corporate Planning Head of D-POPS GROUP Co., Ltd., as well as Co-President of Faithful Corporation, one of D-POPS GROUP’s first member companies. (This interview was conducted in December 2025.)

This is the latter part of the interview. To read the first part, click the link below.
https://d-pops-group.co.jp/en/column/faithful-interview-first-part/

◆Keeping Busy as the Head of M&A

Sugihara:
On the other hand, you continue to serve concurrently as the head of M&A. Regarding the weight of your responsibilities, how do you balance your role as President of Faithful with your M&A duties?

Kato:
The pressure of M&A occupies over 90% of my heart and mind, but what takes up more of my time is Faithful’s business operations.

This is especially because I started as a complete amateur with M&A. Because there are so many buyers in the market these days, good deals won’t just come around if you simply sit and wait.

Sugihara:
How did you manage to start accumulating deals when you didn’t even have any connections?

Kato:
I certainly wasn’t a very pretty sight during my first year. I attended every M&A seminar I could find, but those are usually designed to attract sellers. However, I made a point of sitting in the very front row, asking question after question, and at the end, I would approach them head-on and awkwardly ask to become friends with those agencies.

I would also boldly crash social gatherings even though I didn’t know anyone, and gradually, I began to get close to some people. After a solid year of relentlessly repeating this process of relationship-building, I finally connected with our first deal: graphD.

Sugihara:
Looking back at your core business at the time, wasn’t it a little unexpected to take on a new industry with graphD for your very first M&A deal?

Kato:
I think you’re exactly right. There were concerns that we would be spreading our domains a bit too thin with that first M&A. When I first proposed the deal, President Goto wasn’t very keen on it either.

However, the situation suddenly changed in a funny way. One of our major clients, a telecommunications carrier, gave us very positive feedback, saying, “Partnering with a company strong in POP production would be a very interesting move.” That’s when President Goto said, “Maybe this is a good idea after all.”
(Note: POP = Point of Purchase, i.e., advertising materials for sales promotion.)

But it gets even crazier after that! It turns out that back when Mr. Watanabe—who would later become D-POPS GROUP’s Managing Executive Officer—was still at Yodobashi Camera, he gave the advice, “Starting a POP company like this will be good, and it’ll make business come around more smoothly.” And that’s how graphD was founded!

Sugihara:
Such a wonderfully small world!

Kato:
At that time, I had absolutely no connection with Mr. Watanabe. Without knowing any of that background, I proposed it simply as a deal I had found by myself. When I discovered the facts later, it felt like the dots were finally connecting into a line.

Looking back over my 20 years here, there have been many such chaotic or coincidental events, but now I truly feel that each piece of the puzzle has come together to form the current shape of the group.

◆The Importance of People for D-POPS GROUP’s Style of M&A

Sugihara:
From the acquisition of graphD, I believe about 15 companies have joined D-POPS GROUP since then. Behind the scenes of closing that many deals, you must have been examining a vast number of projects.

Kato:
Yes, it’s more than I can count, ha ha. If I were to list out the cases for this year alone, I’ve inspected somewhere between 300 and 400.

M&A agencies often tell me, “There’s absolutely no other company with conditions like yours.” For example, I set high standards, such as profitable companies with annual sales of 1 billion yen or more, and they tell me such excellent deals won’t just come rolling by. Nevertheless, we’re going to keep on narrowing down the potential candidates to only the truly valuable ones.

Sugihara:
Out of those 300 to 400 cases that you examine, how many proceed to an actual interview?

Kato:
Only a very few hand-picked enterprises proceed to the interview stage. However, I believe that the selection process itself is extremely important.

Sugihara:
Among that vast number of projects, what criteria or standpoints do you have for deciding whether to meet with someone?

Kato:
Intermediaries often ask me to provide specific company names or industries, but that’s actually difficult to do.

The current challenges that are brought up at D-POPS GROUP’s board meetings, and the existing resources we possess: where these two intersect is our criterion for evaluation. When a group ecosystem becomes as developed as ours, if you map out industry areas represented by our companies, most are already filled. So how do you look for gaps? Although cases that are too far from our areas are out of the question, I think a vertical integration model that can only complement our existing businesses is not enough.

It’s not just about acquiring the competition and increasing the scale of our company, it’s about whether or not we can imagine a specific M&A opening up interesting future developments when combined with our current business. I always evaluate a case according to whether or not the company in question would fit within the vision we have for our future and create new value in a multi-dimensional way.

Sugihara:
Suppose you do find a project that fills a missing piece or gap in D-POPS GROUP’s portfolio. After it passes the document review and you meet the CEO in person, what other areas are being checked?

Kato:
Above all, we place extreme importance on whether their atmosphere and culture match those of our other group companies. Even if the industry is different or they don’t use the exact same words as us, as long as our underlying values are the same, we can respect each other. We value that sort of instinct. On the other hand, people who take a one-sided approach to conversation from the very beginning are difficult to work with.

One particular thing I watch out for during interviews is whether they’re at a “presentation ceiling”, so to speak. By that, I mean putting on makeup to make themselves look better just for the interview. But I can see through that. There have been cases in the past where that makeup peeled off during the Due Diligence (DD) process, and the deal fell through.

Sugihara:
What specific steps do you take to discern that?

Kato:
We never conduct a so-called “stress interview”. We’re more interested in listening to each other’s dreams and figuring out if we can possibly enjoy a future together. To decide this, we usually meet twice. The first time is with me alone, and the second time is a deeper discussion with President Goto. However, there are many things you can’t see from just talking about theories, so we make it a point to have dinner together, as well.

The words that slip out when someone has had a drink, the passion they show when talking about dreams…once you finally break into those deep conversations, you will see a person’s true self.

President Goto’s interviews and dinner meetings are usually over three hours long. He intentionally takes that much time to deeply understand people’s backgrounds. While transmitting that level of intensity, we ultimately judge based on the essentially human question: “Do we want to create the future together with this person?”

Sugihara:
Among the M&A deals you’ve handled so far, are there any cases that were particularly memorable or challenging?

Kato:
Our M&A strategy is based on the policy of supporting business owners’ growth, so it is very rare for founders to exit their companies after their acquisition. In principle, our style is to have founders join our group and run together with us toward growth. That is precisely why, in the few cases where founders do exit their companies after joining D-POPS GROUP, the messages regarding the vision they’ve entrusted to us leave a very strong impression.

Even after the acquisition, I want those people to never stop thinking, “I’m so glad I entrusted my business to this group back then.” It is my absolute duty to take the baton and grow that business even further with our new partners, and I feel this responsibility more strongly than anyone else.

Sugihara:
On the other hand, have there been cases where you were forced to make a painful decision?

Kato:
Yes. I still ask myself from time to time whether we made the right decision regarding one company we had acquired, and then ultimately sold to another company.

From a business perspective—making an administrative decision, or in the sense of gaining a return on investment—that may have been the right choice at the time. However, my style is to enter the other person’s world and walk alongside them until closing out the deal, and valuing their feelings all the while. Because I care about individual companies as much as I cared about our individual stores, I still have lingering regrets about that one case.

Sugihara:
Precisely because you value people that much, people choose D-POPS GROUP for reasons beyond just the monetary value.

Kato:
Exactly. I don’t think the acquisition prices we offer are the highest compared to other companies. In fact, it’s more often not the case. However, CEOs will hand over their companies to us and say, “I’ll leave it to you.”

Because they don’t choose us just for the money, I feel the weight of responsibility for their entrusted vision even more heavily. I believe my mission as the M&A lead is to coordinate within the group to see that their trust produces results.

Sugihara:
You mentioned that in extraordinarily rare cases, founders pass the baton of their business to D-POPS GROUP and then step down. I heard that sellers usually don’t explicitly state their desire for how you should grow their companies, but in your position, how do you respond to that kind of expectation?

Kato:
Those expectations aren’t directly spoken in words. However, in the process leading up to them choosing us, I always make sure to ask, “Why did you decide not to go with another company?” Along with the details that we get through the intermediary agencies, I see that accumulation of information as the CEO’s feelings that they couldn’t express out loud, so I make sure to place high value on it.

What always gives me the greatest impression is the dinner that serves as a ceremony for passing the baton. The CEO will say to the employees who are staying with the company, “Thank you for everything. From now on, within this group, continue to do your best!” Those words are a testament of trust in us, effectively saying, “You’ll be fine with these people.” Coming on the back of that kind of moment, I feel a powerful sense of responsibility that I absolutely cannot ever betray those people.

◆The “Flow of Energy” that President Goto Values

Sugihara:
When it comes to the M&A process, has anything President Goto said left an impression on you?

Kato:
It would have to be one phrase: “The flow of energy is bad”. This is the toughest thing to deal with, ha ha. The intermediary agencies will work desperately to find the kind of deal that might only come around once a year or so, and we’ll reach a certain point. But if President Goto says, “The flow of energy is bad”...there’s simply nothing we can say to that, ha ha!

Sugihara:
When you investigate a case yourself and then propose it, only to be told such a thing, is it hard for you to accept that?

Kato:
To be honest, in the past, I really couldn’t accept it at all. Back then, I was only looking at the numerical aspects, group synergy, and positioning in the industry, but now I think I was completely missing the essential human element.

But after doing my homework many times, I’ve gradually come to a place of understanding. I’m able to realize, “Ah, this must be what President Goto was concerned about!” Nowadays, our intuitions are much more likely to align. Although, there are still some times I feel disappointed when a project I’m personally attached to gets rejected, ha ha.

Sugihara:
Besides the flow of energy, what other perspectives do you feel President Goto has regarding finances or business performance?

Kato:
I think President Goto keeps the sharpest eye on how other leaders make intentional decisions.

He often says, “A stack of blocks doesn’t grow just because one block stands out.” He means one person doesn’t need to be the top in everything. On the other hand, as Corporate Planning Head, I take pride in the fact that I’ve worked quite hard to make sure I’m not a burden to our group.

I’ve been given responsibility for practical numbers and for negotiating M&A terms, but for the highest level of decision-making that happens in our board meetings, the board members’ perspectives are also crucial. For large cases, President Goto personally holds preliminary discussions with President Naito and Chairman Semmoto to thoroughly bounce ideas off of them. I incorporate the feedback from that coordination process into our business plans and M&A contracts. After going through such a rigorous process, those CEOs and their businesses finally become our colleagues and join the list of our group companies and investment portfolio companies.

Sugihara:
After handling M&A for this many years, what is the moment that made you feel the most fulfilled?

Kato:
For most entrepreneurs, an M&A is a once-in-a-lifetime, high-stakes endeavor into which they’ve poured their very lives. To be present at such a critical juncture is truly an honor.

Actually, everything I’ve done here at D-POPS GROUP stems from an ambition I’ve held since before I even joined that accounting firm: the desire to stand by and support the visions of entrepreneurs. Now, being able to support life-altering decisions through M&A makes me feel like I am right at the core of my professional purpose.

Sugihara:
You hold the major dual responsibilities of being Faithful’s CEO and the head of M&A for the entire group. Is there anything you have to keep in mind while wearing those two hats?

Kato:
After becoming a company president myself, my respect for the CEOs of our other group companies has grown even stronger. I don’t think I would have ever truly grasped this feeling if I had remained only in charge of M&A.

You can’t feel the true challenges and the sense of loneliness that comes with being a leader until you become one yourself. Back when I first joined and was focused on launching the administrative office, the staff working in the stores sometimes looked at me coldly, thinking, “Who does this ‘executive candidate’ think he is?” But now, having the perspective of a business owner, I understand how to bridge the gap between different departments and standpoints.

I can have a bird’s-eye view of the group as a whole, while also handling the management of a customer-facing business. That sort of environment is an extreme luxury, and it’s a challenge I find deeply rewarding.

Sugihara:
In your busy life with multiple roles, how do you balance your professional life with your private life, and what do you value most in life?

Kato:
One of the major catalysts for me aiming to become a CEO was joining Entrepreneurs’ Organization (EO). Ever since I joined the company around 2007, my mentors would tell me that EO is an incredible place, and I started aspiring to get there someday.

What I learned there wasn’t just management know-how; it was something more fundamental, like a philosophy of life. “We have to face the reality that all people eventually die. How do you want to meet your end?” I often have opportunities to talk deeply with my EO colleagues about topics like that.

My hope is that at the end of my life, my companions and I can look back and say, “We really worked hard back then.” Expanding this circle of gratitude has become my life’s guiding principle.

On a personal note, I’m still very close to my wife, whom I met when I was 19, and this year marks our 30th year together. Having a peaceful family life is a huge support for me.

My personal life hasn't always been smooth sailing. At age 41, I suffered from cancer, and then developed a complication that occurs in only one in a million people. Just the other day, my doctor told me, “You don't need to take medication anymore,” so my battle with that illness has finally settled down, and I feel a sense of relief. It is precisely because of this experience that the importance of family and companions has truly hit home.

By becoming ill and learning my own weakness, I feel that the words ‘integrity, humility, and gratitude’ are finally all connected inside me. From now on, just as I was supported by others, I want to be the kind of person who can be a support for someone else.

◆On “Realizing a Venture Ecosystem”

Sugihara:
D-POPS GROUP aims to realize a Venture Ecosystem. What parts of this goal resonate most with you? Are there any specific mindsets or activities you focus on while building this ecosystem together?

Kato:
Actually, during my job interview 20 years ago, President Goto spent three hours passionately talking to me about his concept for a department store. The idea was to have a cafe, a mobile phone shop, and a perfume shop all within the same building. He said it would be amazing if they could create synergistic effects to generate customer satisfaction.

While the exact shape of that has changed, I believe that was the prototype of the Venture Ecosystem we are aiming for today.

Twenty years have passed and our business model has evolved, but the underlying desire to “create delight and brightness for people” has not changed at all. In the past, it felt like our work was about survival plus a little extra, but now we have gained enough momentum to influence society more broadly, such as through educational support. I can feel that advancement firsthand.

Sugihara:
What do you intentionally do every day to make the Ecosystem even stronger?

Kato:
Almost like clockwork, a difficult situation has occurred roughly every five years, ha ha. But no matter whether we have a serious storm or smooth sailing, I stay focused on three things we have championed for a long time: stand your ground, never stop challenging yourself, and grow at triple speed.

The delight and brightness found in our company name (D-POPS stands for Dream–Produce One’s Pleasure and Shining) can never be created by maintaining the status quo. We apply a comfortable amount of stretch to ourselves and work together to take on lofty goals that at first seem impossible. That process of challenging ourselves creates triple-speed growth, which ultimately leads to someone else’s delight and our own brightness.

To me, the act of keeping this cycle going builds up our Ecosystem.

◆5-year Vision

Sugihara:
Where do you see yourself and Faithful five years from now?

Kato:
I want to reach the level that when someone hears the term ‘direct marketing’ within the context of D-POPS GROUP, he or she will immediately think of Faithful (URIZO).

For nearly the first 10 years after joining, I was responsible for financial strategy, and in the period since then, I’ve handled M&A strategy. If I can firmly establish marketing strategy as a third pillar, I believe I can make a significant contribution as a foundation for the group. My ideal is for the next person who takes over the systems I’ve built to polish them and make them even stronger.

Sugihara:
Will the newly added service, URIZO, be the key going forward?

Kato:
Yes, I want to ensure it is seen as the key. This business, which we took over from a subsidiary of a listed company in 2024, plays an extremely important role in the overall marketing strategy of the group. It is still in the seed stage, but my current mission is to grow it into a large sprout as quickly as possible.

Sugihara:
With the spread of AI, the nature of marketing is changing. What challenges do you see up ahead?

Kato:
We live in an age where anyone can easily obtain primary information and launch marketing measures using AI. That is exactly why it’s absolutely necessary to differentiate ourselves by doing what AI cannot mimic.

I feel there is a literacy gap here similar to what we saw with mobile phones in the past. As digital becomes more prevalent, analog marketing such as mailing out letters attracts attention again, and proposals that carry human emotion rather than being left entirely to AI will gain value. It’s about the multiplication of the latest tools with human ingenuity and passion. I believe the battle from here on out will be determined by how we combine those two.

Sugihara:
Finally, do you have a message for those reading this article?

Kato:
Looking back on my experiences, my major failures leave a stronger impression than my successes. Even so, I learned from those failures, was given another chance, managed to fix those mistakes, and created things that made people happy. For me, one important aspect of this group’s corporate culture is getting a second chance, or many chances, so one can try again and again. I want to continue challenging myself without fear of failure and create new, enjoyable experiences that bring value to the group. If reading this article increases the number of colleagues who resonate with our Ecosystem, I couldn’t be happier. Let’s have fun challenging ourselves and change the world together!

Interview conducted by D-POPS GROUP’s advisor Genta Sugihara.

D-POPS GROUP Co., Ltd.

Managing Director, Operating Officer, and Corporate Planning Head Takahiro Kato

Faithful Corporation

Company Co-President: Takahiro Kato
Address: 32F Shibuya Hikarie Building, 2-21-1 Shibuya, Shibuya-ku, Tokyo