1. Basic corporate management policy
Under the mission encapsulated in its corporate philosophy of “turning encounters into innovation,” the Sansan Group adopted the vision to “become business infrastructure.” Toward the realization of this mission and vision, we are developing services that promote DX by changing the working styles of companies and businesspeople with various business issues and believe that promoting these business activities will lead to the maximization of shareholder value and corporate value.
2. Management indicator goals
Sansan Group conducts business management with an emphasis on growth of consolidated net sales. In the Sansan/Bill One Business, in order to achieve a continuous and cumulative increase in sales, the key indicators are the number of contracts and the contract retention rate (cancellation rate), as well as the number of paid contracts for “Bill One,” and monthly recurring revenue (MRR). In the Eight Business, the key management indicators are growth in B2B services, and the net increase in users as necessary to build and expand the user network.
3. Company medium- and long-term management strategy
The Group’s businesses and business areas have the following characteristics, and we formulate medium- to long-term management strategies based on them.
A. Development of BtoB services (multi-product) that promote corporate DX
The scale of the market continues to expand due to factors that include changes in working styles, such as remote working due to the recent spread of COVID-19 infections, a change in the awareness of DX, and growing interest in the SaaS business. In addition, the DX market is expected to reach a scale of ¥3,042.5 billion in 2030 (up ¥2,251.3 billion compared with 2019)*1, and the scale of the domestic SaaS market will be ¥1,117.8 billion in 2024 (up ¥516.2 billion compared with 2019)*2.
Against the backdrop of this kind of market environment, the Group solves various business issues in fields that include business cards, invoices, contracts and business events. We are developing BtoB services, which are changing the working styles of companies and businesspeople while promoting DX, and building a business portfolio as a multi-product. In the years to come, we will work to strengthen and expand services through in-house development and collaboration with other companies so that this multi-product will become widely recognized as “business infrastructure.”
*1 Based on “2020 Outlook of the Digital Transformation Market” by Fuji Chimera Research Institute
*2 Based on “2020 New Software Business Markets” by Fuji Chimera Research Institute
B. Unique value of and market opportunities from business cards
The custom of business cards being exchanged in business encounter scenarios is deep-rooted, and business cards contain accurate information about a business person, such as his or her name, company, organization, job title and contact information. In addition to the history information of a business card exchange itself having a unique value, even now they are used as is in paper form on a daily basis, and digitization has not made many inroads into the market. We thus believe that there is still plenty of room for more efficient operations and more effective utilization.
By having created the market ourselves, the B2B business card-based contact management service “Sansan,” which we have been working on since our establishment in 2007, enjoys a market share of 83.5%*3 in the cloud-based corporate contact management service market, and we are leading the market as a pioneer. Combined with the expansion of users of our “Eight” personal business card application, which we launched in 2012, we believe that the brand awareness of our company and our services is increasing.
However, when seen from the number of companies and employees that exist in Japan, the “Sansan” coverage rate remains low. For example, the ratio of “Sansan” users to the total number of employees in Japan is only about 2%, and thus based on the number of users*4 we believe that there is plenty of room for development.
*3 “Latest trends in business card management services and sales services [SFA/CRM/online business card exchange],” December 2020, Seed Planning, Inc.
*4 The total number of “Sansan” IDs as of the end of May 2021 is defined as the numerator, and the total number of employees in Japan, which is the denominator, is calculated based on the Ministry of Internal Affairs and Communications statistics 2016 Economic Census Activity Survey.
C. Mechanism and technology to achieve 99.9% accuracy in converting analog information
The accuracy of business card data conversion in business card management services contributes to the essential quality and competitiveness of the service. In the case of “Sansan” its accuracy of 99.9%, and that of “Eight” has a high level of accuracy equivalent to that, and thus accuracy represents a strength common to all our businesses. The Sansan Group’s services convert business cards into data by combining technology that is evolving on a daily basis by means of, for example, machine learning with human efforts. Since its establishment, the Group has converted a huge number of business cards into data, centering on the manual input of business card data. At present, it has become possible to develop and operate a unique system that accurately and efficiently converts a large number of business cards into data. These technological capabilities and unique systems are the source of our competitiveness, and we are pursuing the development of new technologies and the improvement of operations to continuously improve the quality and competitiveness of our services. These systems and technologies also possess the characteristic that they can be utilized in a variety of fields.
D. Financial and earnings models that boast high stability
The Group’s “Sansan” billing model is mainly a subscription model (monthly billing) that can be expected to generate continuous income, so it is a profit model that can be expected to achieve stable and continuous business progress. Also, the monthly churn rate of the service has remained below 1.0% on average for the last 12 months, and by striving to increase sales per subscription we see this as an attractive model that facilitates the maximization of customer lifetime value (LTV).
The specific management strategies of the Group are as follows.
i. Further growth of Sansan/Bill One business
Although subjected to certain restrictions due to COVID-19, “Sansan” has established a series of business processes, from marketing activities to new orders, and continued to grow at a steady pace. For further growth in the years to come, we will continue to respond to the new working styles in the COVID-19 pandemic, such as “Virtual Cards” and optional functions that promote data utilization. We will promote the enhancement of the value of “Sansan” as a business platform by promoting and expanding the functions that promote corporate DX. In addition, we will work to further expand subscriptions per contract by, for example, increasing the number of subscriptions by strengthening the sales system, acquiring new customers on the premise that all employees of the user company will use the service (company-wide use), and promoting the expansion of its use by existing customers.
Furthermore, its unique model of making all invoices available online having been accepted, the high growth of “Bill One” has continued since the service was launched in May 2020. Since “Bill One” is a service that can be targeted at all domestic companies regardless of industry or scale there is a lot of room for development, and we will proactively implement various measures for its further popularization and expansion. Specifically, against the backdrop of a business management system that enables agile and flexible resource allocation through organizational restructuring to maximize sales, we will strengthen sales activities, advertising activities centered on TV commercials, and marketing activities.
ii. Eight Business monetization
To accelerate monetization of the entire business, we will strengthen the development of a variety of BtoB services utilizing the “Eight” network, such as recruitment-related “Eight Career Design” service and the “Eight Marketing Solutions” advertising service. We also aim to further increase the number of users by improving the convenience of the “Virtual Card” function and our “Eight ONAIR” business event media.
iii. Creation of new businesses
In the various business flows of companies, a variety of issues related to efficiency are piling up, and thus the Group is focusing on the creation of new services that will promote corporate DX by leveraging the strengths and knowledge cultivated through its existing services. Specifically, we have started to provide services in the areas of contracts, business events and seminars and, in addition to establishing these business processes and expanding their stable provision, we will promote efforts geared toward the creation of new services.
4. Business and financial issues that should be addressed as a matter of priority
The main issues that the Group should address are as follows.
A. Recruitment and training of talented human resources and ensuring of diversity
For the Group to achieve sustainable growth, it is crucial that we hire many talented professionals with diverse career backgrounds, and then improve our sales, development and managerial structures.
In addition to promoting the creation of environments and the building of systems in which talented human resources who empathize with the Group’s corporate philosophy and business content can work with high levels of motivation, we will work to ensure the diversity of our human resources.
B. Ongoing strengthening of management system for security risks
Handling large amounts of important information assets, such as personal information, the Group considers it important to continuously enhance its information management systems. Even now, after having formulated a personal information protection policy and an information security policy, we pay close attention to measures related to personal information protection, such as the strict management of information assets, and will continue to strengthen and improve our internal systems and management methods.
C. Enhancing technological strengths
As the technology to accurately digitize analog information is the source of the Group’s competitiveness and the common foundation that supports the growth of the variety of services that the Group handles, we consider their ongoing improvement and strengthening to be important. By hiring talented engineers and investing in and monitoring advanced technologies, we will work to improve our technological capabilities to become a group of engineers that is representative of Japan.