Latest news with #ShinichiroKai
Japan Times
18-02-2025
- Business
- Japan Times
SBI-backed Japan robo-adviser Folio targets swing to profit and IPO
Japanese robo-adviser Folio Holdings is looking to go public as the SBI Holdings-backed startup zeros in on profitability in a market primed for expansion, Chief Executive Officer Shinichiro Kai said in an interview. Kai said he expects the Tokyo-based firm to become profitable and launch an initial public offering "in the not-so-distant future.' Japan's robo-adviser market, estimated to be worth around ¥3 trillion ($19.8 billion), has massive room for growth, he added. With more than half of Japanese households' $14.1 trillion savings still stashed in cash and deposits, "There's great potential that some of that money will shift to fund wraps and robo-advisers.' The company has seen client assets rise 84% to ¥250 billion since the end of March 2024 as the risk appetite among Japanese consumers grows. With inflation chipping away at the real value of savings accounts, financial institutions are vying for a slice of the pie. Banking conglomerate Mitsubishi UFJ Financial Group bought WealthNavi in November, the country's largest robo-adviser. Folio lost ¥1.86 billion in the last financial year, but Kai said its profit is likely to increase sharply after reaching breakeven because the business has grown without spending much on advertisements. "I see profitability as an important step for the IPO,' Kai said. "Our sales growth will be nearly equal to our profit growth. That will be our strength in turning profitable earlier than others.' Helping Folio's "Robo Pro' fund is a 2023 report by Japan's regulator that ranked it as the robo-adviser with the highest sharp ratio — a gauge of additional return that an investment gives per unit of increased risk. In addition to selling the fund to retail investors, the firm also drew revenue from offering software systems to financial institutions, which simplified access to new types of customers, such as older adults and people who live outside of big cities, Kai added. Folio's model radically changes its asset allocation based on their own forecasts of which assets are likely to outperform, unlike other services that keep their portfolio more static based on customers' risk tolerance. In recent months, the fund sharply increased emerging market shares despite widespread concerns that they may be hit hard by U.S. President Donald Trump's tariff plans. The switch seems to have been a good call as emerging market shares started to outperform their U.S. peers in late January, thanks in part to a rally in Chinese shares sparked by the emergence of DeepSeek. "Our algorithm tends to favor emerging market stocks when they have a large valuation gap versus U.S. equities,' Kai said.
Bloomberg
17-02-2025
- Business
- Bloomberg
SBI-Backed Japan Robo-Adviser Folio Targets Swing to Profit, IPO
Japanese robo-adviser Folio Holdings Co. is looking to go public as the SBI Holdings Inc.-backed startup zeros in on profitability in a market primed for expansion, Chief Executive Officer Shinichiro Kai said in an interview. Kai told Bloomberg he expects the Tokyo-based firm to become profitable and launch an initial public offering 'in the not-so-distant future.' Japan's robo-adviser market, estimated to be worth around ¥3 trillion ($19.8 billion), has massive room for growth, he added.
