LenderHawk analysis. Not affiliated with or endorsed by Search Funded: The ETA Podcast.
Mitsuya Shimura describes building one of Japan’s first traditional search funds and the early realities of fundraising and sourcing in a market where the model is still unfamiliar. He explains why Japan’s succession problem, aging owner base, and large SME universe make it attractive for ETA, while also highlighting the need for local investor support and public credibility to win over business owners.
Aspiring searchers considering a first-time launch in a country where ETA is still unfamiliar, especially those weighing how to raise capital, source proprietary deals, and build credibility with sellers.
Japan’s succession gap is large enough to support ETA: Mitsuya cites 4 million companies, an average owner age of 60.2, and roughly 50% without a successor.
Traditional search funds were still extremely rare in Japan in 2023, which made education and credibility-building part of the fundraising process itself.
Local Japanese investors mattered because they could act as informal guides in an unfamiliar SME market and introduce helpful relationships.
Proprietary outreach was central to his search process, with direct email outreach to roughly 300-400 owners per month.
A conservative owner culture and low familiarity with search funds meant that most outreach was ignored or rejected, making the few curious owners disproportionately valuable.
He focused on software and healthcare because he viewed them as growing sectors with recurring revenue and at least about $1 million of EBITDA.
His prior experience in sales and new business development at a large chemical company fit the search phase because it trained him to talk with owners about future strategy and growth.
Media exposure, such as a feature in Nikkei, helped increase credibility in a market where the model is not yet widely understood.
Mitsuya’s firm, M Capital, was the second traditional search fund in Japan.
He describes starting one of the first search funds in the country and how new the model was locally.
He had 18 investors in his fundraise, and 9 of them were Japanese.
He explains the mix of local and international backers supporting the search.
He was reaching out to around 300-400 company owners per month by email.
He describes the scale of his proprietary sourcing effort in Japan.
Japan has about 4 million companies, and the average owner age is 60.2.
He uses these demographics to explain why succession is a major opportunity.
About 50% of Japanese company owners do not have a successor.
He cites this as a key reason the search fund model fits Japan.
He targeted businesses with at least $1 million of EBITDA.
He says his industry screen followed typical search-fund criteria like recurring revenue and high margins.
In his experience, half of the companies above that threshold were in Tokyo.
He notes that many of the targets in his search were concentrated in the Tokyo area.
Nikkei is the largest financial newspaper in Japan, and being featured there increased his credibility.
He cites the article as an important trust signal for a new model in Japan.
Find local investors who understand the domestic SME market before leaning on global backers.
Why: They can act as river guides, introduce useful contacts, and help you navigate a market you may not know well.
Promote yourself publicly when the search fund model is unfamiliar in your country.
Why: Visibility can substitute for category awareness and make owners more willing to take you seriously.
Use direct outreach to owners when brokers are crowded and the market is competitive.
Why: He saw direct proprietary sourcing as the main way to build relationships with owners instead of relying on intermediaries.
Treat investor relationships as a source of market intelligence, not just capital.
Why: His Japanese investors could introduce people who helped with strategy and local execution.
Mitsuya said the article in Japan’s largest financial newspaper materially improved how business owners perceived him. In a market where search funds were almost unknown, the press mention acted as a credibility shortcut.
Lesson: In a new ETA market, third-party media validation can be as important as investor capital for winning seller trust.