DDIALOGUE 01

New Normal for Companies andSociety Amid the COVID-19 Pandemic
The global COVID-19 pandemic is causing massive change the likes of which we have not seen before.
This upheaval has given rise to the concept of a Great Reset, which would signify the start of a new chapter for our economy.
MARUI GROUP President Hiroshi Aoi sat down with Taejun Shin, who was selected to be a Young Global Leader 2018
by the World Economic Forum, to discuss what should be the new normal for companies and society after this Great Reset.

Resilience of Microfinance Industry

the local people you were financing through your business.
Shin: The traditional customers for microfinance services are

Aoi: You announced a scenario analysis pertaining to thegenerally not affected by natural disasters or other disruptions.

COVID-19 pandemic back in March 2020. It was amazing how

In Japan, supermarkets and convenience stores were not signifi-

you were able to accurately assess and analyze the situationcantly impacted when the government issued its state of emer-and create a forecast scenario back at that time. How did you

gency declaration. Similarly, microfinance customers tend togo about doing this?

operate businesses providing items indispensable to daily life inShin: I turned my ear to the experts I trusted to have the informa-

their respective economic spheres, and I therefore figured thattion I needed. First, I talked to infectious disease specialists andthey would be fine. However, the lockdowns were an unprec-

read their reports to form an estimate about how long the cur-edented occurrence, and the outlook was initially quite opaquerent situation would continue.

accordingly.

Then, I spoke with economists and business operators andAoi: People who have been in microfinance for a long time, ofconsidered what actions should be taken. So far, almost every-course, understand how to think about their customer base andthing has progressed in line with the scenario I envisioned, whichrisks, but these matters are difficult to comprehend for laypeople.

is an incredibly lucky turn of events from the perspective of

Shin: You are right. One of our directors is a world-renowned

management.

microfinance researcher. At a meeting shortly after the start ofAoi: I see. I am surprised to hear that you spoke with infectious

the pandemic, I remember them saying that we had nothing todisease specialists first, as opposed to economists. It would

worry about because microfinance was a resilient industry.

appear that your approach toward gathering information differsfrom that of other people.
Shin: I figured it would be pointless to talk to economists before

Interpersonal Connections Prerequisite to theMeaningfulness of Data

they had time to formulate their own projections. I am involved in20

the World Economic Forum and various other organizations, andAoi: We had a similar episode at MARUI GROUP. At the financial

I am constantly reading English-language materials from aroundresults briefing for the fiscal year ended March 31, 2020, inves-

the world. Accordingly, I was able to guess, to a certain degree,

tors voiced concern that, as our customer base was relatively

what the key points regarding this issue would be. Also, it would

young, we were at risk of many of these customers defaulting onappear that I am strong under pressure. In February and March

their accounts. This concern was based on the preconception

2020, while other start-ups around the world were wrought withthat younger people are inherently riskier and that low-income

concern, I was hurriedly preparing projections.

individuals have less creditability. The fact of the matter, how-Aoi: Being strong under pressure is a common trait among

ever, is that the ratio of delinquent debt for customers in theirentrepreneurs. What were you most concerned about back in

20s and 30s is slightly lower than that for customers in their 40s

February and March?

and 50s. Under Japan’s state of emergency declaration, people

Shin: My first priority was to secure three years’ worth of capital.

could not leave their homes much, meaning that they had less

I was somehow able to procure an additional ¥2.0 billion during

opportunities to spend money. However, even under thesethe first month, but this period was wrought with anxiety. I guess

circumstances, we predicted that younger people would be

the pressure brought out my true strength.

unable to live without borrowing money. MARUI GROUP’s busi-Aoi: I also suspect that you had concern for the credit risks ofness takes place in a corner of the financial sector that differs

Taejun Shin

Hiroshi Aoi

Co-Founder, Representative Director & CEO
Gojo & Company, Inc.

President and Representative Director
Representative Executive Officer, CEOMARUI GROUP CO., LTD.

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D

DIALOGUE 01

I think the microfinance sector is currently in the best place it will befor the next decade. I am confident that we will not see the emergenceof a strain of microfinance in which everything is digitized and there
are no interactions between real people.
Taejun Shin
Co-Founder, Representative Director & CEO
Gojo & Company, Inc.
Born in Tokyo in 1981, Taejun Shin worked in private equity investment at Morgan Stanley Capital K.K. andUnison Capital, Inc., for eight years before co-founding Gojo & Company, Inc., in 2014. At this company, he isresponsible for corporate management, fund procurement, investment, and other areas of general operation.
While working in the financial sector, Shin founded Living in Peace in 2007 (he retired from the position ofdirector of this organization in 2017). Through Living in Peace, he conducted microfinance surveys andsupport and offered aid to children receiving social welfare and to refugees in Japan. He has graduated fromthe School of Law at Korea University and the Graduate School of Finance, Accounting and Law at Waseda
University and has also been chosen as one of the Global Shapers of the World Economic Forum.

Shin: I think the microfinance sector is currently in the best placeinvesting in start-up companies four years ago. From this expe­

it will be for the next decade. I am confident that we will not see

rience, I realized that the divide between large companies andthe emergence of a strain of microfinance in which everything isstart-up companies is even more clear than I had imagined.

digitized and there are no interactions between real people. At

It took some time before we were able to fully enter into thethe moment, one-third of people in developing countries arestart-up community.

illiterate. The same goes for our customer base. For this reason,

Shin: Empathy is essential to providing customers with quality

we cannot simply tell a customer to go download a smartphoneservices, and also, I believe, to the co-creation management ofapp; they need someone to sit down next to them and explain

MARUI GROUP advocates, and is therefore imperative to thethings. What microfinance needs are services that effectivelyprosperity of companies. One’s empathy is linked to their experi-

combine the value that only people can provide with the pro-ences and imagination. There is a lot we can learn from experi-cesses for which technological substitutes exist.

ence. I think it is important to share experiences with the people

Aoi: That is an interesting take. We cannot rely on technology forwhom we do business with. For this reason, I have stayed at theeverything, but if we do everything by hand, we will not be able tohouses of customers in developing countries and at child wel-stay in business. What we need to do is find the best way tofare institutions in Japan. There is a lot of valuable insight to becombine the two.

gained in this manner.
Aoi: Imagination is, of course, important. But I think it is the real

Shin: That is a difficult question. When the Plague spread duringaware of the need to further promote understanding of this fact.

the Middle Ages, there were some areas where theaters were

Shin: Japan tends to evaluate people primarily based on how

shut down for a decade. However, even after the disease hadlong they have been at a company, and this view can makeclaimed the lives of one-third of the population, these theaters

Aoi: The COVID-19 pandemic could be said to have given us ayounger people seem risky.

still eventually reopened their doors. I see this as indicative ofchance to reset our current society. If start-up companies andAoi: Seeking to assign credit ratings based on outward charac-

people’s undefeatable desire to gather. This inherent desire to

future generations take the lead going forward, I think we canteristics is a bad habit of the traditional financial sector. Younger

gather and engage with other people is strong, and I suspect

shape a new economy and society.

people generally only lack income and assets because they are

there are some areas that will not change as a result. Conversely,

Shin: I anticipate that we will be seeing changes that have been

still young, and that situation will thus change with time. The

I anticipate that even large, very traditional companies willneeded previously but have not yet occurred. These changes,

idea that younger people lack creditability is an oversimplifica-embrace change to improve efficiency through means such as

however, cannot be achieved purely by start-ups; we will needtion. Creditability is not something to be bestowed on people; itholding all meetings online.

help from larger companies.

is something to be built together with them over a long period

Aoi: The spread of digital transformation should allow pretty

Aoi: I hope to help build a world in which there is no need toof time. That is an approach to finance that I hope to spread.

much everything to be done online. One cannot help but wonder

separate one’s hobbies from one’s work. In this world, it will be

Shin: That is the reason why, in the microfinancing field, we also

what exactly will remain purely in the offline sector. We might

possible for what you love to become your job and for that tostart with low amounts. As we have no past transaction histories toconsider how attendance at outdoor events has continued to

become a feasible business if you can connect with a fan base

go by, we start by basing finance on interpersonal relations, such as

grow over the past decade. What is your view on the meaningful-around the world via the internet. If we can build such a world,

extending finance to associates of the village mayor. We realize thatness of offline engagements?

it will no doubt help countless people realize self-actualization.

there are a lot of people who are unable to receive financing due to

Shin: Currently, digital technologies can only stimulate two of ourLarge companies in Japan tend to feel strongly that they need to

outward characteristics. Accordingly, we look to build trust throughfive senses: sight and hearing. We cannot experience smell,

drive innovation themselves. For this reason, it is not uncommon

a cycle of financing and repayment over an extended period.

touch, or taste through online undertakings. Personally, I havefor their open innovation efforts to end in investment and fail toAoi: If you watch someone over time, data will begin to take on

attended the FUJI ROCK FESTIVAL, an outdoor music event, for

produce anything substantive.

meaning through their actions. It is only when combined withnine straight years. There are two reasons why I attend. The first

Shin: It is true that there are few companies that are able tosuch intangible factors as interpersonal relationships that datais that, as people, I think we are only able to fully immerse our-effectively engage in open innovation. At Gojo & Company, wecan exhibit its true meaning.

selves in something when given a space in which to do so. Theare looking to transform ourselves into a tech company. To thissecond is that I am able to immediately share my likes with otherend, we invested in other tech companies and had the manage-people. Until digital technologies are able to stimulate our senses

ment of those companies help us conduct interviews when weof smell and touch, offline engagements will continue to havesought to recruit a chief technology officer. Changes in a com-Aoi: The COVID-19 pandemic led to the theme of the 2021 World

their purpose.

pany are driven by changes in its people. Recognizing this, we

Economic Forum summit to be set as “The Great Reset.” It can

Aoi: Being truly moved by something and sharing the experience

invested in finding human resources that existed outside of thetherefore be expected that many things will or must change.

requires our five senses and a physical dimension. Offline venues

networks for our current staff.

How do you view this situation, Mr. Shin?

might be ideal for fulfilling this need.

Aoi: That story makes things easy to understand. We began

Undefeatable Desire to Gather22

New Economy and Society to be Shaped byFuture Generations

from conventional businesses. This experience thus made metactile aspects of experiences—the sights, smells, touch, howpeople breathe, the temperature—that really make an experiencestick.
Parts of this conversation that were not included in this report are available
on MARUI GROUP’s community site (Japanese only).
www.to-mare.com/tf/

In this world, it will be possible for what you
love to become your job and for that to becomea feasible business if you can connect with a
fan base around the world via the internet.
Hiroshi Aoi

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