At Resolute Software’s fifth birthday party last year , Atanas Simeonov, the founder of Ocean Investments, took the mic —and what he said left a mark on our Ocean Guild:
“I’m confident about Resolute’s future—and all the companies in our group. You know why? Because you’ve got an unfair advantage. You’re part of a family-owned group. And here’s something not many people know: Japan is home to some of the oldest companies in the world, and most of them are family businesses. Their secret? Clear values and a strong purpose. That’s what keeps them going. And we’ve got that same foundation. That’s why our potential to achieve great things is significant.”
It was one of those moments when the whole room paused—not because it was some grand, rehearsed statement, but because it just made sense. In a world where startups burn bright and fizzle out faster than you can say “pivot,” what if the secret to lasting success isn’t about moving fast, but about thinking long-term?
That’s exactly what family-owned businesses in Japan have mastered. The country is home to some of the oldest businesses in the world—companies that have survived for over a millennium, adapting to change while staying true to their purpose. Talk about a blueprint for longevity!
The common thread among these companies is clear: they’re driven by a deep sense of purpose, a commitment to shared values, and a long-term vision passed down through generations.
In this article, we’re exploring what startups can learn from the Japanese family business model—specifically the concept of “ie,” a framework for generational continuity and purpose. Along the way, we’ll show how Ocean Investments draws on similar principles to help its portfolio companies create legacies of their own.
Let’s dive in.
The Blueprint for Longevity: Lessons from Japan’s Family Businesses
When it comes to family businesses, Japan stands out as a world leader in longevity. The numbers are staggering: tens of thousands of Japanese businesses have operated for over a century. As highlighted in an article by György Drótos, Associate Professor at Corvinus University of Budapest and Head of the Corvinus Center of Family Business, estimates suggest there are more than 33,000 such companies, with some sources putting the number closer to 50,000. Of these, 1,938 have been in business for more than 300 years, 147 for over 500 years, and 21 for more than 1,000 years.
Take Kongō Gumi, for example, a construction company founded in Osaka in 578 AD. It operated as a family business for 1,428 years, spanning over 40 generations. Although it was sold in 2006 (it is currently a subsidiary of the Takamatsu Construction Group (or TCG)), it remains a case study in resilience.
(Photo Credit: jpellgen (@1105_jp) on Flickr)Or consider Nishiyama Onsen Keiunkan, a hot springs hotel established in 705 AD, operated under family leadership for 52 generations (including adopted heirs—more on that later).
(Photo Credit: Nishiyama Onsen Keiunkan)What’s the Secret?
At the heart of this extraordinary success lies a uniquely Japanese concept: “ie”—translating to “family” or “home.” But in Japan, a family is way more than just a household. It’s an enduring unit built around economic and social responsibilities. For the “ie,” the survival and prosperity of the family business come before individual interests, fostering continuity.
Here’s how it works:
Business First, Individuals Second
The “ie” prioritizes the collective over the individual, creating a shared vision that ensures long-term stability. Decisions aren’t driven by short-term agendas but by what benefits the group for generations to come.
Adopting Talent for Continuity
One of the most surprising practices is Japan’s tradition of adopting capable heirs—individuals who can take the reins if biological successors aren’t suitable. This strategy, used by companies like Suzuki, Canon, and Kikkoman, ensures the business is always led by someone qualified to uphold its legacy.
For instance, Osamu Suzuki, who led Suzuki Motor Corporation for decades, was the fourth adopted son to hold this role. However, in 2021, he retired as chairman and passed the leadership to his biological son, Toshihiro Suzuki, marking a shift in the company’s succession strategy.
Another example is Nishiyama Onsen Keiunkan—the hotel we mentioned earlier. When no family members were available to take over in 2017, general manager Kenjiro Kawano was adopted into the family and stepped in as president.
Values and Alignment
While the concept of adopting capable heirs is both practical and effective, what truly sustains family businesses are deeply embedded values and alignment. Such principles foster a shared sense of purpose and connection, ensuring that decisions consistently support the family’s long-term vision. It’s a unity that creates resilience and stability, allowing these businesses to endure across generations. You can see it in the remarkable stories of some of Japan’s oldest family businesses:
Kongō Gumi: A Legacy of Principles
A prime example of this is Kongō Gumi’s “Shokuke kokoroe no koto” (family knowledge of the trade), written by its 32nd leader, Yoshisada Kongō, during the Meiji Restoration. This creed distills 16 guiding precepts, including principles such as “Listen to what the customer says,” “Treat the customers with respect,” and “Submit the cheapest and most honest estimate.”
The creed doesn’t stop at business practices, though, and emphasizes interpersonal relationships with advice like “Never fight with others” and “Communicate with respect.” These values formed the backbone of Kongō Gumi’s operations for centuries, ensuring both internal alignment and lasting relationships with clients.
Nishiyama Onsen Keiunkan: Balancing Tradition and Innovation
While Kongō Gumi showcases how principles can guide operations and relationships, the world’s oldest hotel, Nishiyama Onsen Keiunkan, exemplifies how balancing tradition and innovation fosters longevity. This centuries-old inn thrives by embodying the Japanese principle of “omotenashi”—a profound dedication to hospitality that anticipates and fulfills guests’ needs with care and precision.
As President Kenjiro Kawano—an adopted heir—has highlighted, their success lies in honoring heritage while adapting to modern expectations. By continuously enhancing its hot spring offerings, cuisine, and service, the hotel remains true to its roots while staying relevant in a changing world.
Enduring Values Across Generations
Together, these examples show how deeply rooted values and a commitment to purpose can sustain businesses for generations. The strength of these principles lies in their depth and universality. Each employee of the company reflects the personality of the brand and must deeply understand its values, applying them both personally and professionally. This alignment ensures that the company’s mission is carried forward consistently across generations.
Japanese family businesses also demonstrate how a brand’s life cycle can extend for centuries when key principles are executed consistently. You can clearly see that it’s not about sporadic innovation or short-term wins but about staying true to a clear purpose and carrying it forward with intention.
Ocean’s Values in Action
So where does Ocean Investments fit into all of this? Well, we operate much like an “ie” system ourselves. As a family-owned group, we are guided by five core values: happiness, health, freedom, righteousness, and guild. These principles shape how we support startups, ensuring that every company we work with has the foundation to thrive for generations.
What Startups Can Learn: Building a Legacy with Purpose
Like we said, the enduring success of Japanese family businesses is rooted in their ability to adapt without losing sight of their core values. For startups, the takeaway isn’t to copy tradition for tradition’s sake but to find strategies that foster longevity, resilience, and purpose-driven growth. Here’s how to do that:
1. Define Purpose Early
Japanese family businesses thrive on their deep-rooted sense of purpose, often tied to a clear, long-term mission. For startups, defining this purpose early is critical—it sets the foundation for every decision and helps teams align around shared goals. Ocean’s approach prioritizes working with founders who have bold, meaningful visions and help them translate those into scalable, purpose-driven businesses.
2. Build for the Next Generation
Succession planning in Japan goes beyond familial ties. The head of a family business chooses the most capable leader, sometimes adopting talent into the family to ensure continuity. Startups can learn from this by encouraging a culture of leadership development, identifying future leaders who can carry the vision forward. After all, the most meaningful thing is investing in people, not just businesses—and that’s exactly what we do at Ocean, helping teams build the leadership they need to grow sustainably.
3. Prioritize Controlled Growth
In a world that often glorifies “scale at all costs,” Japanese family businesses emphasize measured expansion, preferring to build financial reserves and focus on stability. Startups can apply this principle by balancing ambition with caution, making sure their foundations are strong enough to support growth. Finding the proper balance isn’t easy, but with the right strategic guidance, startups can make it work. Investors like Ocean Investments can provide just that —practical support for sustainable growth.
4. Strengthen Networks and Community
Japanese family businesses succeed because they see themselves as part of a broader ecosystem, valuing partnerships and community connections. Startups can benefit from creating lasting relationships with customers, suppliers, and stakeholders, turning their ecosystem into a source of resilience. We have the same philosophy at Ocean, using our network to open doors for portfolio companies and build meaningful connections.
5. Prepare for the Unexpected
Japanese family businesses “expect” crises, building reserves and strategies to weather economic storms. Startups, too, must develop robust risk management frameworks to remain adaptable in volatile environments. That’s why, at Ocean, we coach founders how to handle uncertainty, ensuring they can respond to challenges with confidence.
Build a Legacy That Lasts with Ocean Investments!
And so, Japan’s family businesses prove that longevity doesn’t happen by chance. It takes a clear purpose, careful planning, and a strong commitment to resilience. Startups can take inspiration from these principles to build something sustainable and impactful.
This is the approach we bring to life every day—working alongside founders to create businesses that thrive across generations. By focusing on purpose, resilience, and adaptability, we aim to help startups build their own legacy—a future-proof business that creates impact far beyond the here and now.
Because at Ocean, partnering with visionary founders to shape a future built to last is what we do best. That’s what we mean when we say: Let’s future together.