Sansan, Inc.

There is a risk that intensifying competition with existing operators and new entrants, or the emergence of competitors' services with groundbreaking concepts, could impair the Group's market share and profitability. The frequency of occurrence is rated at the highest level of 4 out of 5, and the profit impact is rated medium (annual impact of ¥1.0 billion or more but less than ¥3.0 billion). The company is working to maintain competitiveness by creating new value propositions and promoting M&A and capital/business alliances.

If the company fails to respond promptly to rapid technological innovation, there is a risk of declining service competitiveness and unexpectedly increased development costs. The frequency of occurrence is rated 3 out of 5, and the profit impact is rated medium (annual impact of ¥1.0 billion or more but less than ¥3.0 billion), recognized as a particularly important risk in a business environment where technological changes such as cloud and AI are rapid. Countermeasures include actively introducing new technologies and protecting intellectual property rights through patent acquisition, among others.

There is a risk of adverse effects on the financial condition if business plans are delayed following corporate acquisitions or the acquisition of investment securities, or if impairment losses occur on investment securities. The frequency of occurrence is rated 3 out of 5, and the profit impact is rated medium (annual impact of ¥1.0 billion or more but less than ¥3.0 billion). As countermeasures, the company conducts thorough due diligence on target companies and ensures rigorous monitoring and follow-up after acquisitions.

Given the nature of services that handle important corporate information such as business cards and invoices, there is a risk of leakage, loss, tampering, or unauthorized use of customer information due to external unauthorized access or internal intentional acts or negligence. If such risks materialize, they could result in a loss of customer trust and legal liability. As countermeasures, the company has obtained certifications such as ISO/IEC 27001, been granted the Privacy Mark, and made it mandatory for all officers and employees to obtain the Personal Information Protection Officer qualification.

There is a risk that system failures caused by natural disasters such as fires and earthquakes, external damage, or human error could disrupt the Group's service provision. In a business model centered on cloud services, system stability is fundamental to customer retention, and prolonged failures could lead to customer churn. Countermeasures include load balancing across multiple servers, regular backups, and recovery drills in the event of failures.

There is a risk that various defects or critical failures in applications, software, and systems, as well as delayed responses and insufficient follow-up with existing customers when failures occur, could lead to decreased customer satisfaction and increased cancellations. The company addresses this through the establishment and maintenance of a highly reliable development structure and the formulation and implementation of incident guidelines.

There is a risk that the enactment of new privacy-related laws domestically and internationally, or the development of laws regulating internet-related businesses, could force an increase in business operation costs or changes to service provision methods. Given the nature of the business, which handles large volumes of personal and corporate information, it is directly susceptible to the impact of tightened regulations. The company addresses this by gathering information on legal regulations and identifying and resolving related issues.

There is a risk that a shortage of talented personnel, delays in securing or attrition of sales personnel, and decreased productivity due to insufficient consideration of harassment and diversity could constrain business growth. Continuous recruitment and development of personnel are essential to support rapid business expansion, against a backdrop of intensifying competition in the IT talent market. Countermeasures include strengthening recruitment of excellent talent, reinforcing the organizational structure through internal development, and improving the working environment.

There is a risk that difficulty in responding to risks specific to overseas markets (such as legal, political, and cultural differences) or delays in monetizing overseas operations could prolong investment recovery and increase financial burden. The Group is promoting overseas expansion as part of its growth strategy and addresses this risk by gathering information on regions where it operates and formulating appropriate business plans.

There is a risk that restrictions on fundraising due to a decline in creditworthiness, or increased difficulty in securing settlement funds amid the rapid expansion of credit card services, could impede financial operations. In particular, with the expansion into the fintech domain, preparation for the risk of uncollectible receivables is becoming increasingly important. Countermeasures include maintaining creditworthiness through continuous dialogue and information disclosure with the capital markets, diversifying fundraising methods, and strengthening the financial base.