"Entrepreneur's aspirations" to hear the background of deciding to start a business, the conflicts until the business gets on track, and the desires to realize through the business.
In the 29th installment, Mr. Yoshito Usami, CEO of CBA Inc appeared and talked about future business challenges with the perspective of the capitalists Shogo Sakata and Atsushi Fujii in charge.

【profile】
CBA Inc Representative Director Yoshito Usami
At Atlux Corporation (100% owned by Nissho Iwai Corporation), he engaged in product planning and sales using DBs (databases) for 16 years. After recognizing the potential of DBs, he participated in the launch of a waste management system as a new environment-related business at Sojitz Corporation. After that, at JEMS Inc., he Ltd. introduced the management system to about 400 companies, mainly leading Japanese companies. He established CBA Inc. in 2020 and aims to realize DX in the industry by building a platform that promotes domestic resource recycling.

[What's CBA Inc.]
Resource recycling is a global issue. However, there are still few challengers to tackle this issue, and despite the huge market, there are still many unexplored areas in technology. CBA was founded in January 2020 to solve that problem. Starting with the provision of cloud services to realize DX in the waste disposal industry, it aims to build a digital infrastructure for the realization of a recycling-oriented society by developing resource recycling services that make full use of the collected data.

Portfolio

Aiming to accelerate resource recycling through DX of waste treatment

―Please tell us about the business of CBA.

Usami CBA contributes to the acceleration of "resource recycling" that recycles waste as a resource through DX in the waste disposal industry. Even with the advocacy of SDGs these days, resource recycling of waste is not progressing at present, and in Japan, it is still the mainstream to "just dispose of waste".
In order to achieve a 100% recycling rate of waste by not just processing waste but by creating raw materials through resource recycling, it is essential to shift focus of waste management from "disposal" to "resource recycling."
Therefore, in November 2021, we launched a cloud service called "CBA-wellfest" that visualizes what kind of waste is generated from which company in which region, as a first step to accelerate resource recycling.

CBA-wellfest

The service reduces the burden on staff by digitizing the complex tasks required for waste treatment, including selecting a legally compliant treatment method, managing permits, and managing treatment progress. Currently, more than 50 customers, mainly major manufacturers that are highly interested in resource recycling, are using the service.

―How are you developing your business from waste disposal to resource recycling?

Usami First of all, I would like to expand "CBA-wellfest" to small and medium-sized enterprises and connect it to the visualization of the waste disposal situation so that customers of all business sizes and industries nationwide can realize resource recycling.

As the next step, we are thinking of analyzing the data accumulated by "CBA-wellfest" and understanding the waste generation situation in the area. In addition, in the process of analysis, it is also part of the business concept to create a service that provides "environmental credit information" by scoring the degree of environmental contribution. In the near future, when a company selects a business partner, a society will come in which it will investigate "how much environmental load the company creates" and use it as a standard. We believe that each company's environmental load database service will always be in demand.

As a final step, we would like to provide a matching service for the efficient collection and treatment of waste by utilizing the data and analysis accumulated through "CBA-wellfest". By analyzing the accumulated data and grasping the waste generation situation in the area, it is possible to create the optimal collection timing and route, and to request a collection company at an appropriate price. Nowadays, there are a lot of resources that are wasted because they are so small that they are discarded.
We would like to improve the recycling rate of the small amount of waste generated by small and medium-sized enterprises through cooperation within the area, and create a world where resource recycling advances.

―Please tell us what made you decide to develop DX for waste treatment, and how CBA was founded.

​ ​Usami It was 2008 when I learned about the waste disposal industry. At Sojitz, where I was employed at the time, I decided to conduct research as a target area for a new business. When I researched it, I learned that the waste disposal industry is not well-systematized, and the situation is that "even if you spend a lot of money, you just throw it away," and I felt that there was a lot of room for improvement. Around 2010, the issue of resource depletion began to be heard around the world, and the idea of a circular economy (recycling-oriented society) spread, mainly in Europe. Little by little, the seeds of a sense of crisis were emerging that the earth would not survive unless resources were circulated.

Therefore, in order to get deeply involved in this field, I decided to change jobs to a major player in the industrial waste industry, aiming to expand the business. In order to realize a circular economy, it is necessary to invest in factory facilities for resource recovery, but if we do not control and visualize what kind of waste is being produced and where it is coming from, we will not know which area to build the plant in to begin with. From the beginning, I was thinking about CBA's business model that aims to recycle resources, and I was working on various things within the company, but I thought it would be better to start a business to realize my idea of "expanding the circular economy nationwide, including local small and midsize businesses".

―Where does the desire to promote resource recycling in the region come from?

Usami When the Lehman Brothers collapsed in 2008, many people lost their jobs in Gifu, my hometown. Now that supply chains are globalized, if someone in the world catches a cold, everyone catches a cold. At that time, I thought that it would be better to circulate the resources that can be circulated in Japan and reduce the impact of the world situation as much as possible, which would lead to a more secure life in the future. In addition, there is also the issue of a shortage of workers in the industry as a whole. In a situation where it was difficult for young people to enter, even though I was close to my 60th birthday, I had the feeling that I had no choice but to start my own business.

While answering sharp questions about the details of the business, issues became clear.

Mr. Usami (center left), Mr. Shirono (center right) CBA Director, Shogo Sakata (left) and Atsushi Fujii (right), capitalists in charge of JAFCO

―In August 2022, you raised 230 million yen in Series A round. Please tell us about the background of considering this funding.

Usami There are many things that need to be done to realize resource recycling, such as the development of an environmental load database service, which is the next step that CBA is aiming for. By raising funds, we wanted to expand the number of customers of "CBA-wellfest" and accelerate development for the next step.
However, it is difficult to understand the waste disposal industry and our company's business, so I was wondering if I could find a VC that would invest in me after understanding my business well. Mr. Sakata, who was in charge, had a deep understanding and always asked sharp questions. In answering these questions, the business contents and policies were organized, and what I needed to do became clear. I thought it would be nice if this person became a partner.

―Why did you feel the potential of the CBA business?

Sakata In my previous job, I was a management consultant for large companies, so I was interested in the DX area for large companies. While researching which areas had room for improvement, I felt that the waste disposal industry faced many challenges. At that time, I happened to read the press release of CBA's capital and business alliance, and immediately contacted the inquiry desk on the website.

When I met and talked with Mr. Usami, I immediately felt that he had a very high level of understanding of the business and that he had been watching the issues facing the industry for a long time.
CBA's SaaS service also stands out from other services in the industry in terms of convenience. Also, there is no doubt that the realization of the circular economy envisioned by Mr. Usami is an area that will be very exciting when viewed from a global trend. I wanted to bet on the potential.

Fujii When I met Mr. Usami when the investment was concrete, I was impressed by his length of industry experience and depth of knowledge. In the startup field, a "entrepreneur in his late 50s" may be a rare existence. However, in the waste disposal industry, I felt that entrepreneurs like Mr. Usami, who have deep connections with the industry, would be able to reach out to counterparts.
Deploying SaaS to outdated industries is a sure-win pattern for business, and not just digitalization, but resource recycling needs will spread with the flow of SDGs and ESG investment. It is an industry that has a tailwind from changes in laws and regulations, and I felt that if we steadily proceed with business development with the introduction of the system as a foothold, we will be able to catch the long-term trend of the circular economy.

―Could you tell us why you chose JAFCO, Mr. Usami?

Usami I was surprised at how many detailed questions they asked me, and their attitude of trying to understand the industry was completely different from other VCs. Until now, large companies have been the main players in industrial waste disposal. Due to the awareness of compliance with pollution laws, it was normal for the industry to work with large companies as counterparts.
But what CBA wants to do is resource recycling. When it comes to resource recycling, regardless of company size, even small local companies can use the CBA system. I was asked in-depth questions about these aspects, and by desperately creating answer materials, I was able to eliminate minor discrepancies and gaps, and it was a very good opportunity to organize my business. I thought, "I was able to meet a partner who understands me so much. I definitely want to ask JAFCO!"

Sakata I'm happy. I thought it was important to be able to understand the industry and business in the same depth as everyone at CBA. I asked him tons of questions from many different angles, but he quickly provided me with a lot of materials, and my understanding deepened.

―Please tell us about the support after investment and what support you expect in the future.

​ ​Usami I believe that many of the customers in which JAFCO has invested have forward-thinking ideas. Waste disposal is already an industry, but the resource recycling industry is still developing. I think there are many customers who have a strong affinity for taking on challenges in new fields, so it would be great if we could borrow JAFCO's network power and create good services together.

Sakata From the perspective of stimulating the circular economy, the customer's stance is also very important. If we can introduce customers who can be the core customers of CBA, I think it will contribute to the advancement of the business.

Fujii That's right. I would like to work with CBA to spread the world view that it is aiming for among SMEs.

If you keep your thoughts and keep sending them out, you will definitely meet people who will support you.

―Please tell us what you want to achieve in the future, Mr. Usami, and your aspirations as an entrepreneur.

Usami We would like to increase the number of customers who agree with the idea of resource recycling and the number of companies who can cooperate with us, and create momentum in the circular economy market in Japan. Ten years ago when I entered this industry, the grounds for acceptance of digitalization for environmental response have completely changed. No one denies being involved in environmental issues, and there is a growing consensus that "we must work on resource recycling." From now on, I would like to create a successful case together and create a society where everyone involved is happy.

―Finally, please give a message to those who aim to become entrepreneurs.

Usami If you move with your thoughts in mind, you will meet people who will support you.
It's as saying, "If a dog walks, it will hit a pole." If you continue to say, "I want to create a society that recycles and utilizes resources," and try to be more specific about the feasibility of this, some people will agree, saying, "Maybe we can do it." While environmental issues are "clear issues that need to be addressed," it is not possible to say with certainty how much sales will be generated. I think it is important to explain how it works as a business and what significance it has, so I have been trying to.

When I started CBA, I said, "If we continue to use resources as they are now, we will need three planets," and "Soaring resource prices will cause strife and war everywhere." Other business owners and angel investors around me gave me a push, saying, "You should do it" and "I'll support you." JAFCO and all the current employees are like that. I hope that you will not give up and continue to have a vision of the future that you want to realize beyond your business.

Person in charge: Comment from Shogo Sakata​

We recognize that the waste disposal business up to now has had a strong aspect of legal compliance. However, in recent years, it has been strongly linked to themes that are gaining global attention, such as SDGs/ESG support and the realization of a circular economy, and more advanced responses are being required. In order to meet the demands of increasingly sophisticated waste disposal operations, it will be essential to advance operations, including the use of IT solutions.
CBA not only improves the efficiency of conventional waste disposal operations, but also provides a service that collects and analyzes the data necessary for sophistication of operations. We expect the company to lead the realization of DX and the circular economy in the area of corporate waste disposal.