Clear Skies in the Valley
Mr. Hiroaki Hayami, SVP Aozora Bank and head of the Japan Desk at Silicon Valley Bank

While many banks in Japan continue to suffer from the burden of bad debt generated in the bubble economy, Aozora (meaning “Clear Sky” in Japan) Bank has a clean balance sheet. Formerly known as Nippon Credit Bank, Aozora was created by the investment of Softbank and others who rescued Nippon Credit Bank from bankruptcy after making sure all bad debts were eliminated. Like many Softbank investments, Aozora is designed to shake up traditional Japanese industries with unique Western concepts. Aozora calls itself “a Bank for the 21st Century” and focuses on the needs of middle to small- sized businesses with a heavy emphasis on technology ventures. It’s model and partner is the standard bearer for technology banking, Silicon Valley Bank- an investor in Aozora and strategic alliance partner. This month’s interview focuses on a key manager of that alliance, Mr. Hiroaki Hayami, the Aozora Bank in-house representative to Silicon Valley Bank based in Santa Clara, CA.

Q. Mr. Hayami, tell us about yourself and your career with Aozora Bank.

A. I went to Keio University from which I graduated in 1987 with a Law major. After that, I joined what was then Nippon Credit Bank. Through my career at Nippon Credit Bank, I’ve worked in various divisions such as corporate finance and business promotion. I started my cross-border experience when I was a corporate finance officer in charge of various US subsidiaries of Japanese corporations and real estate transactions in the New York Branch. I did that for almost 4 years and I also spent 3 years working on distressed loans to Hawaii. After the collapse of Nippon Credit Bank, I was part of the team in Tokyo working to create the new business plan for Aozora. Our team eventually became Aozora’s Capital Investment and Finance Division which oversees the alliance with Silicon Valley Bank (SVB). In September of last year, I was assigned to head the Japan Desk here and my official term is 2 years.

Q. This alliance with SVB: how did it begin and what are the key features?

A. Softbank was interested in transforming the Japanese banking system through Aozora and invited SVB to invest in Aozora as the foundation of an alliance. Softbank’s investment in Aozora aimed to create an institution that breaks from Japanese banking tradition by being responsive to change, innovative, and deep in understanding of the technology sector- much like SVB. The alliance was later formalized and involves: cross referrals between the two banks, joint conferences and events, co-marketing and sales activities, and some areas of cooperation in investment banking and foreign exchange.

Q. As the operator of this Japan Desk, what are your responsibilities?

A. My main role is to facilitate client transactions involving Japan. First, I am a referral facilitator, supporting the marketing activity of both SVB and Aozora in dealing with US/Japan cross-border clients. My second task is to promote SVB in Japan in order to expand SVB’s institutional reach internationally. Finally, I have a liaison function whereby I help build the ties between Aozora and SVB employees and their respective divisions.

Q. Although it’s been a short time since the implementation of this alliance, have there been any success stories?

A. Yes, in fact there have been several examples. One case that comes to mind is that of a Sunnyvale based maker of semiconductor manufacturing equipment. The company is an SVB client that has one of Japan’s major electronics companies as a customer. With an SVB introduction, Aozora now supports the credit financing of the company’s Japan entity. There are other examples too: a semiconductor firm, a DVD device maker, and a software firm- each with Japan operations banked by Aozora.

Q. As someone with extensive experience in New York, who now lives in Silicon Valley, what do you think are the major differences between the two places? How do you like working in Silicon Valley and at Silicon Valley Bank?

A. I prefer Silicon Valley because it’s simply more casual and social. The people here are easy-going and creative and I find their enthusiasm impressive. In my first few months I quickly noticed how cheerful and happy the SVB people are and how they trust and respect each other. I really love SVB. New York, on the other hand, was not quite as open. It is basically difficult for me to articulate the differences because the time is different and work environment is different. Since I was working for a Japanese company, surrounded by other Japanese, it was very competitive and I had fewer opportunities to collaborate friendly with local people. It’s true that New York is a “melting pot”, but I found that most ethnic groups tend to stay with their own kind. Silicon Valley, however, is a truly mixed work environment, which I like. I would like to stay here if possible.

Thank you Mr. Hayami. Clients and non-clients of Silicon Valley Bank are welcome to contact Mr. Hayami to discuss Japan market entry and local financing options. Mr. Hiroaki Hayami can be reached via e-mail at hhayami@svbank.com. Find out more about the Silicon Valley Bank alliance at http://www.svbank.com/bus_serv/int/aozora.html

Previous Interviews