Subscribe to unlock this article
Thanks for your support.
Japan Bullseye Capital, founded by Eisuke Kobayashi and Mitsuharu Suzaki at the end of 2023 with the backing of 17 investors—including AIJ Holdings, Capital Tree, Japan Private Equity Co., M2O Search, and Scipio Holding—was the third traditional SF established in Japan and the first to adopt a partner model. The firm has successfully completed the acquisition of Gateway Arch Co., Ltd., a Tokyo-based company renowned for its original jigsaw puzzle design and manufacturing.
The transaction was structured with a mix of equity (25%) and debt (75%), utilizing a leveraged buyout with a commercial bank, along with subordinated debt provided through a government-backed business succession support program. The purchase multiple was in the range of 3x–5x, which is typical for Japanese SMEs.
Founded in 1984 by Mr. and Mrs. Yoshida, Gateway Arch has carved out a strong niche in the puzzle market with patented technologies and a deep commitment to high-quality products. Its innovations have been instrumental in the Japanese animation industry, spanning jigsaw puzzles, trading cards, figures, and other art-related items. The company prioritizes sustainability by using biomass resin from sugarcane, pioneering a drawing process for thicknesses up to 4mm, and integrating gravure printing.
Eisuke commented: “We are excited to build on the legacy of its founders and continue expanding the business both domestically and internationally. Over the past year, we have built a strong relationship of trust with the founders and secured funding from 22 individual and institutional investors, both in Japan and abroad. Our investor base includes repeat backers of previous Japanese SFs, such as M2O Search, Japan Private Equity Co., Ltd., and Inclusion Japan, which launched Japan’s first VC–corporate-backed fund dedicated to SFs. This acquisition marks a significant milestone not only for us but also for the broader expansion of the EtA model in Japan.”
He added: “We’re excited about the potential of jigsaw puzzles in today’s digital age. Puzzles offer a rare analog, hands-on experience that fosters mindfulness, creativity, and concentration across all generations. With the global rise of Japanese pop culture and a renewed interest in tactile entertainment, we see strong potential for innovation and international growth in this category.”
He concluded: “While the entertainment sector is generally vulnerable during economic downturns, the jigsaw puzzle segment has shown resilience and even tends to grow under such conditions. That said, the domestic market in Japan is limited. To unlock new opportunities, we aim to explore untapped markets and expand globally—especially through collaborations with major Japanese animation IPs.”
Legal: Nishimura & Asahi / Subordinated debt: Japan Finance Corporation
