The World’s Oldest Company Goes Bankrupt
A Japanese company that began life as a renowned temple builder has gone bankrupt. Not so unusual, except that this company, commissioned by the Japanese royal family, when Buddhism was becoming popular in Japan, began building temples in 578 AD.
Shigemitsu Kongo, Korean owner of this company, began constructing temples in the Osaka/ Kyoto area, beginning with Shitenno-ji temple, which still stands today in Osaka (see picture). His company later called Kongo Gumi was to last 14 centuries. Even as late as 2004, temple building accounted for more than 80% of the company’s revenue, which exceeded US $60 million.
What killed off this company eventually was debt, built up during the huge asset bubble of the period 1986-1991. The company borrowed much too heavily and, when asset prices collapsed, its debts were enormous. It limped along for a few more decades but eventually its revenues could no longer service the debt. The company had survived civil war, political crises, earthquakes, typhoons, and the American mass bombings of Japanese cities in WW2. In the end, due to debt, it was forced to liquidate.
Still, it is stunning that it could have survived over 1,400 years.