Just over a year ago, in April 2025, a major overhaul of the listing maintenance standards for Japan's TSE Growth Market was announced. One year on, the impact has reverberated throughout the startup ecosystem as a whole.

In the world of IPOs, the conversation tends to center on the First-day Opening Price and Offer Price — yet it goes without saying that a listing is not a destination, but a starting point. At the same time, it is equally true that some companies have achieved remarkable growth after going public, even when their Market Capitalization at the time of listing was modest. So, which companies have achieved the greatest increase in Enterprise Value after their listing? In this analysis, we use the "Post-IPO Market Capitalization Multiple" — the ratio of a company's current Market Capitalization to its Market Capitalization at the time of listing (calculated as Offer Price multiplied by total shares outstanding at listing) — as our benchmark, and examine 603 companies listed on the TSE Growth Market (including the former Mothers market) to identify the Top 10 and explore their common characteristics. This analysis covers companies that listed on the TSE Growth Market (including during the Mothers era) and remain listed on the TSE Growth Market today. Companies that subsequently transferred to the Prime or Standard markets are not included. The vast majority of Growth Market-listed stocks that have achieved significant growth — such as Mercari and Sansan — transferred to the Prime Market at an early stage. Accordingly, it should be noted at the outset that this analysis, which is limited to TSE Growth Market-listed stocks, has inherent limitations.

With that caveat in mind, let us first present the overall picture. The median Post-IPO Market Capitalization Multiple across all 603 companies is approximately 0.9x — meaning that more than half of all companies have yet to surpass the valuation they received at the time of their listing. Among them, only 10 out of 603 companies (approximately 1.7%) have achieved a multiple exceeding 10x. Given the name "Growth Market," this situation is, it must be said, somewhat disappointing.

Post-IPO Market Capitalization Multiple Ranking — Top 10

※ Market Capitalization Multiple = Current Market Capitalization (based on share price as of July 2, 2026) ÷ Market Capitalization at IPO (Offer Price × total shares outstanding at listing, including shares issued in public offerings). Revenue Multiple and Operating Profit Multiple = Most recent full-year results ÷ Base period results. The base period is, in principle, the fiscal year immediately preceding the listing; however, for the three companies that listed between 2005 and 2007 (MBS, cotta, and GNI Group), financial data in our database begins from 2008–2009, resulting in a base period that is several years later than the actual listing date. "—" for the Operating Profit Multiple indicates that calculation was not possible due to an operating loss in either the base period or the most recent period (both GNI Group and QD Laser reported an operating loss in their most recent fiscal year). The market-wide median for Market Capitalization figures is based on all 603 companies; the Revenue Multiple median is based on the 591 companies for which the calculation was possible; and the Operating Profit Multiple median is based on the 400 companies that reported operating profits in both the base period and the most recent period.

Common Characteristic ① — Market Capitalization Growth Was Driven by Profit Growth

When analyzing the stocks that achieved significant Market Capitalization growth, what immediately stands out is the magnitude of the Operating Profit Multiple. Across all eight companies for which an operating profit multiple could be calculated (i.e., those in operating profit), every single one showed an Operating Profit Multiple exceeding its Revenue Multiple. Convano achieved a Revenue Multiple of 7.7x against an Operating Profit Multiple of 11.1x; BuySell Technologies posted 7.8x in revenue against 10.7x in operating profit; and Shinmente Holdings recorded 8.1x in revenue against 10.0x in operating profit. The top-ranking companies are those that achieved what is commonly referred to as operating leverage — profit growing at a faster rate than revenue. Looking at operating profit margins, Convano improved from 7.2% to 10.3%, BuySell from 6.6% to 9.0%, and cotta from 3.9% to 5.6%, with virtually all companies showing improvement.

It has long been said that, when evaluating typical growth stocks, "revenue growth is everything — profits are secondary." There is certainly some truth to this view. However, among stocks that have sustained significant Market Capitalization growth over the medium to long term, the data clearly shows that operating profit has grown at a pace exceeding revenue growth.

This is also borne out statistically. When correlating the Market Capitalization Multiple (on a logarithmic basis) with the full universe of covered stocks, the Revenue Multiple yielded a correlation of r = 0.42, while the Operating Profit Multiple showed the highest explanatory power at r = 0.51. Market Capitalization can be decomposed into "earnings × market-assigned multiple," and given that multiples are susceptible to market conditions and tend to mean-revert over the long term, the conclusion is that the sustainable engine driving Market Capitalization growth over a decade is, ultimately, earnings growth. This textbook result has now been observed in the actual data from the TSE Growth Market.

Common Characteristic ② — Starting Small

In seeking indicators beyond revenue and profit that carried strong explanatory power, the most evident finding was the "small Market Capitalization at IPO" (log correlation r = −0.31). This is precisely why we included the Market Capitalization at IPO alongside the other figures in the ranking table. The median Market Capitalization at IPO for the Top 10 companies was approximately ¥2.4 billion — less than half of the overall median of ¥5.98 billion. Six of the ten companies had a Market Capitalization at IPO of under ¥3 billion — including MBS at ¥0.4 billion, cotta at ¥0.5 billion, and Lib Work at ¥0.9 billion — compared to just 21% of the overall universe.

That said, reading this as "smaller IPOs are more promising" would be premature. There is an arithmetic dimension to this: a smaller denominator naturally makes it easier to generate a high multiple. More importantly, the fact that the overall median stands at 0.9x demonstrates that the vast majority of small-cap IPO companies have failed to maintain — let alone multiply — their valuation at listing. The Top 10 are survivors from among hundreds of small-cap listings, and a clear survivorship bias is at work here. Nevertheless, it is worth noting a structural asymmetry: while a company that listed with a Market Capitalization of several hundred billion yen would require an extraordinary leap in earnings growth to achieve a 25x multiple, a company that listed at a few hundred million yen has far more room for its earnings growth to translate directly into multiple expansion. Furthermore, companies with an Offer Price-implied Market Capitalization of less than ¥1 billion are concentrated in the pre-2015 era — a period when the startup market was even less mature than it is today — and IPOs of this scale are likely to become increasingly rare going forward. Nevertheless, the data makes clear an important fact: a small beginning does not preclude eventual scale.

Common Characteristic ③ — Time, and Surprisingly "Unglamorous" Businesses

The median number of years since listing for the Top 10 is 11.6 years (compared to an overall median of 5.0 years). The shortest tenure belongs to QD Laser at five years, and not a single company that listed within the past one to two years makes the list. Achieving a 10x increase in Market Capitalization is, fundamentally, a decade-long exercise in compounding.

The sectoral composition is equally telling. With one pharmaceuticals company, two in construction, two in services, two in information and communications, two in wholesale trade, and one in electrical equipment, the composition is remarkably diversified — these are not companies that rode a popular investment theme of the moment. If anything, the lineup features companies like MBS, which built a franchise network for repair methods using specialty coatings; Convano, which scaled low-price nail salons across multiple locations through highly efficient operations; Shinmente, which provides 24-hour facility maintenance services to restaurant and retail chains; cotta, which deepened its e-commerce focus on confectionery and baking materials; Lib Work, which grew its low-cost homebuilding business through digital customer acquisition; and BuySell, which expanded its at-home purchasing and re-commerce operations nationwide. Each found a niche market, developed a replicable operational model, and methodically scaled it through roll-out expansion. Not glamorous — but the operating leverage identified in Common Characteristic ① is a natural consequence of precisely this type of business model.

What the Exceptions Reveal — Revenue Growth and High Expectations Over Profit Growth

At the same time, several companies in the top rankings do not fit this "profit growth story." The top-ranked GNI Group saw revenue expand 331x (partly inflated by an extremely small revenue base in the base period), yet reported an operating loss in its most recent fiscal year. 9th-ranked QD Laser achieved a 12.8x Market Capitalization Multiple with revenue up only 1.5x and an ongoing operating loss — suggesting that its valuation is driven primarily by market expectations for its quantum dot laser technology rather than by financial results. 4th-ranked Data Section is similarly distinct from the others: its 89x revenue figure reflects a dramatic pivot in its core business, from social media analytics to AI data centers — a very different profile from companies that simply scaled an existing business. These are stocks where the market's forward-looking expectations for revenue growth — rather than current profit generation — are clearly the dominant driver of valuation.

The upper echelons of the multiple ranking contain a mix of two types: "proof-driven" companies that have built their valuation by demonstrating earnings (operating profit) growth; and "expectation-driven" companies where anticipated technological breakthroughs or business model transformation are the primary value driver. The latter type is more susceptible to valuation swings driven by shifts in market expectations, and it is important to recognize that two companies with the same "10x+" multiple may have arrived there through very different paths and with very different levels of stability. While these two companies embody the conventional wisdom that "growth stocks are valued on expectations, not earnings," it is perhaps a noteworthy finding that, across the entire universe analyzed, only two of the Top 10 actually fit this description.

Closing Remarks

Looking across the ten companies that have grown their post-IPO valuations to more than 10x, a clear — if understated — common thread emerges: they started small, built a replicable model in a niche market, grew profits faster than revenue, and took a decade to achieve meaningful scale. Among today's small-cap IPOs, there are almost certainly companies destined to appear on this list ten years from now. Rather than focusing solely on the First-day Opening Price or near-term market buzz, incorporating "the reproducibility of earnings growth" as an additional lens through which to evaluate newly listed companies may reveal an entirely different perspective.

Source: Data from the IPO and TSE Growth Market analytics service "Lapis Lazuli" (as of July 2, 2026). The universe consists of 603 TSE Growth Market-listed stocks (including the former Mothers market) for which both the Market Capitalization at IPO and the current Market Capitalization could be calculated. Companies that listed directly on the TSE Prime Market, as well as certain large-cap growth companies separately categorized as "Star Companies" within this service, are excluded from the analysis. Market Capitalization and financial figures are based on disclosures by the respective companies, but no warranty is made as to their accuracy.
※ This article is intended for informational purposes only and does not constitute a recommendation to buy or sell any specific security.