In Kyocera's third year, 11 high-school hires demanded guaranteed pay. Kazuo Inamori was not even president of the ¥3 million company

That “not even the president” part is the heart of the story.

We’ll rebuild it by keeping filed numbers and later accounts apart.

Spring 1961, at a small ceramics plant in Kyoto.

Eleven high-school graduates who had joined about a year earlier stood before a director with a written demand.

Guarantee our regular raises and bonuses for several years ahead. If you won’t, we quit.

To make sure no one backed out, the 11 had reportedly sealed their pledge in blood.

The director they confronted was Kazuo Inamori. The company, begun only two years earlier, was Kyoto Ceramic, later Kyocera.

Inamori wasn’t its president.

The ¥3 million of capital had come from Kyoto business owners, and an investor sat in the president’s chair.

Employees asked someone who neither owned the company nor ran it as president to guarantee their future pay.

This column rebuilds that scene from the company’s filings and from records later compiled by other writers. Listed companies fall outside the criteria for case articles, so it’s handled as a column rather than a case.

From the 1959 founding to the 1966 presidency

The founding date and capital appear in the history section of the company’s own securities report.

The scene with the 11 appears in no filing. Later writers assembled it from Inamori’s lectures and books.

Inamori didn’t put in a single yen

According to Yu Inoue’s account published on Nikkei BOOK Plus, Inamori’s stake was ¥300,000 on paper, a tenth of the capital.

But it wasn’t cash. It was an in-kind contribution valuing his technology, and Inamori himself paid nothing.

Other people put up the company’s money.

1. His former boss joins

   His boss from his previous employer came along to the new company.

2. A patent attorney is asked to invest

   That boss asked a wealthy patent attorney to put in money.

3. A switchboard maker's president comes in

   The president of a Kyoto switchboard maker, on whose board the attorney sat, came in as well.

A compilation based on the company history and other sources says that president, Danya Miyaki, was the largest shareholder. Inamori held 3,500 shares and ranked fourth.

By the same account, the presidency went first to Miyaki, then to Masaji Aoyama, investors and seniors in turn. Inamori became president only in May 1966, seven years after founding.

In the founding years, then, Inamori was a director with the technology.

He had neither the company’s money nor the president’s title.

Eight blood seals, then eleven

The Nikkei BOOK Plus article says that when Inamori left his previous company to start Kyoto Ceramic, he and eight colleagues signed a blood oath. They cut their little fingers to seal it.

Two years later, the employees did the same.

Eleven high-school graduates hired the year before sealed a pledge in blood so no one would break ranks, and demanded guarantees on pay.

The talks ran for three days and nights, at the company and at Inamori’s home.

The article says Inamori told the last holdout, “If I ever betray you, you can stab me to death.”

New high-school hires probably had few occasions to meet the people who put up the capital.

The person who had hired them and worked beside them every day was the engineering director.

They took their demand to the person they had come for, rather than to a title.

What the desk can say plainly concerns the structure.

At Kyoto Ceramic in its founding years, the people who supplied money and the person people gathered around were different.

And what shook first was the people side, ahead of the money side.

The philosophy was written afterwards

Kyocera’s official site states its management philosophy as “to provide opportunities for the material and intellectual growth of all our employees, and through our joint efforts, contribute to the advancement of society and humankind.” It also says Kyocera started as a small workshop with no funds, credit or track record.

The order is the reverse of Sony in the same era.

Sony’s predecessor wrote “building an ideal factory” first in its founding prospectus. The promise about the workplace was in the founding document.

At Kyoto Ceramic, at least in the order the story is told, the words of the promise came after employees confronted management.

One company gathered people first, another built revenue first

Records of the order in which founders added people exist at much smaller scales too.

At Transistor, the podcast hosting service whose first month brought in $33, the two co-founders kept their day jobs until $30K MRR. They hired their first full-time employee only after passing $1M ARR.

Kyoto Ceramic started with 28 people and was confronted by 11 in its second year.

One company gathered people first, the other built revenue first, and both left a record.

The list setting Kyocera beside other legendary companies is in the column tracing 22 founding stories to their sources.

How far it could be confirmed

The limits need stating.

For first-year profit, the same compilation’s table says ¥1 million while its text says ¥3 million.

That compilation’s commentary also mentions a ¥10 million personal guarantee at founding. But who gave it couldn’t be confirmed in readable sources, so it isn’t used in the story here.

Before its technology, the company’s first test was a promise

Capital of ¥3 million, a director who brought the technology, and a president’s chair held by an investor.

Lay Kyoto Ceramic’s founding years out in filings and records, and the company began with money, technology and people split among different hands.

What first shook the company was neither an order nor a defect. It was a promise about the future, demanded by employees in their first year.

The legend tells this scene as the origin of the later philosophy.

What the record clearly keeps is the order: 11 people sealed a pledge in blood and demanded guarantees from someone who was neither president nor largest shareholder.