We are building the section for buying and rebuilding a bankrupt company in Japan. We know everything has its own ending and all companies be out of business at the end somehow and sometime.

 

But some bankrupt news still shock us.

 

Gainax is out of business now.

 

On June 7, 2024, the iconic animation studio Gainax officially declared bankruptcy. Once celebrated for producing legendary hits like "Gunbuster," "Nadia: The Secret of Blue Water," and "Neon Genesis Evangelion," the company had fallen into near-inactivity since the mid-2010s.

We had one friend working for Gainax ( well, she left before all this happened though).

 

The Golden Years and Early Successes

 

If you love anime from Japan, you are most likely to be familiar with this company name. Or, even if you did not know this company name and even if you have not much interest in anime, you may have heard of the animation called Neon Genesis Evangelion. It is the company which made this popular series!

 

Gainax was founded in 1984 and quickly made a name for itself in the anime industry. Their first feature film, "Royal Space Force: The Wings of Honnêamise," received critical acclaim. Personally, I remember being captivated by "Royal Space Force" during my high school years. The film's groundbreaking animation and profound storytelling left a lasting impression on me, igniting my passion for anime.

 

However, it was "Neon Genesis Evangelion" aired in 1995, that catapulted Gainax to fame. The series not only garnered immense popularity but also spawned a lucrative franchise with movies, games, and merchandise, significantly boosting Gainax's reputation and financial standing. I fondly recall my university days, eagerly watching "Evangelion" and discussing its complex themes with friends. It was a defining series for my generation and deepened my appreciation for the art form.

 

Turning Point: 1997 and the Beginning of the End

 

In 1997, a significant shift occurred when the production committee for "Evangelion" transferred the licensing rights to Gainax, allowing them to receive direct royalties. Unfortunately, the company's upper management mishandled the sudden influx of funds, marking the "beginning of the end." By 1999, Gainax was embroiled in a scandal when it and its then-president were accused of tax evasion by the Tokyo Regional Taxation Bureau.

 

Decline and Mismanagement

 

As revenue from "Evangelion" royalties dwindled, Gainax's financial health began to deteriorate. Co-founder Hideaki Anno, frustrated with the management's continued missteps, left to form his own studio, Khara, taking the "Evangelion" rights with him. Though Gainax retained licensing and merchandising rights, the arrangement eventually backfired.

 

Despite producing hits like "Gurren Lagann" and "Panty & Stocking with Garterbelt" in the late 2000s, Gainax's financial troubles resurfaced around 2012 due to reckless management. Their debts mounted as payments to Khara for "Evangelion" royalties were missed, forcing them to seek loans from Anno himself.

 

Scandals and the Final Collapse

 

In 2019, the company faced further turmoil when a new president, appointed following a shareholder change, was arrested for sexual misconduct involving minors. This scandal prompted another overhaul of the management in February 2020, with support from Khara. Despite these efforts, Gainax couldn't overcome its financial burdens. In May 2024, a debt collection agency filed a lawsuit, compelling Gainax to file for bankruptcy on May 29.

 

Gainax reported liabilities amounting to approximately ¥380 million (about $3.5 million USD) owed to 71 creditors.

 

Legacy and Lessons

 

Throughout its history, Gainax achieved significant milestones and faced severe setbacks. The studio's first feature film, "Royal Space Force: The Wings of Honnêamise," set the stage for future successes, and "Neon Genesis Evangelion" remains a cultural phenomenon. However, poor financial management and internal conflicts led to its downfall. 

 

The "Gainax" trademark and remaining properties were transferred to Khara, the studio founded by Anno, ensuring the legacy of its creations lives on under new management.

 

Gainax's journey from an influential powerhouse in the anime industry to a bankrupt entity is a cautionary tale of mismanagement and the challenges of sustaining success. As the company dissolves, its impact on anime culture and the lessons from its rise and fall will continue to resonate within the industry. For fans like myself, who grew up with "Royal Space Force" and "Evangelion," the legacy of Gainax's creations will always hold a special place in our hearts.

 

So what will happen to Neon Genesis Evangelion ? Will it disappear completely?  No, basically, nothing will happen (and we all hope so). It is being protected by Khara.

 

Here is the English excerpt of the official message from Khara - Mr. Anno company about this issue.

 

' In response to Gainax's bankruptcy announcement, we want to clarify our position and relationship with Gainax.

 

Hideaki Anno, our representative director at Khara, founded our company in 2006 and left Gainax in 2007. Although aware of Gainax's financial struggles, our proposals for improvement were not accepted. Despite providing financial support, Gainax's situation worsened, culminating in the arrest of their representative director in 2019.

 

To protect the 'Evangelion' series, Anno collaborated with KADOKAWA, King Records, and Trigger to refresh Gainax's management and address unpaid debts in the animation industry. However, Gainax was already insolvent, making it difficult to continue operations.

 

We worked with production committees to manage rights related to the works and intellectual property, ensuring creators could continue their projects. We also considered financial support but faced unreasonable demands to cover debts from previous management.

 

We thank the new management and production committees for their efforts. It's regrettable that a studio with nearly 40 years of history has come to such an end. We now manage the Gainax trademark and name. '

 

Source: Gainax official page, Khara official page

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