From the traditional ‘keiretsu’ way of doing business to starting up, Japan has come a long way. Here is what we can learn from its entrepreneurs
Mike Hanski is a content marketer and a writer at Bid4papers.com, an online service that provides editing and writing assistance in a one-on-one format.
Japan is undoubtedly very traditional. Its way of doing business – keiretsu – is a traditional concept of favouring long-term, fixed business relationships even when better and cheaper options are available. Keiretsu, with its core ‘play it safe’ business attitude, has its roots in the nation-wide culture of risk avoidance.
According to Hofstede’s cultural dimensions, Japan has some of the most risk-averse, long-term oriented people in the whole world.
Naturally, these two parameters matter when it comes to the startup scene and how likely people are to swap their corporate jobs for startup initiatives. Startups are inherently risky to both set up and work for, so it’s only natural that entrepreneurship has been lagging in Japan.
The Japanese, it seems, would rather play it safe and be happy with what they already have.
Despite cultural barriers to both domestic and international startups, the startup ecosystem has been flourishing in post-WWII Japan. Recent developments in information technology just can’t stop the arrival of the high-tech era, aimed at changing industrial Japan into a post-industrial economy with its own innovation-spurring startups and entrepreneurs.
“In a world where everything is risky, it’s better to be your own boss, in charge of your own destiny,” says Yoshinori Fukushima, Founder of Gunosy.
Below are three unique cases of startups or individual entrepreneurs showing the world what technological know-how can do in a country where there is no readily available ‘startup medium’ to channel your creativity and knowledge. There is always a way to do it on your own!
Creating something out of nothing
Izumo’s company Euglena is in the business of creating something out of nothing, in a biological sense. The company’s name is taken from a genus of single-cell organisms found in still inland waters (in abundance in Japan). Izumo takes the simplest of biological life forms – plankton – and uses those to develop food for the hungry.
At present, the company’s main product is a greenish drink. Yet, this is enough for it to be valued at roughly US$1 billion. What it also does is use different types of elementary biomaterial to develop alternatively-sourced fuel for jets.
Marrying old craft with new tech
Where it seemed there was no room for startups in Japan, Yuu Sumiyoshi succeeded. He set up a web development and tech consulting business aimed at foreign clients (i.e. outsourcing IT). This is a particularly popular occupation for a startup. However, the opposite can be said about Japan as a whole. The workforce is just too expensive here.
Sumiyoshi went around the expensive workforce issue by starting a new trend. He migrated his company from Tokyo to a nearby rural town that, after several other tech founders had arrived, became known as Kamacon valley.
Locals love their new neighbours and some even get to work with them, either in creating material, product testing or just plain, full-time work. His firm’s two major projects are online supermarket Iichi and Crazyville.
According to Sumiyoshi, what makes Japanese businesses unique is the combination of sometimes centuries-old craft and a passion for new technology. What better example can there be than custom-built dog armour from a real Japanese craftsman?
One-man business in Japan
Hajime Asaoka is famous in the circles of high horology and independent watchmaking. Despite having no watchmaking background, he manages to make watches by himself. That’s an achievement of sorts.
To do everything by hand is difficult. Even more so in watchmaking, where certain parts are so tiny it’s impossible to even see them without specialised equipment.
What the Japanese have to say
Below are 10 selected sayings from Japanese CEOs and domestic investors. Nobody would know better what it feels like to be an entrepreneur in Japan.
All quotes are taken from interview transcripts from DisruptingJapan. Some quotes are rephrased into plain sentences for better understanding.
1. “The samurai spirit is about taking risks, but in a humble, low-key way that suits Japan.” – Kentaro Sakakibara, an investor who has invested in tens of Japanese startups.
2. “Do not seek understanding from people. Entrepreneurs are to exist in a world of their own if they are to succeed.” – Naoki Yamada from Conyac.
3. “I think what’s important is to be able to find someone who’s similar [to you] meaning, for example, I always look for a person who has never worked in a company because I have that [trait].” – Hiroshi Maeda from Beatrobo.
4. “What sets Japan apart is fusion; centuries-old know-how and passion for new technology.” – Yuu Sumiyoshi, owner of a web design studio and maker of Crazyville.
5. “I think startups need users [now], not investment.” – Hashimoto Masanori from NuLabs.
6. “The bottom-up model is very important. Most companies operate under a top-down model. [The] top-down model is killing employee’s ideas.” – Hashimoto Masanori.
7. “The most important thing is to build the right team from the beginning.” – Akiko Naka from Wantedly.
8. “Be aware of the different phases of a company life cycle and never focus on one bit (for example, focus[sing] on product development but leav[ing] other things).” – Akiko Naka from Wantedly.
9. “If you are focussing on some niche [market]; you don’t want to spend money on distribution or marketing. You really want to spend money on R&D.” – Sunao Munakata, owner of a content marketing company in Japan.
10. “I think there are many good things in the Japanese startup ecosystem; however, [a] global point of view I believe is lacking.” – Akinori Takahagi from Moff.
Note: All quotes are taken from interview transcripts with company leaders unless otherwise stated.
The views expressed here are of the author’s, and e27 may not necessarily subscribe to them. e27 invites members from Asia’s tech industry and startup community to share their honest opinions and expert knowledge with our readers. If you are interested in sharing your point of view, please send us an email at writers[at]e27[dot]co
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