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Japanese classifieds site Jmty.jp looks for light at the end of the tunnel

Takeshi Hirano 2013.12.06

This is part of our coverage of Infinity Ventures Summit Kyoto 2013

See the original story in Japanese.

One of the trending sectors on the Japanese internet these days is the C2C (consumer to consumer) market. This includes small-sized e-commerce platforms, flea market apps, and crowdsourcing platforms too. But in Japan, the market is not easy to grow without significant effort. In contrast with the US, many C2C players in Japan may be poorly perceived in the eyes of Japanese users, where consumers are more likely to buy from a publicly recognized company.

At the venue of Infinity Ventures Summit 2013 in Kyoto, we saw many of the key players in the C2C sector. I had a chance to speak with Takahiro Kato, the CEO of Jmty.jp (pronounced as Jimoty). The company provides local classifieds and forums for local communities, including listings for jobs and second-hand items.

The company was launched back in 2011 and raised an undisclosed amount of seed funding from Infinity Venture Partners (IVP), and additional funding of 150 million yen (about $1.5 million) from KDDI, Mitsubishi UFJ Capital, and IVP back in 2012. It also raised money from Fuji Startup Ventures last August.

The story so far

The Bridge: What has happened with Jmty in the last three years?

Kato: We surpassed 1.4 million monthly visitors and 11 million monthly page views back in November. And we surpassed 1 million monthly visitors back in September.

The Bridge: So you mean your users have been rapidly increasing in the last few months?

Kato: Our service was recently featured on Mezamashi TV, a popular morning TV show. I know typically most TV appearances give only a momentary boost but not a sustained increase. However this recent feature brought us many long-standing active users.

The Bridge: Is there any improvement in user activity?

Kato: 20% or 30% of the items presented on our website are unwanted articles that users want to give away for free. When you post a message about this kind of item, you will usually get a comment from other users within 24 hours.

The Bridge: Craigslist is a very similar business to yours. Do you know how large their business is in the US?

Kato: It is said that they still have 60 million monthly visitors with 2 billion monthly page views. That’s really huge.

C2C is different in Japan

A classified platform needs to diversify its business to scale. And I thought acquiring 1.4 monthly visitors in three years was not such a big number. I asked him further about the potential of opportunities in the Japanese C2C market.

The Bridge: Compared to Craigslist, your business is still quite small. Is your growth slower than you expected?

Kato: Craiglist needed five years to surpass 10 million monthly visitors. I know several similar cases in China too. So this speed of growth is within our expectations.

The Bridge: Do you want to see a steeper increase? I think completely open C2C platforms face many obstacles in the Japanese market. For example, many users expect the operators of these platforms to assure the quality of the items they will buy on the platform.

Kato: It’s a fact that we get inquiries from some users asking how we will be responsible for a possible defective purchase. That’s why we added a notice all across our website that we will take no responsibility for any possible defects from trades between users.

The Bridge: So you need to educate users more?

Kato: By adding many notices, it encourages users to police themselves in a way. If you set up a hotline to receiving reports of defective items, many users will kindly tell us who the offending users are.

The platform was launched by Hirofumi Ono, the co-founder partner of Infinity Venture Partners. I asked him where in Jmty’s business he might find some potential to scale up.

The Bridge: When you launched Jmty.jp back in 2011, there was a big rise in classified platforms in mainland China. 58.com (NYSE:WUBA) had recently IPOed. Did these happenings have any impact on your decision to launch?

Ono: When we launched it, we thought it had lots of potential. We saw China’s 58.com and Baixing.com were rapidly growing. We actually asked Baixing.com about the key is to their success.

The Bridge: Did you get some useful advice from them?

Ono: They say it takes a long time to grow. Many C2C services in China have been running since 2005. We were also aware that we divided our topics into too many segments. Jmty.jp has many segments by region as well as by category, and that was intended to result in more accurate message postings.

But a classifieds site has to give users a simple way to interact since all users are not always so savvy. We believe that our service requires simplicity rather than pursuing an experience where topics are focused on special/niche purposes.

The light ahead

There is still a the long way to go in terms of growth for Jmty. And at the end of the interview, I asked Kato how they might emerge from this seemingly endless tunnel.

The Bridge: Will you keep making efforts to increas content topics?

Kato: We will continue to focus on diversifying content that may better suit our users. Regarding posts about jobs or second-hand items, these can be curated a minimal effort.

The Bridge: Can you share any figure on how many trades and transactions you’re facilitating?

Kato: A six-digit number has been already posted, and we’re receiving about 700 new posts every day.

The Bridge: Your service targets average people, so you will need to promote it using mass media, right?

Kato: We received investments from Fuji Startup Ventures, the investment arm of Fuji TV. So we’re planning to do something using television.

The Bridge: I know you will need a long time to achieve your goal, but how do you plan to sustain your business long term? Is there any funding plan?

Kato: We are a six-person team, and currently looking for the next funding opportunity. We hope to get funding from a business entity, rather than a pure investment firm, and partner with them to grow our business together.

The Bridge: Thank you for the time and your great insights!

The key to succeed with a service like this likely depends on how they can increase number the user-generated submissions. We’ll keep our eyes on their progress, so stay with us!

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CNet Japan Startup Award nominees: Mobile C2C flea market apps – Fril and Mercari

Yiling Ding 2013.12.06

This is part one of our CNET Japan Startup Awards nominee rundown. The rest can be found here. Several C2C flea market apps have been popping up in Japan recently, including Mainichi Frima, Stulio, and CNet Japan Startup Award nominees Fril and Mercari [1]. Unlike traditional desktop-focused C2C platforms such as Yahoo Auctions, these newer marketplaces are adopting a mobile-first approach. Both Fril and Mercari have a mobile-only strategy. Sellers can complete the entire selling process seamlessly on the app – from photographing their item using their smartphone camera, to posting the listing, to receiving notifications when their item has been sold. A listing can be created in just a few minutes, and is free to create. Both apps charge a 10% commission upon purchase, and a fixed-rate transaction fee. Payment is handled by their system. By providing a payment infrastructure, Fril and Mercari grant buyers the convenience of paying through convenience stores, ATM transactions, or credit cards. Selling is also simplified into the easy processes of listing, shipping, and receiving payment. Compared to traditional platforms, the user experience is easier and comparatively frictionless. The differences Despite similarities in functionality, Fril and Mercari diverge in a few ways as well….

This is part one of our CNET Japan Startup Awards nominee rundown. The rest can be found here.

Several C2C flea market apps have been popping up in Japan recently, including Mainichi Frima, Stulio, and CNet Japan Startup Award nominees Fril and Mercari [1]. Unlike traditional desktop-focused C2C platforms such as Yahoo Auctions, these newer marketplaces are adopting a mobile-first approach.

Both Fril and Mercari have a mobile-only strategy. Sellers can complete the entire selling process seamlessly on the app – from photographing their item using their smartphone camera, to posting the listing, to receiving notifications when their item has been sold.

A listing can be created in just a few minutes, and is free to create. Both apps charge a 10% commission upon purchase, and a fixed-rate transaction fee. Payment is handled by their system.

By providing a payment infrastructure, Fril and Mercari grant buyers the convenience of paying through convenience stores, ATM transactions, or credit cards. Selling is also simplified into the easy processes of listing, shipping, and receiving payment. Compared to traditional platforms, the user experience is easier and comparatively frictionless.

The differences

Despite similarities in functionality, Fril and Mercari diverge in a few ways as well. Fril (pictured right) is primarily targeted towards females in their teens and 20s, and specifically focuses on ladies’ fashion. Mercari (pictured below), on the other hand, offers a range of product categories from ladies’ and men’s fashion to electronic appliances.

Fril’s more specific target allows it to adopt a stronger visual style, with a very girly color palette. It also provides functions that work well with its fashion focus – such as searching by brand names, shop page customization, and following other users.

Mercari, instead of focusing on fashion, differentiates itself with a strong emphasis on buyer and seller security. It uses an escrow payment system, where the payment is held by Mercari and is not transferred to the seller until both parties have reviewed each other.

China’s largest e-commerce platform, Taobao, uses a similar system, and that has been effective in offsetting the issue of low trust in a C2C transaction.

The competition

CyberAgent’s Mainichi Frima and Singapore-based Carousell are two flea market platform apps that are also mobile-only. A common feature of Mainichi Frima, Carousell, and Fril is the “follow” function. Mainichi Frima also allows users to create customized shop pages.

Where Fril and Mercari stand out, however, is that they handle the entire payment process. Both Mainichi Frima and Carousell leave it up to the buyers and sellers to figure out payments themselves. Carousell encourages face-to-face exchanges with a location function that allows buyers to search by the seller’s proximity.

The advantage of Mainichi Frima and Carousell’s model is that they allow for robust negotiations between buyers and sellers. In this sense, they provide a more accurate online representation of the offline flea market experience. However, if users are looking for a simple, frictionless experience, they will find Fril and Mercari much easier to use.

The CNet Japan Startup Awards are coming up on December 10th. ↩

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Japanese deli delivery service begins closed beta for corporate users

Junya Mori 2013.12.06

See the original article in Japanese How many business people care about the nutritional balance of their diet? For busy professionals, maintaining a balanced diet can be especially tough to manage during work days. Chisan is a delicatessen delivery company in Japan. It has operated a deli delivery service called Okan, targeting single businessmen who live alone [1]. The company started a new service on November 25 called ‘Office Okan’, delivering additive-free Japanese deli to offices. It is currently accepting corporate users applications for its closed beta version. Okan is a service that regularly delivers Japanese deli to a registered addresses. Since the B2C service was launched on March 26 this year, approximately 200 users have subscribed to the service. The new service, Office Okan, caters to corporate users. With Office Okan, corporate customers will receive Japanese deli once a month, since the deli lasts about a month. The package contains 15 kinds of Japanese home-style deli, including “simmered mackerel in miso” and “simmered meat and potatoes”. Brown rice, which lasts about a month, is also available as an additional order. These can be refrigerated, and users can prepare the meal in about minutes. The company’s CEO, Keita Swaki, says…

See the original article in Japanese

How many business people care about the nutritional balance of their diet? For busy professionals, maintaining a balanced diet can be especially tough to manage during work days.

Chisan is a delicatessen delivery company in Japan. It has operated a deli delivery service called Okan, targeting single businessmen who live alone [1]. The company started a new service on November 25 called ‘Office Okan’, delivering additive-free Japanese deli to offices. It is currently accepting corporate users applications for its closed beta version.

Okan is a service that regularly delivers Japanese deli to a registered addresses. Since the B2C service was launched on March 26 this year, approximately 200 users have subscribed to the service. The new service, Office Okan, caters to corporate users.

With Office Okan, corporate customers will receive Japanese deli once a month, since the deli lasts about a month. The package contains 15 kinds of Japanese home-style deli, including “simmered mackerel in miso” and “simmered meat and potatoes”. Brown rice, which lasts about a month, is also available as an additional order. These can be refrigerated, and users can prepare the meal in about minutes.

The company’s CEO, Keita Swaki, says the service can replace lunch, dinner, and even in-between snacks with healthy Japanese deli. Chisan aims to provide opportunities to ensure a well-balanced diet, giving business people an easy way to manage it.

We use the word ‘deli’ as a loose translation here, as the foods included can include meat, fish, beans, vegetables, and more. You can browse the kinds of foods on the Okan.jp site. ↩

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San Francisco-based Kamcord wants Asia to record and share more mobile gaming videos

Rick Martin 2013.12.05

While this week’s Infinity Ventures Summit in Kyoto was largely a domestic affair, there were a number of out-of-towners in attendance looking to kickstart their operations in Japan. One of these was San Francisco-based Kamcord, a startup that hopes to capitalize on mobile gamers’s social tendencies. The young startup offers an SDK that enables game developers to put a ‘movie’ button in game, and when it is pressed, they can then share video clips/replays of their game play. These can be shared directly to Kamcord where they can be viewed by other gamers, or they can be shared to places like YouTube, Facebook, Twitter, or even email [1] And so yesterday at IVS, co-founder Adi Rathnam was in attendance in Kyoto, speaking to potential game company partners here in Japan that might make use of their screen capture service, which is already built into 160 mobile games to date. Their closest competitor right now is Finland’s Applifier, which is similar in that it also provides recording and sharing of game content, but focused more on cross-promotional ads through video. Here on The Bridge we often share screen capture movies of games and apps we like, but the process is not…

The young startup offers an SDK that enables game developers to put a ‘movie’ button in game, and when it is pressed, they can then share video clips/replays of their game play. These can be shared directly to Kamcord where they can be viewed by other gamers, or they can be shared to places like YouTube, Facebook, Twitter, or even email [1]

And so yesterday at IVS, co-founder Adi Rathnam was in attendance in Kyoto, speaking to potential game company partners here in Japan that might make use of their screen capture service, which is already built into 160 mobile games to date. Their closest competitor right now is Finland’s Applifier, which is similar in that it also provides recording and sharing of game content, but focused more on cross-promotional ads through video.

Here on The Bridge we often share screen capture movies of games and apps we like, but the process is not a simple one, requiring specialized software and some patience as well. Having Kamcord built into the game itself certainly makes the process accessible enough for the average gamer, removing the normal obstacles from the video sharing process.

Logically, it makes sense for Kamcord to target the most developed mobile nations in Asia, including Japan and Korea. But perhaps the most interesting market for Kamcord, I think, is China. With Tencent as their major investor, WeChat is a natural and logical partner, says Adi. But China’s affinity for sharing user generated game videos on popular video streaming platforms like Youku would likely mean an easy victory for Kamcord. They will have to bring some local games into their repertoire though of course. Adi elaborates:

Expanding to China, Japan, and Korea is a top priority for us. Our plan to do so involves localizing our product into Chinese, Japanese, and Korean and letting users share content to the messaging apps that are so popular in Asia. Line, Kakao, and WeChat are doing an awesome job growing their user base and driving downloads to games, and we’d love to work with these companies to create a rich experience for users.

As for monetization, Kamcord is still focused on building its community for the time being, but I understand they’ll look at a variety of options from driving installs to advertising.

I’d be surprised if game developers and publishers here in Japan don’t recognize the potential that exists in having enthusiastic fans help market their games using videos. It may require some forward thinking on their part, and a little more trust in user-generated content, but I expect we’ll see many of them jump on the Kamcord bandwagon soon.

I understand the video files are not very big, often around 5 or 10 megabytes. ↩

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Japanese mobile captcha startup Capy wins IVS Launchpad, has more plans ahead

Rick Martin 2013.12.05

This is part of our coverage of the Infinity Ventures Summit Kyoto 2013 Last week I had a chance to catch up with the folks from Capy in an office they’re working out of in Shibuya. The founder of the up-and-coming Japanese startup and CEO Mitsuo Okada first developed the concept behind his secure captcha service while studying at Kyoto University. Capy’s value proposition, for those unfamiliar with it, is that it’s less frustrating than the twisted letter solution of convention captchas, replacing it with a sort of sliding image puzzle that robots cannot complete (see below). While talking with Okada and his colleagues last week, I happened to mention that I’d be attending the Infinity Ventures Summit 2013 in Kyoto. “Oh, we’ll be there too,” said Okada. Skip to a week later where Okada pitched his captcha technology in front of a packed hall at the Westin Hotel Kyoto. They were one of 12 startups that took to the stage, but Capy was judged to be the best of them all. We first interviewed Okada about Capy way back in August, so they aren’t a newcomer to us. But among Japanese startups, the company does stand out in that…

This is part of our coverage of the Infinity Ventures Summit Kyoto 2013

Last week I had a chance to catch up with the folks from Capy in an office they’re working out of in Shibuya. The founder of the up-and-coming Japanese startup and CEO Mitsuo Okada first developed the concept behind his secure captcha service while studying at Kyoto University. Capy’s value proposition, for those unfamiliar with it, is that it’s less frustrating than the twisted letter solution of convention captchas, replacing it with a sort of sliding image puzzle that robots cannot complete (see below).

While talking with Okada and his colleagues last week, I happened to mention that I’d be attending the Infinity Ventures Summit 2013 in Kyoto.

“Oh, we’ll be there too,” said Okada.

Skip to a week later where Okada pitched his captcha technology in front of a packed hall at the Westin Hotel Kyoto. They were one of 12 startups that took to the stage, but Capy was judged to be the best of them all.

We first interviewed Okada about Capy way back in August, so they aren’t a newcomer to us. But among Japanese startups, the company does stand out in that it has taken a pretty global approach from the very beginning, initially launching the business in the US [1].

Even though conventional captchas can be frustrating, I’ve always admired the elegance of reCAPTCHA which makes us of user input not as a security precaution, but also as a means of digitizing books. Two birds with one stone. But Capy will be able to do something similar as well, and I think that’s why it has such great potential.

capy-awards — Okada-san all smiles on stage after winning IVS Launchpad

Websites that use Capy can repurpose its validation screen as a space to advertise, and that’s especially useful given how precious space is on a typical smartphone screen. Capy will have free and premium versions, the free version being ad-supported, and with the premium version, a publisher can use whatever image they want. Right now, the company is focusing on developing the premium version. In addition to advertising, there are other purposes for which Capy images could be used. They’re hoping to attend SxSW next year, and so I expect that many of the things they are currently working on should be ready for showtime by then.

Okada tells me that currently Capy is providing 50,000 captchas per day across three or four clients here in Japan. This is the perfect test market he says, because Japan is very closed. They still have improvements they want to make in user interface and experience, but I’m told they still need more engineers. Currently they are still just a team of four with only two engineers.

Their mentor and angel investor is security expert William Saito, with series A funding last May. I expect that a lot more eyes will be on Capy after their win at IVS Launchpad. So look forward to hearing more from them in the next year or so.

Capy is incorporated in Delaware. ↩

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Japanese tech giant collects job application fee from graduates to narrow the field

Yukari Mitsuhashi 2013.12.05

We previously wrote about Niconico Douga, a popular Japanese social video platform. With over 30 million registered users and two million paid users, the company behind the site, Dwango is one of the major tech companies here in Japan. Dwango recently made an interesting announcement regarding employment of fresh graduates. For its 2015 entry exam, the company will charge a 2525 yen (or about $25) fee. (2525 because of ‘Niconico’ douga). This system only applies to those residing in areas around Tokyo, and does not apply to those living in the countryside. This strategy was taken to attract only those who are truly passionate and serious about working at Dwango. The collected money will be subsequently donated to charity. According to Japan’s Ministry of Health, Labour and Welfare, the employment rate for graduating students is high as 93.9%. With the spread of technology and mobile phones, students can now apply to over 100 companies with a push of a button online. But Dwango explains that the number of available employment spots have not changed. And the increase in the number of application naturally means more work for the hiring side to narrow the field to the best candidates. Back in…

Dwango recently made an interesting announcement regarding employment of fresh graduates. For its 2015 entry exam, the company will charge a 2525 yen (or about $25) fee. (2525 because of ‘Niconico’ douga). This system only applies to those residing in areas around Tokyo, and does not apply to those living in the countryside. This strategy was taken to attract only those who are truly passionate and serious about working at Dwango. The collected money will be subsequently donated to charity.

According to Japan’s Ministry of Health, Labour and Welfare, the employment rate for graduating students is high as 93.9%. With the spread of technology and mobile phones, students can now apply to over 100 companies with a push of a button online. But Dwango explains that the number of available employment spots have not changed. And the increase in the number of application naturally means more work for the hiring side to narrow the field to the best candidates.

Back in April, we introduced a unique startup called Wild Card, which works to ease the job-hunting process for fresh graduates. As we mentioned at that time, the typical job-hunting process for such graduates begins in the fall of their junior year where they spend around six months to a year searching for their dream jobs. For big companies (i.e. those with over 5,000 employess), the job openings to applications ratio can be as low as 0.60.

We can expect to see more startups dedicated to disrupting the traditional job-hunting process, as well as creative tactics from employers to ease the rush on their end.

Recently we have also seen the emergence of a new website called Recme, which allows job-seeking students to post a 30- to 90-second long self-introduction video to appeal to potential employers. Leading Mark, the company behind Recme received funding of 50 million yen from Cyberagent Ventures in November.