Japan’s ChatBook, providing the automated marketing solution under the same name utilizing Facebook Messenger chatbot, announced on Monday that it had raised an undisclosed amount of funding from Salesforce Ventures, East Ventures and YJ Capital in its seed round. It is estimated to total at hundreds of thousands of dollars. This round follows the one from YJ Capital and East Ventures in 2016 when ChatBook took part in the accelerator program Code Republic, which is managed by the two companies (the investment amount had not been disclosed neither but all the participant teams were evenly given 7 million yen (about $66,000) by the 100 million yen (about $940,000)-valuation.
Chatbook was co-founded in September of 2016 (named Hect as its start) by Maiko Kojima who formerly worked for Prime Again as CFO/COO. The firm has been chosen for various accelerator programs so far; the first batch of the Code Public program in 2016, Accelerate course of FbStart which is a developer support program by Facebook in 2017 and the first batch of AI Accelerator organized by the major job information provider Dip (TSE:2379).
ChatBook offers an auto-creation function of chatbot capable of information provision or interaction with website visitors targeting enterprise users, making it difficult to acquire new customers only by landing page. By securing the user flow from landing page to chatbot, enterprise users can achieve more effective marketing.
Chatbook CEO Maiko Kojima gives pitch at Demo Day of Code Public. Photo credit: Code Republic
With the secured money, ChatBooks begins official operation of its service. It is available at no charge for individual users and no charge for ten days for enterprise users as trial use, while it had been opened as an invitational service based on inquiries. ChatBook has already been introduced to many companies including large enterprises or local government, such as the Marugame Seimen noodle restaurant chain and KAGA Route, the recruitment website for the spa resort area in Ishikawa Prefecture, Japan.
In the chatbot-driven automated marketing field in Japan, Hachidori had raised 100 million yen (about $940,000) from Vector, Colopl Next, Evolable Asia, Aucfan and other investors in its series A round last year, as we as ZEALS providing Fanp raised 420 million yen (about $3.9 million) from JAFCO or FreakOut last month. Fanp aims to enhance the conversion by leading potential customers from infeed ad to chatbot, while on the other hand, ChatBook shows a bit different approach in that it aims to improve the conversion by leading customers from existing landing page to chatbot.
Translated by Taijiro Takeda Edited by “Tex” Pomeroy
See the original story in Japanese. Tokyo-based Linc, offering education and employment support services for foreign students to Japan, announced on Wednesday that it had raised approximately 100 million yen (about $937K US) in funding from Genesia Ventures and Beenext. The share ratios and payment dates were not disclosed. Founder and CEO Shiyo Naka (or Siyao Zhong in Chinese pronunciation), Co-founder and COO Vincent Wang, and CMO Sophie Chow are all foreign nationals who have experienced working in major companies after studying in Japan. They founded the company after finding it easy to live in Japan as international students, but discovering that the system of studying abroad and working was lacking in efficiency and convenience. Naka said: There are more than 3.5 million Japanese learners alone in Asia, but the conversion rate of just 300,000 students studying abroad in Japan is very low. The company is also aiming to meet the demand for cultural assistance by using E-learning to educate about daily life and work manners. When I asked Naka about the flow of coming from China to Japan to study, he related that in most cases after arriving in Japan students study in a language school for 1 to…
Founder and CEO Shiyo Naka (Siyao Zhong/仲思遥) Image credit: Linc
Tokyo-based Linc, offering education and employment support services for foreign students to Japan, announced on Wednesday that it had raised approximately 100 million yen (about $937K US) in funding from Genesia Ventures and Beenext. The share ratios and payment dates were not disclosed.
Founder and CEO Shiyo Naka (or Siyao Zhong in Chinese pronunciation), Co-founder and COO Vincent Wang, and CMO Sophie Chow are all foreign nationals who have experienced working in major companies after studying in Japan. They founded the company after finding it easy to live in Japan as international students, but discovering that the system of studying abroad and working was lacking in efficiency and convenience.
Naka said:
There are more than 3.5 million Japanese learners alone in Asia, but the conversion rate of just 300,000 students studying abroad in Japan is very low.
The company is also aiming to meet the demand for cultural assistance by using E-learning to educate about daily life and work manners. When I asked Naka about the flow of coming from China to Japan to study, he related that in most cases after arriving in Japan students study in a language school for 1 to 2 years and then go on to enter a Japanese university. However, in the 1 to 2 years at a language school classmates advance at different rates, and it is necessary to prepare independent measures, apart from the language school, for taking the university entrance exams in Japan.
To solve this, the company released “Ling ke (羚課) Nihon Ryugaku (日本留学)” for the Chinese market, where the ratio of foreign students arriving to study in Japan in January of 2017 was highest. With this service, students can deepen their understanding of the knowledge necessary for attending a university in Japan through video lectures, exercises, questions and answers, etc. In a year, the company has joined together with more than 50 language schools nationwide, and the cumulative audience number for the live lectures exceeded 100,000 people.
One lecture at its longest is 15 minutes and is divided into smaller lessons. By doing this, in addition to maintaining the ability to concentrate, it is possible to focus on points that are difficult for the user, and realize personalized learning plans and steps for advancement for each individual user. Additionally, the company is also looking into a mechanism to utilize learning attitudes for credit scoring.
Naka added:
The majority of students coming to Japan have difficulty reviewing housing and opening bank accounts. In fact, since a cause of this is the difficulty in building trust, we hope to create standards through learning and working that can guarantee it.
A Profitable Business, Funding to Scale-up
From left: Founder and CEO Shiyo Naka (Siyao Zhong/仲思遥), CMO Sophie Chow (蘇菲), and Co-founder and COO Vincent Wang (王超) Image credit: Linc
The service was released in January of 2017, but many of the users are foreign nationals who have come to Japan. On China’s version of Twitter, Weibo, many users are talking about and accessing the service, Linc itself has 80,000 social network followers, and CMO Sophie Chow doubles as influencer with over 500,000 followers. The company will continue to strengthen its social network marketing.
“In a single month the company itself turned a profit,” said Naka. Upon asking, “What about offering E-learning in other countries?”
He confided that the funds raised were for just that, server costs and scaling up. While living in China, some people bought teaching materials, but he felt that the server was lagging and slow to load so he sought to improve the user-friendliness.
In the future, the company aims to expand the introduction of Linc’s learning system to language schools throughout Japan, and to higher education institutions and international schools that provide Japanese language education in the Chinese language sphere. In addition, it looks to strengthen the production system and marketing contents, and to expand the target countries to include foreigners in Southeast Asia.
Translated by Amanda Imasaka Edited by Masaru Ikeda
See the original story in Japanese. Start Today (TSE:3092), the Japanese company behind online fashion marketplace Zozotown, announced in January that it has set up a project team called Start Today Research (Research for short) as its R&D arm. Yuki Kanayama, CEO of Vasily which was recently acquired by Start Today, will lead the arm and conduct projects leveraging big data owned by the fashion giant. The specific Big Data set as its analysis data include 30 million brand-official product data (product information, category, size, material), 10 million fashion coordination data, 23 million user information (user attribute, purchase history, held items), shop information and distribution-related data, in addition to human body dimension data measurements from Zozosuit as had recently been announced and is seen being accumulated in the future. According to Kanayama, although he cannot disclose details about the current team, he aims to build an organization a few hundred-strong comprising doctorate holders in such fields as machine learning, encryption technology, material science or hydrodynamics, so as to analyze fashion from the scientific perspective in the future. In tandem with the announcement, we held a short interview with Start Today CEO Yusaku Maezawa and Kanayama, inquiring into their objectives in…
L to R: Start Today CEO Yusaku Maezawa, Vasily CEO Yuki Kanayama Image credit: The Bridge
Start Today (TSE:3092), the Japanese company behind online fashion marketplace Zozotown, announced in January that it has set up a project team called Start Today Research (Research for short) as its R&D arm. Yuki Kanayama, CEO of Vasily which was recently acquired by Start Today, will lead the arm and conduct projects leveraging big data owned by the fashion giant.
The specific Big Data set as its analysis data include 30 million brand-official product data (product information, category, size, material), 10 million fashion coordination data, 23 million user information (user attribute, purchase history, held items), shop information and distribution-related data, in addition to human body dimension data measurements from Zozosuit as had recently been announced and is seen being accumulated in the future.
According to Kanayama, although he cannot disclose details about the current team, he aims to build an organization a few hundred-strong comprising doctorate holders in such fields as machine learning, encryption technology, material science or hydrodynamics, so as to analyze fashion from the scientific perspective in the future. In tandem with the announcement, we held a short interview with Start Today CEO Yusaku Maezawa and Kanayama, inquiring into their objectives in establishing Research [interviewer questions indicated in boldface].
Approaching fashion from scientific angle
Zozosuit Image credit: Start Today
I give due warning; the whole picture of the R&D arm is still unclear. As mentioned above, it is a fact that the firm has been storing an enormous amount of data related to fashion especially in Japan. The data content will enable more multidimensional analysis by adding body dimension data measured by Zozosuit that astonished the world. The two guys explained about the outline of the new arm.
Although Research was introduced with a bit ambiguous expression as “scientific approach of fashion utilizing big data” in the press release, would you explain about the outline of it again?
Kanayama: The purpose of Research is to utilize fashion data including human body dimension data. We will jointly research with external companies or educational organization about what can be grasped from fashion data or how we can utilize it into our service. The output of Start Today is thought to be divided into two types: the one is academic approach via papers or learned societies and the one is to make it into services or products led by companies. As acquiring an enormous amount of data, I would like to improve the state of the world together with outside collaborators.
Is it a R&D department of Start Today?
Maezawa: We had sometimes conducted planning or development as needed, but here we will cover a wide range of R&D activities in Research.
I ask you more about the organization. While Mercari had also announced the establishment of R&D department with detailed research themes or organization scale, how about is that in Research?
Kanayama: We plan to construct a several hundred-scale organization having Ph.D. members, in addition, we will start researching about fact or theory which has not been commercialized. Fashion has both “protection” and “emotion” aspects. The protection aspect is to wear clothes to protect himself against the cold or to cover up himself. The emotion aspect is to lift the spirit or to gain confidence or satisfaction. To meet the emotion aspect, measurement technology is needed, and the size suit must be improved further. We will explore themes about combination or coordination utilizing algorithm, machine learning, or deep learning. If health factor were required for fashion, healthcare field would become one of our research targets.
These data, Kanayama compared to “petroleum”, is just a string if it remains as it was. Refining it and synthesizing it, they turn it into a form available. The direction Research pursues may be to quantify fashion that had been determined based on the sense and to change fashion into a knowledge that everyone can share as common recognition.
Perfect-fitting by one-centimeter pitch
L to R: Start Today CEO Yusaku Maezawa, Vasily CEO Yuki Kanayama Image credit: The Bridge
What are the specific views the two guys are going to cultivate, while it seems to a big project they imagine? I continued interviewing.
I will ask you about the research contents. For example, Amazon has a simple view like Echo Look, suggesting fashion which suits each user by taking photos. Do you have any specific ideas as outputs from Research?
Kanayama: Yes, we have some plans for services but cannot reveal them now. I want to pursue the point what is cool for him seen from himself just as seen from those around him.
Maezawa: The purpose of Research is to seek the answer to the problem as for what is cool for each user, by suggesting satisfactory fashion that looks cool seen him and also seen from surrounding people. We aim to digitize what is cool and what is cute. Off course, it is important for a user to be satisfied himself, but we want a proof that other people will be sure to admire the fashion enough to recommend them to him.
We will digitize the ambiguous concept of “cool”; for example, a coordination is cool because it is formed by combining this one and that one it is highly evaluated by 85 in 100 people qualitatively. Anyone may be worried about whether clothes will suit him. I think it is important to tell him that it really suits him or looks cool qualitatively to make him positive. To do that, first of all, we want everyone to experience wearing perfect-fitting clothes and to be impressed with them. Then, digitalized data outputted from Research will work as a support. That is our future vision.
As hearing Maezawa’s explanation, I had a dim impression that standardized information related to fashion like “fashion score” will be born from here. Of course, that will be incorporated into the group’s services, but standardized data can be used by external companies too.
Start Today CEO Yusaku Maezawa Image credit: The Bridge
Let’s continue the interview. If you could acquire any outputs from the data in Research, how the world will change? For example, with the advent of fast fashion represented by Uniqlo, we no longer have difficulties in having clothes just to live. How are they going to change the world?
We no longer have difficulties in having clothes thanks to the advent of fast fashion. On the other hand, ocular changes have occurred in the street; homogeneity in fashion can be seen. What impacts do you expect Research to have?
Maezawa: I think the silhouette of aman wearing T-shirt is an art; it completely differs according to person. In autos’ body lines, there is a ratio called golden section which is digitalized to a certain degree. Similarly, we will try to sublimate the silhouette in a size suitable for each person to an art. I believe there is “a point” of perfection.
Currently, we have been producing T-shirts with size intervals of several centimeters pitch and wish everyone to find their favorite silhouette. An impression of clothes changes greatly only with one-centimeter difference in size, but there had not been such line-ups allowing customers to choose thus far. Few people are particular about one-centimeter difference in clothes, right? That is why I wish them to find their own perfect T-shirts.
Although I cannot refer to Zozosuit because I have not experienced Zozosuit yet, how does it feel to wear a perfect T-shirt?
Kanayama: It makes you positive.
I see.
Should the day arrive when we really can obtain perfect-fitting clothes, we will surely get to enjoy fashion from all over the world via online more easily or more people will gain confidence about one’s own fashion by utilizing the abovementioned Fashion Scoring.
Will it bring another change just as fast fashion created? I would like to wait for their outputs with great interest.
Translated by Taijiro Takeda Edited by “Tex” Pomeroy
See the original story in Japanese. Some readers who participated in our community events since we started up our business may recall Youngwook Ko. In those days, we regularly held pitch events at a co-working space located in Nishiazabu, Tokyo. He had based his activities then in Roppongi and sometimes dropped by our events. 20 years ago, Ko came to Japan by himself from Korea when he was just 20. After working at a TV station, he founded his company called Rocket Staff in November of 2010, taking on cross-border app development between Japan and Korea while coordinating app marketing or acting as a reporter introducing Japanese tech trends for a Korean IT-focused TV program. The firm’s representative works include chat and photo-sharing app Peppermeet and ad-based user engagement app Ad&Joy. Ko contacted us again in a long while. 20 years has passed since he came to Japan and he told us that he has embarked on a new journey before reaching the age of 40. At age 40, becoming free from hesitation According to Ko, Rocket Staff’s business has still been doing well. Its current key product is free Manga app such as KING (for iOS / Android) or…
From left: CEO Youngwook Ko (right), Operating Officer Yuichi Honda (left) Image credit: Masaru Ikeda
Some readers who participated in our community events since we started up our business may recall Youngwook Ko. In those days, we regularly held pitch events at a co-working space located in Nishiazabu, Tokyo. He had based his activities then in Roppongi and sometimes dropped by our events.
20 years ago, Ko came to Japan by himself from Korea when he was just 20. After working at a TV station, he founded his company called Rocket Staff in November of 2010, taking on cross-border app development between Japan and Korea while coordinating app marketing or acting as a reporter introducing Japanese tech trends for a Korean IT-focused TV program. The firm’s representative works include chat and photo-sharing app Peppermeet and ad-based user engagement app Ad&Joy.
Ko contacted us again in a long while. 20 years has passed since he came to Japan and he told us that he has embarked on a new journey before reaching the age of 40.
At age 40, becoming free from hesitation
Manga King
According to Ko, Rocket Staff’s business has still been doing well. Its current key product is free Manga app such as KING (for iOS / Android) or Manga Kiss (for iOS). The business model is to digitalize Mangas which are already published through partnering publishing companies and to share the revenue earned from advertising. Rocket Staff was initially managed by Ko with support from shareholders including VC firms and angel investors, after which Ko bought shares back under the strong performance of Manga app sales, and now the firm is wholly owned by him.
He is married with children, and has produced a stable business. He can be called a successful man, and yet never settles for the situation. That is because he is full of entrepreneurial spirit.
Eight years has passed since I started the business of Rocket Staff. The current business has been doing well in Japan, but I noticed there are different patterns of successful businesses between startups in Japan and that in the world.
I want to create a service that can compete on the global market and do not want to regret. I think the limit that I can work super-actively enough to start new business may be 40s or 50s, so there is only 20 years left for me then.
To create a global service, an overwhelming strength surpassing other players is needed. In addition, what is the service which can be created only by them? Ko found a hint in advertising which earns profit for Manga apps.
Why blockchain-based ad network?
In a lot of apps including Rocket Staff’s Manga apps, ad frames are inserted as set by ad agencies. Good sales performance can be seen right after a salesperson first visits an office for promotion and the firm adopts the new ad, as it is fresh. But the performance starts diminishing as freshness wears off a few weeks later. Once the ad agency is prodded into making improvements, the sales recovers but then soon goes down again after refreshment periods. Ko explained that to be a typical cycle of ad sales.
Ad agencies provide either ads they acquired the contracts by themselves through promotion activities or ads distributed from ad network through RTB (Real-time Bidding) to their ad frames. According to Ko, ad agencies tend to prioritize the ads they won contracts due to its better gross profit in many cases. As a result, they often provide ads making much of the number of impression and sales rather than the affinity to media or apps; therefore, the advertising revenue for media or app operators declines.
For example, ads for women are sometimes distributed in Manga app for men. This tragedy is not caused by technical problems but caused by contradictions of the current online advertising business. More than a few global media or app developers earning advertising income must recognize the same issue. So, is it possible to construct an ad network securing transparency by using blockchain? That is the answer Ko found.
Trying to secure transparency of an ad network is like trying to handle one of the sacred cows in the ad industry. Since conventional ad networks are unlikely to work on it, I felt certain that it is worth doing by ourselves.
Perhaps, it might become a disruptive product that presses conventional ad agencies or ad networks. Rocket Staff now is a company with 100% owned capital, so that Ko can strive for development of new platform at his unrestricted position without disturbance by conflict or delicacy.
To realize the new business idea, Ko found a new company in Estonia and moved his base to there. Cooperating with remote developers and staffers in Japan or Korea, the firm will be engaged in development of a decentralized ad network named ACA Network.
In ACA Network, all settlement of buying and selling of ads between advertisers and ad frame providers are conducted by using a ERC20-based token JPYT (provisional name); no problem about volatility will arise by setting 1 JPY = 1 JPYT as the fixed value (pegged rate). On that platform, ordering designers for banner ad creating will also be available via JPYT settlement. ACA Network plans to reduce its commission fee to around 5%, while typical DSPs (Demand-Side Platform) require several tens of % fee.
By the way, since the JPYT token is legally treated the same as prepaid e-money such as Suica or Edy in Japan, service operators have to deposit an amount equivalent to a half of the value of the unused money (Payment Services Act). To secure the capital for deposited money, ACA Network is going to conduct ICO (Initial Coin Offering) selling its own token “ACA” this May. Since ACA Network is an Estonian corporation but not a Japanese cryptocurrency exchange operator, AMA (Ask Me Anything) or white paper will be provided only in English (as not targeting only the Japanese).
Settlement on ACA Network requires JPYT, not ACA. Users cannot use ACA acquired by ICO for settlement of ad trading but can receive a discount on commission fee of ACA Network based on the amount of ACA (there is a risk that paying rewards back to ACA owners may be regarded as equivalent to stock dividend, and the firm adopted such a style to avoid the conflict with regulations).
Preparing ICO of this May, ACA Network has launched the teaser website and released white paper. The road map in the website implies the beta launch of ACA Network next spring.
See the original story in Japanese. Tokyo-based Zerobillbank Japan (ZBB) develops and provides the ZBB Core platform and the ZBB Mobile Wallet, helping companies issue and manage their own corporate currency as well as promoting their employees to use them. The company announced on Monday that it has partnered Benefit One (TSE:2412), a leading provider of corporate welfare services in Japan, to integrate the ZBB Core platform with the latter’s the Incentive Point system in March. The Incentive Point system allows member companies to give points to employees who have achieved excellent results, which the employees can then exchange for about 20,000 items (perks), including restaurant vouchers and movie and theater tickets. In the companies using the ZBB Core platform and Benefit One’s Incentive Point system, this partnership allows the employees to exchange the corporate currency with other employees as well as trade it for services. By making full use of ZBB’s features, this system fully digitizes the process of granting rewards and the detection process that acts as a trigger. For example, by using GPS-based location function it is possible to detect whether employees are leaving on time, or through the use of IoT terminals companies can monitor whether…
Junichi Horiguchi taking the stage at the first Demo Day of the MUFG FinTech Accelerator in August 2016. Image credit: Masaru Ikeda
Tokyo-based Zerobillbank Japan (ZBB) develops and provides the ZBB Core platform and the ZBB Mobile Wallet, helping companies issue and manage their own corporate currency as well as promoting their employees to use them.
The company announced on Monday that it has partnered Benefit One (TSE:2412), a leading provider of corporate welfare services in Japan, to integrate the ZBB Core platform with the latter’s the Incentive Point system in March. The Incentive Point system allows member companies to give points to employees who have achieved excellent results, which the employees can then exchange for about 20,000 items (perks), including restaurant vouchers and movie and theater tickets. In the companies using the ZBB Core platform and Benefit One’s Incentive Point system, this partnership allows the employees to exchange the corporate currency with other employees as well as trade it for services.
By making full use of ZBB’s features, this system fully digitizes the process of granting rewards and the detection process that acts as a trigger. For example, by using GPS-based location function it is possible to detect whether employees are leaving on time, or through the use of IoT terminals companies can monitor whether assignments are submitted on the due date, making it is possible to automatically issue corporate currency to the target employees.
Image credit: ZBB
There are two keywords behind ZBB’s launch of this service, the redefinition of a value chain and the prosperity of a token economy. Three assets indispensable for business – people, goods, and capital – are changing drastically in recent years. These elements have become mutually connected to the Internet, and due to the unbundling of services and products as well as trends in human resource shortages and work style reforms as a result of the decrease in the working population, the value chain of a company cannot be completed within one company or in one supply chain.
The three above-mentioned assets will be shared over the barrier between companies, forcing companies to change their traditional management style which had been pursuing oligopoly and profit in the market by eliminating competition. Naturally, the motivation of people working in companies will also change. Perhaps this will constitute the largest shift in paradigms since the Industrial Revolution or, conceivably, in the history of the capitalist economy. ZBB may not provide an immediate answer to these changes with the latest service, but it will certainly be a foothold in creating a new economic system.
In the future, ZBB will introduce SaaS-based digital asset management solutions “DDAM (Distributed Digital Asset Management)” including ZBB Core and ZBB Wallet for enterprises and consortia seeking digital transformation. Within the year the company plans to specialize in issuing solutions for corporate currency, also apparently looking at replacing conventional functions in companies such as employee stock ownership with digital solutions.
Junichi Horiguchi, previously of IBM Singapore, founded ZBB in Tel Aviv, Israel in February 2015 (as Zerobillbank LTD.). In June 2015 the company fundraised $100,000 US from Tokyo-based incubator Samurai Incubate, and by June 2016 it had fundraised from multiple anonymous angel investors. The company was later adopted into the first batch of the MUFG FinTech Accelerator (now known as MUFG Digital Accelerator) and released the Ooiri blockchain-based corporate coin aimed at reducing overtime for Kabu.com Securities, a MUFG company. In 2017, it was selected to participate in the Sotetsu × Takashimaya Acceleration Program, a joint accelerator of a railway company and a department store in Yokohama, Japan, where it released the Zerobill-Contract platform to automate n-to-n commercial transactions and businesses.
Additional Note:
There is room for discussion as to whether to use the term corporate currency or corporate token. With regards to virtual currency, there is the definition that a currency that is handled by exchanges, circulated across a community, and has a perceived value is not a token. (This definition is not unique and the opinion differs depending on the subject of interpretation.) For the purpose of this article, we used the term corporate currency considering that the rewards various companies on the marketplace offer as exchange make it possible to assign a value. This expression is subject to change in the future according to market trends and community awareness.
Translated by Amanda Imasaka Edited by Masaru Ikeda
See the original story in Japanese. Tokyo-based insuretech startup JustInCase announced on Wednesday that it has raised additional seed funding from 500 Startups Japan and Naoki Aoyagi. Aoyagi is the former CFO of Japanese internet giant Gree (TSE:3632) and now the CEO of MerPay, the financial services subsidiary of Japanese C2C commerce unicorn startup Mercari. Aoyagi participated in this round as an angel investor while 500 Startups Japan made a follow-on investment after their participation in the previous seed round. Although JustInCase has not yet clarified the amount of each individual funding, it did confirm that the cumulative funding amount including this follow-on round along with last year’s is 45 million yen (about $414K US). The company is preparing its first product “Sumaho Hoken (Smartphone Insurance)”, an insurance service to cover repair costs in the event of a malfunction for smartphone users. It uses AI (artificial intelligence) algorithms to analyze user behavior patterns, and conducts a risk assessment for each user allowing the company to provide a service with optimum premiums. As a result, it will be cheaper than Apple Care and other major telecom carriers’ insurance fees for smartphone users. In preparation of launching the official Sumaho Hoken service,…
Front row from the left: Hiroo Koizumi (CTO, justInCase), Kazy Hata (CEO, justInCase), Shinnichi Nasukawa (CFO, justInCase) Back row from the left: James Riney (Head, 500 Startups Japan), Naoki Aoyagi, Yohei Sawayama (Managing Partner, 500 Startups Japan) Image credit: justInCase
Tokyo-based insuretech startup JustInCase announced on Wednesday that it has raised additional seed funding from 500 Startups Japan and Naoki Aoyagi. Aoyagi is the former CFO of Japanese internet giant Gree (TSE:3632) and now the CEO of MerPay, the financial services subsidiary of Japanese C2C commerce unicorn startup Mercari. Aoyagi participated in this round as an angel investor while 500 Startups Japan made a follow-on investment after their participation in the previous seed round. Although JustInCase has not yet clarified the amount of each individual funding, it did confirm that the cumulative funding amount including this follow-on round along with last year’s is 45 million yen (about $414K US).
The company is preparing its first product “Sumaho Hoken (Smartphone Insurance)”, an insurance service to cover repair costs in the event of a malfunction for smartphone users. It uses AI (artificial intelligence) algorithms to analyze user behavior patterns, and conducts a risk assessment for each user allowing the company to provide a service with optimum premiums. As a result, it will be cheaper than Apple Care and other major telecom carriers’ insurance fees for smartphone users.
In preparation of launching the official Sumaho Hoken service, the company is coordinating with a local bureau of the Japanese Ministry of Finance to register as a small short-term insurance company but prior to the official launch, taking advantage of the exclusion provision of the Insurance Business Law (Article 2 of the Business Law), the company began an invitation-only service for pre-registered users from Wednesday.
Upon completion of the small short-term insurance company registration, the advance service is expected to shift to an official service. Due to the restrictions of applicable laws and the like, there is a possibility that the products and insurance premium conditions of the official service will be different from those of the advance service.
Sumaho Hoken is classified as a “P2P (peer-to-peer) insurance” which applies the concept of a sharing economy to insurance, i.e. friends and groups of users (pools) who are interested in insurance against the same risk pay the insurance premiums, and a system is adopted whereby insurance money is paid out from this pool. P2P insurance has various merits including the risk being easier to calculate compared with conventional insurance, insurance products that were impossible in the past can be easily developed, insurance money fraud and moral hazard problems are less likely to occur, and ex-post facto premiums can be kept cheap (through cash back, etc.).
In this space, we’ve seen emerging P2P insurance startups such as Sure (having raised $10.6M US so far), Lemonade (recently raised $120M US from Softbank, GV or Google Ventures, Sequoia Capital, and Allianz last yearend), and Berlin-based Friendsurance (raised more than $15M US from Horizon Ventures, the investment firm of Hong Kong biliionaire Li Ka-Shing.
Translated by Amanda Amasaka Edited by Masaru Ikeda
Masaru Ikeda
The Bridge
Takeshi Hirano
