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How can big companies collaborate with startups?

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See the original story in Japanese. This is a part of our coverage of B Dash Camp Osaka 2013. Here in Japan we’ve recently seen several efforts to connect startups and established companies, like Morning Pitch and Creww’s Ignition Night. In Japan, most incubation programs run by corporate venture capital initiatives aim to let their employees understand the startup culture and get a sense of the creative atmosphere. So in this way, established companies and startups can complement each other, and such efforts will likely be more frequent across the local startup scene. On a day two of B Dash Camp in Osaka last week, we heard more on this topic from Microsoft Japan evengelist Shinichiro Isago, NTT Docomo Ventures managing director Daisuke Miyoshi, and Dentsu [1] senior director Fumijiko Nakajima. This session was moderated by Shuji Honjo, visiting professor at Tama Graduate School of Business, Tokyo. According to Nakajima, Dentsu focuses on three factors when partnering with startups: ideas, entrepreneurship, and technology. Under a well-known project dubbed Neurowear, the company has developed several products like as Nekomimi and Miko, which were also exhibited at SXSW back in March. His team is currently exploring business models for these products. He…

dentsu-nttdocomoventures-microsoft

See the original story in Japanese.

This is a part of our coverage of B Dash Camp Osaka 2013.

Here in Japan we’ve recently seen several efforts to connect startups and established companies, like Morning Pitch and Creww’s Ignition Night. In Japan, most incubation programs run by corporate venture capital initiatives aim to let their employees understand the startup culture and get a sense of the creative atmosphere.

So in this way, established companies and startups can complement each other, and such efforts will likely be more frequent across the local startup scene. On a day two of B Dash Camp in Osaka last week, we heard more on this topic from Microsoft Japan evengelist Shinichiro Isago, NTT Docomo Ventures managing director Daisuke Miyoshi, and Dentsu [1] senior director Fumijiko Nakajima. This session was moderated by Shuji Honjo, visiting professor at Tama Graduate School of Business, Tokyo.

dentsu-nakajima
Dentsu’s Fumihiko Nakajima

According to Nakajima, Dentsu focuses on three factors when partnering with startups: ideas, entrepreneurship, and technology. Under a well-known project dubbed Neurowear, the company has developed several products like as Nekomimi and Miko, which were also exhibited at SXSW back in March. His team is currently exploring business models for these products.

He also shared some of the projects that the company is working on in collaboration with other companies:

  • Draffic: Developed in association with Japanese GIS company Zenrin Datacom, this system visualizes how many people were located in a specific time at a specific location. It is expected to be used by local governments to consider a disaster evacuation plan.
  • Asoberu-T: Developed in association with Japanese fashion retailer Beams, this solution lets users experience augmented reality on T-shirts. We featured this product back in July.
  • Social Marathon: Using RFID technology, this service collects time lapses of runners at a marathon and automatically publish their updates via social networks to more motivate them to keep running.
  • Dentsu Science Jam: This is a joint venture with Japanese web conglomerate Digital Garage, aiming to create commercial services based on cutting-edge research in science.
draffic
draffic

According to Miyoshi, NTT Docomo Ventures aims for capital gain, but for startups, they expect to be seen as a gateway to all NTT group companies.

At a huge conglomerate like NTT Group, you may have no idea how to connect with a certain department. We will find the right person in the right department, corresponding to what you’re looking for, and link you up with them. We will work with you to explore how a department can make the most of your technology.

Since our company is a mobile carrier, we tend to be more constrained, so we will need more time to launch a new business than a typical startup does. By collaborating with startups which typically have lots of knowledge about new businesses, we would like to accelerate our internal entrepreneurial efforts as well.

One of the trends popular with our executives currently is the health care business. If you can bring us a health care solution, we can probably explore a potential business partnership.

For startups from outside Japan, they welcome any types of your approach. But they highly recommend you to visit them with a Japanese interpreter.

microsoft-isago
Microsoft’s Shinichiro Isago

Microsoft launched Microsoft Ventures from its US headquarters back in July. And Microsoft Japan is preparing to launch its Japanese counterpart, providing startups with support such as BizSpark, an acceleration program, and seed funding opportunities ranging from 5 million yen to 30 million yen (from $50,000 to $300,000).

In a response to a question about what kind of startups they can support, Microsoft’s Isago shared an interesting story:

In Saga prefecture, the local government decided to distribute our tablets to all high school students in the prefecture. Our challenge is we have little variety of apps for Windows Tablets. So we really want to support startups which can provide a variety of apps for devices.

For startups, if you want to apply for Microsoft’s incubation program, you will be requested to submit a form in English, as they are a global company. Microsoft Japan can give you translation assistance, but they recommend you to personally write about what has motivated you to launch a startup, regardless of whether your English is good or not.

Moderator Honjo praised the the panelists for helping their respective companies connect with startups. In response, Microsoft’s Isago explained why.

It’s because big companies became weaker. In the past at many companies, smarter people tend to be assigned to high profit business. But for communicating with startups, you will need to be agile and responsive. Supporting startups will not help profits so much, but taking these actions with our future in mind is a good policy.


  1. Disclosure: The author has a business relationship with Dentsu.

Two young Japanese entrepreneurs discuss their recent buyouts

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See the original story in Japanese. This is a part of our coverage of B Dash Camp Osaka 2013. Two Japanese startups that have experienced an strong growth in the last several months are Coach United, the startup behind private lesson portal Cyta.jp, and Bracket, which operates instant e-commerce platform STORES.jp. On day two of B Dash Camp Osaka last week, we had a chance to hear from Coach United CEO Nobuhiro Ariyasu and Bracket CEO Yusuke Mitsumoto. Also on the panel were Rakuten executive officer Takeshi Homma, and KDDI general manager Shigeki Matsuno. This year Ariyasu sold his startup to Japanese recipe site Cookpad, and Mitsumoto sold his startup to leading Japanese fashion commerce company Start Today. Moderator Hiroyuki Watanabe started the sessions with asking about their recent exits. When did you start preparing for buyouts? Ariyasu explained: When we launched our company back in 2007, I had no idea about funding or M&As. We couldn’t help but enjoy developing our product at that time. Two or three years later, we finally could make our business profitable, and had a chance to receive offers from some people [1]. The company kept using bank loans but were exploring funding opportunities…

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Bracket CEO Yusuke Mitsumoto and Coach United CEO Nobuhiro Ariyasu

See the original story in Japanese.

This is a part of our coverage of B Dash Camp Osaka 2013.

Two Japanese startups that have experienced an strong growth in the last several months are Coach United, the startup behind private lesson portal Cyta.jp, and Bracket, which operates instant e-commerce platform STORES.jp. On day two of B Dash Camp Osaka last week, we had a chance to hear from Coach United CEO Nobuhiro Ariyasu and Bracket CEO Yusuke Mitsumoto. Also on the panel were Rakuten executive officer Takeshi Homma, and KDDI general manager Shigeki Matsuno.

This year Ariyasu sold his startup to Japanese recipe site Cookpad, and Mitsumoto sold his startup to leading Japanese fashion commerce company Start Today. Moderator Hiroyuki Watanabe started the sessions with asking about their recent exits.

When did you start preparing for buyouts?

Ariyasu explained:

When we launched our company back in 2007, I had no idea about funding or M&As. We couldn’t help but enjoy developing our product at that time. Two or three years later, we finally could make our business profitable, and had a chance to receive offers from some people [1].

The company kept using bank loans but were exploring funding opportunities for the next stretch.

bdash-camp-buyout-mitsumoto-ariyasu

Bracket is not an old company but has been running a number of businesses for about five years. In contrast to his past businesses, Mitsumoto was aggressively exploring funding opportunities to boost their e-commerce platform. He attributes this to the many competitors in that space [2].

What’s the most impressed in the entire session was the following interaction between the pair.

Ariyasu asked Mitsumoto,

If Base (Bracket’s main competitor) wasn’t around, would you still sell your startup to Startup Today?

Mitsumoto answered, saying:

Without them, we probably might have not achieved the revenue we have.

Why not aim for an IPO?

Since these two startups were rapidly growing but self-funded, their founders could probably consider IPOs as possible options. But they emphasized a good match with the companies that acquired them.

Ariyasu explains:

I’m not really a person who drives after an IPO. It’s all up to you to determine whether an IPO and an M&A is a better choice for you. … I actually got an offer from Murakami (Livesense CEO) but I think it was not so aggressive. I’m close with him, and we have been fishing together. The reason why we partnered with Cookpad was I thought the both companies have something common in their corporate culture.

In a explanation about how Bracket’s Mitsumoto decided to sell his startup, he unveiled it was finally decided over the phone with Start Today’s CEO Yusaku Maezawa, which surprised the audience.

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Bracket CEO Yusuke Mitsumoto

The decision was surprisingly smooth. I’ve been in touch with Maezawa for almost three years since he sent us an inquiry via our website. I’ve handled four different businesses in the past, and I finally managed to find success in my fifth. The recent announcement that Yahoo Japan made of making its e-commerce platform free this year will be a big turning point in the Japanese e-commerce industry, where more players will make more bold decisions to defeat competitors.

Buyer’s perspective, seller’s perspective

KDDI’s Matsuno was involved in Mediba’s [3] acquisitions of startups such as Nobot and Scaleout. In a response to moderator Watanabe’s question about criteria around M&As, he says:

You probably need the perspectives of both a buyer and a seller. When your company is acquired by 100%, you will totally lose your ownership. In an extreme case, you might lose your position as the CEO. When you think of a company that you could sell your business to, you will need to build a good relationship of mutual trust (not to be asked to step down).

Rakuten’s Homma concluded the session with saying that:

Both for a seller and a buyer, the more experience you have, the better you can understand how you should proceed.


  1. We previously featured Ariyasu and Cyta in this article.
  2. Our readers may recall that we visited the Bracket office just last month, and had a chance to speak more with Mitsumoto about Stores.jp.)
  3. Mediba is a mobile advertising-focused subsidiary of KDDI.

Japanese founders discuss the difficulties of sustaining a startup

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See the original story in Japanese. This is a part of our coverage of B Dash Camp Osaka 2013. Recently we have seen more than a few Japanese companies disappearing from the market. According to a 2011 white-paper on Japanese SMEs and Industry, 30% of companies will be gone in ten years, and as many as 50% of them in 20 years [1]. It might be relatively easy to launch a startup, but it’s still very hard to keep running one. So advice for experienced entrepreneurs is very useful for all of us. On day one of B Dash Camp Osaka, we had a chance to hear such advice from Drecom CEO Yuki Naito and Crooz CEO Koji Obuchi. The session was moderated by Septeni Holdings CEO Koki Sato. Sato started the session by noting that even though M&A activities are increasing, IPOs are decreasing. Obuchi says that selling off your company is one of the necessary steps to accelerate the startup ecosystem, but he couldn’t say definitively that entrepreneurs should choose an acquisition as an easier option. When I look at faces of my employees, I feel I wouldn’t be able to let them down. I’m probably very typically…

Crooz CEO Koji Obuchi
Crooz CEO Koji Obuchi

See the original story in Japanese.

This is a part of our coverage of B Dash Camp Osaka 2013.

Recently we have seen more than a few Japanese companies disappearing from the market. According to a 2011 white-paper on Japanese SMEs and Industry, 30% of companies will be gone in ten years, and as many as 50% of them in 20 years [1]. It might be relatively easy to launch a startup, but it’s still very hard to keep running one. So advice for experienced entrepreneurs is very useful for all of us. On day one of B Dash Camp Osaka, we had a chance to hear such advice from Drecom CEO Yuki Naito and Crooz CEO Koji Obuchi. The session was moderated by Septeni Holdings CEO Koki Sato.

Sato started the session by noting that even though M&A activities are increasing, IPOs are decreasing. Obuchi says that selling off your company is one of the necessary steps to accelerate the startup ecosystem, but he couldn’t say definitively that entrepreneurs should choose an acquisition as an easier option.

When I look at faces of my employees, I feel I wouldn’t be able to let them down. I’m probably very typically Japanese in that I wouldn’t be able to take a buy-out option.

Naito also says he really wants to keep running his business, explainging that if he sold off his company, it would be hard to find something else to do.

Looking at recent M&As in the Japanese startup scene, he pointed out that prices for startup buyouts are still low.

Mostly the prices ranging from 500 million yen to 1 billion yen, right? (from $5 million to $10 million) For startup founders, if you still hold half of your company’s shares, the amount is much more than what you can spend on your petty expenses. Your startup is what you want to do, but you will lose it after the sell-off. And you probably wouldn’t be able to spend the money so easily because it represents the fruit of your contnuous efforts. I’m not sure how one can so easily sell off a company.

Tough times

Naito reflected back on the times when he suffered the most:

Drecom CEO Yuki Naito
Drecom CEO Yuki Naito

One year after the IPO of my company Drecom, it still showed a loss. In 2006, we took over a company for 1.3 billion yen ($13 million) but we were forced to borrow money from the bank for it because Drecom had a low evaluation due to the Livedoor Shock. When I looked at the acquired company’s fiscal report, it still had 2 billion yen ($20 million) in short-term debt. If your company shows a loss for more than two consecutive fiscal periods, your bank will take something in security for your future pay-back and attempt to collect money from you.

At the time, Naito was in his 20s but had to make his company profitable, even lending the company money from his personal account. When they got investment from Rakuten, a total acqusition by the e-commerce giant was one of their possible options. But he rejected the proposal since he would not really be motivated to keep running the business if he lost ownership.

Obuchi let his social gaming business mature after pivotting seven times. The moderator asked him if his employees were confused with those pivots, and he said they were very tolerant, and probably understood it was necessary for the company to survive.

Naito emphasized the importance of quick execution in business, explaining:

If you know your business in feature phone content (for example) will suffer, you need to take action as soon as possible. If you start working on it when you see a loss, that might be too late.

bdash-camp-sustain-your-business-2


  1. Issued by the Japanese Ministry of Trade, Economy.

Kaizen Platform’s A/B test service wins BDash Camp Osaka pitch event

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This is a part of our coverage of B Dash Camp Osaka 2013. The highlight of day two of B Dash Camp Osaka was the startup pitch event, with a number of quality entrants from Japan and around Asia. The grand prize winner of the event was Kaizen Platform, whose CEO Kenji Sudo pitched their PlanBCD service. He was awarded a Microsoft Surface 2, a Sony Xperia Tablet Z, as well as return invite to the next B Dash Camp The service is a little tricky to wrap your head around, but its primary function is to help developers improve the user interface of their web service. The front page of their site boasts “Growth Hackers are ready to optimize your site.” But of course it can be costly for companies to hire growth hackers for such improvements, but PlanBCD proposes a crowdsourced solution and useful tools for short-term A/B testing. You will need to set a budget for your site improvement, and then add some javascript to your site’s headers. After that you wait for suggested improvements from growth hackers, and you can A/B test the ones you like best. The results can then be reviewed on a handy…

Kaizen Platform CEO Kenji Sudo

This is a part of our coverage of B Dash Camp Osaka 2013.

The highlight of day two of B Dash Camp Osaka was the startup pitch event, with a number of quality entrants from Japan and around Asia. The grand prize winner of the event was Kaizen Platform, whose CEO Kenji Sudo pitched their PlanBCD service. He was awarded a Microsoft Surface 2, a Sony Xperia Tablet Z, as well as return invite to the next B Dash Camp

The service is a little tricky to wrap your head around, but its primary function is to help developers improve the user interface of their web service. The front page of their site boasts “Growth Hackers are ready to optimize your site.”

But of course it can be costly for companies to hire growth hackers for such improvements, but PlanBCD proposes a crowdsourced solution and useful tools for short-term A/B testing. You will need to set a budget for your site improvement, and then add some javascript to your site’s headers. After that you wait for suggested improvements from growth hackers, and you can A/B test the ones you like best. The results can then be reviewed on a handy dashboard.

Sudo says that they will be looking to expand globally, with the goal of becoming a sort of Github for growth hackers. But they still need to look at reducing their tool’s cost.

Kaizen Platform Inc. just raised seed funding worth $800,000 from GREE Ventures, GMO Venture Partners, and CyberAgent Ventures back in August, with the intention of stepping up its system development and marketing. And it wouldn’t surprise us at all to see them attract more investment very soon.

You can check out their demo video below to learn more about PlanBCD, as well as some of the slides from the pitch (in Japanese).

Mobile ad innovation and the Asia challenge

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This is a part of our coverage of B Dash Camp Osaka 2013. In the second morning session on day two of B Dash Camp Osaka, we heard a panel on the latest developments in smartphone advertising. Included in the talk on stage was Ganesan Velayathan, CEO, Fun & Cool Ventures, and Sid Bhatt, CEO of Aarki Inc. Joining the talk via Skype was Brian Wong, the co-founder of Kiip. 22-year-old Wong was an especially interesting (and charismatic) addition to this panel, since Kiip actually refuses to be called an ad company, instead preferring the moniker of ‘rewards company’. He says they are trying to redefine brand engagement, as well as connections that brands have with consumers: Kiip came from our observation that people were already engaged in ‘moments of happiness’. When people got a high score in a game, there’s an emotion. But that moment of happiness would often be abused by an ad. We wanted to instead acknowledge and reward these moments. Kiip is currently included in about 1500 apps. They started out in games but they are now in six verticals, including fitness, music, to-do, and food. Many of the ad dollars that come their way would…

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Ganesan Velayathan, CEO, Fun & Cool Ventures Inc., Sid Bhatt, CEO of Aarki Inc

This is a part of our coverage of B Dash Camp Osaka 2013.

In the second morning session on day two of B Dash Camp Osaka, we heard a panel on the latest developments in smartphone advertising. Included in the talk on stage was Ganesan Velayathan, CEO, Fun & Cool Ventures, and Sid Bhatt, CEO of Aarki Inc. Joining the talk via Skype was Brian Wong, the co-founder of Kiip.

22-year-old Wong was an especially interesting (and charismatic) addition to this panel, since Kiip actually refuses to be called an ad company, instead preferring the moniker of ‘rewards company’. He says they are trying to redefine brand engagement, as well as connections that brands have with consumers:

Kiip came from our observation that people were already engaged in ‘moments of happiness’. When people got a high score in a game, there’s an emotion. But that moment of happiness would often be abused by an ad. We wanted to instead acknowledge and reward these moments.

aarki
Sid Bhatt, CEO of Aarki

Kiip is currently included in about 1500 apps. They started out in games but they are now in six verticals, including fitness, music, to-do, and food. Many of the ad dollars that come their way would normally be spent on video, he explains:

They want the relationship with users to be a reciprocal one, starting such relationships “with a gift rather than yelling.”

We are now one of Hulu’s top three acquisition partners in the US. […] The bottom line is simple: As long as you have something relevant with a timely aspect to it, people will convert at a higher rate [than traditional ads]

Kiip is currently working with Yahoo Japan as one of their premier partners. They are also working with Lawsons, SMCC, Dell, with many more companies to come later. Japan is an especially fitting environment for a service like Kiip, as Wong explains:

Japan has a great mobile literacy. You can tap your phone and buy something, but that still science fiction in the US. In Japan, that science fiction is a reality. And I felt our platform would be accelerated there.

Like Kiip, Aarki Inc has been getting pretty creative in how it engages consumers on mobile devices. CEO Sid Bhatt showed off some really fun demos, including a rich media ad for Landrover. That ad let the user move their phone around to display a 360-degree view of the inside of a Landrover. Time spent in such rich media ads can be over two minutes, says Sid, and this is what advertisers are really looking for these days.

The traditional format, the banner ad, is quickly becoming obsolete. People still use it but it is definitely not the future.

And then there’s the Asia problem

Sid explained a little about their platform, which allows the creation of complex ads with drag and drop widgets, doing so in a better, faster, cheaper way.

He says that they are considering an office in Japan, but they are still trying hard to understand the market. What we build in the US may not be applicable in Asia.

Ganesan expressed this very same point as well, saying that In addition to the challenges that come with innovating new advertising technology, operating in the Asia region brings a whole new set of obstacles:

In Asia each country has its own style. Agencies still control the market in Japan.[…] Southeast Asia has many languages, many cultures, and different dominant market players. So [the challenge is] how to navigate that, and the agencies, and deliver the best results.

Ganesan, who operates an Asia-focused market place where developers and advertisers can connect, explained the value of their service by pointing out how it lets users choose the app where they advertise, rather than use an algorithm to select.

Moderator Tak Miyata from Scrum Ventures shared some figures to clarify the importance of the innovations these panelists have developed. Mobile ad spend, he says, was only 1 percent of all ad spend in 2011, but by 2017 it will represent about 17 percent – surpassing traditional media.

So while there will certainly be a payoff for companies who can figure out how to best engage consumers on mobile, those who can solve that riddle in regions across Asia have an especially big reward in store.

Spotify, Videology reps discuss mobile opportunities in Japan [Panel]

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This is a part of our coverage of B Dash Camp Osaka 2013. On day two of B Dash Camp in Osaka, we had a chance to hear from two big international companies with their eyes on big market opportunities on mobile, particularly here in Japan. Moderator Tomohiko Kuboto (marketing officer at GCA Savvian Corporation) spoke with Spotify’s Japan director Hannes Graah, and Videology’s APAC managing director, Kenneth Pao. Spotify has launched its streaming music service in 32 markets, with 24 million active users and 6 million paying subscribers. But the company has yet to launch in Japan, and Hannes tells me that they still don’t have any specific timeline for launch here. But they do have an office here with four employees, and hopefully they can lay the groundwork for the Spotify to enter. As Hannes explained, Japan represents a big opportunity, not just for them, but for the music industry too: The average spend of a CD buyer was about $50 or $60. But for a year of Spotify, that costs about $120 a year, which is double that. I would say that it is less about losing money, but more about growing the overall pie. During the…

hannes-graah-spotify-kenneth-pao-videography
Spotify Japan director Hannes Graah, Videology APAC managing director Kenneth Pao

This is a part of our coverage of B Dash Camp Osaka 2013.

On day two of B Dash Camp in Osaka, we had a chance to hear from two big international companies with their eyes on big market opportunities on mobile, particularly here in Japan. Moderator Tomohiko Kuboto (marketing officer at GCA Savvian Corporation) spoke with Spotify’s Japan director Hannes Graah, and Videology’s APAC managing director, Kenneth Pao.

Spotify has launched its streaming music service in 32 markets, with 24 million active users and 6 million paying subscribers. But the company has yet to launch in Japan, and Hannes tells me that they still don’t have any specific timeline for launch here. But they do have an office here with four employees, and hopefully they can lay the groundwork for the Spotify to enter. As Hannes explained, Japan represents a big opportunity, not just for them, but for the music industry too:

The average spend of a CD buyer was about $50 or $60. But for a year of Spotify, that costs about $120 a year, which is double that. I would say that it is less about losing money, but more about growing the overall pie.

During the Q&A session I could help but ask him how much of an obstacle music industry incumbents are for a company like Spotify. And while Hannes diplomatically declined to rank how much of a nuisance they are on a one-to-ten scale as I asked (perhaps I should have phrased my question differently?), he did underscore the excitement that comes with a big music market like Japan:

Every market has challenges, in many different ways. Japan is less of a challenge than it is an opportunity, because it is the second largest music market after the US. The music industry here has been looking for new solutions for a while now. In the last year we have seen some streaming services emerge from the local market and abroad, so its an exciting time to be here.

He adds that piracy and non-monetized consumers represents a huge opportunity, and he looks forward to Japan moving into an era of more profitability.

Kenneth Pao, Videology
Kenneth Pao, Videology

Similarly, Kenneth Pao explained that Japan represents a huge opportunity for Videology too. He began by explaining a little about their ad technology service, which he describes as the “the pipes under the house” which enables brands and advertisers to complete TV ad spending online. In short, says Ken, they put the right advertising in front of the right person.

Videology is active in 18 countries, and Ken hopes that Japan will be the 19th. They did 13.5 billion yen in revenue last year, with 40% of those revenues coming from TV budgets. They have raised 13.4 billion yen in venture funding, NEA, Catalyst Investors, Comcast, and they work with big name publishers like ABC, NBC, ESPN, ITV.

Kenneth explained that in the Japan, there is just 2 billion yen in online ad video spend, which compares to about 410 billion yen in the US. He noted the importance of using internet and mobile in addition to traditional media:

Many people see digital as a competitor of television. But that’s not necessarily the case. If we look at the London Olympics, we saw mobile and tablets actually complement TV. […]

There are an abundance of people on the internet and mobile, and advertisers are not reaching them. Other areas like print, radio, and TV are pretty much saturated.

He adds that if TV broadcasters don’t take advantage of this, there are many disrupters that will jump into that void. It will be interesting to see how Videology fares in particular as it increases its focus on Japan.

Before Japan’s startup elite, Nintendo president talks innovation and the search for something new

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This is a part of our coverage of B Dash Camp Osaka 2013. The highlight of day one at B Dash Camp in Osaka was the final session featuring Nintendo president Satoru Iwata. It’s unusual for him to join an open event like this, so this was a bit of a treat, especially following the social gaming session that took place earlier in the afternoon. Iwata started out with some slides to remind us that Nintendo started out as a card game company way back in 1889. He outlined how the company transitioned to TV games and then to consoles as a game platform. Nintendo is an old company, but always one that wants to make something new, he emphasized. When we talk about Nintendo we cannot ignore (former president) Hiroshi Yamauchi who just recently passed away. He always said that if you have failure, you don’t need to be too concerned. You always have good things and bad, and this reflects the history of Nintendo [1]. Iwata, as you might expect with so many folks from the mobile industry in attendance, really focused on his company’s longevity, innovation, and legacy of surprising the world with something entirely new. If…

nintendo-satoru-iwata-bdash
Nintendo president Satoru Iwata

This is a part of our coverage of B Dash Camp Osaka 2013.

The highlight of day one at B Dash Camp in Osaka was the final session featuring Nintendo president Satoru Iwata. It’s unusual for him to join an open event like this, so this was a bit of a treat, especially following the social gaming session that took place earlier in the afternoon.

Iwata started out with some slides to remind us that Nintendo started out as a card game company way back in 1889. He outlined how the company transitioned to TV games and then to consoles as a game platform. Nintendo is an old company, but always one that wants to make something new, he emphasized.

When we talk about Nintendo we cannot ignore (former president) Hiroshi Yamauchi who just recently passed away. He always said that if you have failure, you don’t need to be too concerned. You always have good things and bad, and this reflects the history of Nintendo [1].

Iwata, as you might expect with so many folks from the mobile industry in attendance, really focused on his company’s longevity, innovation, and legacy of surprising the world with something entirely new.

If you do the same thing as others, it will wear you out. Nintendo is not good at competing so we always have to challenge [the status quo] by making something new, rather than competing in an existing market.

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Iwata left, Nobuo Sayama right

While fans are screaming out for the company to go the way of Sega and and produce games for our mobile devices, Nintendo has been a stubborn holdout. That was, of course, the elephant in the room during Iwata’s talk, with the final question of the Q&A session predictably asking if Nintendo would ever shake from its stance of refusing to produce games for hardware other than its own. Iwata’s response to that was predictably curt:

No one knows the future, but I don’t think that’s going to happen with Nintendo.

As our readers may recall from a few weeks back, I myself have been dreaming that someday soon Nintendo might make a Hail Mary pass by producing a DS Phone. From Iwata’s comments, that does not look to be a likely scenario – although he did leave the door open a crack to the possibility.

I confess, I’ve all but given up hope for the salvation of Nintendo. But at the same time, hearing Iwata describe his company as one that looks for something entirely new – well, that claim appeals to the nostalgic gamer in me, the one that has been three times captivated by the company’s innovations [2]. I’d love to think that the company could pull off a home run again, but the skeptic in me thinks Nintendo is no longer capable of such things.

And yet, Iwata still kept talking.

And it did not sound ridiculous:

It’s often called the ‘Blue Ocean Strategy’, looking for something that no one else is working on. When we created the DS, people said it was strange to have a dual display, and people said elderly people don’t play games. But they did. Opening the first door is when things are most interesting.

He went on to speak of the challenge they faced in pushing Pokemon abroad:

Will America accept cute monsters? No, they said. Some people even recommended to make Pikachu more muscular. If we followed their advice Pokemon would never have been the success that it was. Brain Training software (Brain Age) became a hit in Japan, and I proposed that we sell it globally. And even as I said that as the president, no one listened.

But actually, Brain Training did better in Europe than anywhere else, and Iwata rolled out a handy chart to show as much.

nintendo-brain-age

He went on to praise his company, explaining how motivated Nintendo staffers are. “It’s easy for our employees to see the benefits of the work they do”, he explained, “and when employees are excited, well, that’s the best possible state for a company.”

It’s all too easy to bash Nintendo for its stubbornness in the face of the smartphone revolution. I’ve done it, and I’ll probably continue to do it. But I’d be lying if I said that I wasn’t also rooting for the company to pull off that last second miracle that turns the gaming industry on its head.

The giant is now the underdog, and I’m really not sure why, but I’m still rooting for them to do well.


  1. Do note that quotes in this article are taken from live translation during the event, and that Iwata’s talk was in Japanese. So it’s possible that quotes may not be entirely accurate or verbatim, but I think they are generally solid.  ↩

  2. When I say three times, I’m referring to the Nintendo Entertainment System, Gameboy, and the Nintendo DS. I didn’t buy a Wii, so I missed that train.  ↩

Japanese CEOs from Mixi, Livesense on developing new businesses

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See the original story in Japanese. This is a part of our coverage of B Dash Camp Fukuoka 2013. On day one of B Dash Camp 2013 in Osaka, the first session featured a discussion, moderated by Hiroyuki Watanabe of B Dash Ventures, with two representatives of leading Japanese leading internet companies: Yusuke Asakura, CEO of Mixi; and Taichi Murakami, CEO of Livesense Mixi has revised its fiscal year performance forecast ending March of 2014, down from 13.5 billion yen ($139 million) to 8 billion ($82.4 million), forcing their executives into a hard spot. Meanwhile Livesense, while not well recognized by many outside Japan, but is performing well. We’re forecasting an operating profit worth 1.5 billion yen ($15.5 million). Currently we are exploring the launch of a new monetization model like a buzz marketing site. The both companies need to think about their future business strategy in their respective business environments. Coinciding with a new acquisition just announced today (they’ll acquire speed-dating organizer Confianza to launch a match-making business), Mixi’s Asakura spoke about his company’s future potential for in-house service development and M&A. Our readers may recall that to date Mixi has launched mobile testing environment DeployGate, photobook service Nohana,…

B Dash Ventures' Hiroyuki Watanabe, Livesense's Taichi Murakami, Mixi's Yusuke Asakura
From the left: B Dash Ventures’ Hiroyuki Watanabe, Livesense’s Taichi Murakami, Mixi’s Yusuke Asakura

See the original story in Japanese.

This is a part of our coverage of B Dash Camp Fukuoka 2013.

On day one of B Dash Camp 2013 in Osaka, the first session featured a discussion, moderated by Hiroyuki Watanabe of B Dash Ventures, with two representatives of leading Japanese leading internet companies: Yusuke Asakura, CEO of Mixi; and Taichi Murakami, CEO of Livesense

Mixi has revised its fiscal year performance forecast ending March of 2014, down from 13.5 billion yen ($139 million) to 8 billion ($82.4 million), forcing their executives into a hard spot. Meanwhile Livesense, while not well recognized by many outside Japan, but is performing well.

We’re forecasting an operating profit worth 1.5 billion yen ($15.5 million). Currently we are exploring the launch of a new monetization model like a buzz marketing site.

mixi livesense

The both companies need to think about their future business strategy in their respective business environments. Coinciding with a new acquisition just announced today (they’ll acquire speed-dating organizer Confianza to launch a match-making business), Mixi’s Asakura spoke about his company’s future potential for in-house service development and M&A. Our readers may recall that to date Mixi has launched mobile testing environment DeployGate, photobook service Nohana, a business research service, and a match-making business.

Watanabe asked how such new businesses can be synergized with their conventional businesses. Asakura replied:

We don’t need to pursue immediate synergy with our services. By making the most of the knowledge we have, we will keep acquiring new services and development ones in house. For example, the match-making business will be treated as separate from our main business.

IMGP8555

Livesense’s Murakami unveiled they have four different business development efforts: internal service development, investment in startups, M&A, and partnerships. When pressed by the moderator, he confessed that he had hoped to invest in private lesson marketplace Cyta.jp, recently acquired by Japanese recipe site Cookpad. This prompted a big laugh from the audience.

Since Livesense has been developing a database business from the scratch, it helps them build up knowledge on how to better develop a new business. He said this will also work even in a business that is entirely different from their own existing businesses.

The problems and opportunities in the Japanese social gaming space [Panel]

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This is a part of our coverage of B Dash Camp Osaka 2013. On day one of B Dash Camp Osaka, we heard from a stacked panel from the world of social gaming, including Gumi CEO Hironao Kunimitsu, inBlue CEO Tomohiro Ootomi, Mobcast director and general manager Takeshi Sato. The moderator was DeNA chief game strategy officer Kenji Kobayashi. Any panel including Gumi’s jovial CEO Kunimitsu-san is naturally going to be an easy-going one. But despite the lighthearted tone, the discussion kept coming back to the many problems that exist for Japanese game developers these days. Kobayashi said that games in the app space are obviously growing at a great pace [1], with titles like Puzzle & Dragons, Candy Crush, and Clash of Clans doing incredibly well. Even console makers are trying to replicate their success, says Kobayashi. But he also pointed out the many games that go unfound on the app store, and that that the environment can be quite harsh if you don’t have a runaway hit. Kunimitsu compared the gaming sector to a gold rush, and pointed out that if you dig relentlessly for gold, you will probably die. If you want to do well in gaming,…

bdash-camp-osaka-gaming
Takeshi Sato, Mobcast; Tomohiro Ootomi, InBlue; Hironao Kunimitsu, Gumi

This is a part of our coverage of B Dash Camp Osaka 2013.

On day one of B Dash Camp Osaka, we heard from a stacked panel from the world of social gaming, including Gumi CEO Hironao Kunimitsu, inBlue CEO Tomohiro Ootomi, Mobcast director and general manager Takeshi Sato. The moderator was DeNA chief game strategy officer Kenji Kobayashi.

Any panel including Gumi’s jovial CEO Kunimitsu-san is naturally going to be an easy-going one. But despite the lighthearted tone, the discussion kept coming back to the many problems that exist for Japanese game developers these days.

Gumi CEO Kunimitsu
Gumi CEO Kunimitsu

Kobayashi said that games in the app space are obviously growing at a great pace [1], with titles like Puzzle & Dragons, Candy Crush, and Clash of Clans doing incredibly well. Even console makers are trying to replicate their success, says Kobayashi. But he also pointed out the many games that go unfound on the app store, and that that the environment can be quite harsh if you don’t have a runaway hit.

Kunimitsu compared the gaming sector to a gold rush, and pointed out that if you dig relentlessly for gold, you will probably die. If you want to do well in gaming, it’s hard work.

“I wouldn’t recommend it for my kids,” he explained. Globalizing is much more complex, he adds:

I think many developers create and app, put it in English, press ‘launch’ (so to speak) and expect it to do well. But it’s necessary to localize. When the competition was not intense, or the market was not mature, it was not so bad. But now localization/regionization is important.

Kunimitsu-san said that his own company, Gumi, has launched and expanded globally. They struggled initially, but their games in Singapore are doing particularly well right now.

Sato from Mobcast mentioned that the problems facing game creators today can potentially distract them from their goal if they aren’t careful:

For game creators that need to deal with so many issues, I don’t think this is really their main role, or what they should be focusing their efforts on.

Sato also spoke a little about the challenge of finding new game creators:

But it is very hard to motivate creators, but our CEO (Koki Yabu) has a good feel for this. I think we should stick with good creators and encourage (and nurture) them, rather than search out new ones.

InBlue’s Ootomi also agreed that the challenges facing game developers are indeed a problem. But he also pointed out the opportunity that exists for supporting services that solve problems:

I founded the company alone, and we used external services like Github, or some GMO services, or Mixi’s DeployGate (which is very convenient). We think there’s much room for these kind of services to enter.

Kunimitsu ended the panel on a high note, saying the he hopes that if we meet again next year that they can speak on some more positive things. You never know who will have a winning idea, he concluded.

inBlue CEO Tomohiro Ootomi
inBlue CEO Tomohiro Ootomi

  1. In comparison to browser games which are relatively stable in Japan, not growing nearly as much.  ↩

Japanese mobile moguls on how to succeed with smartphone content

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This is a part of our coverage of B Dash Camp Osaka 2013. On day one of B Dash Camp 2013 in Osaka, we heard an all-star panel speak on the many issues surrounding mobile content in Japan. The moderator was Katsuaki Sato, the CEO of Metaps, and the lineup of speakers included: Shinji Kimura, from news reader app Gunosy. Shin Murakami, operating officer and chief mobil office of Yahoo Japan Eiji Takahashi the president and CEO of Alim Hiroki Teshima, director and executive officer at United Inc (maker of CocoPPa). On the factors that lead to success Gunosy’s Kimura-san explained a little about their news reader application. He notes that they have a general news section, but also a new features that they released today called a content partners channel. Regarding how to succeed with mobile content, he explained: I think it’s really timing that matters. SmartNews Gunosy came out when I think many people were feeling fatigue from Twitter and Facebook. We had an image of how to solve that, with our app confronting that issue head on. In a way, were were meeting a demand, serving news via email. It just worked out to be the right…

bdash-smartphone-content
United’s Hiroki Teshima; Shin Murakami, Yahoo Japan; Eiji Takahashi. Alim; Shinji Kimura, Gunosy

This is a part of our coverage of B Dash Camp Osaka 2013.

On day one of B Dash Camp 2013 in Osaka, we heard an all-star panel speak on the many issues surrounding mobile content in Japan. The moderator was Katsuaki Sato, the CEO of Metaps, and the lineup of speakers included:

  • Shinji Kimura, from news reader app Gunosy.
  • Shin Murakami, operating officer and chief mobil office of Yahoo Japan
  • Eiji Takahashi the president and CEO of Alim
  • Hiroki Teshima, director and executive officer at United Inc (maker of CocoPPa).

On the factors that lead to success

Gunosy’s Kimura-san explained a little about their news reader application. He notes that they have a general news section, but also a new features that they released today called a content partners channel. Regarding how to succeed with mobile content, he explained:

I think it’s really timing that matters. SmartNews Gunosy came out when I think many people were feeling fatigue from Twitter and Facebook. We had an image of how to solve that, with our app confronting that issue head on. In a way, were were meeting a demand, serving news via email. It just worked out to be the right timing.

In terms of montetization, he added:

If you are taking about tens of millions of users, you need to work on satisfying them, and you can work out the business model at a later stage.

alim
Eiji Takahashi, Alim president

Takahashi started off by introducing Alim’s recently launched game Brave Frontier, noting that they ‘respect’ the structure of Puzzle & Dragons and trying to combine familiar content that Japanese users can enjoy. He disclosed some figures about Brave Frontier, which are as follows, noting that these are pretty high for an RPG:

  • 520,000 user accounts
  • 340,000 monthly active users
  • 120,000 daily active users
  • monthly PU rate of 10% and monthly ARPPU of 5,000 yen

Takahashi also spoke a little on the use of ads vs viral marketings in promoting a mobile game:

When we started on iOS, we had an affiliation with the Famitsu app, but beyond that it was word of mouth. We had a pre-launch registration. But before our first 100,000 users, there were no ads at all. But when you reach a ceiling, you’ll need to consider investing in ads. (Moderator asks, “TV?”) I can’t say too much more (laughs).

He also acknowledge that the fate of a mobile business can be somewhat beyond your control, especially in the early days.

I think it’s complete luck, because we didn’t expecxt this at all. We had to suspend our service a few days after launch because we couldn’t quite handle the demand. We thought that we can attract a number of users, but we had no idea how much it would be. It was completely beyond our expectation.

united-yahoo
Hiroki Teshima, United; Shin Murakami, Yahoo Japan

Murakami of Yahoo Japan said that their company has over 95 million downloads across iOS and Android. Community Factory, which they bought, has over 25 million downloads in total across their apps. Noted that Kakaotalk was also doing well in Japan with 10 million downloads, even though Line is the leader here.

He appeared to envy the position of up-and-comping startups, which show more agility than an entity than Yahoo Japan ever could:

In order to get the timing right, I think if you are in a venture company you need to look at the market size of your sector. Becoming number one in a niche industry is possible, and you can catch a wave without too much hesitation.

Teshima-san from United gave a brief intro to CocoPPa, which just surpasses 15 million users worldwide. He was wearing a Mercari shirt as well, showing his support the e-commerce app that they recently poured $3 million into.

Things never go as expected, but if you have many ways to attract users, you should be ok. I think there should be a plan B and C, not just a plan A.

From the beginning I we prepared a Chinese and Korean version. We used Conyac, and it was a very simple translation, but it was good enough to help us go global. I would advise that if you think your app can go global, then don’t skimp on translation costs.

He noted that they might try expanding into the browser to offer their service on the web. He explained that collecting valuable information from people is a good way to hedge risk in business.