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Japanese fashion startup Muse & Co raises $3.4 million

Takeshi Hirano 2013.05.16

Here’s more news from Japan’s fashion commerce space. Apparel-focused, flash marketing startup Muse & Co has announced that it has raised series B funding worth 350 million yen, or about $3.4 million. Investors include Itochu Technology Ventures, Mitsubishi UFJ Capital, and Infinity Ventures Partners (IVP).

According to IVP’s managing partner Masashi Kobayashi, this round brings the total money raised by the startup to a sum of approximately 500 million yen ($5 million). Previously, IVP invested in the startup back in May of 2012.

Consumers love fashion startups

To see a seed-stage startup fundraise such a huge amount, it reminds us that there’s a real trend emerging at the intersection of fashion, e-commerce, and smartphones. Some of our readers will remember, for example, mobile commerce startup Origami also raised about the same amount last month.

Muse & Co is a members-only flash sale site that gives users a substantial discount off the market price for a limited time. In Japan, there are some similar sites in this space. Gilt Groupe has been operating a joint venture with Softbank since 2008. Other competitors include Glamour Sales, Brands for Friends, and Monoco.

According to startup’s CEO Hirotake Kubo, Muse & Co targets the so-called ‘F1 layer’ in Japan (female users in their 20s and early 30s), thus differentiating from conventional competitors. In terms of differentiation from similar smartphones services, they expect to showcase items in the casual fashion category, which may be not so sophisticated but better suited to wearing on a day-to-day basis.

Over $500,000 in monthly sales, 70% traffic from mobile

Muse & Co sells merchandise on commission and has no inventory stocked at all. They showcase clothes from three brands every day, and in total about 30 new items are sold every day. The duration of the flash sale is usually about seven days, but most items sell out on the first day. Their flash marketing starts at 8pm every day, the peak time for user traffic.

Kubo explains that the site’s monthly revenue has reached around 50 million yen, with 50% coming from mobile, and 20% from the smartphone app. They’ve never made any promotion efforts for smartphone users, so it’s not unlikely that these access metrics (in terms of mobile/desktop ratio) are common for most e-commerce sites in Japan.

A good start

Muse & Co was established back in February of 2012. The startup’s founder, Hirotake Kubo, previously worked at global consulting firm AT Kearney, where he has been conducting due diligence on the apparel industry for five years.

From my experience seeing the apparel industry, I wanted to help domestic fashion brands solve the problems they’re facing. Beyond that, I also want to contribute to the strengthening of our economy.

Currently Muse & Co is 20-person team including 5 merchandising staffers. They have acquired approximately 200,000 users since launch, and are hoping to surpass 1 million users in the near future.

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In Japan, internet companies make weddings more affordable

SCORE 1,323

Yukari Mitsuhashi 2013.05.16

It can be hard to make Japanese weddings unique or special, since so many of them are held in the same kind of reception rooms in hotels or typical wedding venues. It’s not uncommon for couples about to be married to flip through wedding magazines like Recruit’s Zexy agonizing over the details of their ceremony. But recently we’re seeing newcomers who challenge the conventional ways of organizing weddings. Amazon just opened up its own sort of wedding store, which can be helpful for couples who might have little time to prepare for a wedding. Rakukon operated by Best Bridal, where couples can pay only 200,000 yen for their wedding in advance (about $1,957) and then pay the rest with congratulatory gift money (Goshuugi). This way, couples do not have to pay out of their own pocket. Rakukon’s pricing is unconventional considering that on average couples spend over 3 million yen on a wedding (about $29,355). Making it affordable Perhaps the biggest game changer in the wedding industry is Minna no Wedding (roughly be translated as ‘Everyone’s Wedding’) which launched back in Feburary of 2008. The service was originally a DeNA offering, but it was split from that company in October of 2010….

minna-no-wedding — *Minna no Wedding* has made weddings affordable for many in Japan

But recently we’re seeing newcomers who challenge the conventional ways of organizing weddings. Amazon just opened up its own sort of wedding store, which can be helpful for couples who might have little time to prepare for a wedding. Rakukon operated by Best Bridal, where couples can pay only 200,000 yen for their wedding in advance (about $1,957) and then pay the rest with congratulatory gift money (Goshuugi). This way, couples do not have to pay out of their own pocket. Rakukon’s pricing is unconventional considering that on average couples spend over 3 million yen on a wedding (about $29,355).

Making it affordable

Perhaps the biggest game changer in the wedding industry is Minna no Wedding (roughly be translated as ‘Everyone’s Wedding’) which launched back in Feburary of 2008. The service was originally a DeNA offering, but it was split from that company in October of 2010. The site has about one million unique users and 10 million page views per month. This count is very impressive considering that visitors to the site are limited to couples planning to marry.

Minna no Wedding’s killer content — and what differentiates it from competitors — are the wedding venue reviews posted by couples after they marry. Previously, all wedding-related information was pretty favorable when describing venues, since the venues were the ones paying to be published. People post reviews for many reasons, but many do so share the excitement (or disappointment in some cases) of their wedding. There is also an incentive system called Goshuugi points where posting three reviews can be rewarded with over 1,000 yen (about $10) worth of points.

By reading genuine opinions and reviews about venues, the likelihood of a successful wedding is obviously much higher. Reviews must be detailed, though, and are required to be more than 300 characters.

Another interesting feature of Minna no Wedding is the bill statement. Couples are sometimes surprised by the difference in the initial estimate and the final cost as venues try to recommend additional options in the preparatory process. Since the actual statements are online, it helps to remove some anxiety for couples.

According to Nikkei, the number of marriages in Japan was about 700,000 in 2010, which is 36% lower than back in 1972 when we experienced the second wave of baby boom. Among those who get married, only 300,000 to 350,000 couples celebrate by having a wedding ceremony. For the rest of the couples who opt to skip the ceremony, Minna no Wedding offers an attractive service that might change their minds.

To see how the website works, check out the video below.

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Meet the startups from Open Network Lab’s latest Demo Day in Tokyo

Masaru Ikeda 2013.05.16

Tokyo startup accelerator Open Network Lab, led by MIT Media Lab’s director Joi Ito, held its demo day event today. We had a chance to check out a wide range of startups, not only from this latest batch, but also from the program’s previous five batches. Here’s a quick overview below. From the sixth batch 1. Zenclerk ¶ Website: zenclerk.com We can’t disclose much about their business because they’re in stealth mode, expected to launch next month. But you can infer what they’re working on from their website, as well as this short introductory video (in Japanese). They did not pitch at the event. 2. Papelook / Pape.mu girls ¶ Website: papelook.co.jp Pitched by: Ichiro Ozawa As some of our readers may remember that we previously featured Papelook, a photo collage/cropping app that allows users to share your fashion snapshots with others. It has now passed 5 million downloads since its initial launch back in March of 2012, growing at the impressive rate of 500,000 downloads a month. Almost 50% of all Japanese female smartphone users aged from 15 to 29 are using the app. In terms of differentiation from competing photo apps like Decopic and Snapeee, Papelook makes it…

From the sixth batch

1. Zenclerk ¶

Website: zenclerk.com

We can’t disclose much about their business because they’re in stealth mode, expected to launch next month. But you can infer what they’re working on from their website, as well as this short introductory video (in Japanese). They did not pitch at the event.

2. Papelook / Pape.mu girls ¶

Website: papelook.co.jp
Pitched by: Ichiro Ozawa

As some of our readers may remember that we previously featured Papelook, a photo collage/cropping app that allows users to share your fashion snapshots with others. It has now passed 5 million downloads since its initial launch back in March of 2012, growing at the impressive rate of 500,000 downloads a month. Almost 50% of all Japanese female smartphone users aged from 15 to 29 are using the app.

In terms of differentiation from competing photo apps like Decopic and Snapeee, Papelook makes it easier to sort good pictures from bad ones, which should keep your camera roll from being filled with unnecessary pictures.

Papelook alone does not make much money, but it transfers users to Pape.mu girls, their cash cow. Pape.mu girls is a fashion app that presents a variety of pictures and updates curated from models’ blogs or fashion brands. The app has 250,000 downloads so far, with 500,000 active users generating six million page views a month. What’s most impressive is the retention time of their users, logging an astounding 50 minutes per visit on average.

In this way, the photo collage app brings users on board, which then creates opportunities for brands to promote products with the fashion app. The startup has already managed to partner with Fashionwalker.com, one of Japan’s largest fashion e-commerce sites. The company is planning business expansion to the US and Mainland China soon.

3. Lang-8 ¶

Website: lang-8.com
Pitched by: Yangyang Xi

Some of our readers may remember we featured Yangyang Xi, the founder and CEO of language learning platform Lang-8 in an exclusive interview back in February. The startup launched back in 2007 but since then has been operated by the founder on his own.

Mr. Xi was allowed to participate in the last batch of the acceleration program, hiring a CTO who previously worked at recipe sharing site Cookpad, as well as a designer.

With these fresh faces, Lang-8 has been seeing improvements in its access metrics. The growth rate of paid users is twice what it was a year ago, and revenue has almost doubled compared to a year ago. Business is finally in the black, and they can now begin developing a mobile app.

There’s no CGM-based language learning service using a mobile app, so that they expect to be on top of this space soon.

From previous batches

1. Kiddy ¶

Website: kiddy-photo.com
Pitched by: Hiromichi Ando, Compath.me

Back in December of 2011, Companth.me’s co-founder/CEO Hiromichi Ando explained his first app to me in an interview. They’ve been developing a number of apps since then, and the newest one is Kiddy.

Parents typically want to record the growth of their children with pictures, but most would prefer not to share all those snapshots with people on social network platforms who they might not be very close to. To address this problem, Kiddy is a photo sharing app that lets parents to share snapshots of their kids within a family group.

The app was launched last January, and more than 1,000 households have signed up for it so far. Comparing to other photo sharing apps, the Kiddy app is showing good user retention, and the ratio of weekly active users among its entire user base is between 40% to 50%, meaning that about one in every two users makes use of the app at least once a week.

With the potential to generate a great lifetime value, the startup expects to enhance the app as a platform for sharing pictures among family members. They have several monetization ideas including photo printing, or new e-commerce services that propose that you buy something that fits the specific occasion/time of your photo.

2. Voyagin ¶

Website: govoyagin.com
Pitched by: Masashi Takahashi, Entertainment Kick

This service initially set out to create a travel experience marketplace for tourists visiting Japan. But subsequently they enhanced their ideas to cover five Asian countries: Japan, India, Indonesia, Thailand, and Vietnam. They are focusing on the Asian market because there are about 42 million travelers that hit region each year, with the market estimated to be worth over $4.2 billion.

Voyagin is planning to move its headquarters to Singapore by the end of this year.

3. SpathSchool ¶

Website: spath.jp
Picthed by: Koichiro Sumi

This service is being operated a pair of developer co-founders. They are often asked by other developers to create smartphone apps, and were wondering why developers outsource development work to other developers. Finally they reached a conclusion. System developers in their 20s are familiar with programming languages like Objective-C or Ruby on Rails, but those in their 30s are better versed in conventional technologies like MySQL or Java.

With this insight the startup identified a sort of technology generation gap in the developer community. And it’s a gap that they aim to fill.

They’ve established set up a 20 to 60 hour lecture program for less experienced developers to learn about app development, and a range of related topics. They are also planning to providing some new courses for IT companies to train their employees.

After all the presentations were made, Kaoru Hayashi, the CEO of the accelerator’s parent company Digital Garage, announced that the top prize at the Demo Day event was awarded to the aforementioned Papelook.

The Open Network Lab accelerator is now accepting applications for the next batch of its acceleration program. The deadline is May 31st at noon.

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Docomo partners with Line, finds a creative way to relieve network strain

Rick Martin 2013.05.15

Back in January of 2012, Japanese carrier NTT Docomo (TYO:9437) attributed a network disruption to free VoIP applications, with popular chat app Line being the first one that it cited. Line, which launched back in mid-2011, was just picking up steam at the time with about 15 million downloads reported at that point, and 5.5 million of those in Japan. Since then of course, the application’s download count is about ten times as high – in Japan, where it has more than 45 million; and abroad, where there are over than 150 million. And while Docomo has itself had time to solidify its network infrastructure to accommodate the kind of data load that apps like Line demand, it can’t be an easy task. So it was interesting to see today that Docomo has decided to partner with Line Corporation, as announced in an event earlier today. There are a few aspects to the companies’ partnership, but the most interesting collaboration will be an original Line application for Android that will include a call button in app that users can use to make voice calls. The goal here, as Docomo itself notes, is to reduce the load on their network. This…

Docomo Line — Docomo CEO Kaoru Kato, photo by Keizai.biz

Since then of course, the application’s download count is about ten times as high – in Japan, where it has more than 45 million; and abroad, where there are over than 150 million. And while Docomo has itself had time to solidify its network infrastructure to accommodate the kind of data load that apps like Line demand, it can’t be an easy task. So it was interesting to see today that Docomo has decided to partner with Line Corporation, as announced in an event earlier today.

There are a few aspects to the companies’ partnership, but the most interesting collaboration will be an original Line application for Android that will include a call button in app that users can use to make voice calls. The goal here, as Docomo itself notes, is to reduce the load on their network. This will be put in place in September, and will allow users to call other Docomo users for free. Ostensibly, the regular Line voice call button (for VoIP calls) will still be in place.

This is a pretty fascinating maneuver on Docomo’s part, as telcos the world over adjust to a mobile industry shifting from voice to data [1].

The other aspect of the Docomo-Line agreement will bring another original Line application to Docomo’s Raku-Raku smartphones, which target users who aren’t accustomed to smartphones, especially the country’s large senior population. This app will implement preventative measures to limit transactions amounts that may have resulted from accidental purchases.

A million reading manga on mobile ¶

In addition to striking this partnership with Japan’s largest carrier, this marks a pretty good day for Line. The company also announced that its new manga application has reached a million downloads, this just a little over a month after the service initially launched in Japan.

As for Docomo, the telco isn’t doing too shabby either with more than 12 million LTE subscribers as of April 20th. Oh, and the company announced some new phones today too. But of course, still no iPhone.

(Download chart as image)

For more information on the growth of Line, please check out our interactive Line Timeline which chronicles its growth from its launch back in 2011 up until the present day.

As one example, check out this ZDnet piece from yesterday saying that such messaging apps would cost Indian telcos more than a billion dollars this year. Of course that’s a far different mobile landscape than Japan, but it will be interesting to see if any other telecoms try what Docomo is doing. (Perhaps some already have? Let us know in the comments if you know of any) ↩

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Japan’s Mixi to appoint new CEO, co-founder Kenji Kasahara to step down

Masaru Ikeda 2013.05.15

Japanese social network giant Mixi (TYO:2121) announced today that its co-founder Kenji Kasahara would step down from the CEO position. Yusuke Asakura will take over in his place effective June 25th when the company’s next shareholder meeting is scheduled. Asakura started his career at McKinsey & Co, founding his startup Naked Technology in August of 2010 [1]. That company was subsequently acquired by Mixi. In the announcement, Mr. Kasahara expressed some parting thoughts: Mr. Asakura has two different backgrounds — working at a big consulting firm and running his own startup, and that experience will help guide him to make good decisions in a logical manner, with passion. He is still just 30 years old but has the great entrepreneurial drive needed to lead our business. 16 years has been passed since the launch of Find Job (a talent/job matching site by Mixi), and nine years has been passed since the launch of the Mixi social network platform. I’ll be stepping down as chairman, but our new CEO will evolve the entire company to bring more new services to the community. Last August Mixi set up an internal ‘innovation team’ to intensify service development efforts. So far their products include app…

From the left: the current CEO Kenji Kasahara and upcoming CEO Yusuke Asakura — Current CEO Kenji Kasahara (left) and incoming CEO Yusuke Asakura (right)

Asakura started his career at McKinsey & Co, founding his startup Naked Technology in August of 2010 [1]. That company was subsequently acquired by Mixi. In the announcement, Mr. Kasahara expressed some parting thoughts:

Mr. Asakura has two different backgrounds — working at a big consulting firm and running his own startup, and that experience will help guide him to make good decisions in a logical manner, with passion. He is still just 30 years old but has the great entrepreneurial drive needed to lead our business.

16 years has been passed since the launch of Find Job (a talent/job matching site by Mixi), and nine years has been passed since the launch of the Mixi social network platform. I’ll be stepping down as chairman, but our new CEO will evolve the entire company to bring more new services to the community.

Last August Mixi set up an internal ‘innovation team’ to intensify service development efforts. So far their products include app testing service DeployGate and photo printing app Nohana. These are not derivatives from the social network, and they represent entirely new revenue streams for the company.

Mixi has also been aggressively acquiring high-profile startups and entrepreneurs, and this is a trend that can be seen across the entire Japanese tech scene, with Yahoo Japan being especially active.

Press briefing at Mixi Headquarters (May 15th, Tokyo)

We’ve recently written about another Naked Technology alum Miku Hirano, who is trying to conquer the Southeast Asia region with a unique photo sharing app. ↩

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How to transform your iPhone into Nunchucks. (Yes, nunchucks!)

Rick Martin 2013.05.15

Part of the beauty of Japanese mobile culture is the wide variety of accessories that you can add to your phone. And in recent years, that means lots of fun iPhone cases (see the bubble wrap or Domu-kun cases that we recently featured, for example). But Japanese manufacturer Nitto has come up with what might be the mother of all iPhone cases with its ‘Trick Cover’. The case is comprised of two hinged portions, one of which holds your iPhone, and the other makes up a flippable cover. But as you can see in the ever-so awesome video above, the magic happens when you hold one part, and swing the other part about – just a you would a pair of nunchucks [1]. Interestingly, you can hold a transit card like Pasmo or Suica in the cover portion, or even order a custom design to be printed on the exterior. The hinged case structure also allows you to prop up your iPhone at various angles for easy viewing. But you’ll most likely be far too busy fighting bad guys with your mobile nunchucks for anything as trivial as that! Trick Cover is available in black or white, and costs 3200…

But Japanese manufacturer Nitto has come up with what might be the mother of all iPhone cases with its ‘Trick Cover’. The case is comprised of two hinged portions, one of which holds your iPhone, and the other makes up a flippable cover. But as you can see in the ever-so awesome video above, the magic happens when you hold one part, and swing the other part about – just a you would a pair of nunchucks [1].

Interestingly, you can hold a transit card like Pasmo or Suica in the cover portion, or even order a custom design to be printed on the exterior.

The hinged case structure also allows you to prop up your iPhone at various angles for easy viewing. But you’ll most likely be far too busy fighting bad guys with your mobile nunchucks for anything as trivial as that! Trick Cover is available in black or white, and costs 3200 yen (or about $31). — [Via BCN Ranking]

Nunchaku, nunchuks, whatever… ↩