In Japan, we have seen a lot of hype around the e-commerce sector, and one of the startups getting a lot of attention is Stores.jp. Launched almost a year ago, the service recently made headlines when it was acquired by Start Today, the company behind the mega fashion e-commerce Zozotown. We visited the very cool Shibuya office of Bracket, the company behind Stores.jp, and talked to the CEO, Yusuke Mitsumoto, about their journey to this point, and where they go from here.
The Bridge: Why did you choose Shibuya as the location to set up the Bracket office?
Yusuke: I graduated from Aoyama Gakuin University which is located in Shibuya, so I’m very familiar and comfortable here. I really can’t think of any other place. We moved here about three weeks ago, but it’s only a five-minute walk from our previous office. We only had five people before, but the team has grown to be more than 20.
Yusuke: I use to work for a foreign advertising agency. The ad industry was so much fun, in fact too fun that I even felt a little scared. In Japan, the job of an ad agency is to sell media space sort of similar to a realtor, but outside Japan, you are more of a partner where you charge your fee by the hour. It was interesting to be able to work for different companies in various industries, from airlines to car manufacturers to even mineral water. But at the end of the day, the final decisions are always made by the client. I wanted to drive my own business and that’s why I started my own company.
The Bridge: Can you tell us about Bracket and its current business?
Yusuke: I founded Bracket as an internet business company back in October of 2008. Five years have since passed and it feels like the blink of an eye. The first service we released was CaFoRe, a C2C car-sharing service, and we now operate five web services in total. The others are Shoes of Prey, Privaterobe, Stores.jp, and ModelTown.
The Bridge: How did you end up making those five products?
Yusuke: The first two years we focused on CaFoRe, and in the third year we released everything except Stores.jp. We launched Stores.jp almost a year ago. We’ve been bootstrapped all this time, so we had to produce more sources of income and each product made contributions to our revenue.
The Bridge: In terms of revenue, which is the biggest contributor?
Yusuke: It’s more like a little from all products, but Shoes of Prey had more impact than we had expected. E-commerce is a simple business: you sell, you get cash. C2C services on the other hand requires a lot of time to grow. Currently, we have about 30,000 registered users on Shoes of Prey.
Yusuke: Yes, I’ve been the only executive until now. However, one of the team members Aya Tukahara, joined me on the board this year. All of the business decisions have been made by me. There are a few entrepreneurs outside the company that I can talk to, but many people choose to get funded or they already have enough funds at hand, so it’s hard to find someone in the same shoes as me.
The Bridge: Tell me a little about your current team.
Yusuke: There are roughly 20 members on our team including part-timers. Of those, about half are designers and engineers, and a quarter consists of managers and business development. The rest belong to customer support. There are no divisions within these teams, designers work on designs for all five products. But this year, we’ve pretty much focused on Stores.jp and Shoes of Prey.
The Bridge: How do you recruit people?
Yusuke: That’s the hardest part, but many are through introductions. We do put out recruiting ads but it’s been difficult to find qualified people. We don’t want to rush to hire people, because it just means more work when it doesn’t work out. Recruiting takes patience.
The Bridge: Can you tell us the current status of Stores.jp?
Yusuke: Since its launch almost a year ago, we have about 50,000 stores on the platform. About half of those are individuals, and the other half are small businesses with physical stores. Many stores owned by individuals sell design products like t-shirts and handmade items.
The Bridge: Your direct competitor is BASE. Why do your users chose Stores.jp over them?
Yusuke: We make many opportunities to speak directly with our users, and many chose us for our design and usability. They feel that the Stores.jp brand is cool. I think our simple domain Stores.jp helps with that branding.
The Bridge: What do you have planned for Stores.jp in the future?
Yusuke: We’re trying to enhance the ability to sell. At the end of July we released a feature called Promotional Switch. By turning this switch on, items within your store are promoted via partner e-commerce and media sites. We want to increase the number these partners to boost Stores.jp selling power.
The Bridge: Can people sell their items abroad?
Yusuke: Yes, there is a feature to translate stores into English. Not many stores use this feature, but we want this total to increase.
The Bridge: What’s your next big goal?
Yusuke: By the end of the year, we want to double the number of stores on Stores.jp.
Working with Start Today
The Bridge: Has anything changed since you joined Start Today, the company behind Zozotown?
Yusuke: Not really. Generally, when a company is acquired by another, you start your job the next day at the new office, you’re given new business cards, and even a new team. But for us, nothing has changed. The decision to move to our current office was decided before we began talking to Start Today, and I’m still the CEO with the same team working together. But by partnering up with Start Today, we now have access to the many powerful resources that they own.
The Bridge: We heard that the acquisitions talks only took two phone calls.
Yusuke: That’s correct. I have known Mr. Maezawa, the CEO of Start Today, for a few years. Before we launched Stores.jp or Shoes of Prey, he somehow found us and contacted us through our website. Ever since then, I’ve occasionally had dinner with him. Bracket had always been bootstrapped, so it was a big decision and a scary one to get funding from outside. But it was time, and we were looking for two hundred million yen.
The Bridge: So you were already in talks with potential investors.
Yusuke: Yes. At first we were talking about a business alliance with Start Today because Zozotown and Stores.jp had the potential to work together to boost each other’s service. But if we’re doing business together, I suggested it might be best for them to invest in us so that we can really work together.
The Bridge: How do you plan to work with them?
Yusuke: This is unintentional, but almost 70% of store owners on Stores.jp are in the apparel sector. There is obviously a huge demand in the apparel industry, and to cultivate this opportunity, it is crucial that we work with Zozotown which has a big influence in that industry.
The Bridge: How many users does Zozotown have?
Yusuke: They have over five million users, and we can certainly leverage these members, maybe providing stores to these people. They also have an impressive inventory, so its possible for us to provide these services to stores owners on Stores.jp. There are so many possibilities and opportunities that come from us working together, and we want to do that to boost the power of Stores.jp by every possible way.
Check out the video below where Yusuke gives us an intro to Bracket as well as some photos from their new office.