Japanese finance advisory startup ZUU raises $3.7M from Fenox VC, angel investors



See the original story in Japanese.

Tokyo-based finance advisory startup Zuu announced on Thursday that it has fundraised about 450 million yen (about $3.7 million) from Fenox Venture Capital and several angel investors. Angel investors participating in this round include Jiro Suzuki, the former CEO of Malaysia Debt Ventures Berhad; he is renowned for the right-hand man of the former Malaysian prime minister Mahathir Mohamad.

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The Zuu move follows their previous funding worth 105 million yen (about $1 million at the exchange rate then) from several angel investors including Japan’s mobile i-mode web service inventor Takeshi Natsuno. Coinciding with this, the company appointed Fenox general partner and CEO Anis Uzzaman as external director, former Freebit CFO Tetsuya Sano as external auditor and Jiro Suzuki as advisor.

Zuu currently comprises 23 full-time workers, 7 freelancers and 15 interns. Accoding to ZUU CEO Kazunari Tomita, the company will use the funds to strengthen human resources. Leveraging Fenox’s network in the US and that of Jiro Suzuki in Southeast Asia, they plan to expand their finance vertical media business from Japan to the world.

Zuu launched Zuu Online, a finance vertical media site and the first service for the company, in September 2012. It has acquired 10 million monthly page views from 2.5 monthly unique users. In the samre year the company launched an online asset management tool called Zuu Signals, which suggests users what stock should be sold or bought as represented by three colors as used in traffic lights. They won the Intelligence Award at RisingExpo 2015, a startup showcase event hosted by Japan’s CyberAgent Ventures in August.

Zuu’s Tomita(right) receives the Intelligence award at RisingExpo 2015.

In an interview with The Bridge Tomita told us why Zuu Online can maintain robust growth and monetization:

Online media sites and vertical media sites have completely different business models. The former attracts an audience with informative content while the latter has to help an audience solve problems. In other words, the former aims to satisfy readers with interesting stories, but the latter is more likely to encourage readers to take an action like buying something after finding relevant information, similar to e-commerce sites.

Finance vertical media typically monetize themselves through affiliate marketing by driving user traffic to financial products. We have partnered with securities and property assets companies, and our commission is relatively higher than other sectors when a user creates an account.

Vertical media sites have to deliver high quality content to readers as well as online media sites. The more high quality content they want to produce, the more production cost is needed. But Zuu avoids this problem in smart ways.

Tomita continued:

We aggregate content for Zuu Online from analysts working for think tanks or securities companies, such as NLI Research Institute, Gentosha, Société Générale, BNP Paribas and Monex Securities. They provide us with their analyst reports intended for their client institutional investors, aiming to gain brand awareness among not only businesses but also individual users.

We also provide content provided by our employee writers to companies for their owned media although we cannot disclose their specific names. Since financial companies are likely to appropriate a budget for owned media marketing, content production jobs from these companies are likely to bring us high profitability.

Zuu Signals (fictional picture)

In terms of the characteristic of content, we were told that Zuu Online has “chemistry” with NewsPicks, one of Japanese major news curation apps, which contributes to driving user traffic to Zuu Online. Regarding Zuu Online as an entrance, Zuu wants to enable visits to a variety of other services involving financial information resources. Later this year, Zuu plans to roll out a membership-based system where all users will be requested to enter their profile so that the company can provide various resources tailored for each user.

We were told that they can’t disclose details about how the upcoming service looks like but it appears to have something to do with data mining.

He added:

Typical e-commerce sites can recommend users what to buy next based on their purchase history. However, financial products are not daily necessities so we can’t predict what users want to buy in the future based on what they have bought in the past.

For instance, when a user logs into any of Zuu services to read a specific article, it can help banks understand his/her preference and provide their preferable financial services or products. We have four people who have served as CTO at other companies. They are working on accumulating user data towards that.

Zuu Online is a media site for users to solve problems. They visit our website because of our fulfilled resources, however it may confuse our readers in choosing which articles to read. We will be more focused on customizing, recommending and matching the best choice of our resources to each of our readers.

Hiring people is a big challenge for many startups, but Zuu could acquire an interesting talent which helps them acquire further interesting human resources later on. It will be interesting to see the upcoming service, which is to launch between this yearend to next year’s beginning.

Edited by “Tex” Pomeroy