Open8, Japan’s mobile video ad network, acquires app prototyping startup The Clip

Front-row L to R: Hisatake Ishibashi (Managing Director of The Clip), Kento Yamamoto (CEO of The Clip)
Back-row L to R: Yohei Harikita (Executive Officer of Open8), Yukou Takamatsu (CEO of Open8)

See the original story in Japanese.

Tokyo-based Open8, a Japanese female-targeted mobile video ad network, announced earlier this month that it has acquired The Clip, an app prototyping and engineering startup. Details of the acquisition have not been disclosed.

The Clip was founded in 2013 by CEO Kento Yamamoto (designer) and managing director Hisatake Ishibashi (engineer). They have been producing design concepts for large companies and startups. [1]

After the acquisition, Yamamoto and Ishibashi will continue to manage Open8 in its design and engineering work and will also be involved in the company’s business and human resource development.

See also:

Acqui-hiring in Japan

In October 2015, Open8 fundraised 800 million yen ($6.6 million) from Jafco, TBS Innovation Partners, iStyle and Excite Japan[2] The acquisition project started right after the fundraising. Yukou Takamatsu, CEO of Open8, recalls the negotiation of this acquisition.

Harikita [Yohei Harikita, executive officer of Open8] and Yamamoto were originally friends and that gave us an idea of this acquisition. Our business has gone well, the next thing we needed was talented people. We needed a group of professionals. It is not so easy to meet this kind of group of talented people in mid-career recruitment. It took us about 2-3 months to conclude this negotiation.

The startup scene in North America tends to acquire corporates in focusing on its human resources, not on its services – it is called “Acqui-hiring”. This Open8 acquisition was not exactly the same way but the purpose was quite similar.

The Clip’s production portfolio of websites and apps

This method makes it possible for startups to find experienced managers under difficult circumstances. But it might not work well if both companies’ culture do not match. In Japan, there were several cases where the managers in unprofitable companies were acquired but broke up after being acquired.

However, it is one of the advantages that The Clip is in a growing phase and in a good state.

Yamamoto said:

At first we started as freelance. Once we incorporated, we started to have a wide variety of clients especially for projects of setting up new business. In the second term we increased sales and it became profitable. Then we started thinking about what to do next.

They could have chosen to continue receiving outsourcing orders in recruiting new staff. Yamamoto and Ishibashi are about 30 and young enough to stand the strain. When asked if Yamamoto could simply have chosen to continue the outsourcing job, he replied:

I simply thought it might be interesting.

L to R: The Clip CEO Kento Yamamoto and managing director Hisatake Ishibashi

When I talked with Yamamoto and Ishibashi, I felt that they have a new career image of specialized professionals as designers and engineers. Talented person who can stay at the same company until retirement and continue the same profession is very rare. To survive in the field, we all have to face management issues.

Yamamoto continued:

I think it is not so bad that there will be more designers who can deal with those management issues. We can emphasize it in remaining in our company after the acquisition. It is a kind of “exit”.

On the other hand, it was very difficult for Takamatsu who had to pass a board resolution, because the board members simply thought that they could just entrust the works to The Clip.

Takamatsu added:

As a resolution of the board, it was not so simple and they said “Why don’t we just entrust the works to them?” We needed time to make them understood, and we also needed time to make Yamamoto and Ishibashi understood this process.

It looks that there are more and more people or scenes with new concepts of career or working styles around Japanese startups. It might be a crowdsourcing, a startup, or this type of acquisition.

While continuing professional works on a small scale, you might take action if there is a great opportunity like this. When it comes to the end, you can move on.

Takamatsu was the one who marked an epoch as one of executives at style with his colleagues. It is impossible that the same profession and the same growth continue forever.

The way to start a startup for young professionals is not only to create a new application in taking a risk with one’s own money. Rather than the transaction value, this acquisition might look very meaningful in terms of new style and concept of working.

Translated by Minako Ambiru via Mother First
Edited by “Tex” Pomeroy, Kurt Hanson, and Masaru Ikeda

  1. The Bridge logo was designed by The Clip team.
  2. Jafco is a leading Japanese VC firm. TBS Innovation Partners is the investment arm of Tokyo Broadcasting System.