THE BRIDGE

Startups

Former exec of Rakuten, Sony, gets $4.1M seed funding for “housing version of Tesla”

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See the original story in Japanese. A former student entrepreneur has returned to the startup scene in order to challenge global issues. In 1995 Takeshi TED Homma was a student entrepreneur working with the early internet doing web design and development. He followed this by playing active roles at Sony and Rakuten, and recently talked with The Bridge about a new startup he is working on. HOMMA, the startup, tackles issues related to “the home.” As is written on their website “Redefining our standard of living,” it is an ambitious project to create a new vision of the future with regards to the necessities of life. Homma had never contemplated a return to entrepreneurship, but a single opportunity presented him with the chance to get back to the startup world. He said: I was thinking of buying a house, but it would take few years to complete. That’s a few years. In Japan it would only take a matter of months. And what’s more, it would be very expensive. I tried to find a solution, thinking there must be one. But no. That’s what got me thinking. But it would take Homma nearly 2 years to reacclimate himself back into…

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Takeshi TED Homma

See the original story in Japanese.

A former student entrepreneur has returned to the startup scene in order to challenge global issues.

In 1995 Takeshi TED Homma was a student entrepreneur working with the early internet doing web design and development. He followed this by playing active roles at Sony and Rakuten, and recently talked with The Bridge about a new startup he is working on.

HOMMA, the startup, tackles issues related to “the home.” As is written on their website “Redefining our standard of living,” it is an ambitious project to create a new vision of the future with regards to the necessities of life. Homma had never contemplated a return to entrepreneurship, but a single opportunity presented him with the chance to get back to the startup world.

He said:

I was thinking of buying a house, but it would take few years to complete. That’s a few years. In Japan it would only take a matter of months. And what’s more, it would be very expensive. I tried to find a solution, thinking there must be one. But no. That’s what got me thinking.

But it would take Homma nearly 2 years to reacclimate himself back into the entrepreneurial world.

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He continued:

Is this really necessary? Is there no solution? Since there was no need to rush I focused intensely on preparing. At the same time, I never went so far as to say this about the entrepreneurial pursuits of my 20s, but somewhere I think maybe there was a part of me doing it for self-actualization too. But this time I had a clear vision and that’s how the decision came to me to spend what’s left of my life doing something for society. So that’s why I’m doing this.

The vision of a new lifestyle, especially the innovation of daily living, is what convinced the self-questioning Homma.

He added:

It took 100 years for the telephone to become the iPhone. 100 years later and Ford cars have evolved into Tesla. But what about homes? Have they changed in 100 years?

Homma used the phrase “a housing version of Tesla” so that even I could easily understand his meaning, but with just 5 words the view of the world that he is trying to achieve spawned endless possibilities. He originally began due to the fact that houses are expensive and take years to finish, but solving these problems will result in “homes becoming more fun”.

Their task is to make houses smart. If their goal is to summit the mountain, they are still at the foot, perhaps having approached the first station.

Regarding funding, Mistletoe, B Dash Ventures, Genuine Startups, 500 Startups Japan, East Ventures, Draper Nexus, and architectural firm KMDW participated in the seed round. The prominent lineup of individual investors starts with Hiroshi Mikitani (co-founder and CEO of Rakuten), and includes Tomohito Ebine (founder of Opt), Shintaro Yamada (CEO of Mercari), Hirokazu Mashita (founder and director of m&s partners), Hiroaki Yasutake (former managing executive director of Rakuten), Kotaro Chiba (co-founder of Colopl), Hollywood-based film producer Masi Oka.

The company raised $4.1 million in capital. This is an extraordinary amount to raise at the seed stage for a Japanese startup, but is appropriate when you consider them trying their hand on the world playing field. Furthermore, he is gathering members that sympathize with his vision who joined from companies such as Apple, Tesla, Amazon and Disney. Their current team of 7 members is working full time to prepare their product at their headquarters in Silicon Valley.

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So, what image of the future are they trying to paint? What is their current situation?

As they are in stealth mode, and also currently still verifying whether the product lives up to Homma’s vision of the “new home,” a precise answer to these questions will take a little more time. However, he was able to talk about challenges with current devices for so-called “smart homes.”

He said:

The so-called ‘smart home’ market is a power struggle between big players like Google, Apple, and Samsung. As a result there are lots of apps and plenty of devices too. I’ve tried them out, but after taking out my smartphone and opening an app that shows battery level, the login screen comes up. (And I think) ‘So, when is the battery going to run out?’

If you ask Homma, at the moment the solutions are not at all useful, and there are three big problems to consider with the current smart home market.

He continued:

First, with smart homes you always have the issue of controls. But this is merely a discussion of on/off and adjustments. Not interesting at all. Next, the level of integration is low. For example, you add a thermostat, but the cooperation with the house is low. As a result we’re not able to do much. Finally, the third problem is communication. If you have 100 smart light bulbs and replace the router, you have to reset everything from scratch. If you use all-purpose Wifi and BLE problems in stability will arise.

Homma disclosed that if he had to choose one way of advocating smart home platforms, as opposed to the direction of horizontal development that Samsung chose in acquiring SmartThings for $200 million, he envisions a model similar to Apple’s or Tesla’s where everything from devices to software are vertically integrated. However, he intercedes that in everything there are a series of stages to go through to achieve goals.

He explained:

Time is the problem. For example, to build a house from ground up takes a long time. We have to think about it together with a scalable deployment. Take the iPod as an example; first, you make the software and the rest comes along after that, or Tesla that started by developing batteries.

But while listening to him speak I couldn’t help but imagine a lifestyle like those portrayed in 2001: A Space Odyssey or works by Osamu Tezuka. With childlike excitement that I couldn’t contain, I felt that I want to experience it as quickly as possible, and now Homma and his team are preparing to make it real.

It takes a little more, for Homma as well, to imagine the collection of big data, that is mass data taken from sensors, from these houses. But, with this as a basis, houses using artificial intelligence for home controls are something he is conscious of. In the past, this field has seen challengers in the area of communication robots here and there, with voice recognition controls by major home appliance makers and more recently in Vinclu’s Gatebox.

In other words, you arrive home and when you announce, “I’m home,” a robot turns on the lights while scanning your face for user recognition, and then uses your social data to recommend your favorite TV show–this is a glimpse of the world view. On top of allowing this to more fully develop, they will more intimately integrate with “the home itself.”

Maybe an autonomous driving house. — To borrow Homma’s words, perhaps in the future we may come into contact with such a product.

The reasons for focusing on Silicon Valley while facing the world playing field are its continued growth in population, high talent level of the population, and Homma remarked whoever is left standing here can become the “world standard.”

Nearly 20 years have passed since his days as a student entrepreneur.

Actually, I really thought someone would appear and solve this problem. But no one showed up so I’m going to do it.

Homma said this with a gleam in his eye, like someone ready and even eager to tackle all future obstacles.

Translated by Amanda Imasaka
Edited by Masaru Ikeda

Japanese-led Kibow gets UK regulator’s approval for mobile sports betting

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See the original story in Japanese. Kibow, a Singapore-incorporated startup with headquarters in Tokyo developing a mobile sports betting app, announced this week that they have acquired a betting license from the British government’s Gambling Commission. The company had previously acquired a betting license in the Philippines, but from here on out in acquiring a license from the UK (considered the home of betting) they will be able to dive headfirst into preparations for their service launch. The exhilarated Kibow CEO Fumitada Naoe said, Piggybacking off of Nike (NYSE:NKE), we want to see ourselves in such a position within 10 years of inception. In reference to the acquisition of a betting license in the UK he remarked, unable to hide his joy, “It doesn’t get much better for us. In terms of soccer, it’s like we were granted access to the Premier League.” In order to eliminate anti-social elements, through certification by the Gambling Commission based on a thorough check of the integrity of the company, Kibow is now able to begin their overseas operations, starting with the UK, by triumphantly entering into the fantasy sports and sports betting worlds. The review of the 2020 Tokyo Olympics boat and canoe…

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See the original story in Japanese.

Kibow, a Singapore-incorporated startup with headquarters in Tokyo developing a mobile sports betting app, announced this week that they have acquired a betting license from the British government’s Gambling Commission. The company had previously acquired a betting license in the Philippines, but from here on out in acquiring a license from the UK (considered the home of betting) they will be able to dive headfirst into preparations for their service launch.

The exhilarated Kibow CEO Fumitada Naoe said,

Piggybacking off of Nike (NYSE:NKE), we want to see ourselves in such a position within 10 years of inception.

In reference to the acquisition of a betting license in the UK he remarked, unable to hide his joy, “It doesn’t get much better for us. In terms of soccer, it’s like we were granted access to the Premier League.” In order to eliminate anti-social elements, through certification by the Gambling Commission based on a thorough check of the integrity of the company, Kibow is now able to begin their overseas operations, starting with the UK, by triumphantly entering into the fantasy sports and sports betting worlds.

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Kibow CEO Fumitada Naoe

The review of the 2020 Tokyo Olympics boat and canoe venue has been in the news recently being hailed a controversy, beginning with problems emerging from behind the scenes, and ending in the reality that the proposed venue is too costly. In the world of professional sports, the media attracts the attention of sports viewers and the general public, and when worldwide competitions are held money is collected through broadcasted rights, sponsorship fees, and ticket sales. It is then made into a fund in the form of guarantee and prize money, finally being returned to players and athletes. So to speak, it is like a sports ecosystem. However, there are drawbacks to this system. Only those involved in major sports events are rewarded, and the current situation stands that even Olympic gold medalists are not guaranteed support after retirement.

Kibow is proposing, through mobile sports betting, they can form a now sports business ecosystem by changing the way money flows from the general public to players and athletes and giving those involved in minor sports and extreme sports a chance in the spotlight. The Nippon Foundation, one of the key role players in social impact investments in Japan, held the country’s largest ever Social Innovation event. Given that they use a portion of proceeds raised from boat racing throughout Japan to finance social entrepreneurs, it may be easy for our readers to imagine the relationship between sport betting, sport business building, and developing athletes. In the future, Kibow plans to provide betting opportunities for Japan’s unique minor sports and extreme sports and, starting in the UK, hopes to attract foreign betting participants.

In this same field, in 2013 Softbank acquired 23% of shares from the UK’s leading online bookmaker Betfair for 355 million pounds (about $540 million at the exchange rate then). In the US earlier this year sports betting startups DraftKing and FanDuel launched their services.

Kibow does not only function as a bookmaker, but while advocating for a position as a sport brand and a lifestyle brand, they are aiming to begin their mobile sports betting service in the UK domestic market by February of next year. The company raised around 100 million yen (nearly $840,000 at the exchange rate then) in funds from Cyber Agent Ventures and individual investors in April of 2015.

Translated by Amanda Imasaka
Edited by Masaru Ikeda

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A concept image for Kibow’s mobile betting app
Image credit: Kibow

Drone Japan unveils drone-based field data analysis service for improved rice farming

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This guest post is authored by Sakahito Sado of Wata-ame in Tokyo. Wata-ame offers user growth consulting service for game and web service developers. See the original story in Japanese. Tokyo-based Drone Japan last week unveiled the concept of DJ Agri-service which enables efficient and low-cost rice farming that utilizes drones. By conjoining efforts of experts in different fields ranging from hardware and software to data analysis and agriculture, this service was formed to realize “Precision Farming” which supports agrochemical-free farming techniques while significantly lowering production costs through use of image analysis and visualization of crop-growing conditions by applying drone-based remote sensing. Automatically acquiring agricultural core data such as crop-growing conditions, it provides reporting service for farmers using analysis from experts. One of the service’s strengths is the accuracy of these agricultural data utilizing specialized sensors, spectral cameras and autonomous flight technologies, which could not be acquired through conventional methods. The experts involved in this project include Yutaka Kaidu (Associate Professor, Laboratory of Biological and Mechanical Engineering, The University of Tokyo) and Guo Wei (Master’s program, same as above) in charge of data processing, Randy Mackay (Japan Drones; supporting software development using open source code for drone hardware developers) in charge of operating drones, and Noriyuki Ichikawa (Ichikawa Farm in Asahikawa, Hokkaido). The…

This guest post is authored by Sakahito Sado of Wata-ame in Tokyo. Wata-ame offers user growth consulting service for game and web service developers.


Image credit: Drone Japan
Image credit: Drone Japan

See the original story in Japanese.

Tokyo-based Drone Japan last week unveiled the concept of DJ Agri-service which enables efficient and low-cost rice farming that utilizes drones. By conjoining efforts of experts in different fields ranging from hardware and software to data analysis and agriculture, this service was formed to realize “Precision Farming” which supports agrochemical-free farming techniques while significantly lowering production costs through use of image analysis and visualization of crop-growing conditions by applying drone-based remote sensing.

Automatically acquiring agricultural core data such as crop-growing conditions, it provides reporting service for farmers using analysis from experts. One of the service’s strengths is the accuracy of these agricultural data utilizing specialized sensors, spectral cameras and autonomous flight technologies, which could not be acquired through conventional methods.

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Kiichiro Katsumata, CEO of Drone Japan

The experts involved in this project include Yutaka Kaidu (Associate Professor, Laboratory of Biological and Mechanical Engineering, The University of Tokyo) and Guo Wei (Master’s program, same as above) in charge of data processing, Randy Mackay (Japan Drones; supporting software development using open source code for drone hardware developers) in charge of operating drones, and Noriyuki Ichikawa (Ichikawa Farm in Asahikawa, Hokkaido).

The service usage fee is 4,500 yen (about $43) minimum per hectare for each use during the cultivation period, inclusive of drone and camera rental, data sensing and data analysis. The firm plans to commence service from April of 2017.

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Analyzing images photographed by drone

The market size for the drone industry is expected to grow to 100 billion yen (about $960 million) by 2020, and agriculture is estimated to account for half of this figure.

In the press briefing, CEO of Drone Japan Kiichiro Katsumata revealed the launch of the service, as well as the start of sales as to value-added rice utilizing drones, in addition to provision of data to agricultural app developers; the company aims to attain sales of 3 billion yen (about $29 million) by 2020.

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Drone Rice

Kotaro Chiba, known for the establishment of the Research Consortium for Co-Creation of Drone Collaborative Society, was also involved in this service as an angel investor and commented as follows:

I feel that technology like those used in drones is going to solve problems for the primary industries.

By focusing on rice cultivation from among the wide-ranging agricultural industry, Drone Japan aims to solve problems related to domestic rice farming by leveraging technologies, not to mention promoting development of Japanese drone agriculture on a global scale.

Translated by Taijiro Takeda
Edited by “Tex” Pomeroy

Japan’s VRize, 360-degree VR ad network, secures six-digit funding from B Dash, Speee

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This is the abridged version from our original article in Japanese. Tokyo-based VRize, the company developing ad network business in the virtual reality (VR) space, announced today that it has secured funding from Japanese investment firm B Dash Ventures and Japanese web marketing company Speee in a seed round. Financial details of the deal have not been disclosed but it seems to have raised six-digit sums in US dollars. Upon this funding, the company has introduced a new service called VRize Video to date. VRize Video is a content management system for VR (CMS for VR) that allows companies or studios to develop VR apps including in-app video clips for several VR platforms such as Oculus, PlayStationVR, HTC Vive, GearVR and Daydream. In addition to distributing VR apps including 360-degree and 2D video clips, the company plans to add to the system several other features such as livestreaming and in-app analysis. See also: Japan’s VRize launches 360-degree VR ad network in closed beta Translated by Masaru Ikeda Edited by “Tex” Pomeroy

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This is the abridged version from our original article in Japanese.

Tokyo-based VRize, the company developing ad network business in the virtual reality (VR) space, announced today that it has secured funding from Japanese investment firm B Dash Ventures and Japanese web marketing company Speee in a seed round. Financial details of the deal have not been disclosed but it seems to have raised six-digit sums in US dollars. Upon this funding, the company has introduced a new service called VRize Video to date.

VRize Video is a content management system for VR (CMS for VR) that allows companies or studios to develop VR apps including in-app video clips for several VR platforms such as Oculus, PlayStationVR, HTC Vive, GearVR and Daydream. In addition to distributing VR apps including 360-degree and 2D video clips, the company plans to add to the system several other features such as livestreaming and in-app analysis.

See also:

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VRize CEO Hideyuki Shoda

Translated by Masaru Ikeda
Edited by “Tex” Pomeroy

Japanese robo-advisory startup WealthNavi secures $15M series B from SBI, others

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Tokyo-based WealthNavi, the company offering a technology-based asset management service under the same name, announced on Wednesday that it has fundraised 1.5 billion yen (about $15 million) in a series B round. Participating companies in this round were SBI Holdings, SBI Investment, Mizuho Capital, SMBC Venture Capital, DBJ Capital, and Infinity Venture Partners. Additionally, the startup has partnered with SBI securities and Sumishin SBI Net Bank, both of which are subsidiaries of SBI Holdings, to offer the robo-advisory service to SBI’s 2.6 million online banking customers plus 3.6 million stock trading customers. This funding means that the company has fundraised a total of 2.1 billion yen (about $21 million) since the company’s launch back in April of 2015. WealthNavi offers a cloud-based robo-advisory service that helps middle-income people better locate diversified investments internationally. The service was officially launched in July this year. It is said that SBI Group has been massively helping regional banks and credit unions nationwide in Japan adopt FinTech services since they are typically small and have few resources to catch up with the new trend unlike typical megabanks. Through the partnership with the financial conglomerate, WealthNavi also expects to gain access to a huge base of…

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Image credit: Wealth Navi

Tokyo-based WealthNavi, the company offering a technology-based asset management service under the same name, announced on Wednesday that it has fundraised 1.5 billion yen (about $15 million) in a series B round. Participating companies in this round were SBI Holdings, SBI Investment, Mizuho Capital, SMBC Venture Capital, DBJ Capital, and Infinity Venture Partners.

Additionally, the startup has partnered with SBI securities and Sumishin SBI Net Bank, both of which are subsidiaries of SBI Holdings, to offer the robo-advisory service to SBI’s 2.6 million online banking customers plus 3.6 million stock trading customers. This funding means that the company has fundraised a total of 2.1 billion yen (about $21 million) since the company’s launch back in April of 2015.

WealthNavi offers a cloud-based robo-advisory service that helps middle-income people better locate diversified investments internationally. The service was officially launched in July this year.

It is said that SBI Group has been massively helping regional banks and credit unions nationwide in Japan adopt FinTech services since they are typically small and have few resources to catch up with the new trend unlike typical megabanks. Through the partnership with the financial conglomerate, WealthNavi also expects to gain access to a huge base of potential customers that these regional institutions possess.

Edited by “Tex” Pomeroy

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In September, WealthNavi CEO Kazuhisa Shibayama delivered a pitch at the RisingExpo competition in Tokyo.

Cities of Japan’s Fukuoka, France’s Bordeaux shake hands to support drone startups

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See the original story in Japanese. The cities of Fukuoka and Bordeaux (France) recently agreed to encourage startup activities in the drone field, including interaction of startups or business mapping as a part of a three-year cooperation plan which starts from 2017. In Bordeaux, flourishing startups activities in the drone field can be seen, such as the largest drone event in Europe called UAV SHOW which is held in every October. In addition, a Bordeaux City’s extra-departmental organization Bordeaux Technowest manages four large-scale areas especially for drones’ test-flying, providing an ideal environment to promote growth of drone startups. Due to the conclusion of the cooperative relationship, Fukuoka-based TrueBizon, providing consulting service utilizing drone, will be invited to UAV SHOW 2016 being held from October 12th to 13th. Truebizon had been chosen to a Fukuoka startup support program for overseas development named Global Challenge! STARTUP TEAM FUKUOKA also, and will take part in a startup tour including a visit to San Francisco from later this October to November. Prior to this cooperation, Kyusyu Drone Consortium was established within Fukuoka Directive Council (commonly known as Fukuoka D.C.), which is an industry / academia / public-sector / government / private-sector platform located near…

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Bordeaux city mayor Alain Marie Juppé and Fukuoka counterpart Soichiro Takashima signing the agreement

See the original story in Japanese.

The cities of Fukuoka and Bordeaux (France) recently agreed to encourage startup activities in the drone field, including interaction of startups or business mapping as a part of a three-year cooperation plan which starts from 2017.

In Bordeaux, flourishing startups activities in the drone field can be seen, such as the largest drone event in Europe called UAV SHOW which is held in every October. In addition, a Bordeaux City’s extra-departmental organization Bordeaux Technowest manages four large-scale areas especially for drones’ test-flying, providing an ideal environment to promote growth of drone startups.

Due to the conclusion of the cooperative relationship, Fukuoka-based TrueBizon, providing consulting service utilizing drone, will be invited to UAV SHOW 2016 being held from October 12th to 13th. Truebizon had been chosen to a Fukuoka startup support program for overseas development named Global Challenge! STARTUP TEAM FUKUOKA also, and will take part in a startup tour including a visit to San Francisco from later this October to November.

Prior to this cooperation, Kyusyu Drone Consortium was established within Fukuoka Directive Council (commonly known as Fukuoka D.C.), which is an industry / academia / public-sector / government / private-sector platform located near the Fukuoka urban area. In the consortium wherein TrueBizon participates along with QTNet, NEXCO-West, FAS Eco Energy, Aso and DJI Japan, various efforts to drive drone utilization or business creation are seen being carried out, such as drone operator development including training of controlling out-of-sight drones, demonstration of drone IoT (Internet of Things) network including utilization of experimental radio base stations, and establishment of a cooperation system during disaster conditions.

See also:

Translated by Taijiro Takeda
Edited by “Tex” Pomeroy

Japan’s HiNative, Q&A app for language learning, secures $2M to boost user growth

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See the original story in Japanese. Tokyo-based Lang-8, the company behind a Q&A app for language learning called HiNative, announced on Wednesday that it has secured 200 million yen (nearly $2 million US) in funding. The investors in this round include Kyoto University Innovation Capital, East Ventures, and DeNA, as well as individual investors notably Chiba Kotaro and Zynga co-founder Justin Waldron, in addition to multiple others. Details of the shareholding ratios and payment date have not been disclosed. Since its official launch back in November of 2014, HiNative has gradually assembled users, and as of the end of July 2016 it had reached around 200,000 registered users. “We can see a 500,000 users milestone within the year,” CEO Yangyang Xi said in a previous interview back in July. In relation to the number of questions and responses, which is of special importance to the Q&A app, as of the end of September there have been 960,000 questions asked receiving 3.4 million answers. The app supports 120 languages and gains user access from almost every country in the world. The company plans to use the funds raised this time around to strengthen their development system, as well as promoting marketing…

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Yangyang Xi, founder and CEO of Lang-8

See the original story in Japanese.

Tokyo-based Lang-8, the company behind a Q&A app for language learning called HiNative, announced on Wednesday that it has secured 200 million yen (nearly $2 million US) in funding. The investors in this round include Kyoto University Innovation Capital, East Ventures, and DeNA, as well as individual investors notably Chiba Kotaro and Zynga co-founder Justin Waldron, in addition to multiple others. Details of the shareholding ratios and payment date have not been disclosed.

Since its official launch back in November of 2014, HiNative has gradually assembled users, and as of the end of July 2016 it had reached around 200,000 registered users. “We can see a 500,000 users milestone within the year,” CEO Yangyang Xi said in a previous interview back in July.

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HiNative’s user growth

In relation to the number of questions and responses, which is of special importance to the Q&A app, as of the end of September there have been 960,000 questions asked receiving 3.4 million answers. The app supports 120 languages and gains user access from almost every country in the world. The company plans to use the funds raised this time around to strengthen their development system, as well as promoting marketing measures aimed at acquiring 2.5 million users by the end of 2017.

And so the story continues, with Xi having said in a previous interview, “Finally, we’re on track and growing,” to now, where he is set to advance to the next stage. He says that while they have to some degree seen verification of their growth, he’d like to improve the number of acquired users and at the same time qualities to retain them.

Xi explained:

As we thought, the more concurrent connections we have the better the numbers become, so first of all we’ll do our best to win over new users. At the same time, what we want to do within 6 months is increase the response speed. If we can get to where answers come within an average of 5 minutes, user experience would also significantly improve, so we want to focus on that from here on out.

Additionally, since his debut in 2007 as a student entrepreneur, Xi has continuously operated his social network for language learning, but unable to make any breakthroughs, experienced his share of struggle. As such, this is his first chance to take a large sum of funding to strengthen the system.

He continued:

Until now we have been working with 5 team members, but we would like that to become 10. In particular, we’re looking for engineers, 1 iOS specialist and one Android, as well as a designer, so those are areas we’d especially like to strengthen. Also, I am still doing the web design, so of course I’d like someone who could take that over.

In terms of business development, they will look for measures to attract YouTuber marketing to their ‘big hit’, as well as for managerial support similar to COO for Xi.

To begin with, Xi seeks to complete his goal of breaking through the 2 million user mark. He also discussed hopes of opening up the language learning contents stored on HiNative for searching capabilities (like Stack Overflow).

Translated by Amanda Imasaka
Edited by Masaru Ikeda

Japan’s Toreta, reservation management platform for restaurants, secures $12 million

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See the original story in Japanese. Tokyo-based Toreta, the company offering a reservation and customer management platform for restaurants under the same name, announced on Friday that it has secured 1.2 billion yen (about $12 million) in the latest round. This round was led by Eight Roads Ventures Japan with participation from NTT Docomo Ventures and Mitsui Sumitomo Insurance Venture Capital as well as four existing shareholders: Femto Growth Capital, WiL (World Innovation Lab), iStyle Capital (now known as iSGS Investment Works), and Salesforce Ventures. Details of the shareholding ratios and payment date have not been disclosed. In accordance with this, David Milstein, Head of Eight Roads Ventures Japan, will join the board as an external director. Since launching the service in December of 2013, Toreta has seen a steady increase in the number of acquired restaurants, and as of September 2016 it has been introduced in some 7000 stores. Additionally, it is possible for participating businesses to access services from detailed table and seat management to online reservations for their restaurants. Merely by accumulating more users, Toreta has found additional business potential. The company aims to use the funds secured this round to enhance their development system and to…

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Toreta CEO Hitoshi Nakamura

See the original story in Japanese.

Tokyo-based Toreta, the company offering a reservation and customer management platform for restaurants under the same name, announced on Friday that it has secured 1.2 billion yen (about $12 million) in the latest round. This round was led by Eight Roads Ventures Japan with participation from NTT Docomo Ventures and Mitsui Sumitomo Insurance Venture Capital as well as four existing shareholders: Femto Growth Capital, WiL (World Innovation Lab), iStyle Capital (now known as iSGS Investment Works), and Salesforce Ventures. Details of the shareholding ratios and payment date have not been disclosed.

In accordance with this, David Milstein, Head of Eight Roads Ventures Japan, will join the board as an external director.

Since launching the service in December of 2013, Toreta has seen a steady increase in the number of acquired restaurants, and as of September 2016 it has been introduced in some 7000 stores. Additionally, it is possible for participating businesses to access services from detailed table and seat management to online reservations for their restaurants. Merely by accumulating more users, Toreta has found additional business potential.

The company aims to use the funds secured this round to enhance their development system and to strengthen their sales and support marketing system.

To get down to it, from their founding period (no, even before that) I’ve kept an eye on Toreta as a favored reservation and customer database management service and now they have managed to fundraise over 1 billion yen ($10 million) in funding. With rumors floating about of an IPO within the next few years, perhaps their next large funding will come with the announcement of this.

Disclosure: A member of the author’s family has in the past had a contractual business relationship with Toreta.

While they continue to steadily acquire new stores, I was curious about their growth strategy for the future. With that in mind, I approached the company’s CEO Hitoshi Nakamura with a few key points.

First, what measures do they have to expand sales? With regards to the introduction speed of reservation and customer database management services Nakamura mentioned it’s proportional to sales force. Aside from this, they can increase numbers by offering additional services with the goal being to upsell. This is straightforward.

But what about the online reservation feature? One of the strong points of Toreta’s model is when restaurants receive a reservation (having until now used a paper ledger to record it) they are now able to to manage the status of their seating digitally. Consequently, it becomes possible to efficiently provide tables and seats to customers, ultimately contributing to the sales of these restaurants.

Recently, Nakamura said close to 20 percent of stores using their service support online reservations, and confided that this is also a growing trend.

We originally developed our service to solve the problem of managing numerous reservations for extremely busy restaurants, and we’ve acquired many contracts with ‘thriving businesses’ concentrating on reservations.

Usability, functionality, support, in every aspect our service have been optimized for these ‘thriving businesses.’ These businesses use Toreta with remarkable results, and from there news of us spreads by word of mouth. I believe our current expansion is a result of this.

On the other hand, restaurants typically require to use Gurunavi, Tabelog, Retty and other online restaurant review sites as a gateway to bring customers to their online reservation. Toreta is the only “reception” system connected to the restaurant side of seat inventory management, and for restaurants to accept customers it is essential to make use of such media sites.

With that, a question: I tried asking about the possibility of Toreta acquiring these types of media sites. First and foremost, Toreta can be thought of as a platform to assist restaurants from attracting customers to improving management. Regardless of the gourmet media sites, there exists a wide variety of service providers in the food-related IT industry, and acquisition can definitely be considered a stepping stone for private companies.

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Restaurant-related cloud services in Japan (From Toreta’s corporate blog, click to enlarge)

Nakamura added:

As a means for the expansion of our business, certainly I think acquisition is one of the choices. Not only reservations, but other business areas as well; not only Japan, but abroad as well. If there are partners that can share in our ideals from a variety of angles, we’d like to aggressively continue to increase such relationships.

He chose his words carefully while answering, but through Nakamura’s expressions I could feel just a hint of satisfaction.

Translated by Amanda Imasaka
Edited by Masaru Ikeda

The happiest company in the world – Yuka Fujii

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The content of this article first appeared on Disrupting Japan. It has been reproduced by The Bridge with the approval of Disrupting Japan and the article’s author Tim Romero. Tim is a Tokyo-based entrepreneur, podcaster and author who has started four companies and led Japan market entry for others since coming to Japan more than 20 years ago. Tim hosts the Disrupting Japan podcast and is deeply involved in Japan’s startup community as an investor, founder and mentor. Yuka Fujii considers Famarry to be the happiest company in the world, and looking at who her customers are, I think she just might be right. But behind this happy company is an aggressive plan to disrupt a cartel of photo studios that have dominated the Japanese market for decades. Changes in technology and demographics have opened up a small crack in this wall, and Famarry plans on using it to gain a foothold and then to change the entire industry for the better. Tim: Can you explain a what Famarry does? It’s basically crowd-sourcing of photographers, and we’ve started with pre-wedding photography. About 70,000 couples get married in Japan every year, and about half of them do pre-wedding photography. That’s the…

tim-romero
Tim Romero

The content of this article first appeared on Disrupting Japan. It has been reproduced by The Bridge with the approval of Disrupting Japan and the article’s author Tim Romero.

Tim is a Tokyo-based entrepreneur, podcaster and author who has started four companies and led Japan market entry for others since coming to Japan more than 20 years ago. Tim hosts the Disrupting Japan podcast and is deeply involved in Japan’s startup community as an investor, founder and mentor.


yuka-fujii-statup-founder-famarry
Famarry founder Yuka Fujii

Yuka Fujii considers Famarry to be the happiest company in the world, and looking at who her customers are, I think she just might be right.

But behind this happy company is an aggressive plan to disrupt a cartel of photo studios that have dominated the Japanese market for decades. Changes in technology and demographics have opened up a small crack in this wall, and Famarry plans on using it to gain a foothold and then to change the entire industry for the better.

Tim: Can you explain a what Famarry does?

It’s basically crowd-sourcing of photographers, and we’ve started with pre-wedding photography. About 70,000 couples get married in Japan every year, and about half of them do pre-wedding photography. That’s the initial market we are focusing on.

Tim:  So they go to a romantic spot with a beautiful back drop and take pictures?

Exactly. The wedding photographer is usually arranged by the venue, so the couple has no choice, but people find pre-wedding photographers by word of mouth or by searching online.

Tim: How have you marketed to this audience?

We’ve had great success using Instagram. It’s nearly a perfect fit for us since it’s all about sharing photos. We run promotions, of course, but most of our customers want to share their own photos, so it’s a more modern version of word-of-mouth. It makes it easy for people to hear about us and to find a photographer they really like.

Tim: On thing that worries me about this business is that you will have very few repeat customers. Since most people only get married once, you would always need to be recruiting new customers.

We plan to build on that. A wedding is the start of a family, so naturally our customers will soon want baby pictures and then family pictures. In the future we’ll be offering these other kinds of photography services so we can grow with our clients.

Tim:  You mentioned before that the photography business is changing in Japan?

The industry is becoming more accessible. Quality camera equipment used to be very expensive, but that’s not the case any more. There are many more skilled photographers with high-quality equipment than their used to be. Also, until recently, the studios controlled just about everything. They had a set of standard backdrops and poses and the customer mostly did what they were told to do. People are now starting to see photography differently. More and more people want something that suits their own character and tastes.

Tim: So there is more independence in the industry now?

There will be. It’s much easier for a photographer to be independent these days, and we try to match those photographers up with clients who suit their style. In the future, it will be very hard for the photography studios to stay in business using their current business model. Independent photographers can deliver higher quality at a lower cost and with a style customized to the customers’ personal tastes.

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Image credit: Famarry

Tim: What made you target the wedding market? With Japan’s aging population, it does not seem particularly attractive.

The overall market may be shrinking from year to year in Japan, but it’s still a huge market. Not much has changed recently, so it’s a market that’s ready for disruption. As you said, the market is not growing, and many Japanese companies are trying to grow business overseas rather than innovate at home, which makes it easer for us.

Tim: Do you think being a women entrepreneur has made things easier or harder for you?

A bit of both, I suppose. Being different makes it easier to get press attention, but it can make it harder to do certain deals. With a startup you have to just deal with whatever advantages or disadvantages you have. I don’t think too much about it. In our case, however, most of our customers are women, so perhaps I can relate to them better.

Tim: I thought they were couples.

They are, but the woman generally take control of the wedding, and they are the ones who make the decisions about things like pre-wedding photography.

Tim: That makes sense. And even when it comes time for baby pictures or family portraits, it will be the wives driving the process.

Exactly.

Tim: What surprised you most about running your own business?

Both how hard it was and how fun it was. I knew it was going to be hard, but I guess you don’t really understand something until you go through it. I’m not complaining. It was just harder than I expected it would be. But I was also surprised ho much I enjoy interacting with both our staff and our customers. It’s a very happy business. To hear the voices of our customers every day and how happy they are with our service is a very encouraging thing.

Tim: I had not thought of that, but actually you are working with people at some of the happiest times of their lives. I can see how interacting with these people every day would be wonderful, and put you and your staff in a good mood as well.

Yes. that’s true. It’s also a pleasure working with the photographers. They are artists who are happy to be chosen to work with couples who like their style. Everyone is really nice, and I really want to help them. I think that we are doing a very good thing here.


I love the fact that Fujii-san considers Famarry to be the happiest business in the world, and she just might right about that.

Famarry, however, also represents a text book example of a beneficial disruptive businesses. The fundamental structure of Famarry results in their costs being much lower and their flexibility being much higher than traditional photography studios. The studios will be forced to either change the way to do business or go out of business.

Hopefully, Famarry will remain a happy business as they continue to grow.

Japanese curated news app company Uzabase to IPO with $177M market cap

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Tokyo-based Uzabase, the startup behind curated news app NewsPicks and company/industry database service Speeda, announced today hat its IPO application to the Tokyo Stock Exchange (TSE) has been approved. The company will be listed on the TSE Mothers Market on 21 October with plans to offer 543,000 shares for public subscription and to sell 114,000 shares in over-allotment options for a total of 193,300 shares. It expects an initial market cap of 17.78 billion yen (about $177 million). The underwriting will be led by Mizuho Securities while Uzabase’s ticker code will be 3966. Founded in 2008, Uzabase started offering the NewsPicks app back in September 2013. The company has differentiated NewsPicks from other similar apps by curating news topics by notable economics news outlets. Prior to today’s announcement, the company secured $4.5 million from several Japanese companies and VC firms in a series C round in August of 2014. Led by the company’s Co-CEO and founder Yusuke Umeda (a 28.34% stake) and Co-CEO and founder Ryosuke Shino (a 28.34% stake), their major share holders include Global Capital Partners (11.43%), COO Yusuke Inagaki (9.91%), and Hong Kong-based financial information provider FISL (4.82%), according to the submission to the stock exchange. In…

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R to L: Yusuke Umeda (Uzabase Co-CEO), Norihiko Sasaki (Managing Director & NewsPicks Editor-in-Chief)

Tokyo-based Uzabase, the startup behind curated news app NewsPicks and company/industry database service Speeda, announced today hat its IPO application to the Tokyo Stock Exchange (TSE) has been approved.

The company will be listed on the TSE Mothers Market on 21 October with plans to offer 543,000 shares for public subscription and to sell 114,000 shares in over-allotment options for a total of 193,300 shares. It expects an initial market cap of 17.78 billion yen (about $177 million). The underwriting will be led by Mizuho Securities while Uzabase’s ticker code will be 3966.

newspicks-intro

Founded in 2008, Uzabase started offering the NewsPicks app back in September 2013. The company has differentiated NewsPicks from other similar apps by curating news topics by notable economics news outlets. Prior to today’s announcement, the company secured $4.5 million from several Japanese companies and VC firms in a series C round in August of 2014.

speeda-intro

Led by the company’s Co-CEO and founder Yusuke Umeda (a 28.34% stake) and Co-CEO and founder Ryosuke Shino (a 28.34% stake), their major share holders include Global Capital Partners (11.43%), COO Yusuke Inagaki (9.91%), and Hong Kong-based financial information provider FISL (4.82%), according to the submission to the stock exchange.

In this vertical, Uzabase’s competitor Gunosy (TSE:6047) IPO-ed with an initial market cap of $263 million in March last year while Japan’s 5th most-funded startup SmartNews recently secured $38 million in a series D round but is also expected to go IPO within this year.