THE BRIDGE

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Japan’s Zeals raises $720K+, unveils bot management tool for web media publishers

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See the original story in Japanese. It has been around one year since we last reported (in Japanese) on Zeals. The company, which stems from producing interaction software for robots such as Palmi and Sota, raised an undisclosed amount of funds in January of 2015 from Will Group (TSE:6089), a major human resource (HR) service company in Japan. Zeals announced on Thursday that they have raised over 80 million yen (about $720K US) from Japanese adtech leader FreakOut Holdings (TSE:6094). In conjunction with this, they pivoted from producing the API for creating chatbots called Bot Tree and re-launched it as the chatbot management tool Fanp. The company will collaborate with FreakOut on strengthening their sales, development, in addition to international expansion. While Bot Tree made a dazzling debut in May of 2016, according to Zeals CEO Masahiro Shimizu, there was a continuous struggle in providing the service. Thanks to the offer of a free trial, hundreds of media sites signed up, but on the other hand, the amount of sites leaving was also great. Shimizu, who felt there was a problem in the service, determined to improve it by working together with media companies. The company joined forces with Iid…

L to R: Yusuke Sato (COO, FreakOut Holdings), Nobuyuki Akashi (Executive Officer, FreakOut Holdings), Masahiro Shimizu (CEO, Zeals), Yuzuru Honda (CEO, FreakOut Holdings)

See the original story in Japanese.

It has been around one year since we last reported (in Japanese) on Zeals. The company, which stems from producing interaction software for robots such as Palmi and Sota, raised an undisclosed amount of funds in January of 2015 from Will Group (TSE:6089), a major human resource (HR) service company in Japan.

Zeals announced on Thursday that they have raised over 80 million yen (about $720K US) from Japanese adtech leader FreakOut Holdings (TSE:6094). In conjunction with this, they pivoted from producing the API for creating chatbots called Bot Tree and re-launched it as the chatbot management tool Fanp. The company will collaborate with FreakOut on strengthening their sales, development, in addition to international expansion.

Fanp
Image credit: Zeals

While Bot Tree made a dazzling debut in May of 2016, according to Zeals CEO Masahiro Shimizu, there was a continuous struggle in providing the service. Thanks to the offer of a free trial, hundreds of media sites signed up, but on the other hand, the amount of sites leaving was also great.

Shimizu, who felt there was a problem in the service, determined to improve it by working together with media companies. The company joined forces with Iid (TSE:6038), developing and offering multiple online media projects, to jointly develop services. After getting wind of this, major companies such as En-Japan (HR service company, TSE:4849), the Mainichi Shimbun (newspaper publisher), and Career Design Center (HR media company, TSE:2410) introduced Bot Tree on their media sites. Reflecting the opinions of such companies, Zeals set about making changes to the interface to birth the new and improved Fanp.

Just as The Bridge also distributes newsletters, general media sites often send out email newsletters in order to raise reader retention (actually, engagement more important than retention). In the beginning, the rate of recipients who open these email newsletters is never high. Zeals uses chatbots to guide messenger (Facebook Messenger) users and it is said that the average opening rate is 72%, with an average withdrawal rate of 7.2%. It is 15 times higher than the opening rate of average email newsletters.

When we look at the fee structure of Fanp we might be reminded of Line@, the messenging giant’s ad service plan for business users, but for now Fanp is only available with Facebook Messenger. Fanp generates a database based on profiles and attributes acquired from Facebook when the user begins to use their bot, and it also has a CRM (customer relationship management) function that allows the media owner to reach the user by specifying conditions.

Shimizu recently had an opportunity to listen to Hiroto Kobayashi, CEO of Japanese leading online media publisher Infobahn, and he became aware that the media of the future is an era of increasing the engagement of the audience rather than creating a vast and shallow audience.

Shimizu said:

All the media site owners want to do e-mail newsletters, but the newsletters can’t tell who the readers are or their preferences yet. SNS covers this to a degree, but even if you get a lot of ‘likes’ you might not be able to reach a large audience. There just isn’t any really good channel.

So, next time you’re going to try to make an app, the CPA to get people to download the app becomes high. Ultimately, it is the push notification feature that is useful with apps. If it’s just a push notification, can’t we do that with messenger? Then let’s try chat media on messenger. That’s our proposal.

Fanp’s dashboard
Image credit: Zeals
Fanp’s dashboard
Image credit: Zeals

In addition to launching Fanp, the chatbot management tool designed for online media sites, they also released Fanp Biz for enterprises. While Fanp strives for an alternative channel for attracting users with email newsletters, Fanp Biz is the one specifically for enterprises aiming to replace their product landing pages.

Shimizu explained:

Now that it’s possible to lead users to messenger with Facebook ads, we can also bring in the bots.

By letting the bot accept documents and make appointments, I think we can obtain an overwhelmingly better user response than landing pages do.

The chatbot introduced on Iid’s automobile-focused online media site Response

Previously Zeals was a strong advocate of Natural Language Processing (NLP) in the development of conversational AI engines, but by switching to ”tap talk” (the user does not input text but instead selects the appropriate choice from multiple options presented in button form by the chatbot) between users and chatbots, they can minimize the resources needed for NLP development.

Shimizu added:

If we were still obsessed with natural language analysis like before, it would mean we’d have to develop in each language in order to go international, and obviously this makes it difficult to catch up with overseas competitors. ‘Tap talk’ is our way of overcoming this and moving towards international expansion.

At FreakOut there are many clients in Japan and abroad that use DSP (demand-side platform) / DMP (data management platform) and so on, and because they have headquarters overseas we have great expectations for international development, so that is what led to financing and collaborating with them.

When asked about their future development, Shimizu dropped the phrase “Communication Ad Platform”. This is when the media can use bots to round up readers, and perhaps next up on Shimizu’s plate is to monetize the next bot channel. There is a possibility that the media will be able to charge advertisers by having their bots relay advertising messages or by having them direct users to other sites (at the present time, there is no word from Facebook about regulating this).   

Zeals wants to deliver an experience of a hub of bots that can connects them each other to better serve users of Fanp and Fanp Biz.

Translated by Amanda Imasaka
Edited by Masaru Ikeda

Japanese adtech company FreakOut invests in online ticket startup EventRegist

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This is the abridged version of our original article in Japanese. Japanese adtech company FreakOut (TSE:6094) announced today that it has invested in EventRegist; the Tokyo-based startup provides event/meetup organizers with an online ticket issuance and management system. Details of the investment have not been disclosed. Upon this funding, EventRegist will strengthen their business operations as well as hiring efforts in Japan and Southeast Asia. The startup fundraised 165 million yen (about $1.6 million) from Japanese newspaper company Nihon Keizai Shimbunsha this April. Taiga Matsuyama, a general partner at East Ventures, had invested in Freak Out in its early days. Through our recent interview with FreakOut COO Yusuke Sato and EventRegist COO Aya Ozasa, we understand that both companies want to see synergy in helping event organizers better promote their events. FreakOut-developed technologies and tactics are to be leveraged for potential attendees. Beyond that, they seek to enable measurement of conversion performance in the real world, upon marketing efforts which were initially generated from online campaigns. Both Sato and Ozasa, as well as EventRegist CEO Kosuke Hirayama, had previously worked at Google Japan, so it seems all they have something common in attitude toward their businesses. They admitted that the fact has influenced their current relations.

freakout_eventregist_logos

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

Japanese adtech company FreakOut (TSE:6094) announced today that it has invested in EventRegist; the Tokyo-based startup provides event/meetup organizers with an online ticket issuance and management system. Details of the investment have not been disclosed. Upon this funding, EventRegist will strengthen their business operations as well as hiring efforts in Japan and Southeast Asia.

The startup fundraised 165 million yen (about $1.6 million) from Japanese newspaper company Nihon Keizai Shimbunsha this April. Taiga Matsuyama, a general partner at East Ventures, had invested in Freak Out in its early days.

Through our recent interview with FreakOut COO Yusuke Sato and EventRegist COO Aya Ozasa, we understand that both companies want to see synergy in helping event organizers better promote their events. FreakOut-developed technologies and tactics are to be leveraged for potential attendees. Beyond that, they seek to enable measurement of conversion performance in the real world, upon marketing efforts which were initially generated from online campaigns.

Both Sato and Ozasa, as well as EventRegist CEO Kosuke Hirayama, had previously worked at Google Japan, so it seems all they have something common in attitude toward their businesses. They admitted that the fact has influenced their current relations.

aya-ozasa_yusuke-sato
From the left: EventRegist COO Aya Ozasa, FreakOut COO Yusuke Sato

Japanese adtech startup FreakOut has filed for an IPO

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See the original story in Japanese. Japanese ad platform operator FreakOut applied and was approved for an IPO on the Tokyo Stock Exchange Mothers Market today. The company is expected to be listed on June 24th, with plans to offer 530,000 shares for public subscription and to sell 112,500 shares in over-allotment options for a total of 332,500 shares. The company was launched back in October of 2010, and subsequently introduced demand-side platform FreakOut in January of 2012 and data management platform Mother in March of 2013. Their major shareholders include Kronos Fund, Jafco, YJ Capital, GMO Venture Partners, Batara Eto, and Shogo Kawada. [1] To elaborate on those organizations and individuals: Kronos Fund is an investment fund by Japanese investor Taiga Matsuyama. YJ Capital is the investment arm of Yahoo Japan. Batara Ito is the co-founder and former CTO of Japanese internet company Mixi, currently managing his own investment fund East Ventures with Taiga Matsuyama. Shogo Kawada is an angel investor as well as the co-founder of Japanese internet company DeNA.  ↩

freakout_logo

See the original story in Japanese.

Japanese ad platform operator FreakOut applied and was approved for an IPO on the Tokyo Stock Exchange Mothers Market today. The company is expected to be listed on June 24th, with plans to offer 530,000 shares for public subscription and to sell 112,500 shares in over-allotment options for a total of 332,500 shares.

The company was launched back in October of 2010, and subsequently introduced demand-side platform FreakOut in January of 2012 and data management platform Mother in March of 2013. Their major shareholders include Kronos Fund, Jafco, YJ Capital, GMO Venture Partners, Batara Eto, and Shogo Kawada. [1]


  1. To elaborate on those organizations and individuals: Kronos Fund is an investment fund by Japanese investor Taiga Matsuyama. YJ Capital is the investment arm of Yahoo Japan. Batara Ito is the co-founder and former CTO of Japanese internet company Mixi, currently managing his own investment fund East Ventures with Taiga Matsuyama. Shogo Kawada is an angel investor as well as the co-founder of Japanese internet company DeNA. 

2 Tokyo startups team up on real-time data analysis for advertising

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See the original story in Japanese. Tokyo-based startups Freak Out and Preferred Infrastructure (PFI) have announced a joint venture between the two companies, to be called Intimate Merger. The entity’s purpose will be to launch new ad solution businesses. For those not familiar with the two companies, Freak Out provides a RTB (real-time bidding) advertising platform for smartphone devices, and PFI provides a range of technologies like information search, recommendations, and machine-learning. By combining their services and technologies, they plan to provide practical solutions for their clients’ marketing or communication needs. Specifically, Freak Out will provide ad technologies including the startup’s flagship DSP (demand-side platform) solutions, and PFI will provide consulting services on optimizing ad performances using big data analysis. The two companies have appointed Ryoji Yanashima as president of this new joint venture. Prior to Freak Out, he worked at GREE and was involved in developing several new platforms. He subsequently joined Freak Out and has been focusing on building revenue. Our readers may recall that Freak Out received series B funding worth 500 million yen (approximately $5.3 million) from Yahoo Japan’s investment arm, YJ Capital, in March 2013.

Intimate-Merge

See the original story in Japanese.

Tokyo-based startups Freak Out and Preferred Infrastructure (PFI) have announced a joint venture between the two companies, to be called Intimate Merger. The entity’s purpose will be to launch new ad solution businesses.

For those not familiar with the two companies, Freak Out provides a RTB (real-time bidding) advertising platform for smartphone devices, and PFI provides a range of technologies like information search, recommendations, and machine-learning. By combining their services and technologies, they plan to provide practical solutions for their clients’ marketing or communication needs. Specifically, Freak Out will provide ad technologies including the startup’s flagship DSP (demand-side platform) solutions, and PFI will provide consulting services on optimizing ad performances using big data analysis.

The two companies have appointed Ryoji Yanashima as president of this new joint venture. Prior to Freak Out, he worked at GREE and was involved in developing several new platforms. He subsequently joined Freak Out and has been focusing on building revenue.

Our readers may recall that Freak Out received series B funding worth 500 million yen (approximately $5.3 million) from Yahoo Japan’s investment arm, YJ Capital, in March 2013.

Tokyo-based advertising startup FreakOut raises $5.3M from Yahoo Japan

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FreakOut is a Tokyo-based startup developing a smartphone advertising platform for real-time bidding (RTB). Today it announced that it has raised 500 million yen (approximately $5.3 million) in series B funding from YJ Capital, the investment arm of Yahoo Japan (TYO:4689). FreakOut was launched in 2010 by Yuzuru Honda who previously launched a content-matching ad platform called Brainer, which was subsequently sold to Yahoo Japan in 2008.  The startup has been delivering its white-label platform to more than 3,000 advertisers through 90 agencies in Japan and the US. With this new funding, the startup expects to intensify operations at its US subsidiary, FreakOut International Inc., which was launched in New York last April. Prior to this fundraising, the startup raised 350 million yen ($3.7 million) from two Japanese VC firms last year. TechCrunch Japan reports that the current value of the company is about 10.3 billion yen ($110 million).

freakout_logoFreakOut is a Tokyo-based startup developing a smartphone advertising platform for real-time bidding (RTB). Today it announced that it has raised 500 million yen (approximately $5.3 million) in series B funding from YJ Capital, the investment arm of Yahoo Japan (TYO:4689).

FreakOut was launched in 2010 by Yuzuru Honda who previously launched a content-matching ad platform called Brainer, which was subsequently sold to Yahoo Japan in 2008.  The startup has been delivering its white-label platform to more than 3,000 advertisers through 90 agencies in Japan and the US. With this new funding, the startup expects to intensify operations at its US subsidiary, FreakOut International Inc., which was launched in New York last April.

Prior to this fundraising, the startup raised 350 million yen ($3.7 million) from two Japanese VC firms last year. TechCrunch Japan reports that the current value of the company is about 10.3 billion yen ($110 million).