THE BRIDGE

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Tokyo Office Tour: Bracket, Before and After Acquisition

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Read this article in Japanese 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. The Bridge: How did you end up starting your own company? 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…

Read this article in Japanese

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.

Bracket-office-meetingspaceThe Bridge: How did you end up starting your own company?

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.

bracket_BThe Bridge: So would you say that you’ve been the only captain on the boat until now?

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.
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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?

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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.

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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.

Yusuke Mitsumoto, the CEO of Bracket
Yusuke Mitsumoto, the CEO of Bracket

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Bracket-papercup

Japanese fashion commerce giant Zozotown acquires DIY shop startup Stores.jp

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Today Bracket, the company behind Stores.jp, announced that it has been acquired by Start Today. Start Today is, of course, the operator of Japanese fashion commerce giant Zozotown. Since news of the acquisition was released a few hours ago, it has dominated social feeds here in Japan. Bracket was founded back in October of 2008, and the company operates serveral online services including a C2C car sharing site Cafore and custom made ladies shoes service, Shoes of Prey. Stores.jp lets users to make their own online shop in matter of minutes for a monthly fee of 980 yen (about $10). Since it launched back in September of 2012, it has been used to create more than 40,000 online stores to date, and that is projected to surpass 100,000 by the end of this year. Considering that 70% of stores on Stores.jp are fashion related, it makes sense for the company to choose Start Today as a partner. The two companies will work together to enhance each other’s services. Zozotown and Stores.jp will be heavily integrated, allowing brands on Stores.jp to set up shop on Zozotown without the hassle of registering product and inventory information, since all data is seemlessly integrated…

Stores.jp

Today Bracket, the company behind Stores.jp, announced that it has been acquired by Start Today. Start Today is, of course, the operator of Japanese fashion commerce giant Zozotown. Since news of the acquisition was released a few hours ago, it has dominated social feeds here in Japan.

Bracket was founded back in October of 2008, and the company operates serveral online services including a C2C car sharing site Cafore and custom made ladies shoes service, Shoes of Prey.

Stores.jp lets users to make their own online shop in matter of minutes for a monthly fee of 980 yen (about $10). Since it launched back in September of 2012, it has been used to create more than 40,000 online stores to date, and that is projected to surpass 100,000 by the end of this year. Considering that 70% of stores on Stores.jp are fashion related, it makes sense for the company to choose Start Today as a partner.

The two companies will work together to enhance each other’s services. Zozotown and Stores.jp will be heavily integrated, allowing brands on Stores.jp to set up shop on Zozotown without the hassle of registering product and inventory information, since all data is seemlessly integrated on the backend.

The startup’s direct competitor is Base, which has likely pushed Stores.jp to hustle by adding many additional services, including professional product photography, original business cards for shops, and most recently, making virtual 3D stores through a partnership with Panoplaza.

You can see in our previously published interactive acquisition timeline that buyouts often take place in the online gaming sector. We hope that this news will serve as encouragement for more up-and-coming startups, especially in the e-commerce space. Similarly, it would be great if we can see more larger internet companies seeking young startups who are making true innovations in the mobile and internet space.

If you’d like to learn more about how Stores.jp works, check out the video below.

Fashion commerce is heating up in Japan

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Fashion commerce is a fast-growing industry in Japan, a 104 billion yen market (over a billion dollars) according to the nation’s Ministry of Economy. Many companies are trying to get a piece of this very fruitful internet sector. And here are just a few of the ones that have caught our eyes recently. Emoclo Marketplace is a shopping site that works similar to Locondo, allowing users to try on clothes before they buy. Users can try clothes at home and send them back (at no cost) if they don’t meet expectations. You can buy up to five items at once and have a week to decide. At the time of launch, there are over ten fashion shops on Emoclo, with over 500 items available. We previously mentioned popular fashion site Zozotown in our previous article about Japan’s hottest online shopping malls. The company is expected to release its Wear app sometime soon, and that will certainly help its mobile strategy (see their promo video below). The app allows users to archive items that they like in offline shops by scanning the price tag, and then sharing and discussing these fashion items with other users. Another Japanese fashion e-commerce service with…

zozotown-wearapp-scan

Fashion commerce is a fast-growing industry in Japan, a 104 billion yen market (over a billion dollars) according to the nation’s Ministry of Economy. Many companies are trying to get a piece of this very fruitful internet sector. And here are just a few of the ones that have caught our eyes recently.

Emoclo Marketplace is a shopping site that works similar to Locondo, allowing users to try on clothes before they buy. Users can try clothes at home and send them back (at no cost) if they don’t meet expectations. You can buy up to five items at once and have a week to decide. At the time of launch, there are over ten fashion shops on Emoclo, with over 500 items available.

We previously mentioned popular fashion site Zozotown in our previous article about Japan’s hottest online shopping malls. The company is expected to release its Wear app sometime soon, and that will certainly help its mobile strategy (see their promo video below). The app allows users to archive items that they like in offline shops by scanning the price tag, and then sharing and discussing these fashion items with other users.

Another Japanese fashion e-commerce service with a long history is Buyma. It launched back 2004 and will expand to the U.S. market as Avenue K. At Buyma, Japanese people who reside in overseas countries function as local buyers. Imported brand items are often more expensive in Japan, but by using Buyma, people in Japan have access to the most recent items that have not yet been sold in Japan — and at a cheaper price too. Avenue K will be operated by their partner ImageNetwork. Beyond Japan, Buyma has already expanded to Korea.

These are just a few of the companies that are active in online fashion these days. Hopefully in the future we can continue to tell you about even more.

Meet 4 of Japan’s hottest online fashion malls

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According to a recent study, the fashion and interior e-commerce market in Japan was about 636 billion yen (about $6.79 billion) in 2012, a 121.5% increase on last year. Many domestic apparel brands join fashion online malls instead of developing and running e-commerce sites on their own. And as a result we’re seeing lots of buzz around these fashion online malls. While it’s likely that brands will have their own e-commerce presences soon enough, the online fashion malls which are currently so popular also have intriguing plans for the future. Let’s take a closer look at a few of the major online fashion malls in Japan (in no particular order), as well as their upcoming plans. 1. Stylife ¶ Rakuten recently acquired Stylife for 1.1 billion yen (about $11,770,000), becoming the biggest shareholder in the company. This is a smart move by Rakuten as it eager to increase its reach into the fashion space. For a long time, what differentiated Stylife from other online fashion malls was its print catalogue, Look!s, that integrated with the online mall, although the company ceased publication of the print version in March of 2012. It is now available online as a web magazine. 2….

According to a recent study, the fashion and interior e-commerce market in Japan was about 636 billion yen (about $6.79 billion) in 2012, a 121.5% increase on last year. Many domestic apparel brands join fashion online malls instead of developing and running e-commerce sites on their own. And as a result we’re seeing lots of buzz around these fashion online malls. While it’s likely that brands will have their own e-commerce presences soon enough, the online fashion malls which are currently so popular also have intriguing plans for the future.

Let’s take a closer look at a few of the major online fashion malls in Japan (in no particular order), as well as their upcoming plans.

1. Stylife

Rakuten recently acquired Stylife for 1.1 billion yen (about $11,770,000), becoming the biggest shareholder in the company. This is a smart move by Rakuten as it eager to increase its reach into the fashion space.

For a long time, what differentiated Stylife from other online fashion malls was its print catalogue, Look!s, that integrated with the online mall, although the company ceased publication of the print version in March of 2012. It is now available online as a web magazine.

stylife

2. Magaseek

Just a month or so ago, mobile carrier NTT Docomo snatched up online fashion mall Magaseek, acquiring more than 41.67% of the company’s stock. Magaseek targets female mobile users in their 20s, and its previous owner was general trading company Itochu which still owns 25% of its shares. Similar to Rakuten, NTT Docomo’s plan is to solidify its competitiveness in fashion commerce by cooperating with Itochu, the largest general trade company in the textiles industry.

magaseek

3. FashionWalker

FashionWalker is another online mall which has aspirations of expanding its business to the Asian market, most notably to Korea and Taiwan. To that end, back in November of 2012 it launched an fashion e-commerce service for Korea. Its parent company is ‘World’.

FashionWalker is more content-focused compared to other online malls, creating dedicated sections for fashion stylists to introduce their latest look-books, under the category of ‘Shibuya Style Village‘.

fashion-walker

4. Zozotown

Another fashion online mall that’s accelerating its business in the Asia region is Zozotown (operated by Start Today) which was founded way back in 2004. In addition to zozotown.jp which serves the Japanese market, the company also runs zozotown.com where items can be delivered to 82 countries. In addition to the global online mall, Zozotown will launch ZozoConnect on Feburary 28 where it will introduce international brands — especially brands from Asia — to the world. At the time of launch, the site will focus on five Korean brands, including Bratson.

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This is part of our ‘Japanese internet in-depth’ series (RSS). Stay tuned for more features that aim to explain what makes the internet unique in Japan.