Japanese Startup Update: Terra Motors, PocketVenture Live!, and Tokyo's Next Big Event
Last week, AkihabaraNews began unpackaging Japan’s nascent startup and venture capital movement, and though it’s but a week since, increased momentum is already evident. We’ll not only cover developments, AkihabaraNews is also getting involved. First, a J-startup update via Terra Motors and PocketVenture Live!:
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Japanese Startup Update
Our mission last week was two-fold: visit and probe Terra Motors, a nearly 3 year-old, Tokyo-based electric scooter startup, and attend PocketVenture Live! Tokyo, an event organized and sponsored by a Finnish startup incubator/connection platform of the same name. Have a look at what we found out, and then have a look down below - the next big startup event is only a month away, and AkihabaraNews is a media sponsor!
STARTUP EXCURSION: Terra Motors
Bluntly stated, this young e-vehicle company is a response to and outright rejection of both Japan’s top-down management & innovation paradigms, and the practical vertical nature of Japanese business, e.g., the tendency of a Sony or a Sharp to design and manufacture nearly every single component of a finished product. As has become glaringly obvious in the now-globalized tech economy, neither pillar of Japanese corporate structure is conducive to remaining nimble and competitive.
Recognizing as much, rather than take his electric transportation ideas to one of the large J-manufacturers, founder and CEO Toru Tokushige decided to go his own way and build the SEED60R, Terra Motors’ first all-electric e-scooter. The standard-looking bike has been on the market about two years and has sold approximately 8000 units - definitely not bad for a startup. In a rather bold move, the company's next push will see the iPhone-enabled, flagship-in-waiting A4000i e-Scooter debut in a foreign market.
That's right, the launch of Terra Motors’ flashy, advanced, relatively powerful, and long-lasting new e-Scooter (galleried below) will happen not on the streets of Tokyo, but Vietnam; Japan will be market #2. Terra Motors also anticipates welcoming markets in the Philippines and India for both the A4000i and their now-prototyping three-wheeled taxi/delivery trike (see gallery).
Rightfully so, the deserved image of Japanese quality and reliability remains strong throughout Asia and on the Sub-Continent, and Terra anticipates far greater markets overseas than is even best-case-scenario possible here in Japan. That kind of outward-looking yet inwardly relevant business strategy is not a common animal here. Would it were, because as we’ve mentioned time and again, Japanese tech firms’ long-standing refrain of creating isolationist products and expecting the rest of world to jump on-board is the essence of self-defeating myopia; conversely, Terra Motors’ strategy seems the essence of innovation.
The Workers’ Perspective; Investors, Too
Our contact at Terra Motors, 25 year-old PR rep Tetsuya Ohashi, is bright, knowledgeable, world-traveled, and speaks pretty decent English - and sure, that’s not an overly rare skillset in Tokyo, but what sets him apart, in the context of Japanese business culture and societal norms, is a rather non-intuitive career decision: going to work for Terra Motors. See, a smart, motivated young man accepting a job at a very large, very stable Japanese company would be considered the best possible first step toward a bright future; parents would be proud, and contemporaries would laud and respect the accomplishment. Well, Ohashi landed what he sees as a great job with a great company, but not the big one.
Young Mr. Ohashi passed the Mitsubishi applicant exam (yeah, they have those here), and he would have almost certainly been hired. In his opinion, however, he also would have been given the shackles of Japanese corporate culture and for decades suffered a stifling of, or indiffrence toward, any creativity or innovative ideas he might express. While he understands those who are taken aback or even shocked by his decision, Ohashi is not at all interested in waiting until his 40s to gain some limited autonomy at an “ancient” corporation; sure, the words of a non-native English speaker, but telling all the same.
Also telling is the number of Terra Motors employees who didn’t jump in right after college, but abandoned their big-name jobs for the startup life. And what is perhaps the most telling, intriguing, surprising, and actually quite hopeful point for Terra Motors in particular, but also Japan’s entire startup & VC movement, is this list:
- Nobuyuki Ide, Former President, Sony Corporation
- Koichiro Tsuji, Former President, Google Japan
- Kenji Yamamoto, Former President, Apple Japan
Those are three of Terra Motors’ most prominent investors.
STARTUP EVENT: PocketVenture Live! Tokyo
Few would jump out of their seat and yell “What is Helsinki, Finland!” during an episode of Jeopardy!; category: Startup Hotbeds for $1000 please, Alex. As it turns out, it would in fact be a pretty decent guess, and one globe-trotting startup incubator/connection platform is the exemplar.
In 2013 alone, Finnish firm PocketVenture has held networking, pitching, and link-up events at home in Helsinki, very far from home in Los Angeles, a bit closer in New York, also very far from home here in Tokyo - and they’ve still got one more engagement before the year wraps up. According PocketVenture managing partner Markku Mutanen, there’s basically one big reason the Finnish are so hip to startups & VC: Nokia. Though bleeding cash, rapidly losing marketshare, and want for innovation in their own right, the stumbling mobile giant pays really, really well. Executives and the rank and file, sitting atop both unrealized ideas and considerable cash, are clamoring to devise and/or fund the next new hotness. If accurate, it’s amusingly ironic.
A partner at PocketVenture since 2006 and well dialed-in to global startup & VC culture, Mr. Mutanen openly stated his opinion that Japan is basically on the ground-floor of its startup movement and therefore perfectly ripe for both innovators and investors - which, obviously, is why his company traveled nearly 5000 miles (8000km) to get an early foot in the door.
Understandably, Tokyo has probably been the smallest PocketVenture event thus far, but that’s not to say it wasn’t of potentially great value. On one hand, the Japanese startup and VC movement needs all the help it can get, and on the other, if it takes off, there's a mountain of cash to be made. Most tech market observers agree that big Japanese names do remain capable of churning out iterative improvements and the occasional novel feature, but it's increasingly difficult to imagine that they can truly innovate for a global market. As such, there seems to be a growing sentiment that, from here forward, it’s either startups or stagnant status quo; PocketVenture and last week's attendees are betting on the former.
The October 30 event was attended by approximately 50 individuals and two media organizations (AkihabaraNews.com, and a reporter from Dow Jones & The Wall Street Journal). The keynote was given by Mr. Toshitada Nagumo, CEO of Spinnaker Partners, Inc., a firm specializing in global business advising and planning. Mr. Nagumo is not exactly inside the norm of Japanese business advising, and interestingly, he is not exactly a young man. In fact, the majority of PocketVenture Live! Tokyo attendees appeared to be well over 40 years old. Given that it’s the pun-intended Old Guard who’re keeping the death grip on Japanese corporate culture, it’s curious - and quite hopeful - that so many middle-aged business people are keen to put themselves out into what remains - in the eyes of Japanese business traditionalists - at best a suspicious movement away from traditional business as usual.
Again, though a small crowd, there was a lot of chatter and hand shaking, and business cards were flying. Perhaps this event was a meaningful babystep, a point of initiation toward one of Japan’s Next Big Things. At the absolute least, it was a lean in that direction.
Suffice it to Say:
Most would agree that if a Japanese tech renaissance is impending and brighter days are just ahead, there’s little to no sign that it's coming top-down. And so it's interesting that some of those who used to be at the top, along with a large swath of older generations, seem quite interested in the startup and VC movement. It's relatively new and only tenuously bubbling up, but the movement's definitely got legs, and domestic efforts from the likes of Terra Motors and international attention from the likes of PocketVenture bode very well for what some of us are referring to as: Japan, Inc. 2.0.
No doubt, the movement is young, fragile, and just getting off the ground. And no doubt, the Japanese can be very set in their ways; macro-scale change comes hard in this country. But even across the shared consciousness and/or consensus of a massively monocultural and homogeneous population, turns are made - and once a movement hits critical mass or a tipping point, more often than not the turn is swift and profound.
AkihabaraNews will be watching and reporting, and in truth, we’re kinda cheering for the little guys. Of course, as a news source we strive for impartiality, but since tech innovation is our lifeblood, it’s difficult not to hope for more light from the little guys at the bottom.
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AkihabaraNews Media Sponsorship: Venture Day Tokyo
The startup incubator section of J-Seed Ventures, Inc., a Tokyo-based tech management consultancy, in conjunction with the IE Business School of Madrid and the Keio Graduate School of Media Design, are spearheading Tokyo’s next big startup and VC event: Venture Day Tokyo - December 9, 2013
As should be wildly obvious from the above, AkihabaraNews is actively pursuing, investigating, and reporting globally on Japan's very young but growing startup and VC culture. As part of our ongoing coverage, we've jumped on-board as a media sponsor for Venture Day Tokyo - naturally we'd like to see a wide range of pitches, and we’ll be reporting live on the highlights and newsworthy developments throughout the event. Other high-profile sponsors including Rakuten, AOL, and Turkish Airlines.
Show What You've Got
Pitch Your Bright Ideas; Your New Product; Your Novel Service
As a media sponsor, we're helping to recruit investment-ready startups ready to give a great pitch and make an impression on:
- A set of venture companies, with potential investment decisions at stake.
- A panel of judges made up of high-profile business people who will rate each company’s pitch.
- A panel of speakers from leading companies willing to impart their wisdom and advice for the group.
- Event sponsor representatives, those who've come for the networking, and other attendees.
A panel of judges will pick two winners from among the startups and these qualified companies will win prize money and plane tickets to Madrid to participate in events at the IE Business School. Click through to register and learn more about Venture Day Tokyo:
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Sources: Terra Motors; PocketVenture Live!; J-Seed Ventures; AkihabaraNews.com
Images: Terra Motors; PocketVenture Live!; AkihabaraNews.com