I love Japan. I love the people, the food, the traditions, and the convenient stores. However the one thing that is lacking in this country, is a startup ecosystem. Japan is a hostile environment for startups. It is very difficult to get funded, it is hard to find advisors and mentors, and there is no community of startup entrepreneurs to meet and support each other.

I believe that Open Network Lab will be the key in building a startup ecosystem in Japan and I am very fortunate to be involved with the project. Here are a few ways I believe Open Network Lab can help build a startup ecosystem:

Mentorship:

Most people can’t get it right the first time. So we have assembled mentors worldwide, who are either active or accomplished entrepreneurs. The mentors will guide the first-time entrepreneurs to success by sharing their experiences and giving feedback/advice.

Multiple Exits:

We aim to produce startups that are “globally competitive.” Meaning, startups that come out of the program would create services that target international markets. Global startups have the advantage to exit in several ways. For example, they can go public in multiple countries (ie. Japan, USA, Singapore), and they can be subject to acquisition by companies from different countries.

Global Funding Network:

In Japan, it is difficult for startups to receive funding. It is especially difficult for early stage startups to get funded. Venture capitalists in Japan are extremely risk averse and there is also a lack of angel investors in Japan (I can count only a few in my head).

However, I believe the root cause of the problem is actually the lack of exit strategies for startups in Japan. If we can create multiple exit strategies for startups, and also increase their chances of an exit with proper mentorship, investing in early stage startups will become much more attractive and will naturally make early stage investing much more active.

In the meantime, Open Network Lab will make an effort to connect Japanese startups with venture capitalists and angel investors from overseas.

Building a Community:

This is probably the most important element for building a startup ecosystem. We need to build a big, strong startup community where entrepreneurs can meet and support one other. Our attempt to build a community is to host monthly events that will bring entrepreneurs together. We had our first event two days ago which brought together 200 people. In future events, we will have to prioritize educating and allowing entrepreneurs to discover each other.

The Biggest Obstacle:

Culture is going to be the biggest obstacle. The Japanese people are extremely risk averse and have the biggest fear of failure. I am probably making this up but I think the origin of the risk averse culture comes from the bushido (samurai) code where warriors perform seppuku (stomach-cutting) when shame is brought to them.

The way to overcome this is to build a strong community. Japanese people show a tendency towards herd mentality, so creating a herd of entrepreneurs will bring more of them together. Also, creating a successful startup role model will also be essential. We will have to create at least one successful startup that will make people go for the startup dream.

Some people have been telling me how it is impossible and how this is a foolish attempt. But we have to try and keep on trying because I believe building a startup-friendly environment in Japan is essential for the country’s survival.

Peace.

I believe Twitter is also going to change Japan. Not only will it change the way Japanese people use the Internet, but it may also change our culture entirely.

As of last October, Twitter users in Japan surpassed two million, and is continuing to grow [source]. Many famous people in Japan are starting to use Twitter. Japanese Prime Minister, Yukio Hatoyama and Softbank President, Masayoshi Son, have started using the service.

Many businesses in Japan are beginning to use Twitter in creative ways to promote themselves. A small store in Japan that sells board games is giving 100 yen (approximately $1) discount for every 100 followers you have (this means that Ashton Kutcher would get about $45K discount if he comes to this store!). All you have to do is tweet about the store just before you check out at the cash register [source].

Shinsuke Usami, CEO of EC Navi, is using Twitter to recruit new graduates. The only requirement for applying is that you have more than ten followers on your twitter account. He is also actively organizing events and information sessions via Twitter.

Japanese Internet users have always been paranoid about privacy and are reluctant to share information. They rarely use their real name on blogs and social networks. Their profile pictures are always their pets or anime characters.

Mixi, Japan’s largest social network, is very closed. Users only connect with their intimate friends and communities. Mixi is not the optimal platform to expand your network and establish your online brand.

However the growing presence of Twitter in Japan is starting to change all of this. The concept of being open and available is slowly becomming less foreign to Japanese people. At the same time many major social networks such as Mixi, Gree, and DeNA are opening up their platforms.

I am hopeful that this movement of becomming more open and sharing will create more room for innovation and drive entrepreneurship in Japan.

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The video is really cheesy and looks like an instructional video from 1995. “Cacoo” is also a horrible name.

But despite all that, the service itself seems like a very useful! 

“Cacoo lets you create site maps, wire frames, and UML diagrams with a simple drag and drop. It also lets you collaborate with multiple users”

http://cacoo.com/

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FINALLY! Tweetdeck for iPhone supports lists!

And now it supports geo-tagging.

Seems pretty solid. Maybe I’ll switch back to it.

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Lately, I have been paying a lot of attention to acceleration programs such as Y-Combinator and TechStars. I really think they are great programs that really work as a business. The programs stimulate innovation and give more opportunities to people who are interested in building their own startup.

Don Charlton, who went through an acceleration program, shares 7 things he learned from it.

My company The Resumator is a graduate of the Innovation WorksAlphaLab program.  AlphaLab is an acceleration program for startup companies. (some use the word “incubator”, but this name is usually frowned upon by the programs). Acceleration programs are designed to provide entrepreneurs with early-stage capital, guidance and connections. Other programs include Y-Combinator and TechStars. I thought I’d share a few things that I learned during my time at AlphaLab to hopefully encourage you to apply to participate in one these programs. The experience is incredible, and the knowledge you gain will be invaluable.

read more

Photo Credit: Flickr

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When you first start your own company you have very little budget to work with. However, it is still important to separate the space of where you sleep and where you work. Having an exclusive space for work will help you and your employees focus more, and it will increase your team’s productivity. Here is a great post by Don Charlton on How to Create a Great Startup Office Space on a Bootstrap Budget

Tip #1: Find office space that comes with tax benefits.

Through a few new friends, I learned about a program in Pittsburgh called Keystone Innovation Zones. These are zones that provide tax credits for businesses that choose to operate in certain locations. Don’t let your suburban upbringing blind you—these are not buildings in blighted communities, as some narrow-minded folk would immediately assume. They’re just available space, all over the city, where economic development is encouraged. Your startup could qualify for tax credits simply by moving into the zone. That means if I have a tax bill of $4,500 by the end of 2010, that amount—and probably more—will be credited. If you work with your local government to find out if there are tax benefits for your business to locate in certain buildings or areas, you can offset the costs of moving into that space, and then some.

Photo Credit: Flickr

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Droplr is a Mac OS desktop application which lets you share files, pictures, texts, and links to your friends and followers by simply dragging and dropping.

This demo on YouTube explains it all!

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New Years is just around the corner now, and I am going to make this blog as a part of my new years resolution! I am usually pretty good at sticking to my new years resolution so expect to see more posts!

Last week I attended Le Web, the largest Internet event in Europe. It was my first time and it was a great event! The speakers were excellent and I had the chance to network with many amazing people. I highly recommend you to attend if you have the chance!

I’ve uploaded photos of Le Web and my trip to Paris on Flickr.

Le Web Day 1 –  http://www.flickr.com/photos/26010036@N05/sets/72157622860767783/

Le Web Day 2 - http://www.flickr.com/photos/26010036@N05/sets/72157622985485322/

Le Web After Party (there is a photo of the Mayor of Paris!) - http://www.flickr.com/photos/26010036@N05/sets/72157622844798853/

Tour of Paris - http://www.flickr.com/photos/26010036@N05/sets/72157622860633761/

Tony Hsieh had a great speech on company culture and happiness.

Truly inspiring for those who runs their own company. 

Hopefully you will hear more from me.

Cheers,

Hiro

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