TT-742 -- TiE Tokyo Chapter Open for Business, e-biz news from Japan

An Insider's comments on Japan's high tech business world
* * * * * * * * * T E R R I E 'S T A K E * * * * * * *
A weekly roundup of news & information from Terrie Lloyd.

General Edition Sunday, Feb 02, 2014, Issue No. 742


- What's New -- TiE Tokyo Chapter Open for Business
- News -- Breakthrough by Riken researcher in stem cells
- Web Content/Tech Job Vacancies
- Upcoming Events
- Corrections/Feedback
- Travel Picks -- Scenic Akasaka cafe, Matchlock rifles in Iwate
- News Credits

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The start of a new year brings with it new dreams and opportunities.
Within the business sphere, and for the betterment of society by
keeping people employed, one of the most valuable dreams is to create
a new business. Unfortunately in Japan kids are given a head start in
learning risk aversion, thanks to the scoldings they get from their
teachers from primary school onwards, whenever they try to do
something different. Teamwork and following the rules is all-important
and kids quickly get the message not to stand out. For this reason,
most company start-ups are done either by men in their 50's who have
realized that they have missed the management elevator and therefore
expect to get squeezed out of their companies, or by part-timers and
contract workers who are looking for tax benefits to offset their
second-class job status.

The number of young people who actually WANT to start a company
because they dare to dream big is still disappointingly small, our
guess is that it is less than 1% of all graduates. In comparison, in
the USA the number of graduates wanting to start a company some day is
said to be as high as 54% (Kauffman Foundation study). OK, there is a
growing group of young Japanese who flirt with the idea of a start-up
(either starting one or joining one to see how it's done). However,
flirting and doing are not the same thing. We recently interviewed a
young woman who was smart, international, highly motivated, wanting to
build a business, and in our opinion would make a good CEO herself in
the not-so-distant future. But once she found out that she would have
to figure out most of the job for herself (biz dev role -- maybe we
were too honest), she promptly lost interest. Unfortunately for her,
before you can dream of the money and Google-like office bliss, there
is a river of risk and mountain of unknowns to cross first. Japan
needs its young people to be a little bit more hungry and adventurous.

There are some bright spots, though, such as the increasing number of
accelerators, mostly in Tokyo, which provide not only mentoring but
also core business training and mental conditioning. Since most
Japanese kids coming out of university have little or no idea what is
involved in practical business, such training is really critical to
their survival and eventual success. Of course the training is
generally through Japanese eyes and hands, and so we feel the "chains
of limitation" (i.e., educating those kids about what you shouldn't
do, versus what you should dare to do) are still there and still
causing many start-ups to think small.

[Continued below...]

----------- THAI'S NEWEST DESTINATION - SENDAI ------------

THAI now has flights to Sendai, direct and non-stop from Bangkok.
Sendai is the capital city of Miyagi Prefecture, situated in the heart
of the scenic Tohoku region. THAI's new flights operate non-stop from
Bangkok every Tuesday, Thursday and Saturday, with TG680 departing
Bangkok at 23:59 and arriving in Sendai at 07.55 on the following day.
The return flights operate on Wednesday, Friday and Sunday, with TG681
departing Sendai at 10:30 and arriving in Bangkok at 15.40.

For ticket reservations, please visit or call
THAI's Japan desk at 0570-064-015, or the international Contact Center
at +66-02-356-1111.

[...Article continues]

Then there is the lack of all-important role models -- companies
headed by young people making lots of money and leading interesting
lifestyles. There was a short surge of role models back in the early
2000's, when a bunch of current Japanese internet companies went
public, but after the Lehman Shock the flow of IPOS dried up and so
did the stimulus for 5-7 years of university graduates. We're hoping,
like many others, that Nomura's prediction of a significant increase
in IPOs this year, will turn things around and that public media
attention as well as a renewed interest by investment funds in
start-ups will mean that we will see a second wave come through.

Another problem confronting Japanese start-ups is the funding gap --
between the JPY5m-JPY10m that a new company will receive from its
founders and friends, followed by the JPY5m-JPY20m they can get from
the accelerators or angel investors, there is a gap of about
JPY50m-JPY100m that they will need to make their first commercially
viable products and services (think operating costs for 10 people for
at least 12 months). Without this money, most start-ups need to find
their own cash (very few), or they have to start small and build their
way up to a fundable level by selling interim services. This results
in very few commercially strong products coming out of Japan, and the
local start-ups getting overtaken by better funded foreign competitors
and local corporately backed entities because of their slow ascent.

Of course, there are investors to help start-ups across the funding
gap -- the nation's VCs. The problem is that there are just not that
many of them and the biggest ones are only doing just 3-5 fundings a
year, seeing about 20 - 50 candidates to make a single positive
decision. Because of supply and demand, Japan's VCs typically want to
see their candidates already fielding their product/service and have
customers and be gaining commercial traction. Or they have to have
some very seriously geeky technology out of a university lab (which is
actually happening a lot). So it's a Catch-22 for most start-ups and
they stay small.

But rather than complaining about the situation, our role in life is
to make things better. For example, with dwindling student numbers and
therefore dwindling government funding, Universities are finally
starting to realize that helping their student base and research
product transition into start-ups can provide them with an important
link to a sustainable economic future. Not only do they get licencing
revenue if a product makes it, they also get known as the place that
helped successful new businesses get their edge, thus causing other
ambitious youngsters to seek to join their courses. Waseda and Keio
are doing well in stimulating student entrepreneurship, and others are
watching carefully.

Another way to make things better is to share information and know-how
with experts. Not everyone wants to be in the furnace of an
accelerator to find out whether they have what it takes. Instead, the
funnel of advisors needs to be wider, and the people (existing
entrepreneurs and professionals) assisting the start-up need to come
from a more diverse base, so as to give the new entrepreneur enough
data to plot their own course. Back in 1994, Yoshi Hori, the current
owner of Globis University and Globis Capital (a leading VC), started
the first Japan chapter of a global self-help entrepreneur group
called the YEO (Young Entrepreneurs Organization).

Yoshi lined up 38 original members, including two foreigners, one of
whom was this writer. The group was something completely new, and was
dedicated to helping new entrepreneurs make contact with each other
and share common problems and solutions, and also to mentor future
entrepreneurs. The YEO was quite successful and continues today as
just "EO" (Entrepreneur's Organization), with 180 members and two
chapters in Japan. Worldwide, the EO has 131 chapters and about 9,500
members. All of these members are founders and owners of businesses
with revenues of more than JPY100m annually -- making the
conversations and content of their meetings very different to other
business organizations. They are an excellent resource for new

Another newer global self-help entrepreneurial business organization
has appeared on the Japan scene, and this one seeks specifically to
develop new entrepreneurs, although the networking aspect is there as
well. The organization is called TiE (from "The Indus Entrepreneurs").
Unlike the EO, TiE is not limited to CEO/Founders, so anyone
interested in developing entrepreneurship can join the network. TiE
has an interesting background, as can be deduced from the name. It's
well known that many of Silicon Valley's successful high-tech
entrepreneurs are immigrants, and according to the Kauffman
Foundation, between 2006 and 2012 at least 43.9% of start-ups had at
least one foreign founder -- and 30% of them came from India. TiE was
formally established in 1994 by a group of these Indian-origin
entrepreneurs and since evolved into one of the largest networking
organizations in the world. Nowadays, TiE has 61 chapters in 17
countries, with about 15,000 members.

By natural osmosis the group grew and attracted the attention of many
successful business innovators with no Indian connections, and the
decision was made in the early 2000's to open the organization to
anyone wanting to become an entrepreneur or to support those who were
making the effort. The founders' underlying ethos is still evident in
TiE today, and its philosophy is "A compatible blend of the Silicon
Valley culture of economic value creation through Entrepreneurship,
and the ancient South Asian tradition of Guru/Shishya or
Teacher/Disciple relationship."

What makes TiE stand out is the passion and activity of its membership
base in reaching out to new businesspeople. Since the organization is
predicated on Silicon Valley entrepreneurial values, its members are
in for the full deal: risk taking, passion to build, appropriate
financing, the importance of networking and mentoring, and intense
work ethic. It isn't for everyone, but it can certainly provide a
rocket boost for anyone looking to build a leadership position in
their sector. The network is particularly open, and a member from here
in Tokyo can reach out to members elsewhere around the world and
expect that they will be looked after. We often see international
members looking to come to Tokyo ask for meet ups with local members.

One of the best parts of TiE, is the range of events organized by each
chapter around the world. At the top of the pile is TiE50, which will
be held in May this year in Silicon Valley. Roughly 3,000 to 4,000
members from all over the world go to Tie50, both to see 50 hot
start-ups compete for ranking by their peers, and to network with the
hundreds of investors and company founders there. Many international
deals start with meetings at TiE50. Last year two Japanese start-ups
presented there and both of them emerged as finalists. One of the
firms, a software company started by a university graduate,
subsequently scored US$1m in funding by an investor also present at
the event. The other, an electric vehicle maker, got into a business
deal with a manufacturer in India.

After an informal first year, TiE Japan has just set itself up as a
formal NPO in Japan and is now inviting people interested in
supporting the linkage of Japan's entrepreneurs with the international
market to contact its President, Kaz Terada, to get details of how to
sign up. If you are an experienced entrepreneur, investor, or business
educator, then you may want to join as a Charter member. On the other
hand, if you are looking to get into business for yourself or you are
simply interested in meeting some of Japan's hottest start-ups at an
intimate level on "pitch nights", then you can look at joining as a
regular member. Fees and conditions of membership are available from
Mr. Terada at:

...The information janitors/


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+++ NEWS

- Share buyers think post-tax consumption will fall
- Skymark hits market turbulence
- Breakthrough by Riken researcher in stem cells
- Class action suit against builders of Daiichi plant
- NHK hushing up negative nuclear discussions prior to election

=> Share buyers think post-tax consumption will fall

One of the best barometers of public opinion on economics is to be
found in the stock market. Given that frugal-friendly company stocks
have suddenly become popular again, while luxury company stocks are
being dumped, it seems that many investors are betting that consumers
are going to stop spending and move back down-market after the
consumption tax increase in March. For example, Isetan shares fell by
12.1% in January, while beef bowl chain Yoshinoya shares rose 13.7%.
Investors have figured out that since 70% of Japan's wages are paid by
small-medium sized companies (roughly 80% of the work force), most
people will NOT be receiving pay rises when the unions start pushing
the big firms for more money for their workers. (Source: TT commentary
from, Feb 1, 2014)

=> Skymark hits market turbulence

Not a happy time for Skymark Airlines at the moment. The company
continues to cut routes from its destination list, following its
termination of Narita-Fukuoka flights last November. The new
terminations will be Narita-Asahikawa, Narita-Ishigaki Island,
Haneda-Asahikawa, Haneda-Kumamoto, and Kobe-Ishigaki. The airline is
blaming competition from JetStar on the niche routes and predatory
early-booking discounts by ANA/JAL on the bread-and-butter routes.
***Ed: However, rather than JetStar taking away Skymark business, we
imagine the real problem is that unless you're offering compelling
deals as JetStar does, Tokyo-ites feel that Narita is just too far to
go for domestic flights. We wouldn't be surprised if Skymark
eventually go under -- or maybe Tony Fernandez at AirAsia will buy
them out?** (Source: TT commentary from, Feb 1, 2014)

=> Breakthrough by Riken researcher in stem cells

It's all over the news that there has been an amazing discovery in
relation to stem cells -- that regular mature cells can be "shocked"
by environmental stimuli into becoming pluripotent. The new technique
is not only much quicker and productive than the gene insertion method
used by Shinya Yamanaka, it can also be used in ALL parts of the body,
and so is suitable for cloning as well as regeneration. Very good
original announcement article in Nature magazine. ***Ed: As a side
note, it's interesting how many Western media reports mention Charles
Vacanti at Harvard University in connection to the discovery, whereas
the reality is that a Riken scientist who was on his team was
responsible over a period of 5 years for the discovery. Her finding is
being hailed as the breakthrough that will bring iPS treatments into
the mainstream of medicine.** (Source: TT commentary from,
Jan 29, 2014)

=> Class action suit against builders of Daiichi plant

In an unusual development, roughly 1,400 plaintiffs have filed suit
against the builders of the Fukushima Daiichi nuclear power plant,
charging the companies with failing to install safety improvements to
the plant during the over 40+ years of its operation, and consequently
bear responsibility for the explosions and contamination. Currently
Japanese law protects the companies from prosecution, and the class
action suit, which seeks just 100 yen per plaintiff, seeks to overturn
that law and make the companies responsible for not only Fukushima but
also any other reactors they may have worked on. The companies being
targeted are General Electric, Toshiba, and Hitachi. (Source: TT
commentary from, Jan 29, 2014)

=> NHK hushing up negative nuclear discussions prior to election

Looks like the LDP political machine is up to its old tricks again
already. Orders have come from the top that there should be no
discussion of nuclear issues at NHK prior to the Tokyo gubernatorial
elections. Given that former PM Koizumi and Hosokawa are firmly
anti-nuclear, while the LDP's candidate Masazoe is for nuclear, it's
clear which political source the new policy is being directed from.
The NHK orders appear to have been quite heavy handed and have caused
a well-known economist from Toyo University to resign from a morning
news program because of the restriction. ***Ed: Another reason we
seldom watch NHK -- there is already plenty of propaganda in the
world, without having to watch it being done badly.** (Source: TT
commentary from, Jan 30, 2014)

NOTE: Broken links
Some online news sources remove their articles after just a few days
of posting them, thus breaking our links -- we apologize for the



=> Are you in web content, sales, or engineering? If so, this section
is for you.


- Regional Sales Partners

If you live outside Tokyo, have an interest in selling media and
online tourism services and are bilingual (i.e., strong Japanese
required) then we have part-time and full-time positions for suitable
candidates. Our target clients are local governments, major regional
companies, and tourism operators. Each Sales Partner receives the sole
right to represent their region, and receives support from the Tokyo
office to convert promising leads. The position is open to anyone with
sales experience or the ability to sell. Initial contracts with
non-experienced candidates are a no-retainer, commission-only
arrangement, however, promising candidates will have the opportunity
to move to retainers. Visa sponsorship may also be a possibility for
the right person. Friendly team, interesting technology, incentivizing
commissions are all part of the opportunity. Please send your resume


- Bilingual account manager for major tourism portal
(, JPY3M - JPY5M
- Bilingual sales trainee for web media properties, JPY2.5M-JPY3M +
10% commission
- English-only experienced PHP Zend software developer, 5 years
experience, JPY3.5M - JPY5M

Interested individuals may e-mail resumes to:




---------------- Start a Company in Japan -----------------

Entrepreneur's Handbook Seminar 15th of February, 2014

If you have been considering setting up your own company, find out
what it takes to make it successful. Terrie Lloyd, founder of over 17
start-up companies in Japan, will be giving an English-language
seminar and Q&A on starting up a company in Japan.

This is an ideal opportunity to find out what is involved, and to ask
specific questions that are not normally answered in business books.
All materials are in English and are Japan-focused.

For more details:

------------------ ICA Event - February 20th-------------------

Speaker: Tish Robinson, Professor of Organizational Behavior at
Hitotsubashi University ICS
Title: "Workshop - Speak Out!!! Don't Freak out!!!"

Details: Complete event details at

Date: Thursday, February 20th, 2014
Time: 6:30 Doors open, Buffet Dinner included and cash bar
Cost: 4,000 yen (members), 6,000 yen (non-members) Open to all. No
sign ups at the door!!!!!!!
RSVP: RSVP by 10am on Monday 17th February, 2014. Venue is The Foreign
Correspondents' Club of Japan.



=> No feedback this week.



=> Miharashiya Cafe, Asakusa, Tokyo
Panoramic view of the Asakusa area and Tokyo Skytree

Do you plan to visit Asakusa and you are looking for an
"out-of-the-way" spot or experience? I may have just the right story
for you, read on.

I went to see a rakugo (Japanese comedy show) performance at the
Asakusa Cultural Tourist Information Center, together with one of my
Japanese friends. Being a local, born and raised in the Taito ward, he
knows the area very well. He also knew about my hobby (photography),
so he showed me the Miharashiya Cafe on the eighth floor of the
Tourist Information Center. He said it was an anaba, meaning a
"little-known good place" in Japanese. Not many people know of the
cafe and we enjoyed visiting their observation space.

Before jumping on to the cafe, let me introduce the premises of the
Asakusa Cultural Tourist Information Center. It is located just
opposite the Kaminarimon, the huge gate in Asakusa, and I highly
recommend this place to all visitors since it provides great
information and assistance in Japanese, English, Chinese and Korean.
There is also free Wi-Fi internet access in the premises...

=> Goyozan Matchlock Rifle Brigade, Iwate-ken
Take aim - FIRE!

If exploring caves or panning for gold hasn't quite filled your
appetite, prepare to be blasted back to early Edo Japan by Sumita
town's very own Matchlock Rifle Brigade (Goyozan Hinawaju Teppotai).

Matchlock rifles or hinawaju (hinawa, meaning fuse, is made from the
bark of a species of Japanese cypress, hinoki, while ju refers to
firearms) first made their way into Japan during the late Muromachi
Period (1337-1573) through the island of Tanegashima, south of Kyushu.
Oda Nobunaga (1534-1582) a famous warlord of the Azuchi-Momoyama
Period (1573-1600) used matchlock rifles extensively in his military
campaigns, using a rank and file system whereby one line of troops
would open fire while the following rank was reloading.

Cast your mind back to pre-Meiji Japan and you will find that Japan
was divided into a system of fiefs (han) each governed by a local
warlord under the ruling military government, or Bakufu. The area
occupied by Sumita-cho was formerly part of Date-han (this is
pronounced da-te as in "café latte" not as in "date" in English),
ruled by Masamune Date (1567-1636) an influential and wealthy lord
(daimyo) of the early Edo Period (1600-1868). If you have any interest
in Date Masamune, some of his calligraphy is on display in Tokyo
National Museum.



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