2011 APEC Business Incubation Forum
Incubation in Japan
Ryo Umezawa
Director, J-Seed Ventures Inc.
Director / Investor, AllCoupon Japan
@ryoumezawa
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
Until now
0~10 years old
20 years old~now
10~19 years old
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
Until now
Startups
Entrepreneur
Cross Border Alliance
Business Development
5 Years
Market Entry
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
Until now
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
J-Seed Ventures Inc.
Venture incubator
Founded in 2000
Self-funded
8 portfolio companies currently
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
We start businesses that
address real market needs
with innovative business
models and technologies.
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
ventures
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
Entrepreneur in Japan
Risk > Rewards
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
High Personal Risk
• Low Social Status
‣ Unemployed
• Social Stigma of failure
‣ >10% start another venture
• Labor Market
‣ No turning back
• Personal Guarantee
‣ Bankruptcy
• Getting the first client
‣ Track Record
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
Venture Support Infrastructure
• Law & Accounting firms Charge full rates
• Venture Capitalist are salaryman
• Landlords ask for track record
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
The challenge
•Japan has the third largest
economy in the world.
•But the population is
shrinking and rapidly aging.
•And the younger
generation is underemployed.
Source: The Economist
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
The solution
Entrepreneurs are the source of new growth
“Between 1980 and 2005, virtually all
net new jobs created in the U.S. were
created by firms that were 5 years old or
less.”
“That is about 40 million jobs. That
means the established firms created no
new net jobs during that period.”
Kauffman Foundation,
April 2010 (NY Times)
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
However…
•Japan generates only $3 billion
a year in venture funding for
about 3,000 investment deals.
•US start-ups receive $30 billion a
year in venture funding for about
4,000 investments.
VC investments
US: $29.4B, Japan: $2.8B
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
The reason
Smart people are discouraged from becoming
entrepreneurs in Japan
Low tolerance for failure
Low social status
Limited capital
Narrow social networks
Weak support infrastructure
Over-regulation
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
Who are we?
• We are experienced entrepreneurs.
• We have spent our careers building new
businesses.
Jeffrey Char
Entrepreneur
Pario Software, Inc.
Solis Corporation
Sozon Inc.
Arne Koch
Entrepreneur
Rebate Networks Gmbh
Ryo Umezawa
Entrepreneur
Pido Inc.
Mobikyo KK
AllCoupon Japan
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
Our partners & networks
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
Why we are doing OIC
• We believe Japan
needs more
entrepreneurs and the
businesses they build.
• We believe Japan can
lead the world in
successful
entrepreneurs and
ventures.
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
Our mission
• To make starting a
venture one of the
standard alternatives
that smart and
ambitious people
consider.
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
What OIC does
• OIC will educate and support entrepreneurs in
Japan.
Mentorship
Network
Facilities
Capital
Education
Government
Creative
Environment
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
OIC fills in the gap
Year
-1
1
2
3
-1
1
2
3
Supporters
Corporates
Banks
VC funds
Gov't funds
Angels
Needs
Capital
Network
Mentorship
Facilities
Year
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OIC Overview
OIC
Open Incubation Center
Services
Education, mentorship, access to capital, networking, back
office support, introductions
Facility
Central Tokyo facility; open design; meeting and desk space
for 40 companies; 24x7 access; convenient to public
transportation, restaurants and shops
Target
companies
Early-stage Japanese ventures; overseas ventures entering
Japan; ventures with innovative technologies and business
models; preference for ventures targeting the world’s most
urgent social and environmental needs
Status
Not-for-profit entity
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
OIC - the key differences
 An incubator run by entrepreneurs for entrepreneurs
 Complete understanding of how to help entrepreneurs succeed
 Clear mission – to create long-term growth for Japan by
educating and supporting entrepreneurs
 No hidden agenda
 Completely independent
 In a position to provide best impartial support to entrepreneurs
 Designed to be a sustainable, but not-for-profit organization
 Fostering entrepreneurship is our #1 priority
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
OIC - the key differences
Run by
entrepreneurs
Run for
entrepreneurs
Open
environment
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
Open network
Successful US incubators
Silicon Valley, CA
Payment solutions
Social lending
Boston, MA
Wireless chips
LEDs
Wireless devices
Email software
Data mgmt
Location services
Silicon Valley, CA
Publishing software
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
case study : 500 startups
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
Entering Japan
Conclusion
Entrepreneurs are vital for the future long term growth of
Japan
Entrepreneurs are under represented in Japan
OIC will educate and support entrepreneurs
Co-incubation network help growth internationally
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.
19
Ryo Umezawa
ryo@j-seed.com
ryoumezawa (E)
umemac (J)
www.ryoumezawa.com
© 2011 Ryo Umezawa - Confidential - All Rights Reserved.