Disrupting Japan

Fifteen years ago, University-run venture funds were all illegal here in Japan, but today a higher percentage of major Japanese universities have VC funds than in the US or Europe.

Today we sit down with Kei Furukawa, a partner at the University of Tokyo IPC, a $300M venture fund, and we talk about the unique role these funds play in Japan, how they drive innovation in rural areas, and why he has to talk professors out of becoming startup CEOs.

It's a great conversation, and I think you'll enjoy it.

Show Notes

UTokyo IPC'a mission and investment strategy How the Japanese government is trying to accelerate university innovation Why the government plans to stop funding university VC funds The unique role of University funds in Japan How IPC is helping startups work with large enterprises Why Japanese CVCs are more founder-friendly than American VCs Why Japanese CVC investment increased during covid How to talk a professor out of being a startup CEO Can startup interaction reform Japan’s universities? The challenge in developing innovators outside of the major cities Which startup sectors are most promising in Japan How sempai culture is holding Japan back

Links from our Guest

Everything you ever wanted to know about UTokyo IPC IPCs 1st Round program Follow Kei on X @keisukefurukawa Friend him on Facebook Connect on LinkedIn



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Transcript Welcome to Disrupting Japan, Straight Talk from Japan's most innovative founders and VCs. I'm Tim Romero and thanks for joining me. University Venture Funds play a much larger role in the startup ecosystem and in startup finance in Japan than they do in the US or Europe. Japanese university funds also operate differently, and  fill a different niche than most of their Western counterparts. Their oversized impact is all the more amazing when you consider that 15 years ago, it was basically illegal for Japanese universities to invest directly in startups, but now they've become a driving force. Well, today we sit down with Kei Furukawa, a partner at the University of Tokyo IPC. A $300 million University fund, and we dive into how Japanese university VCs invest today and how that's going to be changing in the near future. Oh, and for our overseas listeners in this conversation at different times, Kei and I talk about the University of Tokyo and Todai and UTokyo. It's all the same place. It just goes by many names. So Kei and I talk about how you can get investment from IPC, even if you're not a University of Tokyo student or faculty. The single biggest challenge to getting university professors on board with what's required to commercialize their research and how the different investment strategies in Japan are leading to a different kind of startup enterprise collaboration than we see in the rest of the world. But, you know, Kei tells that story much better than I can. So, let's get right to the interview.

Interview Tim: We're sitting here with Kei Furukawa, a partner at the UTokyo Innovation Platform or IPC. So, thanks for sitting down with me. Kei: Thank you for having me on. Tim: In the introduction, I gave a brief description of what IPC is and what you're doing, but could you explain a little bit more? So like, what's your thesis? What are you investing in? Kei: So, we are a university of Tokyo Innovation platform company. In short, we are called in Japanese Todai IPC. I think there's three major points in our activities. Number one, we are a hundred percent subsidy of the University of Tokyo, which until a few years ago, it was a pretty rare case because national universities were not allowed to have, let's say, investment companies or let's say companies itself under the organization. But we were created for a more government policy point, we are a hundred percent subsidy, which is pretty, I think, unique model around the world that there's a venture capital right under...

(sketch by Kaori Rei)Today we are going to sit down with an old friend.

It was over seven years ago when I first had Tim Rowe on the podcast, and we mapped out what we saw as the future of startup innovation in Japan. In today's short episode, we talk about what we got right. what surprised us, and what we think is next for Japanese startup innovation.

It's a great conversation, and I think you'll enjoy it.



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  Transcript Welcome to Disrupting Japan, straight talk from Japan's most innovative founders and VCs. I'm Tim Romero, and thanks for joining me. I'd like to share a special short in between episode with you. Last month I had a fireside chat with Tim Rowe, the founder and CEO of the Cambridge Innovation Center at the Global Venture Cafe's anniversary celebration in Tokyo. And I thought I would share it with you just as it happened.  I first had Tim on the show about eight years ago, just before CIC opened their Big Tokyo collaboration space. This time Tim and I talk about the changes to the Japanese startup ecosystem since then, what we are likely to see in the future, and we also discuss what might be a new model for startup ecosystems. As startups have become more and more accepted and more and more common. The old community playbook may not be as effective as it once was. But Tim tells that story much better than I can. So, let's get right to the interview.

Interview Romero: All right, Tim, it is great to be sitting down with you again. And as a bit of background for the audience. You and I back in 2017, we were sitting down over coffee in Tokyo and you were telling me about your plans to open Venture Cafe and CIC and I remember asking you like, how the hell are you going to fill 6,000 square meters of co-working space in Tokyo? And here we are. Venture Cafe is one of the driving forces in the startup ecosystem. CIC is over capacity. I have never been so delighted to have my doubts proven wrong, so congratulations on that. Rowe: Thank you, Tim. Glad to be here. Romero: Before we dig in, you've got ties to Japan. You've been working with Japan for a long time, so can you tell us a little bit about what was your involvement in Japan in the 90s and forward? Rowe: Okay, so a bit of background. I'm from Cambridge, Massachusetts. My father was a professor at Harvard. My mother was a professor at MIT, so I'm one of those kids. And I was fortunate to be exposed a bit to the world. My grandmother had spent about a decade in Asia in the 1920s. And she used to teach me kanji when I was little. And so I didn't know much about Asia, but I thought this was really interesting. And I learned later that my great-grandfather arrived in Yokohama in 1919. He was then acting Surgeon General for the United States. And he was on a world trip to kind of build connections and relationships. So, we go back a little ways in Asia. My father, when I was in high school, did something that I think all the parents in the room should do. He said, look you should learn a little bit about the rest of the world. And he said, if you learn Japanese, I'll give you an opportunity to work in my company's Tokyo office for the summer. And I said, okay, deal. And I started studying Japanese. I didn't know the language at all, but it seemed like a cool opportunity. By the way, a generation later, I made the same offer to my oldest child. Actually, I made the offer to all my children, but my oldest child took me up and he came and worked in Tokyo also when he was 16. Kihara-san, I understand that you did something similar. You were in school in Chicago and in Amsterdam when you were young. And clearly your English reflects that experience. I think all of us should have this opportunity to go out of our usual comfort zone and work in another country and learn about other cultures. But that's my background. So, I did a year at Dosha University later as an exchange student from Amherst College.

Today we are going to break down some startup stereotypes.

I sit down with Kunio Hara, co-founder and CEO of Beatrust and break apart the stereotypes of the uncreative Japanese enterprise and the young startup founder, and Kunio explains how Beatrust is already teaching old dogs new tricks.

It's a great conversation, and I think you'll enjoy it.

Show Notes

How Japanese enterprises are different from their US large counterparts Things to know when starting a company in your late 50s Why older founders lead to more successful outcomes Challenges in breaking the age-hierarchy in Japan Can software actually make people collaborate? What it takes to get Japanese firms to innovate and collaborate freely Does Japan's management style have to change or can innovation happen within it? Why American companies will also soon have to change their work styles What new founders need to keep their eyes on when starting a startup

Links from our Guest

Everything you ever wanted to know about Beatrust

Follow Beatrust on X @jp_beatrust Beatrust on Note Get in touch with Beatrust

Connect with Kunio on LinkedIn Friend him on Facebook

Leave a comment Transcript Welcome to Disrupting Japan, Straight Talk from Japan's most innovative founders and VCs. I'm Tim Romero, and thanks for joining me. I didn't really realize what this episode was about until I finished the editing. Oh, don't worry. I'll be introducing you to an innovative founder in just a minute, and we'll dive deep into their business and their market. But this episode is really about stereotypes, how much truth they really have and why they stay with us, and what we can do to change both the perceptions and the realities that underlie them. Today we sit down with Kunio Hara, co-founder and CEO of Beatrust, a startup that's focused on getting Japanese enterprises to break from their hierarchical structures and let their employees collaborate. Listeners who have spent time in Japan know that this is not an easy task, but as we explore this subject, it becomes clear that both the reality and the solutions are not as straightforward as the stereotype suggest. We also explore the stereotype of the young Rebel startup founder, and man that is a pervasive one. In 2007, a 22-year-old, Mark Zuckerberg famously declared that quote, young people are just smarter. Paul Graham explained in 2013 that investors tend to be skeptical of any founder who is over 32 years old. However, if you take the time to look at the real world results, the data actually show that older founders are much more likely to have a large value exit than younger founders. Kunio started Beatrust in his late fifties, and we talk about the positives and the negatives associated with that. But, you know, Kunio tells that story much better than I can. So let's get right to the interview.

Interview Tim: So, I'm sitting here with Kunio Hara, the co-founder and CEO of Beatrust, who is modernizing corporate collaboration and culture in Japan. So, thanks for sitting down with me. Kunio: Yeah, thank you, Tim. Long time no see. Tim: Yeah, it has been a while since you're at Google. So Beatrust is focused on helping employees collaborate. This is important. Everyone agrees it's important. But it's hard. So what is Beatrust doing differently in this space? Kunio: We call our service talent collaboration tools because we try to define the new space and compare with other HR tech, especially talent management. What we do is mainly to help large organizations drive and facilitate more autonomous collaboration like cross functions. Tim: Okay. Yeah, that's challenging and in a bit, I want to dive deep into exactly how you do that. But before that, tell me about your customers. So, who's using Beatrust? Kunio: Obviously, large enterprise customers. They want to transform the culture to more innovative oriented,

While American AI startups are dominating the headlines, one Japanese company has begun rolling out "AI employees" to famously cautious  Japanese enterprise customers.

Today we talk with Shota Nakagawa the CEO of Caster and discuss their model of human-AI collaboration, why Japan is positioned to lead real-world AI deployment, and the big steps needed for Japan to catch up with the West.

It's a great conversation, and I think you'll enjoy it.

Show Notes

Caster’s new model for gig-workers Why almost 90% of Caster's workforce are women How remote work is evolving differently in Japan than in the US Can remote work really revitalise rural Japan? Why Caster uses full time staff rather than gig workers How AI employees could be the solution to Japan’s labor shortage How Caster makes extensive use of AI in their workflow today What is responsoble for the low level of trust that Japanese have in AI and how to fix it Which tasks AI agents will take over and which they will never do

Links from our Guest

Everything you ever wanted to know about Caster

Follow Caster on X @caster_jp Friend Caster on Facebook

Friend Shota on Facebook Follow him on X @nakasy000

Leave a comment Errata

Caster's percentage of female employees is about 87% not 95%. Caster was founded in Tokyo, later moved to Miyazaki, and then moved back to Tokyo after the IPO

Transcript Welcome to Disrupting Japan, Straight Talk from Japan's most innovative founders and VCs. I'm Tim Romero, and thanks for joining me. While American CEOs are competing to see how quickly they can leverage AI to replace both full-time employees and gig workers alike, one Japanese company is taking a different approach and they're already rolling out their AI workforce. Today we sit down with Shota Nakagawa, founder and CEO of Caster. Now, Caster is a remarkably progressive and innovative Japanese company. They were a strong and vocal advocate of remote work years before the pandemic hit, and even after their IPO, their 800 person workforce remains fully remote with our corporate headquarters located in a shared office space in Tokyo. Caster has now begun rolling out its AI workforce, and they're taking a very Japanese approach. Rather than leveraging a collection of flexible gig workers or freelancers, Caster continues to build a long-term full-time workforce who is co-developing and already working alongside their AI employees. If history is any guide, Caster’s thinking today might tell us what the Japanese market will be thinking 10 years from now. Shota and I talk about the long-term AI trends in Japan, how Caster solve the problem of corporate, Japan's deep skepticism about AI and whether or not AI can really provide a solution to the economic problems associated with Japan's declining population. But, you know, Shota tells that story much better than I can. So, let's get right to the interview.

Interview Tim: So, I'm sitting here with Shota Nakagawa, the founder and CEO of Caster, who is creator of an outsourcing platform and a relentless advocate of remote work. So thanks for sitting down with me. Shota: Thank you very much. Tim: So, I explained very briefly what Caster did in the intro, but I think you can explain it much better than I can. So, what does Caster do? Why is it unique? Shota: People are all work remote every day, every day. Tim: So, the entire company is remote. Shota: Yeah, yeah. All people. Tim: That's pretty unusual. And we're here today actually sitting in a share office space to have this conversation. Well, actually let's talk about that in detail later. But first, let's talk a little more about Caster. So, what do you do for your customers? Shota: BPO, business process outsourcing, client about SMB small business, want back office service. Tim: So, what kind of back office services, is it like recruiting, accounting? Shota: Many types. Tim: So,

Welcome to Disrupting Japan. Straight talk from Japan’s most innovative founders and VCs. I’m Tim Romero, and thanks for joining me. There is so much happening in Japan right now. Startups and innovation are beginning to reshape Japan with the same dynamism we saw during the post-war boom or the Meji-era re-opening. And I’ve been in the middle of this for a long time. I’m now a partner a JERA Ventures, but over the over 30 years that I’ve lived in Japan, I’ve started four startups here, worked at TEPCO Ventures, ran Google for Startups Japan, and, of course, I’ve been running the Disrupting Japan podcast for more than 10 years. Every episode, I sit down with friends, VCs, founders, and leaders who are shaping Japan’s startup ecosystem to give you an inside look at what’s really happening here in Japan. So, please subscribe and join me on this journey. I’m Tim Romero, and thanks for listening to Disrupting Japan.