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Growing in Asia: Japan

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Growing startups in Asia, winning locally and scaling beyond the region. We take a look at how Japanese startups disrupt the incumbents in Asia and what kind of strategies they take to scale beyond their local market.

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Growing in Asia: Japan

  1. 1. GROWING IN ASIA How to survive local disruption while going global Alex Barrera alex@thealeph.com
  2. 2. HELLO MY NAME IS...
  3. 3. My Blended Experience
  4. 4. FACE TO FACE FORUMS (WhatsApp) WOW Room
  5. 5. Growing in Asia Group http://bit.ly/GrowingInAsia
  6. 6. Entrepreneurial Region by nature
  7. 7. Historically entrepreneurial
  8. 8. Later Silla sea dominion Trade Control
  9. 9. China Silk Road control Trade Control
  10. 10. Despite Europe… Asia trade was central
  11. 11. Red Seal Ship System.1634 AC Trade Control
  12. 12. Gunpowder
  13. 13. Compass
  14. 14. First Movable Type
  15. 15. Horticulture & use of grafts
  16. 16. Horticulture & use of grafts
  17. 17. Taoism
  18. 18. Buddhism
  19. 19. Confucianism
  20. 20. 4 books and 5 classics (四書五經)
  21. 21. Major peace in the region (Tang Dynasty)
  22. 22. Rise of the Startups
  23. 23. 1946 Masaru Ibuka
  24. 24. 1985
  25. 25. 1986
  26. 26. 1987 CRISPR
  27. 27. 1994
  28. 28. 1995
  29. 29. 51.1% GDP 70.2% Employment
  30. 30. Number of internet users in selected countries in the Asia-Pacific region as of January 2019, by country (in millions) Source: Statista 2019
  31. 31. Source: The Mobile Economy Asia-Pacific 2018 Report.GSM Association.
  32. 32. Source: The Mobile Economy Asia-Pacific 2018 Report.GSM Association.
  33. 33. Mobile internet user penetration in Japan from 2017 to 2023 Source: Statista 2019
  34. 34. Source: e-Conomy SEA 2018 Report.Google-Temasek Japan 0.3%
  35. 35. Source: CBInsights Data.The Aleph Report elaboration.
  36. 36. Source: CBInsights Data.The Aleph Report elaboration.
  37. 37. Masayoshi Son
  38. 38. Sectors
  39. 39. Source: Japan Startup Finance Report 2018
  40. 40. Investment by sectors Source: Japan Startup Finance Report 2018 Healthcare Artificial Intelligence Content Sharing Economy Fashion Security Gaming Biotech
  41. 41. Messaging Source: Line Corporation Q4 2018 Earning Results
  42. 42. Messaging Source: Line Corporation Q4 2018 Earning Results
  43. 43. Messaging Source: Line Corporation Q4 2018 Earning Results
  44. 44. Messaging
  45. 45. Messaging
  46. 46. Fintech
  47. 47. Fintech
  48. 48. Fintech
  49. 49. Cryptocurrencies
  50. 50. Cryptocurrencies
  51. 51. Cryptocurrencies
  52. 52. Tokyo University Kyushu University Keio University Osaka University
  53. 53. Healthcare
  54. 54. Healthcare
  55. 55. Healthcare
  56. 56. Healthcare
  57. 57. Artificial Intelligence
  58. 58. Artificial Intelligence
  59. 59. Artificial Intelligence
  60. 60. Space Tech
  61. 61. Space Tech
  62. 62. Food Tech
  63. 63. Food Tech
  64. 64. Food Tech
  65. 65. Food Tech
  66. 66. Online Retail
  67. 67. Online Retail
  68. 68. Source: e-Conomy SEA 2018 Report.Google-Temasek
  69. 69. Incumbent Disruption
  70. 70. And Japan, because of both its hierarchal nature of society and the importance of consensus and decision making has a particularly hard time with bottom-up change, and yet for the Japanese economy to thrive or even to continue to grow sustainably at all there needs to be a mechanism for disruptive innovations to take root and flourish.  So, while Japanese industry made its fortunes disrupting markets all over the world they put in place a system at home to protect domestic markets from disruption. “ Tim Romero. Disrupting Japan Podcast.2015.
  71. 71. Corporate Investment Financial Institutions
  72. 72. Source: Japan Startup Finance Report 2018 Overseas Other Government / University Financial Institutions Corporations Overseas
  73. 73. General disregard for small startups
  74. 74. Hiroshi Mikitani,CEO & Founder Rakuten
  75. 75. Tips for incumbents Don’t undervalue disruptive tech (i.e. Blockchain)
  76. 76. Tips for incumbents Don’t undervalue disruptive tech (i.e. Blockchain) Focus on trends, not tech itself
  77. 77. Tips for incumbents Don’t undervalue disruptive tech (i.e. Blockchain) Focus on trends, not tech itself Focus on new business models, not self improvement
  78. 78. Tips for incumbents Don’t undervalue disruptive tech (i.e. Blockchain) Focus on trends, not tech itself Focus on new business models, not self improvement CVC isn’t just about ROI
  79. 79. Tips for incumbents Don’t undervalue disruptive tech (i.e. Blockchain) Focus on trends, not tech itself Focus on new business models, not self improvement CVC isn’t just about ROI Begin working with Venture Builders
  80. 80. Scaling beyond the region
  81. 81. Local still complicated
  82. 82. Masayoshi Son.Reuters,Jun 2019 “Until recently Japan was at the technological leading edge. In the most important current technology revolution – artificial intelligence – Japan has become a developing country,” Son said at an annual SoftBank event for suppliers and customers.
  83. 83. Gaming
  84. 84. Gaming “MOBA games, as a whole, are not really popular here in Japan,” he said. “Actually, any game that requires building up a team and cooperating with somebody else is struggling here in Japan. At the same time, Japanese people love to play against the CPU, because this avoids human interaction, and they prefer avoiding a real person that disturbs them while they train.” Paolo Gianti,former Nintendo EU.Jan 2019
  85. 85. Source: LinkedIn Future of Skills APAC Report,2019.
  86. 86. The Trade Wars
  87. 87. Source: Southeast Asia Tech Investment in 2018.Cento
  88. 88. Buddhism Source: https://oec.world/en/profile/country/jpn/
  89. 89. Buddhism Source: https://oec.world/en/profile/country/jpn/
  90. 90. HUAWEI NVIDIA / QUALCOMM
  91. 91. Natural scaling regions Source: e-Conomy SEA 2018 Report.Google-Temasek
  92. 92. Source: e-Conomy SEA 2018 Report.Google-Temasek
  93. 93. Source: The Rising of Japanese Startups in Southeast Asia,2016.
  94. 94. Cross border investments
  95. 95. Cross border investments Source: JETRO Invest Japan Report 2018
  96. 96. Avoided markets
  97. 97. Avoided markets
  98. 98. 660 M vs 743 M
  99. 99. Average annual spending per capita for online shopping in Europe from 2015 to 2018, by country (in euros**) Source: Statista 2019
  100. 100. 28 countries 23 official languages
  101. 101. Northern Europe Southern Europe 4000 KM
  102. 102. Western Europe Eastern Europe
  103. 103. Source: Dealroom.co.Excludes buyouts,secondary transactions,debt,ICOs,lending capital,grants.
  104. 104. Distributed Startups
  105. 105. Global Scope Most SEA too regional Some players undervalued
  106. 106. Europe - Asia opportunities
  107. 107. Market Saturation
  108. 108. Local Corporates (CVC) Who funds the region?
  109. 109. Increased competition
  110. 110. Organic growth
  111. 111. Breaking the regional lock
  112. 112. Excel at scale Apply to Europe
  113. 113. Lessons of efficiency
  114. 114. Logistics (Forward Freighter) Operations (massive retail operations) Automation (autonomous vehicle China roads) Recommendation (Dynamic Yield) Semiconductors – AI chipsets (Xiaomi) 5G (Huawei) Cryptocurrencies eSports Cybersecurity & Privacy technology
  115. 115. http://www.slideshare.net/thealeph Alex Barrera (@abarrera) THANK YOU Alex Barrera alex@thealeph.com
  116. 116. Growing in Asia Group http://bit.ly/GrowingInAsia https://www.linkedin.com/in/abarrera

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