The Tokyo Metropolitan Government’s X-HUB TOKYO, which supports global expansion of startups in Tokyo, held the Kickoff Event for 2020 on August 28th. Seven speakers who are active in their respective fields spoke about the latest information on the ecosystems in the U.S., Europe and Asia, as well as strategies for startups to expand globally in light of the impact of COVID-19.
X-HUB TOKYO is a program that supports the global activities of startups and revitalizing the economy in Tokyo through exchanges with global startups. X-HUB TOKYO was launched in 2017 and has supported 50 startups so far. It has successfully raised over 20 billion yen in funding and the number of business alliances in Japan has exceeded 98.
In 2020, we take the crisis caused by COVID-19 as an opportunity to create innovation and provide chances to expand into new global markets with the theme of creating new normal that has never existed before. We will offer “OUTBOUND PROGRAM” for startups in Tokyo aiming at overseas expansion and “INBOUND PROGRAM” for overseas startups aiming at entering into Tokyo, and hold events to catch up the latest global trends and real experiences from entrepreneurs.
At this event, we delivered the keynote speech on “The startup’s overseas expansion strategy With / After COVID-19”, a panel discussion on the changing startup ecosystems in the U.S., Europe, and Asia and speeches by senior entrepreneurs who are actually expanding overseas. We shared the latest information that would be useful not only for startups, but also for organizations such as VCs and universities offering various supports to startups.
Keynote speech: Five points to keep in mind for startups looking to expand globally in the middle of COVID-19
Mr. Masayuki Tadokoro, Unicorn Farm Inc. CEO
We would like to start this event with a keynote speech by Mr. Tadokoro, CEO of Unicorn Farm Inc. He is widely known as a serial entrepreneur. In the COVID-19, what kinds of actions should startups take?
Since COVID-19, I’ve discussed with about 300 entrepreneurs. I advised them to “be a cockroach startup” in order to survive anyhow. First of all, figuring out the runway and raising funds as much as possible. There’s still more you can do such as forecasting sales and improving productivity.
In the wake of COVID-19, we have entered an era that could be called “virtual first” in 2020. Given the current social situation where various things are shifting to online, I think we will see a lot of changes in the workplace and in our personal lives.
Throughout history, it has not been the strongest one that has survived, but those that have been the first to adapt to the changing environment. If we can survive the current crisis and continue to manage, we will be able to see the possibility of scaling up and the global expansion.
ーWhat do you think is important for startups that want to expand globally in the future to keep in mind when planning their strategies?
As COVID-19 has not changed the core part in such strategies, I believe there are five important points to consider when formulating strategies for global expansion.
The first point is to determine whether if you really “Want” to expand globally. We should check whether the founder and management team have empathy for customers in global markets and strong desire to solve local problems.
The second point is to check the capability you “Can” offer as an advantage when competing in the global market. It’s important to analyze your past performance and technical abilities to measure your capabilities objectively.
The third point is how much your product or service is “Needed”. Take it into consideration that how large the potential overseas market is and how deep rooted issues are in the local market.
The fourth point is “Get Paid”, a perspective on whether entering global markets is an appropriate way for a company to grow and survive.
The last point is “Growth Story”, which is to determine whether global expansion is aligned with your company’s growth story.
Panel discussion: Changes and perspectives in the Startup Ecosystems in the U.S., Europe and Asia
Mr. Takuya Miyata, Scrum Ventures LLC
ーMove on to the Panel discussion. Affected by COVID-19, startups and ecosystems around the world are changing. First, let’s learn about the current situation in the U.S. from Mr. Miyata, Scrum Ventures LLC.
Looking at the recent startup events held in the U.S., the situation is slowly calming down compared to the beginning of COVID-19 outbreak. People have come to know that we can work remotely and I think online based smart cities will become a reality. I feel as people use disposable personal income for digital related services and virtual is playing a broader role.
Due to the impact of COVID-19, it is difficult to issue new visas in the U.S., it will be difficult to enter physically right now. However, I think it is possible to expand your services globally online.
Also, as geopolitical risks being considered, more foreign companies are looking to make contacts with Japanese startups to expand into Asia. We highly encourage you to approach the global market now.
ーThank you. Then please tell us about the situation in Europe, Mr. Odajima from EDGEof Inc..
Mr. Taisuke Alex Odajima, EDGEof,Inc.
I would like to speak on the premise that Europe, which is made up of many different countries, is difficult to be viewed as a single market. However, one of the common features is the rapid pace of government initiatives and legislation.
In Europe, there have been a number of cases of implementing online voting and deliberation one after another in various industries as a result of reviewing the existing rules temporarily. For example, a local startup that handles online voting of residents that occurs in condominiums and other property management processes has seen an explosion in sales.
A variety of events are now held online, which made it easier for us to gather information from around the world. If you learn global-first-perspective and take it personally from an early stage, you will see a different view.
ーThe government initiatives are impressive. Now, Mr. Ebihara, please share the situation in Asia.
Mr. Takeshi Ebihara, Rebright Partners Pte Ltd.,
At the outbreak of COVID-19, the market was a bit of a mess. However, investment in seed and early stage are currently doing well and the listed markets seem to be so too. Because of the many social issues in Asia, I have a feeling that we will see an increase in social problem-solving startups providing robust value in the future, especially in the education sector.
In the past, an opportunity for investors and startups to meet have been based on face-to-face presentations, so the atmosphere and enthusiasm of the entrepreneurs have been perceived as important. However, as online communication becomes more and more mainstream, as it is today, the numbers and performance of a company become the proof of its strength. I feel that today’s startups are being asked to improve their ability while continuing to refine the essence of their services.
As we will continue to provide a variety of support as a pilot in Asia, we hope that you take on the challenge of global expansion now.
Senior Entrepreneur Lecture: The appeal of reality of Overseas Expansion in the U.S., Europe and Asia.
Mr. Takanobu Kawano, Vacan, Inc.
ーLastly, we would like to learn from three senior entrepreneurs who are doing business globally. First, Mr. Kono from Vacan, Inc..
We run “VACAN”, a portal site that allows users to check real time availability of restaurants, department stores and real estate. Founded in 2016, we now do business in Taiwan and Shanghai too.
China is a market with tremendous potential and the commercial sphere is rapidly expanding. As we manufactured hardware there, we thought there were advantages of managing our products with factories if we can enter Chinese market. The difficulty for us was the difference in cloud computing between Japan and China. The licensing system was so complex and I still remember how difficult it was.
However, as a result of our efforts to expand our services locally there, we became the first Japanese company to be selected for a government sponsored accelerator program in China and Taiwan in 2020. Going forward, we will provide the visualization services of congestion to create cities where local residents and tourists can safely live in and feel more convenient.
ーThank you. Next is Mr. Mizuno from Life is Tech, Inc..
Mr. Yusuke Mizuno, Life is Tech, Inc.
We offer programming education services for junior and senior high school students. It is established in 2010 and we have been working with a variety of companies and local governments to develop digital talent. In developing our services, we keep on approaching actively those with whom we would like to collaborate. In addition, by consciously sending out press releases when we collaborate with companies and local governments, we have more and more opportunities to gain new contacts and clients.
Owing to these efforts, we began test marketing in the U.S. around 2016 and in 2019 we established a base in the U.S.. However, COVID-19 caused us a significant delay in our business schedule, but we are finally able to start business there.
There are many unforeseen problems that occur when aiming for overseas expansion. This is where the most important thing is the passion of the entrepreneur or leader. If a leader with a strong desire deals with local business, the results you see will be different.
ーI see, the passion of the management team is an important factor. Lastly, Mr. Takahashi from Doreming Co.,Ltd..
Mr. Yoshikazu Takasaki, Doreming Co.,Ltd.
We offer Fintech related services which combine finance and technology. Our services are currently available in the UK, the U.S., India, and so on. It is estimated that there are two billion people in the world without a financial account, and since we found our company in 2015, we has been expanding our business to address social issues such as poverty and inequality.
Today, we have received high reputation from the United Nations and Nobel Peace Prize winner Mr. Muhammad Yunus as our philosophy is broadly shared. Also, we became the first Japanese Fintech startup to have an office in “Level 39”, the co-working space in the heart of London’s financial district. In Europe, the government faces the problem of refugees so we believe that we can play a big role through our financial services.
Each region has its own unique challenges. We work with external and local development companies to develop our services. Recently, we are receiving a number of inquiries from emerging countries like Africa. Let’s take on the challenge of solving the world’s social problems together.
ーAt the Kickoff event, we provided a wide variety of contents including the latest information on ecosystems in the U.S., Europe and Asia, as well as overseas expansion strategies for startups With/After COVID-19. Through various upcoming events, X-HUB TOKYO will continue to provide useful information for startups aiming to expand globally as well as the latest trends in open innovation.