Disrupting Japan

Bio-tech is messy because life is complicated. A lot of attention is given to computers sequencing genomes, but some of the most advanced and important work is done by studying and using other living things to make our own lives better. Kenta Yamato co-founded Kaico to commercialize a technique that uses silkworms to manufacture small-batch custom proteins. And Kico is involved with everything from veterinary medicine to Japan's search for a coronavirus vaccine. We also talk about the challenges or creating startups based on university technology and the one e-commerce model in Japan that just won't go away. I think you'll enjoy the conversation. Show Notes How to get proteins from a silkworm (It's not fun for the silkworm) Why silkworms, in particular, must be used The importance and uses of small-batch, custom proteins The start of a silkworm startup The most common (and least successful) Japanese e-commerce model Why it's so hard for Japanese universities to spin-out startups How Kaico silkworms are part of the fight against covid-19 How to scale a silkworm startup Links from the Founder Everything you ever wanted to know about Kaico Friend Kenta on Facebook Connect with him on LinkedIn A Kaico video explainer Leave a comment Transcript Welcome to Disrupting Japan, straight talk from Japan's most successful entrepreneurs. I'm Tim Romero and thanks for joining me. Today, we're going to be talking about worms. No, no, wait, don't go, I promise this is going to be really interesting. Today, we're going to sit down and talk with Kenta Yamato of Kaico, a Kyushu-based startup that is using silkworms to rapidly produce custom small-batch innovative proteins that are used for bio-research, medicine, and they play a part in Japan's search for coronavirus vaccine. It's a fascinating process but admittedly one that's not particularly fun for the silkworms themselves. We also talk about the most popular and most unsuccessful e-commerce business model in Japan, the challenges Japanese universities in spinning out startups, and we even cover some practical solutions to that problem. But you know, Kenta tells that story much better than I can, so let's get right to the interview. Interview Tim: So I'm sitting here with Kenta Yamato of Kaico, a company that uses silkworm to produce specific protein used in medical tests and vaccine, and thank you for sitting down with me. Kenta: Yes, thank you for me and I have a very pleasure to explain our company's story. Yeah, thank you very much. Tim: It's great to have you on the show. I tried to explain very briefly what Kaico does, but I think you can explain it a lot better than I can, so at like a high level, what does Kaico do? Kenta: We started Kaico two years ago in 2018. Kaiko means silkworm in English. Maybe you know silkworm can make silk for clothes, but we will use this kaiko silkworm for making proteins. We are a startup company from Kyushu University and our products are many proteins, the protein the other companies cannot make because it is difficult to make it. We make this protein by silkworm. Tim: So if I understand the basic process, you inject the silkworm with a virus containing the target gene, and then it makes the proteins as part of its silk, and then you extract the proteins from the silk? Kenta: No, no. First, we'll incorporate the gene of target protein into baculovirus, so this baculovirus is safe for us humans and animals, but baculovirus damage to only silkworms and we will insert this recombinant baculovirus into silkworm and their body can make the specific protein in their cell, and finally, we'll collect and purify the body liquid from the silkworm. Tim: Okay, so it's not from the silk, it's from the silkworms themselves that you extract the proteins. Kenta: Yes, we don't use silk. Tim: Okay. So why silkworm? Is there something about silkworms that makes it easy to generate proteins in this way? Kenta: Yes. Maybe other insects can make same like proteins, but silkworm is the only one insect not moved and it's very cheap. Do you know the price of a piece of silk? Tim: I have no idea. Kenta: A piece of silk a silkworm can make is $0.20 or $0.30, so very cheap, silkworm, and we can plant a huge amount of silkworm in a very narrow space. Tim: So the advantage of the silkworm isn't genetic, it's the fact that they just eat the mulberry leaves and stay put, and you can control them? Okay. Kenta: Yes, yes, it's very easy to plant silkworms. Tim: So what is the normal process for producing these kinds of proteins? Kenta: Normally, people use very huge tanks like beer tanks, silver tanks, but the silkworm is like a biologic tank, so very useful and convenient for us. Tim: So they're little bio-factories? Kenta: Yes, a bioreactor. Tim: Little bioreactors? Kenta: Yeah. Tim: So you mentioned it was cheaper to use silkworms, so how long does the process take and how much cheaper it is than the industrial approach of large tanks? Kenta: Maybe many industrial tanks need to study and develop for the production ways and process but we don't need the scale up period and money because we can make proteins from silkworm. One silkworm, we will make a huge amount of protein because we just increase the number of silkworms, so it's easy to increase. No need to study for scale up. Tim: Yeah, I could see why that would give you a lot of flexibility for producing small amounts or very flexible amounts of the proteins as you need. So what is the turnaround time? How long does it take from the time that you identify a target protein that you want to produce to the time that you've isolated and you have that protein in the bottle? Kenta: Our setup time is about one month, we'll make the recombinant baculovirus, and after that, we will insert this baculovirus into the silkworm in three or four days so they can make the target protein in their cells. So after four days, we'll pick up the protein from a silkworm, just only four days. Tim: Oh, wow, that's much faster than I imagined it. Kenta: Yes, but we need about one month to make recombinant baculovirus, so total is two months. Regarding COVID-19, we already developed the spike protein of COVID-19, so earlier this year, we get approval from the Japanese government to procure this COVID-19 and two months later, Kyushu University and our company had finished this research and we can get s-protein in May 10 or 15th, yeah, about two months. Tim: I want to go into more detail about the COVID research you're doing in a minute, but in general, what kind of problems does this solve? So I mean, everyone's talking about COVID right now but what other kinds of medical research and testing is this technology likely to be used in? Kenta: Oh, we are now developing the diagnostic product with partner companies and maybe in September, we can show our demo kits to the domestic markets, and next, our target is vaccine for coronavirus. Tim: Actually, before we get into the details on the vaccine and the corona, I want to ask you a little bit about your own background. You mentioned before you started Kaico in April of 2018 but your co-founders, it's based on the research of two very prominent researchers, but your own background is in economics and business, right? Kenta: Yes, that's right. Tim: So how did you end up starting a silkworm startup? Kenta: [laughter] Yeah, mysterious, maybe mysterious but my history is long. So after graduation from Yokohama National University, I joined Mitsubishi Heavy Industries. I was responsible for the ship sales and procurement for materials for ship building and power plants, and after 15 years, I decided to make own company, name is Burio and we were handling Internet products because I was in the Kyushu island in 2004 or 2005 and in these days, the first stage of Japanese Internet trade, so I built Kyushu local products, for example, Castella and the other product produced Kyushu. Tim: So like e-commerce selling Kyushu products? Kenta: So using Rakuten commerce, but very busy. We could sell the product but nothing profit because we need packing and dispatching, everything needed for manpower, so no - Tim: I think that is - yeah, that is one of the most common and most commonly failed e-commerce models. Everyone wants to sell like, interesting food and crafts from local hometowns. Kenta: We can sell but no profit. So two years later, I decided to return to salaryman, but I thought I want to make one more startup company and I watched a commercial, Kyushu University has a business MBA course for businessman, evening class and Saturday and Saturday class only, so I joined. In the MBA course, I met these professors, Kusakabe-sensei and Kamiya-sensei, and we talked about silkworms problem and silkworms merit, so I found this is very interesting business and this is very Japanese domestic science. Tim: Yeah, definitely very uniquely Japanese, I think. Was this like a university program trying to match business and researchers or did you just run into your co-founders socially at the university? Kenta: We had some classes in the university, industry and academic collaboration program and I joined this class and I was taught how to make a startup, so one of the selections is the startup company we will make, so I negotiated with these professors: please make our startup company. After that, these professors agreed. Tim: That's great. I mean, we're seeing more Japanese university spin-outs but they're still pretty rare, so it's great to see this working out. Kenta: Thank you very much. And one more matter is Dr. Kusakabe was willing to spread their technology worldwide but he wanted to stay in the professor's position in Kyushu University. He didn't want to be a businessman, so he said, okay, I will stay in university but you have to make a business. Tim: Well, that's - I mean, I think that is,

We have always loved maps. Maps combine artistry and utility in a way that very few disciplines allow. But of course, it's always been a trade-off. The beautiful, ornate maps from centuries past told you where the major landmasses were, but provided little detail. And today's GPS-based maps provide an unprecedented level of accuracy but uninspiring in their presentation. Machi Takahashi, founder and CEO of Stroly, has a best-of-both world's solution. We also talk in-depth about the unique challenges facing women founders in Japan, and what can be done to make things better for everyone. It's a great discussion, and I think you will really enjoy it. Show Notes Strolling with stories: How Stroly works How to make Google Maps community-oriented How Stroly pivoted to prosperity during Covid-19 How industry will be using VR after Covid-19 ends Why corporate spinouts are so hard in Japan Why Japan has problems commercializing fundamental research The challenges female founders face in Japan How Japanese women are taught they should not really be CEOs Why Japanese startups need to think globally Links from the Founder Everything you ever wanted to know about Stroly Connect with Machi on LinkedIn Women's Startup Labs Ari Hori on Disrupting Japan Leave a comment Transcript Welcome to Disrupting Japan, straight talk from Japan’s most successful entrepreneurs. I’m Tim Romero and thanks for joining me. One of the most common themes on Disrupting Japan is the intersection of tradition and high technology. Stories about what things that we’ve known and loved for generations can teach us about how we should use technology today. Now, I’m not sure how much of this is due to the fact that I personally find such startups fascinating and important, and how much of it is due to the fact that there’s something about Japanese startups and Japanese culture that encourages and appreciates these kinds of innovations. Well, today, we sit down with Machi Takahashi of Stroly and we discussed that while mobile GPS mapping is awesome, there’s something important that we’ve lost in our rapid adoption of that technology and it’s something that Stroly is bringing back. We also look into how COVID is not only changing things but changing some things for the better and how this is really a time for innovative startups to shine. And we also talk in some detail about the challenges women founders face in Japan and some simple ways to improve the situation. But you know, Machi tells that story much better than I can, so let’s get right to the interview. Interview Tim: I’m sitting here with Machi Takahashi, the CEO of Stroly, so thanks for sitting down with me. Machi: Thank you, Tim, for having me. Tim: Stroly makes custom maps that are overlaid onto Google Maps, but I think you can explain it a lot better than I can, so why don’t you explain briefly what Stroly is, how it works? Machi: Okay, sure. So, Stroly is our company name and also the name of our service and it means to stroll with story, so we came up with this idea to combine illustrated maps with GPS positioning while we were developing a new guide system for a theme park, and instead of choosing Google Maps, we chose to use this beautiful hand-drawn illustrated map of this theme park and we came up with this technology to combine these latitudes and longitudes on top of these illustrated maps. Tim: Okay, so when people are visiting the theme park, instead of looking at Google Maps or Apple Maps as they are wandering around the park, they would look at those kind of cute hand-drawn illustrated maps and they’d navigate on top of that? Machi: Right, exactly. So, we have this technology where we can adapt these GPS positioning on top of any kind of a map in any form so people can actually exaggerate some of the spots in the map, and then actually draw some of the spots in the map. Tim: Are most of your customers in tourism and entertainment? Machi: Yes, most of them are in tourism and also, some of them are in transportation and also in area development. Well, our platform is open, so you can start free and people can upload their maps themselves, so a lot of people who upload their maps themselves are not necessarily business customers, so they could be just some community leaders who want to show great things about their cities. But for the business users, it's mostly in the travel area. Tim: So you mentioned people can upload their own maps. How difficult is the system to use? Does it require… Machi: It's very easy. Even some people who work for, I don't know, like a library – I shouldn't say that, but I don't know – Tim: Non-programmers, non-programmers, yeah, that's right. Machi: Non-programmers, right, exactly, so it's very easy. People who draw their maps, they can upload the image of the map and they would have this correlation of positions on top of these maps, so they put some thoughts on the map and Stroly will show all the other places with GPS positioning. Tim: Oh, I see, so they would kind of like pin a few key points and then Stroly will sort of interpolate the others and so people can see their position on the cute illustrated map? Machi: Exactly. Tim: So far, you mentioned a few cases of the people creating their own maps. I mean, what kind of maps are they uploading? Machi: During this COVID-19, people actually suddenly started realizing how important their local business is. Some designers have started drawing their own city or their own neighborhood with the restaurants or the food stands where you can take your food out. So, some maps were made to empower these local communities or local businesses. Tim: Wow. Machi: That's something we didn't see before this COVID-19, so that was quite interesting. Tim: So from the consumer side, the user side, it’s just a chance to feel, I don't know, more connected or less standard, more special. Is that the – Machi: I think so because if you imagine like, moving into a new town and you have this map that shows how this small business is doing around your neighborhood or like these attractive places, small places where if you go into just one alley down, then you would find them, then it just makes your life so much richer and more interesting. Tim: You know, it is interesting because kind of the tourism apps, those illustrated maps, in a sense, they serve a really different purpose. Machi: Yeah, it does. Tim: Like, Google Maps has replaced a lot of kind of the street maps that used to be for sale at every gas station in the world, but in tourism, they never would use a street map, they always would use these kind of illustrated and fun, engaging maps, so there's definitely something there. Machi: Yeah, I think so. These maps have their own points of views. It kind of sets up the context of the city. With  this kind of viewpoint, you would start to see different things in the city. Tim: So, how do you get users onto the app? How do you get users using Stroly? How do they find out about it? Machi: Our service is not an app, it's a web-based service, so these maps actually work on the websites. We encourage these paper map creators to put a little QR code on their paper map so that people can actually read it and they can start immediately with their browser on their phones. Tim: So, this is like, really cool technology. It's fun, but what's your business model on it? How do you make money? Machi: We have this B2B service. If you are using Stroly for business, you obviously want to put your brand on top of these maps, and we help them put their logos on their maps and we also unlock the foot travel data, how these maps are used. Tim: Okay, so you've got a kind of data collection, data analytics component to this as well? Machi: Yes. The users, they have their GPS positioning on while they are using our map and we have analytical data of how people tend to use these maps. Tim: From your customers’ point of view, do they view the main value of Stroly as being the presentation, the ability to show these lovely kind of illustrated maps or do they see the main value coming from those data analytics? Machi: I think the first value comes from presentation of it, yeah, because you cannot control how Google Maps would look. Tim: Well, yeah, everything looks the same on Google Maps or Apple Maps, right? Just, everyone in the world has the same presentation and that's useful too, but it's not good for branding. Machi: Right, right, exactly. First, it's the presentation and nowadays, because of COVID-19, users cannot come to their park or cannot come to the areas. Tim: Yeah, that is something I wanted to ask you about, and since your business is so focused on tourism, COVID-19 must have had a huge impact on your business and your startup. Machi: Yeah, it did. Well, kind of hit directly to our clients and we were actually planning to have a lot of things coming up for the Olympics and Paralympics, of course. All these got canceled and we had to develop our service so that we can help our clients stay connected with their users. Tim: How do you do that? Because I mean, Maps is such a – you know, it's such a… Machi: I know. Location-based [crosstalk]. Tim: I can't think of anything that is more directly like being there, right? Machi: But the thing is, we said Stroly maps are more about branding or just communicating how great the place can be to the users. So, what we did is that we've created this virtual map service where people can actually come into the map with an avatar and there is a tour guide who is standing in the map showing around how the park looks like. Actually, we have this one experiment with the theme park already, the same theme park, and they've filmed the movie in the themepark so that this guide person of this virtual map can show around where this film was taking,

You don’t usually think of Japan’s geisha as being an industry, but it is. In fact, strictly speaking, it’s a cartel. A cartel that is now being disrupted by internet-based booking agencies and low-cost substitutes. It seems that even geisha are not immune to internet-based disintermediation. In this special interview Sayuki, Japan’s only geisha who also holds an MBA, explains the business model behind geisha. We talk about the way things used to be, the current threats that have many geisha concerned that the traditional art form and the lifestyle will not survive, and how some geisha houses are trying to adapt. This is a rare, behind the scenes look at the business of being a geisha and a chance to see how Japan’s geisha might survive and even thrive in the coming digital age. It’s a fascinating discussion, and I think you’ll enjoy it. Show Notes for Startups How Sayuki broke 100 years of tradition to become a geisha How geisha are being challenged by both the entertainment and tourism industries Changing geisha from a private art to a public one Why geisha might not survive the modern era of tourism The geisha cartel is being challenged, and why that's not good for anyone The challenge modern geisha face on social media The changes in training for the next generation of Japan's geisha Links from the Founder Sayuki's home page  Follow her on twitter @sayukiofasakusa Become her patron on Patreon Follow her on Facebook Book a geisha experience Geisha Banquet in Tokyo Private Custom Shopping Tour with a Geisha Private Lunch with Sayuki Kimono Shopping Tokyo Tour [shareaholic app="share_buttons" id="7994466"] Leave a comment Transcript Welcome to Disrupting Japan. Straight talk from Japan's most successful entrepreneurs. I'm Tim Romero and thanks for joining me. I’ve got a great Selects show for you today. We sit down and talk with Sayuki a geisha. An actual geisha. and she also holds an actual MBA from Oxford. It’s a great conversation that breaks down the business model of running a geisha house, and it's a lot more complex than you might imagine. A lot of people talk about disrupting traditional business models, but this is a truly traditional business model. And we also talk about how the Internet and social media is threatening to complexly destroy it. There are a lot of people wondering if geisha will survive this. In fact, there are a lot of geisha wondering if geisha will survive this. It’s a story involving centuries-old cartels in new turf wars, counterfeit goods knowingly being sold over the internet, and the challenge of getting maiko off their social media accounts long enough to train them. Although that last one is both a problem and a potential revenue stream. Anyway, please enjoy the conversation, and I’ve got an update for you at the end of the show. Intro Today I’ve got something really special for you. We are going to talk about the kind of business that you’ve probably never heard any details about. Today we’re going to sit down and interview Sayuki, a Geisha. And since this is Disrupting Japan, we’ll be talking about the business side of being a Geisha. We’ll look at the Geisha business model and examine how it’s being disrupted by modern technology. And believe me, it really is. Now, listeners outside Japan might not understand how special this opportunity is. Traditionally, Geisha are not really supposed to talk about their business. Geisha create the illusion of comfort, beauty, and elegance, that is unsoiled by such base things as money. But make no mistake about it; it’s an illusion. Geisha is a very serious business and Sayuki, who also has an MBA from Oxford, has agreed to sit down and walk us through it. In fact, from a business point of view, Geisha are an established cartel that are being disrupted by new technology, the internet, and tourism websites in particular, and by low-cost substitutes. And there’s a very good chance that Geisha will not survive in their traditional form. In fact, many Geisha houses are proactively trying to adapt to this new market environment. But Sayuki tells this story much better than I do, so let’s hear from our sponsor and then get right to the interview. [pro_ad_display_adzone id="1404" info_text="Sponsored by" font_color="grey" ] Interview Tim: So today we’re sitting down with Sayuki, who is a bonafide Geisha here in Japan and we’re going to talk about the business of being a Geisha, so thanks so much for sitting down with me today. Sayuki: Thank you. Tim: First and foremost, a lot of our audience is either in Japan or knows a lot about Japan, but a lot of people don’t, so before I get started for the business can you clear up exactly what a Geisha is, what they do now, what they used to do? Sayuki: A Geisha means arts person, literally. So Geisha are traditional dancers or musicians, and most of the entertainment that we do is private entertainment. So we go to dinners and parties, which are usually in private rooms, and not large-scale public performances, although we also do those occasionally. Tim: Okay. You’ve been a Geisha now for about 10 years? Sayuki: Nearly. Getting there. Tim: Wow. Okay, so since this is an audio podcast, I should explain that you are Caucasian—you are not Japanese, which makes you very unique and I’m sure appealing in the world of Geisha. But can you back up a bit and tell us a story of why on Earth you decided to become a Geisha and how you managed to do it? Sayuki: Sure. I’m an anthropologist. I got my doctorate from the University of Oxford, and graduating, I started to lecture in Japanese studies, and also to make documentary programs for television for broadcasters like BBC or National Geographic Channel. And I took a slate of ideas one day to National Geographic Channel, including ideas about infiltrating the mafia and all of those kinds of things. And one of those ideas was to make a program about Geisha. Tim: So you started to infiltrate the Geisha? Sayuki: Instead, yes. Tim: Which sounds a lot more interesting and safer than infiltrating the mafia. Sayuki: My life could have taken a very different turn. Tim: I imagine so. I mean, but especially as an Australian, you can’t just decide, “I want to be a Geisha.” How did you get connected? How did you find someone willing to take you on? Sayuki: I looked first among my alumni and I was the first white graduate—the first female white graduate of Keio University in Japan, and it’s a school with a very strong alumni network. And it came in very handy in the Geisha world because many of the tea house owners are Keio graduates, many of the customers are Keio graduates, and it was a really great network, and they really looked after me and helped introduce me to the Geisha world. So I was very lucky in that sense. But it’s true that you can’t just walk into the Geisha world. There’s a lot of misconceptions. There was an American anthropologist in the 70’s, called Liza Dalby, who wrote an absolutely amazing thesis about the Geisha world, after researching in Kyoto for a year. She was living in the house of an ex-Geisha and somewhere along the road, in her research, they dressed her up and sent her out to a banquet to experience what it was like. And she wrote her thesis on the basis of that research. And some people have made the assumption that she became a Geisha because of that, but it’s actually very different to actually become a Geisha. For example, in Kyoto, to become a Geisha, they would have to change their rules, their constitution, to allow a foreigner in for the very first time in Geisha history. And that would be an absolutely major affair, as it was for me. It needed the agreement of all 45 Geisha in the Asakusa and of all the people who are connected to the Geisha world, and it was a very major decision, and there was absolutely no way possible that Kyoto would have made this decision in the 70’s. Tim: I’ve been in some hard negotiations before, but how did you manage to convince 40+ different Geisha houses to make this change? Not only accepting a westerner in but accepting—most people start off the Geisha training very young girls, right? So that’s a really big deal. How did you get them to make that change? Sayuki: I think I was really lucky and I had very good introductions and those people worked very hard on my behalf. Asakusa is a very conservative, very old fashioned district and a lot of people realize that Tokyo is very much more conservative in many ways than Kyoto is. Kyoto is very conservative in the look and the way they do things but they have many modern business methods that Tokyo still doesn’t have. So in that way, Tokyo is still very conservative. In that way, I think it’s surprising that I got permission to debut in Asakusa, knowing now what I know about the Geisha world. There’s other misconceptions that people make. They think that I opened the door and now suddenly the Japanese Geisha world welcomes foreigners in. That is very far from the case. That’s not true at all. To get in a proper town district now would be equally as difficult now as it was when I debuted 9 years ago. Since I debuted, there have been a number of foreigners who have worked as a Geisha in the countryside, or in former seaside resorts, or Geisha districts that have very casual standards, and they’re not at all the same thing as town districts. In some of those districts, they have fewer Geisha than they used to have and they have a lot of need of Geisha for tourists who suddenly come in at certain times of the year. So they recruit part-timers and all kinds of casual people. Tim: Geisha is not really a part-time job. In the town that—see, there is a very big divide between a town class Geisha district and a countryside, or seaside, or former lodging town.

They probably mean well. They are telling you something that is easy to understand and that seems like it's true at first, but it's still a lie. I received an overwhelming response to my recent episode on success via public humiliation, and more than a few people tried to set me straight about how Japanese keigo is supposed to be used, so today I'm going to return the favor. Don't worry, this is not a Japanese lesson, at least not in the pedantic sense, but it might clear up a few of the lies you've been told, and perhaps even repeated about how honorifics are used in Japan and in Japanese business in particular. Please leave a comment because I would love to hear your thoughts on this. Show Notes Feedback on Failure How you are being lied to Why keigo is not about social status or individual respect How to insult by being polite Actually showing respect Leave a comment Transcript Welcome to Disrupting Japan, straight talk from Japan's most successful entrepreneurs. I'm Tim Romero and thanks for joining me. While the coronavirus lockdown continues to disrupt Disrupting Japan’s production schedule, whatever stage of lockdown or reopening you might be in right now, I hope you're doing well. Today I’m going to point out something that every Japanese language textbook I have ever seen gets completely wrong.   Feedback on Failure But before that, I want to thank you for all the emails and messages you sent in response to last month’s episode on how public humiliation has been my secret to success in Japan. It was a hard one to make, but it seems like it really resonated with a lot of listeners, and the feedback was really overwhelming. So, thank you for that. There was also, however, some comments about my difficulties speaking keigo and my description of it as a “mind-boggling complex protocol of honorific and humble forms whose use depends on a non-linear, three-dimensional matrix of formality, in-group out-group status, and the role you are playing in that particular interaction.“ OK. I admit I was a bit overdramatic there, but quite a few people emailed to tell me that keigo was actually quite logical and very straightforward as long as you keep in mind a few simple rules. It is something, they asserted, that can be mastered in a few years of serious study. OK. Yeah, maybe. But it’s interesting to note that all the emails telling me how easy keigo is, came from non-Japanese. Among the emails I got from my Japanese fans, only two mentioned my keigo comments at all, and they both sympathized, saying that they also make mistakes sometimes. In fact, one of them even mentioned that she can’t understand why anyone thinks rakugo is funny either. So hey, maybe it’s my sense of humor, and not my language ability that’s the problem here. But to those non-native speakers claiming keigo is simple and straightforward. Well OK, perhaps you have a gift for it. Perhaps its really clicked for you. You almost certainly have a better command of it that I do, but maybe you should consider, that just perhaps, you don’t understand it as well as you think you do.   How you are being lied to In fact, I will go further than that. Every Japanese language textbook I have ever seen completely misrepresents both what keigo is and how it is used. It’s almost always defined as a “means fo showing respect to individuals with higher social status”. And that’s just wrong! It is not about showing respect to individuals and it has nothing to do with social status. Sure, that definition might be useful for people with short attention spans or who know little about Japanese society. But fortunately, Disrupting Japan listeners have proven themselves as having long attention spans and they know a thing or two about Japanese society. So let’s dig into this. If you are a non-native speaker, by the end of this short episode, I promise you’ll have a new way of looking at keigo. OK. We are going to tackle this social status nonsense first, but before that, we need to remember that Japanese culture highly values protocol and the Japanese language, naturally, reflects this. Keigo, and polite language in general, is best understood as part of this overall protocol. And just like the rules that govern behavior and speech in military protocols and diplomatic protocols, the rules for keigo are complex and sometimes kind of arbitrary, but it’s important that the protocol be followed for everyone to get along.   Why keigo is not about social status or individual respect And despite what your language textbook may have told you, the part of the keigo protocol you follow is absolutely not based on social status. It is determined only by the role you are playing in that particular interaction. Let me give you an example. Let’s consider two people of radically different social status. Let’s say an unemployed construction worker and the president of a major Japanese bank. There is no question who has a higher social status here. The gap is extreme. But if the two happened to meet while our friendly construction worker was making a withdrawal from an ATM, the bank president would address him in honorifics. Because the roles they are playing at that moment are that of vendor and customer, and protocol dictates that the vendor addresses the customer in honorifics. And our bank president would not in any way feel odd or reluctant to do this. He would do so naturally and enthusiastically. Not doing so would be considered, ill-mannered, boorish, and unthinkable for a man of good sense and family. Because his use of keigo has nothing to do with his social status. It’s determined solely by the role he is playing in that particular interaction. Now, I’m going to take you further away from your textbooks here and tell you that, in most cases, keigo is emphatically not about showing respect for the person you are talking to. And once you start seeing keigo as a protocol, this becomes more and more obvious. Oh, you are showing respect to something, but not the person you are talking to. The protocols that govern Japanese language and business are complex, but in my experience, there is one group of Westerners who seem to pick them up pretty quickly. Those who used to be military officers. Military protocols and Japanese business protocols are completely different, of course, but maybe spending a few years living inside one set of complex protocols makes it easier to transition to a new set of complex protocols. Actually, military protocol is useful as a way of thinking about keigo. When an officer salutes a superior, they are not showing respect for that individual. Hell, they might think that particular officer is a complete asshole! It doesn’t matter, the salute shows a respect for the protocol. It shows respect for the system. It’s the same way in Japanese. When you use honorifics, you are usually not showing respect for the individual you are addressing, you are showing respect for the protocol, for the system. You are showing respect to the whole idea of a polite, ordered Japanese society. But, of course, there is more to it. Not using the protocol has meaning too. There are many people I speak to in honorific, or at least polite, protocols in public, but speak to casually over coffee or a beer. Dropping the protocol signals, “Hey, it’s just us friends here. Let’s talk.” Our relative social statuses have not changed, but the roles we are playing at that moment have. I’m not showing any less respect for my colleague here, and he’s not showing me any more of it. He’s saying this in this conversational setting we are playing different and more equal roles. It’s a sign of closeness.   How to insult by being polite And this is why you can actually insult people in Japan by being too polite. You see this in retail all the time and in business fairly often. When someone rigidly follows protocol, even the little details that everyone normally lets slide, it signals the opposite of closeness. It signals distance. It’s a way for someone playing the lower role to say “I respect the system. I respect the protocol, but I have no particular opinion about you.” In fact, years ago, when I was still new to Japan I ran into this a few times when talking to staff in department stores. My Japanese wasn’t very good at the time, and shopping could be a frustrating experience. On a few occasions, the clerks sensed this frustration and switched to an even higher level of formality. Now this, was very bad for two reasons. First, as Japanese speech gets more polite and honorific, it gets more abstract and indirect, which makes things even harder to understand. Second, as Japanese speech gets more polite and honorific, sentences get a lot longer, and people inevitably compensate for this by talking much faster, which makes things even harder to understand and more frustrating. And so, this protocol results in a vicious cycle of misunderstanding, frustration, and escalating honorifics. And the only way out was for me to take a deep breath and say, in the politest Japanese that protocol and my ability would permit. “I’m sorry. I’m having trouble understanding the pricing. Do you have a piece of paper? Maybe we could write it down.” After a few tries, the clerk would usually oblige and drop down into the lowest level of formality and politeness that protocol would permit, and we’d slowly work things out. Now, in this situation, it would have been completely unreasonable for me to ask her to speak to me in regular or polite Japanese. That would have been a rude request. It would be a huge violation of protocol and would have made her look bad in front of anyone who overheard our conversation. Only when I tried to meet her half-way was she conformable enough to deescalate the politeness and try to actually help me out. In Japan,

Oracle first came into Japan more than 25 years ago, but the challenges they faced and overcame then are exactly the same ones firms are facing today in executing their Japan market entry. Allen explains why Oracle needed a unique sales and marketing strategy for Japan, and how he managed to get buy-in from headquarters — even though Oracle already had a sales and marketing program that had proven fantastically successful in other markets. We also talk about how Oracle managed to negotiate a amicable exit out from their exclusive distribution agreements not just once, but twice. That’s an amazing accomplishment considering that many foreign companies have destroyed their Japanese business the first time they attempt it. But Allen, tells the story much better than I do. I think you’ll enjoy the interview. I know I did. [shareaholic app="share_buttons" id="7994466"] Leave a comment Transcript Welcome to disrupting Japan. Straight talk from Japan's most successful entrepreneurs. I'm Tim Romero, and thanks for joining me. Update Japan is slowly opening up again. The official “unofficial” lockdown ended at the beginning of June. Restaurants, bars, and shops are reopening with a lot if plastic curtains and sheeting separating patrons and proprietors.  It’s a long way from normal, but it's better than being stuck in the house. International travel is mostly shut down, but domestic travel is really picking up. It seems most of the hotels and resorts in Okinawa are already booked solid for the summer by Japanese who would normally be flying to Hawaii. And Okinawans, grateful for the business, but still nervous about the virus, have some pretty mixed feeling about that. And of course, with international travel shut down, and all the trade shows canceled, most foreign startups have put their Japan market entry plans on hold. And that’s normally a lot of activity. If you are a B2B startup you need to be looking at Japan. It can be a hard market to crack, but it’’s a lucrative one. So today, I want to re-share what is one of the most amazing Japan market-entry stories of all time. It has ambition, misdirection. drama, serious career-risk, and rock-concerts.  It’s an old story, but a good one. The technologies have changed since then, but the challenges and the strategies haven’t. Intro To kick things off today, we’ll get a chance to sit down and talk with my good friend Allen Miner about the challenges Oracle faced, and overcame, when breaking into Japan. I’ll warn you in advance that this episode is longer than most, and believe me, I cut things to the bone. But there is just too much great information about how to overcome both the personal and professional challenges that foreign companies face here. I felt like I would be cheating you if I edited out any more. In fact, Allen explains how Oracle successfully maneuvered out of an exclusive distribution agreement, not only once, but two separate times. This is something that has sunk more than one foreign company here. But Allen tells the story much better than I can, so let’s get right to the interview. [pro_ad_display_adzone id="1411" info_text="Sponsored by" font_color="grey" ] Interview Tim: So I’m sitting down here with Allen Miner and Allen, you’ve been involved with the market entry of a lot of companies into Japan. But today I want to focus on the one that you led personally, which was Oracle Japan. So let’s back up. What was attractive about the Japanese market? What made Oracle decide that they needed to be in this country? Allen: Actually, that happened a few years before I joined Oracle. In, I believe it was 1982, Oracle was about a $5 million a year company worldwide, 5 years old as a company, and just released their first commercial version of the Oracle database software. There was quite a bit of press about, “How interesting is this relation to technology? It doesn’t require traditional programming to do data manipulation.” And the U.S. press got read by some technical geeks in Europe. And one in particular in Japan said, “This sounds really interesting. We ought to figure out if we can bring this cool new technology to Japan.” Tim: So it was a partner company pulling you in? Allen: Yeah, it was a company called Digital Computers Limited, that at the time was building DEC VAX clones. Because Oracle originally was released on the DEC VAX computer platform, the president of that company, a gentleman named Mr. Yamada had read an article about it. So this is when we reached out to Oracle and see if we can sell their software in Japan and that contact from an interested Japanese distributer was what got it all started back in 1982. Tim: Okay. Even today, I think that still a really common case. Allen: Yeah. I think it is. For companies that come into the market early, perhaps earlier than they are really ready, I think that’s the most common. It’s very common for a young company with really interesting technology to be found by someone in Japan, or other countries of the world. Everyone knows that Japan is potentially a big market. I don’t think there’s a question of the potential opportunity or the size of the potential market in Japan, but often it is the trigger of, “Oh, someone is interested in our software in Japan.” Tim: But it seems like that could really be a two-edged sword. Oracle was not a small company at that point. Allen: No we weren’t. It was 5 million in revenue, maybe 60 people. There was no international division at the time so the person who took the inquiry was one of, I think, 3 or 4 U.S. sales representatives. Tim: How did you guys vet this company? How did they make sure it was for real? Allen: The president and one of his technical staff, I understand, flew to Oracle’s headquarters in California, met with the sales team at length. I’m sure that because they were clearly well-informed about the DEC VAX environment, they had customers for their computer products, they clearly had some kind of understanding with what you could do with a relational database that I think was some technical vetting, maybe not a lot of time spent on what they might be able to do in the marketplace. I’m not sure that Oracle really, at that point, had really figured out how it was going to grow the market. Tim: So it just was a good strategic fit and it was a market they couldn’t have addressed anyway, so let’s give it a try. Allen: They weren’t even actively pursuing international opportunities yet so I think our initial entry into England, the Netherlands, and Japan all started that way, with some local geek who was always staying on top of the latest technology trends reaching out and saying, “We’d love to distribute your software in our country.” Tim: All right. So things obviously went well for them. They sold the product. Allen: Yeah. Tim: How did you get involved? When did they bring you on board? Allen: Well, as Oracle continued to grow, we expanded the platforms that the product ran on. It was initially on the VAX, then we introduced UNIX platforms, the PC, and even IBM mainframe computers. As we were expanding the platforms for Digital Computer Limited, the UNIX environment and the VMS environment were quite comfortable. But when we wanted to introduce a mainframe product, they didn’t know anything about the IBM space, they didn’t want to get involved with the IBM space, and by that time we had hired a vice president of international. I think he had one or two staff and their company was maybe a couple hundred people by then, worldwide. The decision was that we were now proactively trying to grow the business internationally and if the distributor in a particular country was not interested in the mainframe product, we believed at the time we were going to have a huge business in the IBM mainframe world. Turned out not to be the case but at the time that was what the folks in Oracle believed and because Digital Computer Limited didn’t understand, didn’t want to pursue the mainframe space, the decision was made to identify a second distributor in Japan that would focus on the mainframe products. This was in 1986 that this work was going on—or 1985 rather—and we added a second distributor called NESHEEN Products that had experience with the product out of Germany. Tim: So for the structure of this, did each of these distributors have an exclusive right to resell the product— Allen: So Digital Computer Limited had exclusive rights around the VAX line of computers. NESHEEN Products had exclusive rights around the mainframe and both companies were free to sell the UNIX and PC products. Tim: Okay. This is a challenge I think a lot of companies get themselves into coming into Japan, is if you give a distributer exclusive rights, and they’re successful, you’re going to want to come into the market yourself and that’s exactly what you did. Allen: That’s exactly what happened with Informatic. Tim: How did you deal with that? How did you kind of change the game for these exclusive arrangements you had? [pro_ad_display_adzone id="1652" info_text="Sponsored by" font_color="grey” ] Allen: Well, I think—remember we had the two distributers in Japan with distinct sectors of the market. I think between the two of them, the fact that we had those two distributers and we did not have a Japanese language product at the time, and the two distributers apparently were arguing about what the specs should look like and which of them should be authorized to build it for Oracle. Which of the two were technically more competent to advise us on building a Japanese version. That is the situation in which Oracle came and interviewed me on the campus university, and when they noticed that I was not only a computer science student, but I spoke Japanese, the recruiter said, “We want to hire you.” He said, “Oh, I see you speak Japanese.” I said, “Yes,

You would expect that event-focused startups would be some of the hardest hit by the global pandemic and lockdown, and for the most part, you would be right. But Peatix is one event startup that adapted fast and is now actually thriving during the lockdown.  We've talked with Taku Harada before, and if you have not done so already, you should check it out. It's a great conversation and there is no overlap with today. Today we talk about how startups can pivot and survive during the pandemic, why having too much money can be a curse for startups, and we dive into what's gone wrong with Japanese B2B SaaS startups. It's a great discussion, and I think you will really enjoy it. Show Notes How an evets company pivots during Covid-19 What makes a good online event Will people play for online events What will be the long-term behavioral changes from the lockdown The surprising secret to scaling a social network Tips for Japanese who want to run an international startup The trap of startups having too much funding What's wrong with Japan’s SaaS companies Why Japanese enterprise has too much influence on startups The importance of an ecosystem is not what you think  Links from the Founder Everything you ever wanted to know about Peatix Friend Taku on Facebook Follow him on twitter at @takumeister Petix on YouTube Leave a comment Transcript Welcome to Disrupting Japan, straight talk from Japan's most successful entrepreneurs. I'm Tim Romero and thanks for joining me. Today we get a chance to sit down with (at a very safe social distance) with Taku Harada the founder of Peatix, and we’ll talk about how this particular event planning and booking company is not only surviving but thriving during this covid crisis. And hey, this is the very first DJ episode I’ve released, where I’ve interviewed someone over video conference.  Oh, I’ve recorded a few interviews that way them before, but I’ve always found something lacking. Something impersonal and not fully connected when you talking to an image on a screen rather than a person in the same room. But this time was different. Maybe because Taku and I are old friends, or maybe just because we all, myself included, are getting more used to living our lives online. So we’ll be doing more interviews this way, at least until things return to the way they were in the before times. This is actually the second time we’ve had Taku on the show, but this is all new information, and I strongly encourage you to go listen to the other interview. It’s a great discussion about the things no one ever tells you when you first start your startup. I’ll have a link to that episode up on the site But today we are going to talk about how to build, and expand, your customer base during lockdown, some things you should know about fundraising right now, and what the hell is wrong with Japanese B2B SaaS companies. But you know Taku tells that story much better than I can, so let's get right to the interview. Interview Tim: So, I’m sitting here with Taku Harada of Peatix, the event ticketing and promotion service. Thanks for sitting down with me. Taku: It’s great to be back, I guess. We talked several years ago. It’s nice to see you again. Tim: Likewise, and we’re being very appropriately socially distanced here, you being in New York. Taku: Very much. Tim: Yeah. Yeah, actually, you were one of my very first guests on the show and that was, man, almost six years ago now. Taku: Was it six years ago? Tim: Yeah, 5 ½, six years. Times change. Taku: When was it, 2013 or so? I’m curious to find out what I had said back then, if it matches up with the way I’m thinking right now. Tim: Yeah. We finished off a bottle of wine at the old engine yard office in Tokyo. Taku: Yeah, an Ebisu, right? Tim: Yeah. Now, it was a really great interview and we’re not going to cover the same ground again today although I mean, you talk about some great stuff in terms of like founder motivation and more reasonable expectations for this journey. Taku: That would have been maybe a year and a half or maybe even close to two years after we started Peatix, I hope I’m not going to contradict myself today too much, but let’s see how it goes. Tim: Well, no, that’s actually what I’m – well, not hopefully you’re going to contradict yourself but I think this is like this really awesome chance to kind of check in and see how the predictions and strategies played out and where you had to pivot because I don’t know, there’s this big mess of like entrepreneurship being this study journey from point A to point B, and it’s nothing like that. Taku: No, no, it’s a lot of ups and downs, it’s uphill all, you have to go downhill and just go left and right, and somehow, when you look back, okay, maybe you are in a higher place than you were before. It’s never a linear straight line as you know. Tim: Yeah. Well, actually, let’s jump right into it. I mean, the biggest thing that’s coming to mind here is that as a start of focused on event planning, I mean, COVID must have really had quite an impact on your business. Taku: This was as it was for most people, I’m sure, totally unexpected. Boom! Everything hit, but I would say, what was it, late March? I remember specifically when the Tokyo Marathon was canceled towards the second half of March. That was when everything hit us, all the events that were on our platform, they started to get canceled and we had to do all the refunds, and everything just turned upside down, and then the second tsunami, so to speak, was first week of April when Japan declared its national emergency, and that was just our world had totally turned upside down. Tim: So, how does a company that is just built around these live events, how do you develop? How do you adapt to something like that? Taku: It felt like, let’s see, let’s see, maybe a week of total panic, not knowing what to do, and then several days of sort of a very low point which was just being depressed and wondering what the hell we are supposed to do. But then, gradually picking ourselves up and just thinking about where the market would go. Thankfully, the majority of Peatix, the events on Peatix, they are not the sort of the large-scale sports or music entertainment. The majority of our events were a longtail community meet ups and whatnot. We did see that it would be relatively easier for these kinds of events to go online. We saw an opportunity there, we figured it out and said, what we could do is sort of tweak the platform a bit, but really, a lot of communication to our customers, communicating to them that okay, this is how your communities is survived by taking things online. Tim: So, were you just like, proactively reaching out to your customers and saying, “Okay, now, it’s time to move everything online, and here’s how you do it”? Taku: Yeah, so people were just canceling their off-line events, we took the stance of being very proactive in supporting those efforts and communicating to our customers how to cancel your events, how to do the refunds. We figured that okay, the very least we can do is to try to build trust with our customers, so that was that phase, and then once we figured out that the online strategy, I was proactively going out there talking to the customers, “This is how you should go online with your events online.” We launched an online event series by ourselves, just as a showcase, so to speak, and this thankfully has thousands of viewers and listeners every week. Just positioning Peatix as your go-to platform for your online events, and very quickly, all these events started to sort of flood our platform during April. Yeah, we are in a very sort of good place right now. Tim: So, everyone adapted pretty quickly then? Taku: Yeah. Tim: So, what makes a good online event? I mean, I’m sort of like old school and even – you and I are doing this online now, but it’s not the same as sitting across the table and drinking wine together. Taku: Yeah, no, I mean, think folks are still trying to figure everything out, not everything is perfect – there are a lot of technical glitches along the way but because it’s such a transition area., I think the participants are always, they tend to be a little weekend. Okay, maybe because of connectivity issues, the event might go down for a couple of minutes or so but it’s not like oh, everybody is pissed off and yelling and screaming at the organizer. People are a little more receptive and patient with things. In terms of format, Zoom, the typical event that we see on our platform is using Zoom speakers, just talking about the topic of their choice within their communities, so that communication among the participants and the organizers and how to bring that online and how to bring that sense of conductivity. It continues to be a challenge but there are various tools out there and we are really amazed with how creative people are in trying to replicate the experience online. Tim: So, are people willing to pay to attend online events? Taku: They are, so pre-COVID, I would say maybe 60%, 70% of our events were paid events. Typically, $50 or ¥4000-¥5000 would be the ticket price for these paid events. In the post-COVID world – not “post” but during this COVID world, maybe only 30% of the events that we have are paid events. Tim: But that’s still pretty high. Taku: It’s still pretty high. Tim: All things considered, yeah. Taku: Yeah, and the average ticket price is much lower than the pre-COVID days, maybe even half – let’s say ¥2000-¥3000, maybe not even ¥2000. That is the average ticket price, so we have to make it up to the volume, obviously, and the volume is catching up, thankfully. Tim: Aww. Taku: Yes, people are willing to pay, and that mix continues to go up, so it’s about 30% today. I think we’re going to see that mix go up higher over the coming days. Tim: Alright.

I've never managed to find a direct road to success. My bio reads like a random walk down many different career paths, so I always feel unqualified to answer when people ask me for career advice. Today, however, I'd like to share one insight about doing business in Japan that I learned the hard way. If you've been through something like this, I hope you'll be able to identify with it. If you haven't, I hope you can learn something from it, and avoid it. Please share your experiences in the comments. Show Notes More life lessons from Mark the Dog Japanese fluency is an odd target What's worse than any horror movie plot? Success via humiliating failure How good does your Japanese need to be to do business in Japan? Leave a comment Transcript Welcome to Disrupting Japan, straight talk from Japan's most successful entrepreneurs. I'm Tim Romero and thanks for joining me. Today I want to tell you the story about one of the most embarrassing and publicly humiliating events of my life, and something very important it taught me about doing business in Japan. Before we get to that, however, I received a lot of great feedback from the last episode on the Japanese trap of the Glorious Failure, including a number of Japanese listeners who said they really liked Taniguchi-bucho’s explanation of corporate Japan’s negative point system. (More) Advice from Mark the Dog But by far the most popular request was for pictures and more life lessons from Mark the Dog. Well, OK. I’m going to do that, but please understand that this is not a very deep well. There is only so much Mark the Dog can teach us about how we should live our lives, because after all, Mark the Dog, is … well, he’s a dog. So I’ll put a couple of pictures of Mark the Dog on the website, (Yes, he is very cute), and I’ll let you know that there is, in fact, one more thing that Mark the Dog has taught me during the ongoing lockdown. Mark being a good boy. This was my wife's idea. Meet my PA, Mark.   You know how dogs get really excited every time they hear a little noise outside or see something move past the window? Or how they become nearly hysterical whenever someone rings the doorbell or comes to the door? Well, I get that now. I totally understand where dogs are coming from on this. The other week two pigeons landed on my window sill, and I got way more excited about that than I probably should have. So hey to all the world’s dogs; we're cool on the doorbell thing. No judgment here. OK, back our main story about my path to success via public humiliation.   Japanese fluency is an odd target One of the things people always say when they find out I’ve been living in Japan for almost 30 years is “Wow. How good is your Japanese? You must be fluent!” I never really know how to answer that. I’m definitely not fluent. I mean, I’m not trying to be overly humble here, my Japanese is good. I manage staff in Japanese. I do sales in Japanese. I do presentations in Japanese. So it’s good. But fluent? No. Often when I try to explain a complex or abstract thought, I manage to get lost before I find my way to the verb. I can’t get into a heated argument in Japanese. And I usually don’t understand most of the jokes. My wife loves rakugo, which is a popular Japanese form of comedy storytelling. They are these long shaggy-dog stories that people find hysterical, and I can understand 100% of the story, but I can’t for the life of me see how any of it is funny. And then of course, there is keigo. The mind-boggling complex protocol of honorific and humble forms whose use depends on a complex three-dimensional matrix of formality, in-group out-group status, and the role you are playing in that particular interaction. Frankly, once I get past basic greetings and a few set phrases, I tend to screw it up pretty badly. But, as I mentioned, keigo is hard, even native Japanese speakers mess it up sometimes. Not as bad as I do obviously, but still, it’s hard, and I usually get something wrong. But the funny thing is, that seems to be OK. In Japan, you get a lot of points for just trying. People really appreciate a genuine effort to get it right even when you end up getting things very wrong. Sincere intention counts for a lot. But anyway, why so much information about my Japanese ability? Well, you need to understand that for the rest of our story to make sense.   What's worse than any horror movie plot? And so, this brings us to one of the most humiliating experiences of my life. And I am not exaggerating when I say that. I literally had nightmares about this event for months afterward. So I’m sharing this hoping you can learn from my mistakes because I would not wish this experience on anyone. OK. So what happened? This was about seven years ago when I was the Japan CEO for an American software startup, and I had the chance to give a presentation at a startup and investment conference. No problem. I do presentations in Japanese all the time, and besides I had over a month for me and my staff to put the speech together and for me to practice and polish any rough edges. I was psyched. I mean this was actually an amazing opportunity. I was being given 20 minutes to address an incredibly important audience of Japan’s leading investors, startups, and the press. There would be about 1,000 people in attendance. So yeah, I was feeling a little pressure, but in a good way. It was a kind of motivating pressure. So I wrote and refined and practiced my speech. The day came, I waited my turn backstage. The MC introduced me. I walked confidently onto the stage as the title slide with our company logo was displayed on the huge screen behind me. I began my speech in Japanese, and then things began to go horribly, horribly wrong. Actually, it’s hard to say exactly where everything started to go bad. I’ve replayed these events in my mind far more times then is healthy, and I don’t think that there was any one thing that caused it all. But things began to unravel. It turned out that my twenty-minute presentation needed to be 30 minutes. So I would have to improvise, to stretch my speech 50% longer to fill the time. A few little jokes I made were met with silence. Oh, the audience understood the jokes. They just didn’t think they were funny. At all. By slide four, I realized that my staff had sent the wrong presentation deck. It was one of the older versions. The slides were out of order. I was trying to figure out exactly which version of the deck this was, and remember which slides had been added and removed since then. Each slide transition brought was a new confused panic as I tried to remember what I used to say on this slide, and tried to improvise to add more content and explanation so I could fill the 30 minutes. All in Japanese. All while, in the back of my mind I was desperately trying to remember, or even guess, what slide might be coming next. And even when I guessed right, I just could not remember what I was supposed to be saying. I did not do well. I ended my presentation at the 27-minute mark and thanked the audience. There was polite but quiet applause. I walked off stage with as much confidence as I could fake and returned to my seat. The MC was a pro. He brought the energy of the room back up and brought on the next guest. I wanted to die. I wanted to simply disappear from the Earth and be forgotten. Mostly, I just really wanted to go home. But I couldn’t even do that. I was up in front, in the speakers' row. There was no way for me to leave without the entire audience seeing me do it. No. I had to sit here for another hour. But then the event would be over. I would still have to face the walk-of-shame though the reception and networking area, but then I could get my coat and go home. But when that time finally came, something very strange happened on the way. An older, and particularly well-dressed executive, tapped me on the arm and said, in Japanese. “Wow. That was really amazing. I don’t think I would have ever have the guts to try a speech like that in English.”   Success via humiliating failure Before I could finish thanking him, two, five, six more people came over and wanted to chat. Everyone congratulating me on the courage I showed, and everyone wanting to know more about me, and my company, and what we did. With the pressure off, I was speaking Japanese normally again. I had a crowd of people around me until the networking event ended and the doors closed. I walked out with a stack of business cards and six actual appointments with prospective customers. From a purely numerical, data-driven point of view, it was one of the most successful presentations I’ve ever given. It turns out, that in Japan, a terrible speech in Japanese is actually much more appreciated than a polished one in English. But it was awful. In fact, I haven’t been counting, but I think I’ve had to do six, maybe seven, retakes just to record this story for you. So when people ask me how good their Japanese needs to be in order to be effective in business, I just don’t have an answer for them, because that’s not the point. It’s making the effort that matters. Use whatever you have, and make the best of it. People are wonderfully appreciative of sincere efforts, no matter how badly you screw up. And you know, that’s probably true about a lot of things in life. Do the best you can with what you have. Nothing is more worthy of respect.   Outro Wow, this has been a hard one. But if you want to talk more about making the best of what you have. Drop by DisruptingJapan.com/show164 and let’s talk. Please also look for us on LinkedIn or Facebook, and if you like the show, please tell people about it. But most of all. Thanks for listening,

Japanese businessmen famously fear failure. But that understanding is horribly incomplete. In fact, there is one type of failure that is admired, almost sought after, in Japan. Today we take a look at the trap of the Japanese glorious failure, see how it's hurting startups, and examine our options on fixing it. Show Notes Life lessons from Mark the Dog When and why failure is feared in Japan What is a Glorious Failure, and why it is admired How the Glorious Failure is hurting Japanese startups What is (probably) the only way to fix this Leave a comment Transcript Welcome to Disrupting Japan, straight talk from Japan's most successful entrepreneurs. I'm Tim Romero and thanks for joining me. I'm recording this episode for release on April 28, 2020. I usually try to make all Disrupting Japan content evergreen. Most of the insights you hear on Disrupting Japan about starting companies in Japan, or building a customer base, market testing, or doing business here will probably be just as valid in ten years as the day it was recorded. And in some ways, this episode is no exception. The common wisdom is that Japanese. and Japanese founders in particular, are too risk-averse and have too great a fear of failure. Well today, we are going to turn that view on its head. I’m going to explain that, in truth, Japanese founders don’t fear failure enough, and that’s hurting Japanese startups here. You know, actually, maybe I am being too pessimistic. Maybe ten years from now, you and I will listen back on this episode and laugh at how things used to be and smile when we think of how much has improved. Well, maybe. But before we start talking about why Japanese founders need to fear failure more, I want to say something about the coronavirus situation, at least as it stands in late April 2020. The world might have changed a lot since then. Tokyo is currently on official, but actually unofficial, lockdown. There are clusters of idiots in the parks, but most people seem to be taking things seriously. If you go outside, the police won’t arrest you, but they might ask you where you are going, and ask you to consider if you really need to be out. There is no real punishment or anything, but they make you feel kind of guilty, and that seems to be enough to keep most people indoors. The operations of the Disrupting Japan Studios remain largely unaffected by the shutdown, but that mostly because, Disrupting Japan Studios broadcasts from inside of my wife’s walk-in closet. The acoustics are great in here, but it can get a bit cramped. So for the past six weeks or so, I’ve been staying in the house with my wife Ami and my dog Mark. And you know, Mark the dog has taught me perhaps the most important lesson about how to deal with the corona crisis and the lockdown. Mark the dog, he doesn’t really know what’s going on. All he knows is that my wife and I are home all the time, and he’s never alone. There is always someone to lean up against, or play with, or give him some attention. Mark the dog, doesn’t worry about what might happen tomorrow, and I don’t think he really remembers what happened yesterday. But right now, at this particular moment, he knows he is with the people he loves and who care about him. And for right now, that’s pretty awesome. And believe me, Mark the dog is the happiest, most contented creature you could possibly imagine. So day-by-day, right. At this particular moment, I hope you are OK and with people you love. Anyway, let’s put Mark the dog out of the studio. We're going to talk about why Japanese founders need to fear failure more. The Failure that is Feared You’ll often hear that Japanese founders, and Japanese society in general or overly afraid of failure. And in some ways that is true. Attitudes have shifted for the better over the past few decades, but most kinds of failure here in Japan do cary a certain stigma. From not getting into the right university to not getting your first promotion to failing at your first startup. Far too often failure is viewed as a kind of permanent condition to be avoided at all costs. My very first job in Japan, and this was a long time ago, was at Fujitsu, and the section chief, Taniguchi-bucho explained promotions and failure in corporate Japan this way. “In both America and Japan promotions are based on the point system. Whoever has the most points get promoted. The big difference, however, is that in America you start at zero, and points are awarded for your successes, but in Japan, you start at zero, and points are subtracted for your failures. In Japan zero is the highest possible score.” So, in America, you succeed by succeeding, but in Japan, you succeed by not failing. This caused me endless frustration early in my career. Like most founders, I’m an optimistic, proactive, get-things-done kind of person. But there I was sitting in meeting after meeting where everyone in the room would take turns eagerly, confidently pointing out risks or potential problems with the plan, but no one offering a single constructive suggestion. I eventually figured out, that this was simply how management worked in Japan. It is the junior staffer's job to do the research and come up with the plans, and management’s job to de-risk those plans and to approve them. Unless a manager is among colleagues he really trusts, it would foolish for him to suggest a new innovative solution in an open meeting. It’s not his job, and he’d be opening himself up to blame if things failed. Pointing out risks, on the other hand, is seen as helping prevent failure. It’s a sign of competence and teamwork. When constructive feedback is given, it’s done in private, verbally, and off the record .With the manager safely insulated from any potential failure of the idea. As you can imagine, this simply doesn’t work at startups. And Japanese startups are emphatically not run like that. But that aversion to failure is still a big part of the overall business culture in Japan. The Failure that is Admired There is, however, one important exception to this rule. There is one kind of failure that is actually respected in Japan. There is one kind fo failure that is, in some ways, admired almost as much as success itself. And that is the Glorious Failure. The glorious failure is where every member of the team gives every fiber of their being working together against impossible odds. This is the failure of the hopelessly outmatched sports team that gives everything they have. This is the sales team working 14 hour days trying to close 80% of this quarter’s quota in the last two weeks. This is the 300 Spartans at Thermopylae. And if deep down the team knows success is impossible, but that truth is never spoken, well, that makes the failure even nobler, more glorious. Glorious failures are respected, even adored in Japan. I mean, sure, someone will have to take the blame and suffer the social consequences, but in general. If you are one of the team members giving your all, you have little to fear from a glorious failure. And that … is a problem. The option of the Glorious Failure is hurting Japanese startups. Because being part of a glorious failure means never questioning your teammates or their decisions. It means doing more. Trying harder. Regardless of the odds. And while that attitude is indeed admirable in an underdog sports team or an outnumbered band of Spartans, those are times where you can’t change the rules. Those are times where convention or contract or fate has dictated that you must walk onto that field today … Startups, just aren’t like that. At a startup when the odds are hopelessly against you. You don’t double down, you figure out how to change the rules. You do something new. You change your approach, you change your messaging, maybe you pivot the whole company to a new product and set off in an entirely different direction. But before you can do that, before you can even consider doing that, you need to accept that what you are doing now isn’t working. That your current strategy is a failure. And not a glorious failure either, but a simple ordinary failure. And that. That is hard. Over the last seven years or so, Japanese startup founders as a whole have moved from beginners to world-class operators. From ideation to pitching to productization to marketing, Japanese startup founders are some of the best in the world. But the pivot? That’s still hard. Japanese startups are still often avoiding the pivot and opting for the glorious failure. I mean, it’s definitely getting better, and we’ll talk about possible solutions in a bit, but I’ve seen this dynamic play out at a number of startups. Including some that I’ve been pretty close to. When times are hard, the instinct is to pull together and work harder. For a member of the team, even the founder, especially the founder, to stand up and say “We need to put aside our plans, our pride, and our priorities and try something new.”? That very often feels like a dismissal, even a betrayal, of all the hard work that everyone has done so far. And after all, if the founder admits that his plans have failed, why should the team trust him now? No, it’s usually much easier to insist that we have the right plan and just need to work harder. It takes a particularly skilled founder to pull off a pivot in Japan. But it does happen. Pre-revenue and before promises have been made to customers, Japanese startups find it easier to pivot. In fact, startups are releasing products earlier, getting feedback faster, and adapting to that feedback more flexibly than they have in the past. Early on, there is more and more experimentation around product-market fit. The real danger, however, seems to be when a strategy that has been working well, suddenly stops working.

Almost all startup accelerators are going bankrupt and going away. Hiro Maeda, the founder of two of Japan's most successful, and most different startup incubators explains both the brief past and precarious future of startup incubators and accelerators. We talk not only about the mechanics and challenges of what it takes to make an incubator successful, but Hiro has some practical advice on when founders should consider joining an accelerator and how they can avoid the 99% of them that provide no real value. Hiro also explains why so many Japanese VCs today find investing in South East Asia more attractive than Japan, the forces behind Japan's startup boom, and what the next ten years holds for Japanese startups. Show Notes for Startups The motivation behind the founding of Open Network Labs Incubator How to measure the success of an incubator How Japanese VCs will be deploying capital in the next few years The success of Beenos's Inception Program and why they had to shut it down Why public companies have trouble with startups How to tell a good incubator from a bad one Why most incubators provide no value The coming shakeout in the incubator industry What’s driving Japan’s startup boom The future of Japanese entrepreneurship Links from the Founder Beenos Hiro's Blog Follow Hiro on Twitter @djtokyo Friend him on Facebook The SGE Facebook Page [shareaholic app="share_buttons" id="7994466"] Leave a comment Transcript from Japan Welcome to Disrupting Japan, straight talk from Japan's most successful entrepreneurs. I'm Tim Romero. Thanks for listening. I hope you and your loved ones are staying safe and staying healthy during this coronavirus crisis. I honestly can’t see too much more than that, because one of the things I learned in releasing our previous episode is that the situation can change dramatically from the time I record to the time I release and then again from the time of release and the time you get a chance to listen. So about the only thing I can say right now that I know will make sense when you listen to this is that I hope you are doing OK and staying healthy; or failing that getting better. Today, I’ve got a great Selects show for, so we can sit down over a beer with Hiro Maeda, one of the most insightful Japanese VCs. This interview was recorded back in 2015. A lot has changed since then, but a surprising amount of things have not. When we first caught up with Hiro he was just about to launch his new fund, and I’ll give you an update on what happened after the show. What might be even more interesting, however, is that the predictions Hiro makes in this interview have not come true as quickly as expected, but many of them are playing themselves out in slow motion right in front of us. Intro Today, we sit down with Hiro Maeda and talk about Start-Up Accelerators. Now, Hiro is the creator of both Digital Garages, Open Network Lab and the Beenos Inception Program. These are two of Japan's best known Start-Up Acceleration Programs. Their approaches are very, very different. Naturally, we talk about both the past and the future of Start-Up Acceleration in Japan, and the critical differences between the good ones and the bad ones. What impressed me most about our conversation was Hiro's commitment to running his Accelerators just like Start-Ups. Now, we dive into the fundamental reasons behind the attraction that Japanese VCs now have for Southeast Asian Markets. As well as the reasons behind what we both see as the coming hard times for Start-Up Accelerators, and the coming good time for Japanese Start-Ups. I will let Hiro explain all of that in his own words. Let's get right to the interview. [pro_ad_display_adzone id="1404" info_text="Sponsored by" font_color="grey" ] Interview Tim: I am sitting here with Hiro Maeda of Beenos formally. The man who found the Open Network Lab with Digital Garage. Today, we are going to talk a lot about Accelerators. Because you are a man that knows. Hiro: [laugh]. Thank you. Tim: Thanks for sitting down with us. Hiro: Thank you for having me. Tim: Let's get right into it. I am really interested in your experience and setting up and running the Digital Garage Open Network Lab Accelerator. Why don't you tell us a bit about it, and what your goals were in starting that Accelerator? Hiro: Yeah, so this was back in 2010. It was right after the Lehman Crisis. It happened in 2007, 2008, 2009 was no one was investing in start-ups in Japan. It was basically myself, Joey Ito, who is currently the Director of a MIT Media Labs, and also the Founder of Beenos, or the former Founder of Beenos Taru and then the CEO of Digital Garage. We all kind of got together, and were discussing what can we do, right? Yeah. Tim: Okay, let's back up here for a second. How did all of these people end up in the room getting together? Because that is a pretty diverse group of people right there. Hiro: Other than myself those three actually knew each other. They always wanted to do something, right. Digital Garage was just moving into a new office. They had some extra space. They actually started off with what can we do with this space? Tim: Okay. Hiro: I got pulled into the discussion, and then I was at the time really looking into Tech Stars and [00:02:47]. Tim: Right, right. Hiro: The two Accelerators in the U.S. that were starting to do very well. I basically proposed that why don't we just do this in Japan? Tim: You are trying to replicate wht was happening in San Francisco, and then well in Boulder. Hiro: Yeah. Tech Stars. Tim: Happening in the States. Hiro: Mm-hmm. Tim: You are putting this together. You were learning as you were going. Hiro: Mm-hmm. Tim: It has been up and running now for 5 years? Hiro: Yeah, I think 5 years, yeah. Tim: All right. Hiro: Yeah, yeah. Tim: When you are running an Accelerator, how do you measure the success of the Accelerator? Is it the return of the Portfolio. It is the number of companies that are still in operation after 4 years? How do you measure success from the Accelerator point of view? Hiro: As an Investor, the closest way to measure success is return on capital and I guess mark-ups, right. Tim: Right. Hiro: I guess how much more valuable your Portfolio is. We are right now about roughly about 20 X mark-up. Our entire Portfolio is 20 X more valuable than it initially was. Tim: All right. Hiro: Which is pretty good. We will see how much of that becomes cash. Tim: Right. Hiro: I am hoping it will be somewhere above 10 X. That is one way to kind of measure success. I actually think the purpose of an Accelerator – I mean we do have fiduciary duties to make big returns. The other thing we have to do is increase the success rate of start-ups to get to the next phase, right. The other thing we look at is actually how many of the companies that enter our incubator or accelerator are able to raise money from VCs? Tim: Right. Hiro: Right. I don't know what the exact number is right now. At one point, we had 70 percent of the companies that go through our Accelerator were able to raise their next round. Whether is was $100,000 dollars or $500,000 dollars or a million dollars. Tim: That's pretty good. Listeners in San Francisco wouldn't be particularly impressed with that number. Hiro: Yeah. Tim: Anyone who has been dealing with start-ups in Japan for the last 10-15 years knows that is extremely impressive. Hiro: Yeah. We were proud of that. We were pretty proud about that. Tim: Well, actually that brings up a good point. There seems to be a real Series A crunch in Japan right now. What do you think is behind that crunch? What's the best way to solve it? Hiro: To be honest there aren't that many Series A Investors in Japan to begin with. Tim: Right. Hiro: There is only a handful you. What probably happened is we had more seed Accelerators emerge, more seed funded start-ups. Those seed funded start-ups are having a much harder time raising money. [pro_ad_display_adzone id="1653" info_text="Sponsored by" font_color="grey” ] Tim: Here is the dynamic I see. Let me know what you think. The nature of starting a company has changed. You can do it with much smaller teams. With much lower amounts of capital. The economics favor not only lots of people starting companies, but investors making lots of very small $10,000 dollar to $50,000 dollar bets. We had a whole emergence of pre-seed, early-stage financing come up. Hiro: Yeah. Tim: The people who have to step in next and set a price, and put in three-quarters of a million dollars. Seem to be the same people that were doing it 10-20 years ago. Hiro: Mm-hmm, mm-hmm. That is the case. I mean yeah. I don't see that many new funds being formed investing in the series A or B range. It is usually the same kind of people, the same brands, pretty much the same people, right. Tim: It does seem that most new funds are focused on see, early stage, the strategy of lots of small bets. Hiro: Mm-hmm, mm-hmm. Tim: What about some of the larger funds now? The incubate funds. These are funds with hundreds of millions of dollars. There is not enough start-ups to invest in. Hiro: Yeah. [pro_ad_display_adzone id="1408" info_text="Sponsored by" font_color="grey" ] Tim: You can't invest that $10,000 dollars at a time. Hiro: Yeah, yeah. I am not sure what their exact strategy is with raising $100 million dollar fund in Japan. My guess is they want to do more in emerging markets like Indonesia. Tim: Yeah. Hiro: The other is they want to be able to fund the full stack. They want to be able to fund the seed, the Series A, the Series B and C. They keep on doubling down on companies that are doing well in their Seed Portfolio.

Innovation drives society forward, but everyday competence keeps it on the road. Over the past five years, we’ve spent a lot of time talking about the importance of disruptive innovation, but today I’d like to talk about the framework that allows disruptive innovation to be a net positive to society. The coronavirus pandemic has some people looking for innovation and others for stability. However, examining how Japan and the rest of the world are getting though it shows us something very important about innovation. Something that is almost always overlooked. Show Notes Life in Tokyo during the pandemic Why you don't want to cough in Singapore Why we probably can't innovate our way out of this pandemic The very real dark side of disruptive innovation Why innovation depends on everyday competence Leave a comment Transcript Welcome to Disrupting Japan, straight talk from Japan's most successful entrepreneurs. I'm Tim Romero and thanks for joining me. Things are not normal in Japan right now. Japan is one of the countries that is being been hit the hardest by the coronavirus. And the rest of the world is watching Japan because it has a modern health-care system, an active response to the virus, and a government that can be trusted to release .. reasonably accurate information about infection and mortality rates. How things play out for Japan over the next few months is quite likely how they will play out for the rest of the world over the next year. So yeah, everybody is watching Japan; as they should be. People are nervous in Japan, but things are calm and orderly. Of course, Japan tends to do calm and orderly really well. Public gatherings like graduations, business conferences, and sporting events have been canceled. As I record this, no decision has been made about the 2020 Tokyo Olympics, but it seems likely they’ll be postponed. Two weeks ago Sunday, I was walking back home through nearly deserted streets around Ark Hills and saw a young couple doing their wedding photography in the atrium there. Masks nervously being taken off and put back on between shots. It’s got to be a frustrating time to have had a wedding scheduled. On the business side, most large companies including Dentsu, Panasonic, Mitsubishi and of course Google as well, are either requiring or encouraging their employees to work from home. Which is good. Almost all business travel is canceled, and that’s for the best. In fact, three weeks ago when I was returning to Japan from Singapore, I coughed while walking through the airport on the way to my gate. Not like a big, sick, hacking cough, but just like a, I mean I’m a human being, and sometimes we just cough, right? A few seconds later, someone from security wearing a mask walked up to me with a heat sensor to take my temperature. He was very polite about the whole thing, and I was fine of course. It’s good to know that Singapore is taking things seriously, but FYI, don’t cough in the Singapore airport. In terms of Disrupting Japan, well, I have not been scheduling interviews for the obvious reasons, and honestly, right now most founders are focused on coronavirus countermeasures. If the situation continues, I may try video-conference interviews again, or I may do more commentary episodes. The feedback I received on my last few was overwhelmingly positive, so maybe. Today, however, I want to talk about the nature of innovation itself. You see, the coronavirus has the potential to teach us a valuable lesson about innovation. No, no. It’s not the one you think it is. It’s not the standard fare about innovation and ingenuity will get us through even humanity’s worst problems. No, it’s something a bit less on-message. But it’s an insight that is for more important, and in a way, far more reassuring than the standard trope about innovating our way out of a bad situation. Unfortunately, it’s also a lesson that I think all us innovators will completely forget the minute the coronavirus crisis has passed, and the world returns to normal. Innovation Won't Save Us The thing is, innovation is almost certainly not what is going to get us through this pandemic. Innovation is great. The ability to innovate and to widely pass on that learning is something uniquely human. We like to say that modern society is based on layers and layers of past innovation, but that is not quite correct. That leaves out something very important. These days we talk about innovation in general, and disruptive innovation in particular far too casually. In fact, over the past 20 years, the word “disruption” has been diluted to the point where it is practically lost all meaning. We frequently hear people say things like “We are disrupting the Japanese gaming industry.” when they mean that “they are competing in the Japanese gaming industry” or “Their game is for sale in the Japanese app store.” I’m not blameless here. The name of this podcast is “Disrupting Japan”, and I’ve had plenty of promising and interesting, but non-Disruptive startups on the show. But when I actually refer to a technology or a company as disruptive, I try to use the term in at least something like how Clayton Christensen originally defined it in The Innovator's Dilemma. We are enchanted with the idea of disruption, but disruption has a very real and painful dark side. People suffer. Companies and industries disappear. People lose their savings and their health. We tend to brush aside those negative aspects of disruption because over the long-term and on average, that economic disruption leads to a greater overall good. We gain more than we lose. But it doesn’t have to work that way. It’s not an iron law. Of course, our fascination with disruptive innovation is easy to understand. There’s drama. There is conflict. There are winners and losers. And when we are talking about technological disruption, the innovators are almost always the winners. And everyone loves to root for a winner. But the thing is, the innovators are not the ones who are going to get us through this coronavirus crisis. Oh, some CEOs and politicians may get some credit when its all over, but innovation won’t be what gets us through. What gets us through is going to be everyday competence. It’s the doctors, nurses, schoolteachers, janitors, and millions of other people who have been doing the same job the same way for decades and doing it well. They are the ones who will get us through the disruption caused by the virus, and as you’ll soon see, they are actually the ones who get us through disruptive innovation as well. That might seem like a strange claim to make, particularly from an American where there is practically a cult of innovation. The Purpose of Everyday Competence While innovation is what drives us forward, everyday competence is what keeps us on the road. It’s the teachers and taxi-drivers, and maintenance workers, and mid-level managers, and health-inspectors, and waiters, and nurses who keep society functioning. Everyday competence provides the stability and direction that allows disruptive innovation to utterly destroy an entire industry without damaging society as a whole. We don’t tend to think about everyday competence much. The stability it provides is like air. It’s mostly invisible. You don’t think about it much. It’s just always there. Until it’s not, of course, then we start thinking about air a lot. Then we start to panic. We can’t really help it. Our brains are hard-wired to seek out the new and to discount the familiar. One of the most powerful ways we have of containing the spread of this virus is simply washing our hands a lot. But it's hard to get people to do it, because when we hear this advice our brain’s reaction is “Yeah, I already know that.” and so many people discount the information. They don’t change their behavior because our instincts tell us that new problems require new solutions. But our instincts are wrong. And hey, maybe some pharama company will innovate to come up with a treatment that will reduce the symptoms or speed recovery. That would be great. They’ll make billions of dollars, and the international press would proclaim them heroes. “Hero”. That’s another word that has lost almost all of its original meaning. Let’s face it, the people who are really getting us thought this pandemic, are the thousands of doctors and nurses working 70-hour weeks, the consumers who remain calm and don’t buy hordes of masks and toilet paper, and millions of school teachers who are getting the kids to wash their damn hands. It’s not heroes or innovators. It’s just good people with everyday competence. But our love for innovation, particularly in America, often leads us to overlook that. Right now, President Trump is being, quite rightfully, criticized for his firing of the American pandemic response team back in 2018. After all, they were just sitting there, sucking up taxpayer money. They were not producing or innovating anything. Who needs everyday competence. But this is not unique Trump. We all tend to elevate innovation and downplay everyday competence, but we Americans in particular practically fetishize innovation. Actually, perhaps the best example of valuing innovation over competence came in 2018 when 12 Thai teenagers and their soccer coach became trapped in a cave. The rescue effort started with a small team of divers and eventually involved several thousand people trying to apply their individual decades of skill and experience to come up with the best way to rescue those boys. But a frustratingly large percentage of the US media coverage focused on innovator (not just innovator, but billionaire innovator coming though! Step aside!) Elon Musk, elbowing his way into the spotlight to teach these so-called competent experts how things should really be done.