Entrepreneurial spirit born anew in Japan

McClatchy Newspapers


Before last year’s devastating earthquake, college student Tatsunori Hirota envisioned a life as a “salaryman,” one of the nation’s countless tradition-bound corporate foot soldiers in white shirts and black slacks who fill the city’s subways every morning and night commuting to and from nondescript offices.

But the psychological aftershocks of the disaster have created a new sense of urgency among a small but growing number of young professionals and college students like Hirota. They are abandoning the path of the corporate salaryman to chart their own way by launching tech startups.

“We lost family,” said Hirota, a Tokyo University economics student who, after the magnitude 9.0 quake, began studying programming and co-founded an e-learning website, Mana.bo, that received positive feedback from venture capitalists after he visited California over the summer.

“We felt death closer than before,” he said. “Now we don’t want to work for the big company. We want to work for ourselves. The biggest risk is that something could happen to you before you do something you really love. It could happen anytime, anywhere.”

The shift in attitude comes as Japan’s technology sector struggles to remain relevant in a global economy that is leaving it behind. Observers say Japan’s inward-looking and risk-averse culture has for years dampened the nation’s entrepreneurial spirit. In its 2010 report, the Global Entrepreneurship Monitor ranked Japan lowest among advanced economies in terms of attitudes toward launching new businesses. It noted that Japanese were the least likely to consider becoming entrepreneurs.

In the aftermath of the earthquake and tsunami, which cost more than 13,000 lives and triggered widespread power outages and radioactive leaks from the Fukushima Daiichi nuclear power plant, there was a “shattering of trust in big institutions” across Japanese society, said Phil Libin, CEO of Mountain View, Calif.-based Evernote, a provider of note-taking and archiving technology that has operations in Tokyo.

That collapse of faith extended to large tech companies, many of whom have broken with long-held promises of lifelong employment with mass layoffs.

“The younger generation — their parents are getting fired from the big companies,” said Nobuyasu Kondo, an executive with Tokyo-based GNT, a Japanese mobile and gaming platform. “They realize if you work for the big company, you can still get fired. So why not take a risk and start your own company?”

At the same time, Japanese realize their nation’s future prosperity and economy, surpassed recently by China as the world’s second-largest economy, is vulnerable in the global market, said Ted Yamamoto, a general partner at UTEC, a venture firm tied to Tokyo University whose mission is modeled after Stanford University, which long has fostered tech entrepreneurship among faculty and students.

“It’s obvious the Japanese market is shrinking,” he said. “The population is shrinking. You bypass Japan to go to China and India.”

Government officials, academics and industry leaders say that if the nation is to regain its technological mojo, it needs to jump-start an entrepreneurial culture, and that includes tapping into Silicon Valley.

“To come to Silicon Valley, that is the dream of many startup companies and entrepreneurs in Japan,” said Yukiko Pollard, general manager of Tokyo-based image processing software company Morpho, which opened a San Jose office this year.

But young Japanese entrepreneurs face daunting obstacles. In Japan, there is nothing resembling the entrepreneurial ecosystem of Silicon Valley. And while companies like Mana.bo are able to tap into venture capital here for initial startup funding, there is a dearth of investors willing to spend the larger sums needed to fund deep research and development to prepare startups for the global market, experts say.

“In Silicon Valley, you can get $20 million without owning a suit. In Japan, it’s much harder to raise money,” said Evernote’s Libin, a big fan of Japanese technological prowess looking to make investments in the country.

For sure, there is brainpower aplenty in Japan, whose engineering brilliance has never been in question.

Copyright 2012 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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