Day one of Startup Asia Tokyo continued rumbling along into the afternoon. While investors and entrepreneurs roamed Bootstrap Alley, the conference hall remained packed with attendees wanting to hear insights and opinions for the all-star panel of guest speakers.
Asia startup showcase – Metaps
Metaps has quickly become a valuable resource for app developers. The company’s core service – data-driven advice on how to increase in-app downloads – has reached 100 million users. Founder and CEO Katsuaki Sato has spoken at length about this service in the past so he focused this talk more on how he sees his company evolving in the future.
He noted that it is a mistake to assume that the smartphone age means that the IT industry must be centred in the United States. For him, he wants his company to be truly global, with 800 million users within two years. He wants to get into underserved countries like India, Brazil, and Africa.
His advice for other entrepreneurs making the global leap? You need to know the local market even better than the locals.
Katsuaki Sato of Metaps during his talk
Keynote by Infinity Venture Partners’s Akio Tanaka – It’s still sexy to invest in China
Tanaka stressed that the perceptions of China are influenced by a Western-centric ranking system. He noted that for app downloads by country, the US is number one but China is second. Further, China ranks only fourth in terms of app revenue. But these numbers are limited to Google Play Store and the App Store. If the local Android app stores were included, China would likely be number one or two.
He also challenged the idea that entrepreneurship in China is limited. He cited the Chinese language website 36kr, which, like Tech in Asia’s Techlist, tracks startups and investors. According to 36kr there are roughly 7,000 startups and 1,000 investors, both numbers which are higher than in Japan.
Tanaka ended by saying that China had moved beyond the days when it would copy Western products. Instead, Western companies should start to consider copying China’s approach. Ctrip, one of China’s largest travel firms, has some functions lacking in American travel heavyweights such as bus reservations and visa applications.
He also singled out China’s Uber-esque car startups, saying that local services – such as Yongche – allow users to order their black car in advance and select a preferred driver – two things that are not possible with the current Uber app.
Fireside chat with Takashi Inoue about how he, a frustrated real estate agent, started Japan’s largest property portal
Inoue talked about how he wanted to reform his own industry. He described legacy players as being uninterested in the true happiness of their customers. Most people looking for new homes or apartments believe that their chances of getting the apartment of their dreams is decided by concrete standards.
The reality is very different and fair standards are ignored. “Why do they treat their customers so poorly?” Inoue said he wondered at the time. His property portal helps customers find their apartments more fairly. Looking forward, Inoue wants to use his service to make his clients as happy as possible.
“What matters most to people? Education, home, working place, healthcare,” he said. Inoue went on to say that he wants to improve the search engine so people can find the right house with the right schools, right healthcare and right commute.
His ideas will not be limited to Japan; the company is trying to expand to 100 countries within 10 years. It is an aggressive goal but that does not bother Inoue. “It’s not easy but it is important to always go after the more challenging path. It is tough at first but will change your character,” he told the crowd.
Takashi Inoue, CEO and founder at NEXT Co., Ltd, left, interviewed by NIKKEI, at Startup Asia Tokyo 2014.
Discussion – Why are Japanese investors investing in Southeast Asia?
A rockstar group of investors came on stage to explain the curious trend of Japanese investors putting their money into Southeast Asia. Batara Eto, co-founder and managing partner at East Ventures, Tatsuo Tsutsumi, partner at GREE Ventures, Tommy Matsuo, director at Transcosmos, Yasuhiko Yurimoto, founder and CEO at Global Brain (GB), and Yuji Horiguchi, CEO at IMJ Investment Partners, made up the panel with Akio Tanaka, co-founder and managing partner, Infinity Venture Partners, as the moderator. (Disclosure: East Ventures is also an investor in TechinAsia. See our ethics page for more information).
Batara had a unique perspective, being raised in Indonesia and Japan, and then deciding to come back to Indonesia for investment purposes from 2011. He said that Indonesia has a lot of potential but no investors at the time, making it a prime target.
Yurimoto: “Valuations rising in SEA. Seeds get $10M, early stage $20M. Not based on real sales, just a prototype.” #StartupAsia #bubble
— Tom Chiu (@_tom_c_) September 3, 2014
Yurimoto was straightforward about his continued interest in the region, saying that he had invested US$5 million in an ad firm but could not disclose the name yet. US$5 million might seem like that a lot but Yurimoto said that seed-stage companies often get US$10 million and early-stage firms get US$20 million regularly.
Matsuo, who has been working in Bangkok for 20 years, also agreed that Thailand has been caught up in the rising valuation trend.
On the subject of exits, Tsutsumi had modest expectations. Exits are not as common in Asia as the US but, for him, it’s better for a company to get a few million than nothing.
Regarding Rocket Internet, the company’s rapid expansion was less of a concern. Tsutsumi spoke for everyone when he observed that Rocket has a lot of turnover and that talent tends to stay in the region, making new startups or coming into established ones in senior positions.
The panel
Keynote by App Annie on Japan and worldwide app trends
Yuji Kuwamizu, the general manager of App Annie in Japan shared some new insights from the widely-cited analytics firm.
At the worldwide level, he noted that plenty of people download apps on the Google Play store but more people are spending on apps from the iOS App Store. Further, the vast majority of downloads are on iPhone as opposed to the iPad. The iPad is really only monetized in the United States.
アンドロイドの勢いがすごい、、、
#StartupAsia pic.twitter.com/C3z9iialdH
— Minoru (@678Kjtfa) September 3, 2014
In Japan, he showed the top 10 publishers for the month of July by downloads and by revenue. A surprise absence in the downloads column was GungHo, publisher of the runaway hit Puzzles and Dragons. For revenue, it was listed as sixth, after Gree, Line, DeNA, Sony, and Gumi. According to Kuwamizu, this shows that the game’s players are hardcore fans and will keep spending a great deal on the game.
Keynote by CyberAgent Ventures Tetsuya “Terry” Hayashiguch – Key lessons learned when investing across Asia
Terry talked about his firm’s “Time Machine” investment concept. His team makes a table with categories on the y-axis, set against countries along the x-axis. They then plug in the companies that they have invested in so they can see what countries are saturated and which are ripe for an explosion in a given field.
CyberAgent Ventures has a lot of data to work from. Terry said that they have made 200 investments and seen 20 IPOs. The company’s focus will not be leaving Asia any time soon. As he sees it, there are more people under 30 years old in Asia than anywhere else in the world and the region will have two billion mobile users by 2017.
Discussion – How can Japanese telcos help (or kill) startups in Asia
Tomohiro Ebata, director of KDDI’s open innovation fund (VC) and Yuichi Kimura, director of NTT Docomo Ventures were on hand to talk about their efforts to reach out to the startup community in Japan.
Ebata talked about KDDI’s incubation program which just started its seventh round and has expanded its reach to include student-driven startups. He noted that his team helps the fledgling startups with the nuts and bolts of building startups such as fund-raising and hiring.
Kimura and Docomo also take the mentorship role. He mentioned that Docomo only decided to start working with startups because it had a positive experience working with Evernote. Perhaps unbeknownst to him, Phil Libin has helped spur a rush of funding for startups in Japan.
During a Q&A with the audience, one guest asked what industries do the two men want to invest in besides game developers? For Ebata, it was disruptive firms like Uber that can change how an established industry works. For Kimura, it was search and security.
Keynote by Rebright Partners Takeshi Ebihara – Why Indonesia is the next big thing
Ebihara laid out the case for Indonesia in succinct, persuasive numbers. For starters, by 2023, the country’s GDP will be the same scale as current major players like France and Germany. As Indonesia continues to grow, it will take a full third of Southeast Asia’s economy.
He said that major Indonesian firms are taking a deep interest in the ecosystem as well. The top telcos – Telkomsel, Indosat, and XL Axiata – all have venture capital funds now.
According to him, exits regularly hit US$20 million and IPOs are slowly but surely increasing. Top IPOs recently out of the country are JobStreet (US$268 million) and iProperty (US$178 million).
“Every service is here and the market is crowded,” Ebihara summarized.
Discussion – The startup investment climate in Southeast Asia
The final session of the day was highly anticipated as it brought together Amit Anand, founder and managing partner at Jungle Ventures, Dmitry Levit, general partner at Digital Media Partners, Kuo-Yi Lim, partner at Monk’s Hill Ventures, and Saemin Ahn, managing partner at Rakuten Ventures, to talk about the their investment experiences.
Everyone agreed that the market is very popular right now. Ahn described the growth in interest and rising valuations as an “apocalyptic change.”
A common point the panelists agreed on was the need for companies expanding in Southeast Asia to work regionally. Anand described as an example the work that Jungle Ventures did to create a regional office in Singapore for Japan’s Voyagin.
Lim noted that sometimes an industry does not yet exist. He described a time in Vietnam when he met with a real estate startup that was having trouble finding investors because the idea of basic elements like housing loans were not common.
Anand echoed this, saying that some of the things that hold true in Japan do not work in Southeast Asia. In Japan, the workforce is well-educated but scarce and capital is relatively easy to get. Around the region, however, labor is plentiful and cheap but not as skilled, while capital is in short supply.
Day 2 is coming soon, only one sleep away! Check out the agenda here.
The post Highlights from day 1 afternoon sessions at Startup Asia Tokyo 2014 appeared first on Tech in Asia.
Highlights from day 1 afternoon sessions at Startup Asia Tokyo 2014
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