People often say I take an active role around the world, but the way I see it, rather than taking an active role, it’s more like making strenuous effort. It feels like I’m struggling with all my might in the middle of the ocean that is the world.
Since starting-up my company in Japan 12 years ago, I have built up a network, cultivated customers, constructed a brand and earned trust in the open seas of Japan.
I’m now trying to carry out this same process on the larger stage of the world, and that is why I’m swimming as hard as I can.
On this trip, I’ll spend one night each in Hong Kong and Shanghai. The entire business trip to two cities will last just two nights and three days. I will be meeting three investors in Hong Kong and will be speaking at a conference in Shanghai.
I’ve not yet recovered from the fatigue after my trip to the Middle East last week; I’ve just got to keep going, without a break.
Investor meetings are, in a word, sales. I need to sell our fund at 500 million yen per lot. We’re selling something you can’t actually see so investors have a hard time making up their minds. This investment carries a risk and also costs a lot of money.
Investment decisions have to be based on our track record, the potential of the Japanese market, the GLOBIS brand and network, and the trustworthiness of the management team including me. The kinds of investors I approach here are not usually found in Japan, and so I have to explain everything clearly and in detail. I prepared a presentation of around 50 pages to explain the GLOBIS fund. I also explain the macro-level factors, such as the economic and technological situation in Japan, the social environment, the state of the stock market and M&A. The meetings typically last from 60 to 90 minutes.
Investors just don’t seem to be won over unless the head of the company conducts these explanations. So it’s up to me to travel overseas fairly often to meet and brief them. After preparing several sets of the same materials, I repeat the same explanation over and over again.
Sometimes I get fed up, but, perhaps because I’m a salesman at heart, I always adopt a positive attitude and try to have fun with it.
GLOBIS has recently enjoyed a solid investment track record and trust in us is going up; that means that sales is getting easier, thankfully.
And my plans for overseas trips are gradually focusing more on other kinds of events, such as attending or speaking at conferences as the main purpose around which I then arrange visits with investors, rather than having the investor visits as the centerpiece.
On this trip I have been asked to speak at a gathering called ATRE (Asian Technology Roundtable Exhibition), in Shanghai. I decided that as long as I was there, I might as well go visit investors in Hong Kong, making the trip two nights and three days overall.
I have just now finished meeting two investors in Hong Kong, and still have a little time, so I’m writing this column in a café. On recent business trips, I’ve been doing a lot of writing for the GLOBIS website. I frequently travel abroad on my own, so writing partially relieves my feeling of loneliness. Also having this dialogue with my readers really calms my l heart. (Having said that, I’ve got a meeting in ten minutes at the third company on my list, so I’ll have to continue writing this in Shanghai).
After my third meeting, I got on the train for the airport to board my flight on China Eastern Airlines to Shanghai. At immigration, I bumped into my neighbor from Karuizawa. What a small world!
From my hotel window I can see a building under construction. You can tell that China is still proceeding full-steam ahead, although not at quite the same pace as at one point earlier.
The ATRE conference begins tomorrow morning.
This event is organized by the DASAR, which had purchased the American magazine, Red Herring. The same company also ran the gathering held the other day in Seattle, where Mr. Bill Gates was a guest, as well as ETRE (European Technology Roundtable Exhibition) gatherings, last held in Seville, Spain.
The founder of Dasar is a French-Jamaican, Mr. Alex Vieux. He is truly a unique person.
What stands out about these ATRE and ETRE conferences is how Alex always provides his own sharp and witty questions or ripostes after any speech. Doesn’t matter who has spoken, Alex will have a penetrating observation that keeps the audience on the edge of their seats, not wanting to miss a beat.
As a speaker, I was also the target of his deeply probing questions.
On this occasion I was prepared for speaking on the morning of the first day during a keynote snapshot, a time slot of particularly high quality, which is always particularly well attended.
I had done a good job insisting on being a keynote speaker during my negotiations with Alex when he asked me to participate in the event.
I was simply delighted to have been awarded a such a good time slot. This was an ideal chance for people to understand what Japan is really about. Thinking about this got me going.
My turn arrived, but since we were running behind schedule, it appeared my speech might have to be cut and we would go straight into the Q&A. Nevertheless, I insisted on making the speech. You have to be assertive when you’re overseas. More than anything, it was a great opportunity to promote GLOBIS and Japan to the audiences.
I didn’t have quite as much time as I should have, but I went ahead speaking to the audience of over 200 people from 27 countries. As soon as I finished, Alex launched into his grilling questions, just one after the other, such as:
“Why is the annual amount of foreign investment into Japan so low? Why are foreign VC firms retreating from Japan? Why isn’t venture capital taking off in Japan?”
“There is more venture capital in China than in Japan. Why China but not Japan?”
“It seems the culture in Japan does not respect successful people, as if making money was a dirty word. Why? Successful people are acknowledged in places like California, for example.”
“People say Japan is changing, but this isn’t true at all, is it? What’s going to happen with China and Japan?”
“If you were to start a business right now from scratch, what would you do? There is no bubble at the moment, so where are the opportunities?”
The questions kept coming, right in the middle of my replies.
I am used to these kinds of questions, so I was able to reply with relative calm.
“Many believe that Japan is three or four years behind the U.S. Foreign venture capitalists adopted the model that succeeded in the U.S. and brought it over to Japan. They thought this would bring success. However, it appears that the issue is more than Japan being behind the U.S. It seems, in the first place, that Japan has a completely different industrial structure and management environment. Trying to shoehorn U.S. investment style into Japan without acknowledging the differences led to failure and they left. They needed, however, to give a reason for pulling out, so they said things like, “Japan can’t nurture entrepreneurs,” or, “You can’t assemble a management team,” or, “the market is immature,” making Japan out to be the scapegoat. As a result, it has become difficult to raise funds for venture capital in Japan.
“The signs that Japan was changing began to emerge around 1996. This has now developed into a formidable swell. In 1997, Yamaichi Securities autonomously ceased business, and many large banks subsequently started to go bankrupt. This led to the collapse of lifetime employment, since regardless of one’s sense of loyalty to the company, if the company goes bankrupt, employees lose out. If that’s the case, you may as well strengthen your own capabilities and identify your own career path. This is the generation that is coming to the fore.”
“Today, many venture capital enterprises are springing up with young people at the helm. Some of the companies in which we invest have been set up by technical people who quit major corporations like Sony and Matsushita. This was unheard of before 1997. Furthermore, the stock market is energized. In terms of venture capital, the current investment environment in Japan is extremely good. However, investors and the media in the West tend to base their judgments only on image and atmosphere. Investment in India and China is fashionable right now, so attention is fixed on those two countries. This, however, is just a trend. I want to say, “go for it,” to anyone who chases after these trends. For our part, we are enjoying operating in a relatively non-competitive market.”
“It’s not true that Japan does not respect successful people. I do think, however, that the way successful people use their money is being closely watched. People who use their money decently and responsibly are respected, but those who engage in reckless spending are reviled. Japan has a culture that emphasizes harmony of character; so an understated assertiveness is very highly valued. I think that this, in itself, is not so bad. It’s really not necessary to become as materialistic as in the U.S.”
“If you look at the bigger picture with regard to Japan, in contemporary history we are now in the third period of upheaval. The first period was the Meiji Restoration, the second was the post-war era, and now we are in the third. You never see major changes in Japan during periods of stability. Actually, I don’t think that many significant changes occurred during the periods of stability in the Edo, Meiji and Showa eras. Yet, when change does begin, it really generates upheaval. We are now in such a period. During the bubble era, you didn’t have to be smart; you just needed to have guts and you could easily make lots of money. In that sense, it was not a very good period. Now you have to be smart and courageous with an international perspective. These times represent a magnificent opportunity for us.”
“I think Japan will undergo immense change in the next few years. At the center of this change will be the generation now in their 30s and early 40s.This generation will become the main event, and people with ability will make themselves known, thereby driving the evolution of the social and economic environment. Around about 2010, I think it is safe to say that Japan, China and Korea will be economically unified in terms of their economic systems. I am very excited about this.”
Alex continued his relentless flood of questions, to which I responded just as quickly.
I was a little worried about whether I had gotten the message across, but I think my execution had been fairly solid. You can usually tell how well a speech went by the number of people who approach you afterwards to exchange business cards. This time, I exchanged cards with a lot of people, so I think that my speech went fairly well.
I returned to my room with mixed feelings of being done and worn out, yet with an overall sense of achievement. I checked my email, packed, and then went back to the meeting site for half an hour for lunch before checking out of the hotel.
I headed for the station, since I was taking the Linear Motor Car. I got on after a 10-minute wait. The time and speed were displayed above the door into the carriage.
We were off. We cleared 100 kph and then 200. After two minutes or so, we had exceeded 300 kph. It was like entering the unknown!
Three minutes later we were going faster than 400 kph, and we started to sway from side to side. In another three minutes, we began to settle into a speed of 420 kph.
The train generally maintained this speed, sometimes wavering between 419 and 421. Looking out of the window, urban Shanghai was soon replaced by barren land. Beyond that you could see the ocean and several tankers.
In Japan around the time of the Meiji Restoration, the new government ran steam trains from Shimbashi to Yokohama to ferment the idea of change in people. I wonder if the Chinese government is following a similar pathway now. Just as I was thinking about this, the Linear Motor Car began to slow down.
It had taken seven minutes to reach the airport. A trip that would have taken more than 40 minutes by car was over in just 7 minutes. Wow! However, although I had only been on board for seven minutes, my body felt lethargic. I suppose this could be from the electromagnetic field….
I have decided to be positive about everything in these columns, but there are many things I want to say about the policies of the Japanese government.
One is about the Linear Motor Car. I don’t know how much money has gone into it, but it still has not become a reality. China on the other hand, has already got it up and running, even though it introduced technology from overseas.
Feeling a little irritated, I opened my PC on the plane and began to write my column, wishing that politicians would adopt a sound approach, break away from the “old school” and energize Japan.
The soothing sound of Tchaikovsky’s “The Seasons” conducted by Vladimir Ashkenazy flowed through my headphones.
I would soon be back in Japan. At the request of the flight attendant, I shut down my PC.