Report No.8
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Japan Entrepreneur Report No. 8 June 2003
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- Making the whole world laugh and cry
- Homeless man turns CEO
- The end of corporate philanthropy
- "Average effort, extraordinary effort"
- Bits and bytes
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Making the whole world laugh and cry
Standing onstage wearing the paint-splattered overalls of a
workaday tradesman, Daisuke Sato, a gangly, earnest 29-year-old,
is on a roll. Like a young comedian in a long-sought breakthrough
performance, he's got a packed room of 200 ordinarily reserved
spectators in stitches.
The standing-room-only crowd roars with laughter at Mr. Sato's
happy confession of his failure as an architect, an event that led
to an unusual new career in commercial painting. They whoop at
before-and-after photos of used bicycles and microwave ovens
brought to life again with vibrant, whimsical, custom paint jobs,
and at Mr. Sato's boundless enthusiasm for painting nearly anything
and everything. And they howl when, from the stage, he strikes a
deal with someone in the front row to give an old bicycle a custom
paint job.
Most of all, the audience loves Mr. Sato's vision of reducing waste,
reshaping Japan's "throwaway" consumer mindset, and helping others
rediscover craftsmanship and the joy of work through a combination
painting service/school that strives to give new utility to the
previously discarded--and sometimes transform it into art. When
he concludes his presentation, they shout with laughter and
approval.
But a couple of hours later Mr. Sato can't stop the tears when judges
announce he has won top honors in Japan's 2003 Social Venture
Competition, including three million yen in startup funding.
Struggling to regain his composure, he promises the audience he
won't disappoint their faith in his vision. Somehow they know he
won't, and they explode one last time in cheers and applause.
The scene was Japan's Social Venture Competition, an event that
should be on television: I doubt anyone attending got away with
completely dry eyes. Each May seven finalists present plans for
socially-conscious business ventures before a panel of judges
including the likes of Oki Matsumoto, founder of online securities
trading pioneer Monex, and Takehiko Ogi, Managing Director of
Tsutaya, Japan's largest chain of video and DVD rental shops. The
event is in its second year, and this year, as last, all seven
presentations were moving in their own way.
Mr. Sato and his colleagues inspired the first issue of JER
dedicated to socially conscious entrepreneurship. While writing
it, I happened to be reviewing Built to Last, Jim Collins's landmark
book about visionary companies. A key message of Built to Last is
that all truly great companies are driven by ideologies that go
beyond product, service and earnings goals. And in listening to
and talking with the socially conscious entrepreneurs featured this
month, the message that came across most strongly is this: there
really shouldn't be any difference between profit and nonprofit
corporations.
So read on to learn from entrepreneurs who care a great deal about
the world beyond themselves and their companies. And for more
detail on the Social Venture Competition in Japanese, please see
the Entrepreneurial Training for Innovative Communities (ETIC) Web
site at <www.etic.or.jp/style2003/>.
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Homeless man turns CEO
On cold nights, after curling up on a bench outside Tokyo Station
and covering himself with discarded newspapers, Kaneto Kanemoto
would drink a small cup of bottled takeout sake to warm himself
enough to doze off into a fitful mix of bright dreams of changing
the world--and dark ruminations over the failures that drove him
to homelessness.
An award-winning designer, Mr. Kanemoto had previously tried to
exercise his social consciousness as the leader of a nonprofit
network whose lofty mission was to use functional design as a tool
of social change. Enraptured with what he later recognized as an
overly-ambitious, one-man agenda, and oblivious to his own
preaching, one-way communication style, Mr. Kanemoto alienated not
only other designers in the network, but his own wife, who insisted
he leave their home and grant her a divorce.
Broke and depressed, the 28-year-old designer found himself
homeless in the world's most expensive city, where he quickly
learned the survival skills of the down-and-out. Rule Number One:
Tokyo convenience stores ("conbini") throw out unsold rice dishes
around one o'clock each morning. Mr. Kanemoto soon became a
nighttime regular at several "conbini" near a park in Tokyo's posh
Omotesando district.
The experience of asking others for free food both humbled him and
reshaped his social mission. Amazed at the vast amounts of unsold
but perfectly edible rice thrown out every morning, he calculated
that the quantity discarded daily by Japan's 35,000 + convenience
stores would feed all the children in Africa for weeks, and started
dreaming of a "world knowledge management" network whereby he could
share these facts across the globe and eventually help remedy
inequality and wastefulness--and even bring about world peace.
He soon started getting freelance design jobs, investing a precious
400 yen in a trip to a public bath before each pitch for work. Before
long he won bigger projects involving Web design, eventually
earning enough to send money back to his wife along with letters
of apology. They eventually reconciled and now have three children.
Today, Mr. Kanemoto is the 36-year-old founder and president of
OKWeb, an online FAQ service that will gross nearly U.S. four
million dollars in 2003. The firm eliminated its accumulated
deficit last year and today generates net earnings of more than ten
percent of revenues each month. Over cold barley tea at his Shinjuku
office, Mr. Kanemoto shared what he learned from his homeless
experience, and how it relates to his subsequent success as an
entrepreneur.
"The biggest lesson was that I had to learn to listen as well as
talk," he admitted. "Communication is a two-way street, but before
I became homeless I wasn't really listening to others. It sounds
obvious, but the question and answer process is really the
foundation of all communication. I learned to truly hear others
and be influenced by their thoughts and opinions."
That fundamental insight piqued his interest in the Frequently
Asked Questions (FAQ) feature common to most commercial Web sites,
and he became keenly interested in FAQs--not only their design and
organizational attributes, but their potential as a tool for
solving non-technical problems: everything from interpersonal
conflicts to social ills. That led to the development of OKWeb,
a free service whereby consumers can ask questions about anything
under the sun, and expect intelligent and thoughtful replies from
fellow consumers.
After OKWeb became successful as a consumer FAQ service, Mr.
Kanemoto made the business scalable by adopting an Application
Service Provider (ASP) model whereby other companies can employ
either the OKWeb methodology, the accumulated database of OKWeb
community FAQs--or both. Today more than 60 companies, including
NTT DoCoMo, Daiichi Life Insurance, Yamaha and JAL Tours, use
OKWeb's FAQ service on an outsourced basis.
Mr. Kanemoto is convinced that a well-organized, interactive FAQ
is the most efficient integrated tool for managing problem
statements and proposed solutions, and hopes someday his
methodology will serve to effectively address global issues and
achieve some of the higher social aims he has dreamed of for years.
"Fundamentally, I believe capitalism is a system whereby people are
rewarded for doing positive things for the world," he says. "In
my view, there's no need to distinguish between nonprofit
organizations and for-profit organizations. A corporation should
fulfill a positive social purpose, and along the way earn money that
can then be invested in further good works. Ordinary corporations
should be fulfilling the roles that nonprofit organizations do
today. My hope is that OKWeb's FAQ and knowledge management systems
will eventually prove the validity of this conviction."
What's the secret of entrepreneurial success?
"If you don't know what you want to do, you shouldn't start your
own company," Mr. Kanemoto declares. "And if you do know what
you want to do, it's best to first join an organization that has
a goal similar to your own, and see if you can work within that
organization to achieve your goal. Change the organization itself
from the inside if you need to. Your passion and commitment should
be such that it can take you to the top of that organization. 'Being
independent' or 'having your own company' as the primary goal of
entrepreneurship is backwards, in my view. The true path of
entrepreneurship means having a clear goal in mind and starting a
company because there is no existing organization with the same
goal."
How's that for some fresh thinking from someone who knows the view
from both the top and the bottom? OKWeb's consumer and corporate
Web sites can be seen at <www.okweb.ne.jp> and <www.okweb.co.jp>,
respectively.
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The end of corporate philanthropy
Marc Benioff is calling for the end of corporate philanthropy as
we know it.
At a speech here in Tokyo last month, the founder and CEO of
Salesforce.com said that philanthropy can no longer be separate
from business. If a business makes use of the Tokyo community's
infrastructure and resources to house and conduct its business, Mr.
Benioff says, it is morally obligated to give back to the Tokyo
community--and not simply by spending its net earnings there.
The San Francisco-based entrepreneur, who grew his startup to $100
million in revenue in a scant 36 months, was in Tokyo to implement
at Salesforce.com Japan the same integrated community giving model
the U.S. parent has followed from the start: contributing one
percent of equity, one percent of earnings and one percent of
employee time to create social change. That includes hiring one
full-time employee in Tokyo dedicated to managing and implementing
the integrated philanthropy model.
One of Benioff's remarks, in particular, made me snap to attention.
"Cause-related marketing doesn't work," he warned. "Don't do
corporate philanthropy for marketing purposes. There is no
marketing benefit to philanthropy. Reporters don't want to write
about good news. Do it because employees will feel great. Customers
will feel great, too. When employees and customers feel great, you
will have a great company."
Some final food for thought from Mr. Benioff: "Business and
philanthropy are not separate things."
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"Average effort, extraordinary effort"
It's Quote of the Month time again :)
Years ago my wife, Keiko Onodera, stunned me with a simple and
profound comment.
Much of the impact lay in the way she said it. Unlike my tendency
to pontificate when dispensing pearls of wisdom, she simply
responded in an offhand manner to a comment I made about the quality
of some piece of work. I can't remember exactly what job we were
talking about, but I'll never forget what she said:
"Average effort produces average results, extraordinary effort
produces extraordinary results."
Sounds like a Dale Carnegie chestnut from 1935, doesn't it? Maybe
it is, something translated into Japanese long ago, a truism she
happened to recall that fit the particular moment of conversation.
But when she said it, I instantly saw how her work style, her
behavior, and the way she lives each day embodies the blazingly
obvious truth of those words. And ever since, whenever I ponder
the outcome of a particular endeavor, I ask myself: was the effort
involved average--or extraordinary?
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Bits and bytes
Starting a new business or thinking about it? Here's a terrific
resource for you: the Entrepreneur Association of Tokyo, a new group
that started off with a bang this month. About 50 people attended
the inaugural meeting to hear Allen Miner discuss entrepreneurism
in Japan and offer his refreshing contrarian view that the real seat
of worldwide technological innovation over the past dozen years has
been Japan, not Silicon Valley. Guerrilla marketing gurus Andrew
Silberman and William Reed are up next at EAT on July 2. See
<http://www.ea-tokyo.com/Seminars/020703.html> for particulars.
Mobile blogging in Japan? I personally don't foresee Japanese
language blogging of any kind gaining much momentum soon, but the
guys organizing the First International Moblogging Conference here
in Tokyo on July 5 are among the world's most qualified to prove
me wrong. See <http://marginwalker.org/1imc/j/index.html> for
details. I'd love to attend, but prior commitments prevent. How
about someone writing up a summary for next month's JER?
Kerry Kennedy's iTV Japan online streaming video service continues
to be an outstanding source of insight into all aspects of doing
business in Japan. Kerry records his videos in Michael Alfant's
Building 2 studio right around the corner from the SunBridge Venture
Habitat in Shibuya, and recently he was kind enough to invite me
to share my thoughts on entrepreneurship in Japan. The interview
can be seen at <www.itvjapan.com/bus_int.html>.
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Tim Clark
Senior Fellow
SunBridge Corp.
Voice 813.5459.0765
Fax 813.5459.0629
clark@sunbridge.com
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Copyright 2002-2003 Tim Clark
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