Monozukuri Ventures: 7 reasons why you should prototype with Japanese partners
After the launch of MBC Shisaku Fund, the 1st VC fund for hardware startups to prototype in Japan, I spoke to some founders who aren’t aware of how innovation takes place in such a traditional place like Kyoto. Inspired by a recent post explaining why NYC is a great environment for hardware startups (Keen Home), I believe sharing some examples about Japanese initiatives can help other startups understand what’s so unique about our ecosystem.
- Monozukuri: rapid prototyping, always fast and better
Japan is known for its best-in-class industrial practices, including the one lead by Toyota: Monozukuri mindset.
Monozukuri — “the process of creating superior products through pride of workmanship, manufacturing excellence, and continuous improvement” — has its deepest origins in ancient Kyoto: all the best-in-class expertise was learnt from China & Korea and then mastered in Japan.
Since the time Kyoto was the political center of Japan, a strong tradition of craftsmanship and specialization has been developed from fine designs, architecture and handcraft. This ecosystem later became the basis for both hardware and healthcare worldwide known industries, with a network of suppliers working together to optimize their local business ecosystem.
Such unique resources — connected and working as a group — used to be limited to large corporations and its vast Supply Chain, with companies like Omron, Shimadzu, Horiba, Kyocera and Murata, but it’s also available to entrepreneurs now, thanks to recent updates in how manufacturing happens(with affordable 3D printers, laser cutters and CNC machines). In this way, small lot productions became common and used even by those giants, as part of their R&D best practices to try new technologies: testing markets and using customer’s feedbacks for constant iteration.
Startups like Hakuto, Google Lunar XPrize winner, count on experts support from small & medium enterprises, like Hilltop (aluminium manufacturers) who understand the main challenges to achieve their goals.
The city with the largest concentration of universities in Japan, with around 38 universities and colleges, Kyoto students represent 10% of the local population, a great chance for new enterprises to carry out.
Omron, HQ in Kyoto, is credited for having developed the world’s first electronic ticket gate — IEEE Milestone in 2007, and one of the first manufacturers of automated teller machines (ATM) with magnetic stripe card readers. The company has also been engaged in student contests like Koto Challenge, where projects can be iterated and students can get further support from other connected programs, like Makers Boot Camp.
That was the case for Waiston Chobit Healthcare members Yuki Matsuda and Yugo Nakamura, both students from Nara Institute of Technology (NAIST). They won the competition with a connected belt and got the chance to improve it. The original prototype was revised thanks to KSN local partners, while Makers Boot Camp’s helped with their Business Plan.
From a local university hub: EV carmaker startup GLM, founded in 2009 by Hiroyasu Koma, when he was a member of Kyoto University’s Graduate School and invested by former Sony CEO Nobuyuki, was acquired by Hong Kong's luxury car company O Luxe Holdings Inc.
2. Quality Control is a key part of manufacturing in Japan
Japanese Monozukuri manufacturing system doesn’t allow any small lot to leave a factory without a minimum quality control, as high quality is always a premise when making a new product in Japan.
Japanese prototype makers know how to make it work cheaper for startups, and cheaper means optimized.
Makers Boot Camp Co-Founder Kenshin Fujiwara, a serial-entrepeneur, faced a hardware challenge and achieved his goal, after he decided to make a new product 100% Made in Kyoto: building Hacarus smart scale with Kyoto Shisaku Net, a network of local manufacturers.
Each part of the process was done by one specific company and the project was managed by one leader, which helped Kenshin to get a fast result with a great quality. His potential customers tested his device and he pivoted his business based on real user's feedbacks.
3. Project Management is king! Kaizen, Kanban and much more.
One common mistake most startups tend to make is waste too much time and/or money managing a number of different suppliers. Having a Master Plan in advance, with milestones definition and involving experts who can guide your decisions is a key part of manufacturing.
If you ever studied Project Management, you might be familiar with terms like “Kaizen” — “applied to processes, such as purchasing and logistics, that cross organizational boundaries into the supply chain”, and also “Kanban” — “takes information that typically would be communicated via words and turns it into brain candy.” It applies “to evolution, not revolution. It hinges on the fundamental truth that you can’t get where you want to go without first knowing where you are.” For startups that have never worked for a hardware project, it’s really hard to face all the ups and downs of a project.
SMEs like KSN will take your project seriously no matter how small your lot is, so you don’t have to worry about managing suppliers of your supplier. In such a small country with only a limited surface able to have cities (most of Japan consists of hills, mountains and volcanos), Japanese have been able to develop a very respectful work ethics with sustainable practices as a core.
4- A melting point: Nintendo’s hometown spirit
If you ever played Mario, Zelda or Pokemon, you might be more familiar with our local atmosphere than you could imagine, as all the scenes in those stories/games seem to take place around our neighbourhoods. Such an inspiring ecosystem has inspired young talents to start their studies and career in Kyoto, planting seeds for future projects.
That was exactly the case for Kyohei Nakano and Kyohi Kang- back there working as Engineers at Nintendo, where they decided to open their own business. That was the starting point for Atmoph, a company that started with a smart digital window that opens to the world in 4k-videos and gives some ambience to your house, office or restaurant.
Kyoto VR co-founder Atticus, American expat based in Kyoto, ended up falling in love with the local atmosphere and decided to bring their artistic approach using virtual reality. Currently, they’re looking for partners to help creating a virtual city, implementing new technologies to improve tourism and social interactions.
5- A vast benchmark for good products
The high level of manufacturing might actually be a direct result from a very demanding market, which means bad products won’t last long here.
I recently bought a USD 1 charger for my iPhone (had to do it in an emergency) and the connector broke inside my phone (probably overheating) — then I had to ask for help to take small pieces out of my connector. I noticed my Japanese friends were very surprised “of course it was a bad choice. What do you expect from a cheap charger?”
A NYC-based startup that visited Japan last year told me about running a project in China. “I closed a deal with a great PCB company offering the slogan: Japanese quality with Chinese prices”
There’s no miracle, Japanese consumers know that lowest prices usually come with bad quality. And other Asians search for products from Japan and South Korea, looking for good quality products.
6- Join International events in English
Kyoto D-Lab organizes a range of amazing opportunities for interaction with the creative local community, as Kyoto Startup Summer School, bringing mentors and experts from overseas + local role models.
Makes Boot Camp co-hosts a series of Monozukuri Hub Meetups — events in English, sponsored by Kyoto City (ASTEM). The main purpose is to give visibility to the new venture companies (as startups are often called in Japanese), so they can get useful feedback from possible customers, investors and partners.
We mix a range of experts and startups from different ecosystems and diverse backgrounds to share their points of view.
Some of our recent guest speakers were from NYC (Julio Terra/Kickstarter and Ajay Revels/Polite Machines ), Pittsburgh (Jeff McDaniel/Innovation Works), India/China (Manmeet Singh/China Accelerator), and France (Régis Duhot/Parkisseo and Adrien Sadaka/Timescope).
In our next edition — May, 18th, Greg Fisher, Hardware Massive, CEO & Founder, is our special invited guest to share his experience with startups, from CA to China. If you’re around, just sign up here! (free of charge)
7- Kyoto is a great spot for some break
If you’re still not convinced, come visit us and we can show you much more.
We’re now selecting hardware startups for our next co-hort with FabFoundry NYC, so check more details about Monozukuri Bootcamp and come prototype with us!.
