How Japan’s evocative machines are quietly creating new startup unicorns

This is a rather personal episode. We have no guests this time. It’s just you and me. Today, rather than diving deep into a specific aspect of startups in Japan, we are going to take a hard look at both what is and what is not working within the Japanese startup ecosystem as a whole. And at the end, I'm going to answer the most common question I am asked by overseas audiences. "Where are the Japanese unicorns?" You might already know about Japan's two existing unicorns, but I'm going to explain where the next four will be coming from. I guarantee that it's from somewhere you would not have expected. So let's get right to it. UPDATE:  Evocative Machines are starting to take off in Japan. If you are interested in the subject, please check out The Evocative Machines Project. [shareaholic app="share_buttons" id="7994466"] Leave a comment Transcript Welcome to Disrupting Japan. Straight talk from Japan's most successful entrepreneurs. I'm Tim Romero, and thanks for joining me. Once again, I’ve got a special show for you today. There will be no guests, no beer, no playful banter with someone speaking English as a second language. Today, it’s just you and me. It’s been a while since I’ve done one of these one-on-one episodes. Way too long really. I truly enjoy doing them and they tend to be my most popular episodes, but man they take a lot of time to write and put together. This episode, in particular, I had to rewrite two or three times, to make sure you would really understand what I am trying to explain. Because by the end of this episode you and I will definitely be in new and uncertain territory, and I for one love being in new and uncertain territory. By the time we’re done, you’ll have a solid idea of where Japan’s next dozen unicorn startups will be coming from. First, I want to tell you what inspired me to create this episode for you. In fact, it was kind of a strange situation. I mean twice a month we sit down and talk about innovation in Japan. I’m privileged to talk with and to introduce you to some of the most interesting founders and innovators in Japan. I spend a lot of time talking, writing and thinking about how the startup ecosystem is changing. But. You know, I think I missed something. Something important. And, I think the reason I might have missed it was because I watch things so closely that when …. Well, lets back up a bit so all of this will make sense. Actually, it was my friend Allen Miner who first pointed out the change. For those of you who don’t know him, Allen was one of Japan’s first modern VCs and he also brought both Salesforce and Oracle to Japan.  And by the way, if you have not listened to the Disrupting Japan episode where Allen tells the story of Oracle’s Japan market entry, you really need to go back and listen. Someday business schools will make proper case studies from that story, but until then, it’s a Disrupting Japan exclusive. It’s a story of fake it till you make it on a multi-billion dollar scale. The plot involves intrigue, secret dealings, and … rock-concerts. What more could you possibly want?    Go and listen to it right now. I'll wait. … Welcome back. Did you listen to the episode? No, of course, you didn’t. Nobody ever does. It’s a silly conceit. I don’t know why we podcasters keep using it. We should stop. Anyway, give Allen’s interview a listen when you get the chance. Now back to our story. For the past eight years, the Japan Society of Northern California has given out annual innovation awards to startups in both Japan and the US. They are a really worthwhile organization that has been around for more than 100 years. I’m on the advisory committee for the awards, and last month in Tokyo I attended the awards ceremony for the Japanese startups. The winners, by the way, were Mujin, Soracom, and Cloudian.  Ken, the founder of Soracom was on the show last year, and you’ll be hearing from the other two founders on the ...