Disrupting Japan

Explore how artists can thrive in an AI-dominated world with a solid three-point strategy. Discover the crucial differences between human and AI-generated art and the shift in music consumption from deep connections to fleeting abundance. The podcast delves into how AI is reshaping the creative landscape, encouraging artists to foster genuine relationships with fans. It also challenges the pressures of conformity in the industry and questions the true nature of creativity amidst the rise of AI.

Yuka Hata, Senior Managing Director of the Japan Investment Corporation (JIC), discusses Japan's proactive funding approach for startups. She highlights the challenges new Japanese VCs face, such as low valuations affecting deep tech ventures. The conversation delves into JIC's investment strategies, including support for female VCs and attracting foreign investors. Hata also explains the cultural shift needed in Japan's VC landscape and the importance of global partnerships for enhancing the startup ecosystem.

In this engaging discussion with Makoto Shibata, head of FinoLab and a fintech innovator for over 20 years, listeners explore Japan's unique fintech landscape. He discusses the crucial shift from cash to cashless payments and the startup opportunities that arise. Topics include AI's cautious integration in traditional banks, the importance of corporate support for fintech growth, and hurdles for Japanese startups aiming for global reach. Shibata also sheds light on the potential for fintech innovations and how foreign companies can thrive in Japan's market.

Disrupting Japan is 10 years old today! This is a simple thank you rather than a full episode. Thanks for listening!   Transcript Welcome to Disrupting Japan, Straight Talk from Japan's most innovative founders and VCs. I'm Tim Romero and thanks for joining me. This is a very short and very special episode. It's not an episode really, more of a personal message. You see, ten years ago today. I released the very first episode of Disrupting Japan. And I just wanted to say thank you. I really mean that. Independent podcasting is an incredibly personal medium and it depends on there being a real connection between the host, and the guests, and the listeners.  Commercial talk shows spend a fortune creating the illusion of that connection. And being in the center of that in real life is an honor and it’s amazing. It’s become a cliche when the host thanks their audience and reminds them that the show would not be possible without them, but it’s different at Disrupting Japan. You really do create a big part of the show’s value.  Let me explain. It’s not about download numbers or affiliate link-clicks. I don’t sell anything and my guests aren’t selling anything on Disrupting Japan, so those metrics don’t matter much to me. However, my guests often comment on the surprisingly high quality of inbound contracts they receive  after appearing on the show. These connections have resulted in a lot of new hires, and a handful of investments have been made as well. That community, the engagement and overall quality of the listeners is a big part of the show’s value. In fact, over the years, four Japanese startup founders have told me that listening to our guests’ tell their stories on Disrupting Japan gave them the confidence to start their own startup, and that’s pretty awesome. So, thank you! Ten years ago I never imagined how big Disrupting Japan would become. Honestly, it kind of freaks me out sometimes. But here we are. Ten years and well over 200 episodes later, and we have over 9,000 listers in more than 150 countries around the world — including one listener from Vatican City. Now, I have no way of knowing for sure exactly who that listener is.  I mean, it could be anybody. But I like to think of it as a testament to the influential nature of Disrupting Japan’s listeners. Building Disrupting Japan is an honor and a joy. I love putting the show together, and despite having a fairly demanding day job, I always make sure Disrupting Japan is released on schedule and is a quality show that woth the time you put into listening to it. The show takes up a lot of weekends and evenings. I’ve done pre-interview research while in the hospital for a minor surgery. I’ve done post production editing in so many different airport lounges, and twice I’ve made a little pillow-fort in my hotel room so I would have decent acoustics to record the intro and outtro. So, whether you are a new lister or have been a part of Disrupting Japan ever since episode 1 was released 10 years ago, thank you for taking this journey with me. Startup innovation is really starting to flourish in Japan, and we have exciting times ahead. And most of all, thanks for listening and thank you for letting people interested in Japanese startups and VCs know about the show. I'm Tim Romero and thanks for listening to Disrupting Japan.

Shinji Asada from One Capital shares his insights into Japan's thriving SaaS market. Interestingly, while global SaaS valuations plummet, Japan sees untapped growth potential, especially in SMBs. He discusses the necessity of product collaboration tailored for Japan and what it takes for local startups to expand globally. Asada highlights a unique venture capital model in Japan, the shifting workplace culture post-COVID, and how Japanese founders have evolved. His perspective illuminates the promising future of tech entrepreneurship in Japan.

Join Jeff Wentworth, Paul Chapman, Sam Pemberton-Ahmed, and Samantha Ghiotti, successful foreign fintech founders, as they share their journeys in Japan's startup ecosystem. They tackle unique challenges like cultural barriers and the importance of local partnerships. The conversation dives into innovative financial solutions and the crucial role of timing and regulation in launching a product. Discover why foreign founders are vital for Japan’s fintech landscape, and gain insights on navigating the regulatory landscape and designing user-focused apps.

James Riney from Coral Capital discusses Japan's startup sectors poised for global leadership, the potential of niche startups, and why Japan's approach to investing differs from Silicon Valley. They explore Japan's hidden unicorns, the challenges faced by foreign VCs, and the importance of sustainable value creation in startups.

Japan thinks about robotics and AI differently that the West. In addition to their functional, productive role, a lot of thought is also given to our personal interactions, their social role, and the relationships we build with them. Today we sit down with Shunsuke Aoki, founder of Yukai Engineering and one of the most innovative and creative thinkers on the emotional connection between humans and machines. We talk about the future of robot companionship, how AI will change the definition of "culture", and why the future of Japanese robotics will have a lot more participation by foreigners. It's a great conversation, and I think you'll enjoy it. Show Notes The importance of emotional connection with robots Why children will listen to robots more then parents The importance and future of robot companionship Japanese vs western robot attitudes in culture and fiction How GenZ is is accepting AI boyfriends and girlfriends What a healthy emotional connection with an AI or robot looks like How to keep AI from influencing us into developing bad habits and Why do we keep building human like robots Why it’s easier to form an emotional connection to Qooboo than Abbot How to (maybe) make money on emotional robots Why the Japanese approach to robotics needs more foreigners in Japan now Links from our Guest Everything you ever wanted to know about Yukai Engineering Follow Shunsuke on Twitter @aopico Friend him on Facebook Connect on LinkedIn Yukai's Products Bocco Emo Qoobo Nekkomimi Fufury Transcript Welcome to Disrupting Japan, Straight Talk from Japan's most innovative startups and VCs. I'm Tim Romero, and thanks for joining me. Today, we're going to talk about robots because I mean, hey, who doesn't love robots? Now, in past episodes, we've talked a lot about how Japan's relationship with robots and automation is fundamentally different from what it is in the West. It's not really about technology. I mean, technology is universal. It's more about the personal and cultural connection to machines in general. Well, today I have a real treat for you. We sit down and talk with Shunsuke Aoki, the founder of Yukai Engineering. Now Shunsuke may not be that well known outside Japan, but he's one of the most innovative and creative thinkers on the topic of how humans and machines can connect on an emotional and a subconscious level. Now, to be fair, an audio podcast can't really do justice to Yukai engineering's creations, but we're going to do our best. You need to see the videos or really you need to interact with Shunsuke's creations in person to fully understand the emotional impact. Shunsuke and I talk about the future of robot and AI companionship, how AI will change the way we think about culture, and why the future of Japanese robotics will involve a lot more participation from foreigners. But, you know, Shunsuke tells that story much better than I can. So, let's get right to the interview. Interview Tim: So, we're sitting here with Shunsuke Aoki, the founder of Yukai Engineering who's creating lifestyle robots, and thanks for sitting down with us again. It's been a while. Shunsuke: Thank you. It's been a while. Tim: Yukai over the last decade and a half has been making so many cool, interesting things that just to name a few, your first big hit was the Nekomimi wearable cattier that respond to brainwaves. You have the Qoobo sort of companion pillow which has the cat tail on it. The Bocco family robot that seems to be getting a lot of traction and it's hard to describe these on an audio podcast. But we'll put videos and pictures on the site, but it's hard to understand this kind of emotional impact unless you can touch and interact with these robots. With so much robotics research going on, you've been very focused on this sort of emotional connection. Tell me about that. Why is that important? Why do you focus on that? Shunsuke: At the time we started a business 2011, smartphone dominated the cellular phone market right after the launch of iPhone. Japan people are skeptical and they say, a Honda are already smart and we don't need touch screens. But three, four years later, most people accept it. As a result, I see a lot of wire connectivity, like Wi-Fi modules or Bluetooth. They're becoming cheaper and cheaper, which makes us easy to build our own robots. I saw a possibility of personal robots that can be used as an interface not for manipulation. Tim: Well, I understand that from sort of a technical point of view. I mean, yeah, about that time a lot of things came together to enable, like this new wave of innovation in robotics. But while most robotics startups are focused on like factory automation or increased efficiencies and things like that, you've taken a different path, like Bocco, for example, which has been a pretty successful product for you here in Japan. It's a family robot. Shunsuke: Yes. It's designed for isolated seniors and Bocco is designed to enable family members to keep in touch easily and monitor their activity without cameras or intruding the privacy family members can leave a message to their smartphone, and the Bocco robot will speak out the message, and the seniors can make reply by recording voice message to the robot. That message is sent to the smartphone as a voice message and with a text. Tim: So, like Bocco is a sort of cute 20 centimeter tall little robot looking thing. Shunsuke: Right, right, right. Tim: So why use something like that instead of using a smartphone and line chat or using Amazon Alexa or Apple Pom Pod or something like that? Shunsuke: The idea of vocal started from my own experience as a working parent leaving my kids at home. I thought it's not a good way to give my kid who newly entered the elementary school, so around six or seven, and he have to come home alone with the key and wait for the parents to come home for several hours. I saw smartphone is not for him because when he got a smartphone, he starts watching YouTube and I want to give him some companionship, something to keep him company. Tim: Is there something important about having a dedicated device? So, a smartphone kind of does everything, but is there something important about having that physical device? Shunsuke: Yeah. Smartphone can do the same job as Bocco, but Bocco is a separated physical device. When I was a kid, I was always carrying a plush toy of a bear. Tim: The teddy bear. Shunsuke: Yeah. Yeah. And it was my best friend, so I wanted a robot to be his best friend. Tim: How did it work out? How did your son end up interacting with it? Shunsuke: Interesting thing is he listens more to the robot than parents. Like when the robot told him to brush your teeth, take a bath or go to sleep, he listens to the robot very well, unlike to the parents. That was very interesting. Tim: But for the Bocco product, rather than targeting families and young children, why did you decide to target the elderly? Shunsuke: When we started, it wasn't meant only for the seniors. It is useful for working parents in the age of smartphone people they're busy with their smartphones. That was the thought. Tim: It is interesting that people can build this emotional connection to robots. Yukai has done a lot of pilots with large companies on elder care and home care. And how have those worked out? What's been the reaction? What's been the uptake? How often do these seniors use it to communicate? How do they interact with it? Shunsuke: The biggest example is Secom, the largest security company in Japan. They employed Bocco as a communication device between the isolate seniors and the operators. So, operators can chat through Bocco. It gives senior the chance to exchange messages, which is good to maintain cognitive ability for those who don't have much chance to have conversation with people. Tim: So, the projects have turned into long-term contracts. Shunsuke: Right, right. It's not a POC anymore. It actual service. Tim: I want to get back to the comment you made just a minute ago about the importance of robot companionship. So, this is something we've talked about a lot in the past. You and I. Shunsuke: Yes. Tim: I know when you're talking about robots as companions, you're not talking about replacing human companionship. What kind of relationship do you think people and robots will have? What kind of companions will robots become? Shunsuke: Robot cannot replace human or pets, pets are almost really the human. It's almost a family member, so robots cannot replace them, but robots can be a partner. I see a lot of example in animation, of course, Doraemon. Doraemon is kind of personal coach or Nobita. Tim: I mean, in fiction, there is that long, especially in Japan that history of robot companions. But I think even now, if you look at, it's not robots, but its AI products that are like AI girlfriends or AI boyfriends. And if you look on Reddit and you watch how people are talking about the relationship with these AIs, the generation Z. They are building a real relationship, a real emotional connection. They know it's not human. They're not like delusional. But both men and women seem to be forming this kind of unique emotional bond. Shunsuke: Maybe, but it's not something that substitutes humans. Tim: No, I don't think so. I don't think that most of the people using these Apps view it as a substitute. They view it as something different and unique. Sort of like the Doraemon robot coach. With all the rapid development in AI over the last couple of years, especially with large language models, being able to enable computers to communicate in a much more human-like way. What's the impact you think that AI is going to have on robotics, particularly these emotional, these lifestyle robots? Shunsuke: I think we have a huge possibility we can finally give robots conversational feature.

Ken Yasunaga from Global Hands On VC discusses how VCs hinder Japanese startups from going global. Topics include challenges in Japan's ecosystem, lack of unicorns, need for global expansion, importance of mentorship, role of foreign VCs, and government support for innovation.

There is important news for Disrupting Japan this week. It's a very short episode because I just want to let you know what's coming, and to thank you for all your support over the years. Leave a comment Transcript Welcome to Disrupting Japan Straight talk from Japan’s most innovative startups and VCs. I’m Tim Romero, and thanks for listening. Big changes are coming to Disrupting Japan. Our 10th anniversary is coming up this September, and you know, I thought about making this change then, but no. No, there is too much going on right now now to wait for four more months. For the past ten years Disruption Japan has brought you the stories of Japan’s most successful entrepreneurs, and I am going to continue to do that. But starting today, we are going to be hearing from Japan’s leading venture capitalists as well. There are a few reasons for the change. Part of it is that the Japanese venture landscape is changing fast, and in some very different snd important ways than what we see in the US.  Understanding innovation and startups in Japan requires understanding how it all gets financed and understanding the changing role that venture capital is playing here. The other reason for the change coming now is that these days as a Partner at JERA Ventures, these are the waters in which I swim. And there are some incredibly interesting trends and changes going on in the ecosystem that I will be sharing with you. Naturally, we’ll also talk about the kinds of startups VCs are investing in now and where they see the market heading in the future. And of course, Disrupting Japan will still be talking with founders —  a lot of them! After all, that’s where the change and the innovation really comes from. The founders are the are men and women who are actually in the arena, fighting the good fight, and changing the world. So I’ll see you right back here in just a couple of weeks. And most of all thanks for listening, and thank you for letting people interested in Japanese startups and investors know about the show. I’m Tim Romero, and thanks for listening to Disrupting Japan.