Disrupting Japan

We have been dreaming about flying cars (and startups have been promising them!) for over 70 years, and it looks like we might almost be there. Orders have been placed, and delivery schedules set. Today we sit down with Tom Fukuzawa of SkyDrive, and we talk about the development of their flying car and their recent contract with the city of Osaka for air-taxi services. However, we also talk about the real difficulties of turning a group of passionate volunteers into a passionate startup. I don't want to spoil anything for you, but it did not turn out like it was supposed to. It's a great conversation, and I think you'll enjoy it. Show Notes Why the word is experiencing a boom in flying car research and prototypes The cool concept vehicles of the Carivator project How to bing young innovators in an industry together Why driven, committed people rarely "volunteer" Why just asking for money can be easier than getting investment. Why aircraft innovation is slow and why aircraft startups are rare The size of the future flying car market How we will integrate flying cars and traditional infrastructure Why the enterprise to startup revolving door is so important Links from the Founder Everything you ever wanted to know about SkyDrive Friend them on Facebook Follow them on Twitter @Skydrive_Global Check out SkyDrive's LandCare Robot SkyDrive's Vision Video Transcript Welcome to Disrupting Japan, straight talk from Japan’s most successful entrepreneurs. I’m Tim Romero and thanks for joining me. You know, we seem to be in a bit of a flying car startup boom right now. Of course, the flying car has been a symbol of the future for over 70 years now. And for that whole time, we've always been just 10 years away from saying goodbye to traffic and taking to the skies.  Well, today we sit down with Tomo Fukuzawa, founder of SkyDrive. And he explains how he plans to have his flying cars on the road or rather in the skies in three years.  And while there are many startups making such claims today, SkyDrive recently signed contracts with the City of Osaka to deliver an air taxi service. And last month SkyDrive began the final stage of government certification for their vehicle. So yeah, there's something here that deserves a closer look.  Oh, and by the way, Tomo was at their testing facility so there's some background noise in this interview. The drones and flying cars themselves weren't flying around so just some cars passing by. It's not too bad. But at one point, it sounds like a tractor trailer drives between us and knocks over our table. You'll know it when you hear it, trust me.  Anyway, Tomo shares some really important lessons about running a moonshot startup, how partners and collaborators and people you've known for years begin to treat you differently. Many of these lessons apply to anyone following their dreams, but the startup experience makes everything so much more intense.  But you know, Tomo tells that story much better than I can. So let's get right to the interview.   Interview  Tim: So we're sitting here with Tomo Fukuzawa of SkyDrive, who is making flying cars and cargo drones. And thanks for meeting with us today. Tomo: Thank you very much for inviting me. Tim: It's my pleasure. I love the whole aerospace and aviation sector. I love what startups are doing in here. I want flying cars to be real so badly. Tomo: Thank you. Tim: So tell us a bit about your current prototype. It's currently a one-seater model, right? Tomo: We started SkyDrive three years ago. And last summer, we studied manned test flight of a flying car or eVTOL. And this was the first time in Japan to show manned flying car, and we have one-seater and eight propellers. And now we are flying 5 to 10 minutes by one charge. Tim: I want to get into the details of the technology in the future in just a minute. But it seems like in the last, let's say, two years or so, there's been this huge interest in flying cars startups, not just in Japan but all over the world, what's driving this? Tomo: Yeah. There are about 400 project of flying around the world, and about 10 project have already studied manned flight. Those project started 3 to 10 years ago. So, movement of flying car is coming for the last two or three years, but they have already started years ago. And the biggest lesson is that the sensor or controller is very, very smaller size and high spec but reasonable price. Tim: When you say the controller, do you mean like-- Tomo: Okay. That means CPU or flight controller or motors are used and how much electricity to produce the controller. Tim: Okay. So despite all this recent global interest in flying cars, I mean, you've been very involved with this for a long time now, right. So, you started out at Toyota and you were part of a project called Cativator. Tim: Yeah. Cativator is a volunteer group. It was found eight years ago when I was in Toyota Motor Company and other members in other companies. We wanted to make a nice vehicle, and we finally decided to make a flying car. Tim: What other kinds of vehicles were you working on? Because it wasn't just the flying car, right? It was a lot of different experimental projects. Tomo: Yeah. Before we decided to make flying car, we thought of unique vehicle, like, two stories car or car we can sleep in or cargo to see or like that, yeah. Tim: What was the motivation of starting this? Because it was a lot of engineers from a lot of different companies, I mean. Tomo: Yeah. So the member was about 20 or 30 years old. And as they are in a big company, they cannot see whole vehicle but only light or only washer or only steering wheel, like that. We wanted to make a vehicle, and also we wanted to make innovation to the vehicle. Tim: And so of all these different, you know, two-story vehicles, you decided on the flying car, Tomo: We experienced many things and we found if we can freely, it is very fantastic, not only efficiency but also very fun. And we decided to make flying car. Tim: That's awesome. So it was just this project, a bunch of talented engineers who wanted to work on the whole project. So, what made you decide to change the structure from this friendly group of people collaborating into a real startup? Tomo: When we started Cativator, the first prototype was drone-size product. So, we bought radio controller car, and also we bought a drone, and combined together and fly. And after that, we made a full scale prototype, and it wasn't flying very well at first. And we finally started flying it in 2018. And I thought, oh, it might be a good business. Tim: So just it seemed like it might be something that you could turn into a business? Tomo: Yeah.  Tim: But that's a pretty big shift. Tomo: Yeah. When I see full-size prototype flying, I was very surprised, because for the last three years, it wasn't possible. And if it is possible, we have to try hard to make a real flying car. Tim: Yeah, yeah. And so during that transition, changing from a community of engineers to turning it into a real company, so a lot of your current staff is from Toyota and Mitsubishi. So, did most of the members joined the new company? Tomo: Not too much. So, there are about 100 members in volunteer group. And now in the company, there are only five to eight members from volunteer groups. Tim: Oh, wow. Who came? How did people make that decision? That must have been a really difficult time. Tomo: Yeah. When we made a company, we found a very, very specific engineer in our volunteer group, and asked him or her, why don't you quit your job and come to our company? And of course, not all agreed about it, because it is very difficult to make flying car with five or six or seven full-time members. We hired engineers from outside too, before that, many members of our brand to come group was from automobile sector. But it is our drone and also aircraft, so we searched aircraft engineer too. Tim: All right. So, what's the biggest change from running the organization versus running the startup? Tomo: Ah. It is totally different. If we joined volunteer group, it is just a hobby. So, don't have to focus it so much. And for startup, it is changing of life. Yeah, if they don't-- Tim: They don't commit or-- Tomo: Yeah, yeah. Commitment is so much different.  Tim: Yeah, that's true. I mean, startups, it takes over your life. It's not a hobby. You don't have any hobbies when you're running a startup. Tomo: Of course. And I found another part that very committed people don't join volunteer group but join startup.  Tim: Ah. You know, I guess that makes sense. Because very committed people want to be around other very committed people. Tomo: Yeah, that's right. And committed people want to do project seriously, not hobby. Tim: That makes perfect sense why it was time to change from a hobby to a startup. Actually, it looks like a lot of your funding came from Toyota and Mitsubishi and the same sources that a lot of the engineering talent came from too. Tomo: Yeah. To be honest, first funding was from venture capital, and the last funding stage, some big company begin to fund.  Tim: Okay. So they came on later. Tomo: Yeah, that's right. Yeah. But when we are a volunteer group, we get money from Toyota or other company, other sponsor fee. And we got more than $2 million. That was very good. Tim: So you get $2 million from the sponsor fee as the volunteer group? Tomo: Yeah.  Tim: But they wouldn't invest early on? Tomo: That's right, yeah. Tim: Okay. Well, I'm glad they've invested now. Let's talk about how flying cars and cargo drones are going to roll out. So, are cargo drones kind of the first step, is that what we're going to see commercialization of first? Tomo: Yeah. We launched cargo drone last month. And now, more and more cargo drone is flying near the mountain. Tim: So,

Cloud visionaries promised us unlimited scalability, but they greatly underestimated the amount of data we would start producing. Today we sit down with Michael Tso, the co-founder of Cloudian, and he explains why some systems are just too big for the cloud, and how the industry is adapting.  Mike also shares his advice for selling via channel partners, and we talk about the competitive advantages and disadvantages of being a Japanese startup on the global stage. It's a great conversation, and I think you'll enjoy it. Show Notes The real reason we are "drowning in data" The missing link in connecting cloud and local storage What kind of apps really need 100's of petabytes of storage How to pivot successfully in Japan, and why it's so hard to do so Using Japanese culture as a competitive advantage The most important difference between Japan and US startup culture Why US companies hesitate to buy from Japanese software companies How to expand globally using channel partners and systems integrators What everyone gets wrong about failure Links from the Founder Everything you ever wanted to know about Cloudian Friend Mike on Facebook Follow him on Twitter @MichaelTso   Transcript Welcome to Disrupting Japan, straight talk from Japan’s most successful entrepreneurs. I’m Tim Romero and thanks for joining me. As a society, as a species, we have way too much data on our hands. A decade ago, our data got too big for our local systems and so we moved it into the cloud. And now, well, our data has gotten too big for the cloud and we're moving it back on premises.  Now, I promise this will make a lot more sense in a few minutes, when we sit down with Michael Tso, co-founder of Cloudian. Cloudian makes massive scale storage systems, massive as an hundreds of petabytes of storage that can run on site and seamlessly integrate with Cloud Storage. Cloudian is also interesting, because they're one of only a handful of Japanese startups that have really succeeded in the US and European markets. And Mike and I talk a lot about how they made that happen.  We talk about the challenges and the necessity of pivoting in a Japanese startup, how Cloudian's Japanese identity and culture both helped them and hurt them in their global expansion. And Mike gives some really great advice about how to sell software through channel partners and what you should really expect from those relationships.  But you know, Mike tells that story much better than I can. So let's get right to the interview.    Interview  Tim: I'm sitting here with Michael Tso, the co-founder of Cloudian, which provides object storage for the enterprise. And Mike, thanks for sitting down with us. Mike Tso: Yes, happy to be here, Tim.  Tim: Now, object storage for the enterprise is something that gets talked about a lot. But what does that mean exactly? Mike: Yeah. So I think I need to just rewind a little bit and just kind of talk about why are we drowning in data? Why is there so much data? Well, because actually, if you think about the process of innovation and the process of invention, it's data-based, right? You need to have data to know where you're at, and you can draw inspiration from analyzing your data. And then you go try some invention, and then you have to measure the outcome. And then you go back and kind of either fix it or improve it. So it's a continuous process. Tim: But, I mean, if you look at kind of like human history, we humans will fill up as much data, well, we've always had data, it's a question of how much we can store. And the easier it is to store, the more of this information we will. So it used to have to be engraving on cuneiform, clay tablets and creating vellum now it's just, oh, we'll automatically just save everything.  Mike: Well, I think about this a lot, right? It starts with how easy it is to create the data. So if you have to chisel away on a rock, you're not going to create a lot of data. But these days, we have sensors with cameras, when people think about data, people think about, oh, how many emails am I sending? How many pictures are you taking? But actually all these are very small in the grand scheme of things. What is generating what the big data that we're seeing these days are mostly machines, because we have automated data curation, we've automated data movement, we've automated data storage. So, the whole thing is becoming very easy. And now we have AI, which has just a unsatisfiable appetite for more data, because the more data you have, the better your AI becomes.  Tim: We've got this perfect circle. So we've got machines generating the data, the machines storing the data and the machines analyzing the data. Mike: That's right. And thankfully, humans are still needed in a process to make sure everything works. But exactly, the more value you're able to get out of your data, the more people are keeping all the data, so we're not keeping it just because it doesn't have value. We're keeping it because people are really generating this data. So actually, in a week from now, I'm going to be speaking at a conference called the High-Level Forum at Grenoble, France, where the theme is reinventing industry. And of course, I am there to speak about what I think is at the center of all this, what's underneath all the reinvention is the amount of data that people's collecting so that they can invent better.  So anyway, so coming back to the object storage, when you have that much data to manage, you really have two or three kinds of sets of problems. So data that's growing about 20-40% a year, that's growing 5 times to 10 times faster than the IT staff that we have in the world. So you need a solution that can manage sort of an infinite amount of data with the same team, right? And that's one of the things that object storage allows you to do. And then secondly, something like 80% of all new applications are born in the cloud. So, all these application expect cloud-native environments, and that includes object storage, because every cloud is using object storage as its way of storing data. And third is security. We're seeing 700% increase in attacks from ransomware. Building strong firewalls are really no longer sufficient. You have attackers that only needed see once, and once they come in, you have so much data that they're going to be kind of going after it. So, the data storage, the data management systems need to be self-protecting. You cannot rely on building bigger walls. Tim: To frame what Cloudian does. So, Amazon, Google, Microsoft, they're all talking about object storage. Mike:  90% of data on Amazon, Google, Microsoft is stored in object storage. Tim: What does Cloudian add to this? Mike: We develop object storage software that allows you to have the same kind of technology that's being used in the cloud, but you're able to deploy this in your own data center or in somewhere else where your data cannot move into the cloud, either for cost reasons, or performance reasons, or privacy reasons, or legal reasons. So really, the way to think about what we do is that we provide an extension of the cloud and bring the cloud to where your data is. We bring all the flexibility, all the ease of management, all the stuff that the cloud offers, but we bring it to where you happen to have the data. Tim: Okay. So, if I'm a programmer sitting at one of these companies, and I'm accessing data, it all looks like I'm just accessing data in the cloud. I don't necessarily know if it's on-site or off-site or, okay. Mike: Exactly. The idea is that your data should be resident wherever it's most efficient for you. Our software makes it looks like it's a cloud-native environment. Tim: Awesome. You know, Mike, we've known each other for a long time, and I've been trying to get you on the show for a while, because you and Cloudian are one of the few real success stories of a Japanese startup that's succeeding in the US market. I want to get into that, but first, I'm still trying to wrap my head around the scale of this data. So, you guys are talking about applications in the tens of petabytes. Mike: It's actually hundreds now. Tim: Or hundreds of petabytes.  Mike: Yeah. Tim: And so when I was doing research, trying to understand what you do in this industry, I'm trying to wrap my head around these numbers. And it just gets silly, you know, you're talking about, well, it's millions of songs or hundreds of thousands of videos. The Library of Congress is about 20 petabytes of information, and like, my brain just can't wrap around that. So really, what kinds of things require tens of petabytes of storage? Mike: I can tell you quite a lot of examples. So one of our customer that has hundreds of petabytes of storage, they're a major media company, and we archive for them all of the media that they have ever produced from the beginning of time. People tend to think about movies or TV shows. They think about, okay, it's going to fit on a DVD, right? Okay, it's true, that's the finished product. But actually, all the clips that it took to make that, all the takes that they have, they actually keep all of it, because a lot of times they go back and they do a remake or they do a recap, or they make the movie for a bigger screen or for lower resolution for mobile devices. So there's lots of different versions of this. And with 4k here and 8k coming, you're going back and going to the source files, and they are making higher resolution versions of the same movies or the same shows.  So, before they put us in, they used to keep that library on a bunch of tapes, and they have to tape libraries—one that they use actively, one that they live in like a mountain that they never touch. When you're using tape, you know, when I want something I think it's on that tape, tape number whatever, I send like a truck to go and get it.

Japanese university and government venture funds play a much larger role in Japan than in the West. I've always considered this difference to be, on balance, neutral, today's guest makes a convincing case that these funds are actually hurting the startup ecosystem here. Today we sit down and talk with Hiroaki Suga, co-founder of PeptiDream.  PeptiDream is now a $7 billion biotech company, but it started out as a couple of university faculty members funding operations out of their own pockets. PeptiDream succeeded by using a very different model than that used by either the current generation of university spin-outs or biotech startups in the West. It's an interesting blueprint that other biotech firms might want to copy, but only if they are really sure that their technology will actually work. It's a great conversation, and I think you will really enjoy it. Show Notes Japanese Univstities' problems with applied research The challenge in moving from academia to startup operations How to hire a CEO What most professors don't know they don't know about business How to land large sales contracts as a small startup How to sell new technology to Japanese pharmaceutical companies Why biotech investment is so hard in Japan Why you want to step away while you are on top Japan's next biotech unicorn Why most Japanese government startup money is misused Links from the Founder Dr. Suga's Lab Everything you ever wanted to know about PeptiDream Hiroaki's new project MiraBiologics  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. Today, I'd like to share some amazing insights about the startups being spun out of Japan's universities, because what's going on here is very different than what's happening in e US or the EU.  This is a special selects show, and I first spoke with Hiroaki Suga co-founder of PeptiDream a few years ago. The points he made in that conversation, however, have only  become more important since then,  and I'll be back with an update after we talk. So here we go! --- We’ve talked a lot before about how there are not many life sciences startups in Japan and what can be done to change that. But there are, of course, some and some incredibly successful ones. PeptiDream is one of those startups. Founded by a small team at a university lab, PeptiDream has grown from nothing to a $6 billion company. Today, we sit down with the founder of PeptiDream and fellow guitarist, Hiroaki Suga, and he’ll explain how they’re working with pharmaceutical companies all over the world to discover new drugs and new treatments. We also talk about the rather unusual business strategy that allow them to scale up with relatively little financing and to land deals with global drug companies a lot sooner than most biotech startups can. And I’ve got to say, my conversation with Dr. Suga really changed my mind about the role the Japanese universities and the government should play in fostering startups and innovation here. It’s a fascinating and unique perspective from inside the system, and I guarantee you, it’s not what you think it is. But you know, Hiroaki tells that story much better than I can, so let’s get right to the interview. Interview Tim: I’m sitting here with Hiroaki Suga, the cofounder of PeptiDream. So, thanks for sitting down with me today. Hiroaki Suga: Sure. Very welcome. Tim: PeptiDream is a peptide discovery platform but what is that exactly? Hiroaki: So, the technology started from over 25 years ago. I had idea. Is that okay? I want to develop RNA catalyst. The so-called ribozymes. I did a post doc with Professor Jack Szostak in Harvard Medical School. I run the techniques for the in vitro selections but I didn’t really get major success, but I was fortunate enough that I get an academic position in State University in New York Buffalo. So, I succeeded in developing we call “flexizimes” so that the first two patents are owned by SUNY Buffalo, but it wasn’t really quite useful yet. Tim: So, you were working on this for 20 years plus? Hiroaki: Pretty much, yeah. Tim: Did you have an end target in mind saying, “This is how I’m going to commercialize it, this is why it’s useful”? Hiroaki: Right, right. I already envisioned that we can apply this to the in vitro transition system. Once we have this in hand, we can do a lot of things, a lot of interesting things, right. So, I developed this flexizime prototype in the US. I came back to Japan by the invitation of the University of Tokyo. I got back to Japan and immediately we succeeded in real practical version of the flexizime. Tim: That’s interesting because Japanese universities have a reputation of really prioritizing pure research over applications. Hiroaki: Right. But this is actually pure research stage. Tim: Okay. Hiroaki: It’s really pure research but I was reminded to make it very practical. So, having this flexizime allows us to rewrite the genetic code. We call it “genetic code reprogramming.” Tim: It sounds like from pretty early on, you were thinking about how to commercialize this at some point in the future. Hiroaki: Yeah, at some point but not – I don’t know when. I didn’t know when. Tim: So, was the drug discovery an early and obvious target or was that something that — Hiroaki: No, no. I was not interested in an obvious target or anything. This is just platform technology. So, idea is I want to rewrite the genetic code but at the time peptide is containing the amino acids which you don’t see in a protein, then I can mimic the secondary, metabolize the various organisms like bacterias and fungus and yeast and whatever they make. And it is very often used for antibiotics or something, other things. But natural products are very important drug source for a long, long time. So, if you can mimic the natural product, then you can synthesize artificially natural product like molecule will be useful for drug discovery. Tim: So, the PeptiDream platform and this technology, in general, allows the synthesis and analysis of a huge variety — Hiroaki: Of natural product-like molecules. Tim: Right, and it can do it very quickly and very cheaply? Hiroaki: Right. Tim: Let’s talk about that. Hiroaki: Yeah. Tim: Because, I mean, now PeptiDream is a $6 or 7 billion company but you found it very recently. It was 2006, right? Hiroaki: Yes. Tim: So, back in 2006, you had a long successful academic career, you had academic accomplishments and the proof of the value of the technology. Hiroaki: Yeah. Tim: But how did the company come together? Hiroaki: So, I envisioned that okay, if I further develop, I try to prove this system works for the drug targets. If I succeeded it, I’m pretty sure pharmaceutical companies will come to me to develop the drugs together. I really want to because I know if I do with them, if I get something very nice product, and then I cannot publish. My mission in academic, we need to publish. If it’s bad ones, maybe we can publish it. But if it’s good ones, we cannot publish it. And I was really confident that we can get something really good ones. Tim: So, how did you get that initial founding team together? Hiroaki: I wasn’t really intending to make a company but I was disclosing the patent through the – it’s called Todai TRO which is Technology Transfer Office in the University of Tokyo. They said, “You know, this sounds like really good technology. Are you interested in forming a company?” I said, “I may if I can find a good CEO. I don’t want to be CEO. I don’t think I can do CEO. Business is not easy.” And so they started screening the people I interviewed, maybe four or five people, then I found one, Kiichi Kubota. So, before forming a company meeting with him many times, mostly drinking together, to know him very well, otherwise, I cannot trust. I developed a good friendship. I can see his vision. It wasn’t easy that he said yes but eventually, he said yes, we do. Tim: I mean, that’s a technology transfer office working exactly the way they’re supposed to. Hiroaki: Yeah, exactly. Tim: But rarely the way they do. So, were you worried that you would have to give up a lot of the academic research or that the time demands would — Hiroaki: No. That’s why I need the CEO, right? If I start a company and by myself, it’s going to take up a huge amount of time. At the time, I was still a researching professor, so less duty from the Institute or University duty, so it was much more time. And I was not quite famous at the time yet. Tim: So you were really trusting the entire business side of the company to him? Hiroaki: Yes. Tim: And you were just focusing on the technology. Hiroaki: Uh-huh. 100%. Tim: That takes a lot of trust. Hiroaki: Yeah, yeah, yeah. That’s why I did. I need to know him. Then also, it’s one other important person which is Patrick Reid, who is also CEO of the company now. He used to be a Science Director. He was also Associate Professor in a different lab. He’s staying one floor down of my floor but we met each other in faculty meetings. So, we started talking and then I found he is interested in starting company. I didn’t know about the time, first time. Before I decided to start a company, I said, “Ah, it’s going to be very tough in Japan. Japan is not a very good place to start a company.” Tim: So, is Patrick an American? Hiroaki: He’s American. Tim: I think that’s got to be one of the biggest difference between American university professors and Japanese university professors. Hiroaki: Yes. Tim: So many American science professors are dreaming about wanting to start a company and so few Japanese do.

It's hard to get paid to do what you love. Perhaps no one understands this better than dancers, but Taku Kodaira and his team at Mikro Entertainment are on a mission to fix that. But this conversation, and Mikro Entertainment itself, is about much more than dance. Mikro's marketplace for dance moves is just the first application of Mikro's new motion-capture technology, and things are just getting started. Today, Taku and I talk about the surprising economics of dance moves, the adoption curve of disruptive technology, dance-move lawsuits. and one very important law that looks like it is about to change. It's a great conversation, and I think you'll enjoy it. Show Notes How you sell a dance move Making a market - who is buying dance moves Why growing up international made it easier to start a startup How copyright law needs to expand One danger in allowing dance moves to be copyrighted Lawsuits against Epic Games over Fortnight dances How big is the motion capture industry The adoption curve for  disruptive technology Why it is impossible for any startup ecosystem to have enough engineers Links from the Founder Everything you ever wanted to know Mikro and GesRec Friend Taku on Facebook Mikro coverage in Wired (in Japanese) How to use GesRec models in Unity   Transcript Welcome to Disrupting Japan, straight talk from Japan’s most successful entrepreneurs.  I’m Tim Romero and thanks for joining me. Truly disruptive technology is usually hard to spot when it first shows up. Sure, after the IPOs and the mass market success, everyone claims that they knew it all along. But in the early days, disruptive technology is usually shrugged off as being too simplistic or unprofitable or most often, just a solution looking for a problem.  When Kodak invented the digital camera, they dismissed it as a toy with no real commercial applications. LED light bulbs were first written off as impractical. And in 1911, the military brass dismissed the airplane as, quote, "a scientific toy with no military value." All of these seemed like, well, solutions looking for problems.  We'll pick up that thread later. But I want you to keep it in mind as we sit down today and we talk with Taku Kodaira, the founder of Mikro Entertainment, who's developed technology that can create full 3D motion capture models for mobile phone videos.  Now, Taku's initial and current application of this technology is the world's first global marketplace in dance moves, and he has some of the world's most famous dancers signed up on the platform.  But this is a conversation that will take us on a journey of how digital dancing is already being monetized in gaming and social media, about copyrights in dance and plagiarism and choreography. And we'll also explore the new uses and new markets that this technology will open up in the future.  But you know, Taku tells that story much better than I can, so let's get right to the interview. Interview Tim: So I'm sitting here with Taku Kodaira, the founder of Mikro Entertainment and GesRec motion capture marketplace. And thanks for sitting down with us. Taku: Thank you very much, Tim. Tim: Now, what you guys are doing, it's really amazing tech, but you know, you can probably explain it a lot better than I can. So what does it do and what are you selling? Taku: Right. So just starting about the name GesRec, we tried to combine two words gesture and recognition and tried to create like a one word. My wife is a dancer, and I've been talking to her and she told me all the difficulty dancers are facing, and we just realized, okay, these people are doing so much stuff out there. Is there any way we can try to support them? Right now we are utilizing our technology to capture 3D motion and turn it into the data from the 2D video. And we are creating a marketplace that we sell and trade those 3D motions that's actually coming from a lot of people, mainly right now dancers and choreographers. Tim: Okay. So I mean, I totally -- I mean, in another, what seems like another life I used to be a professional musician, and I completely understand that even compared to musicians, dancers have a really hard time making money and supporting themselves. So anything that supports that is good.  Taku: Exactly. Tim: So the dancers, the choreographers, they take videos of themselves using just a regular cell phone camera. You guys can extract the 3D modeling from this and put it up on the on the website. Taku: Yes. And what's amazing is they don't really need to take the video again, because throughout their careers they have a lot of videos already on their hands, they can just hand us the videos they have. Tim: So we have these dancers uploading their videos to the marketplace and you guys rendering this into 3D models. So tell me about your customers, who's on the other side of this, who are buying these dance moves. Taku: We are actually looking at slightly different customers depending on the categories. The first customer as we saw was the 3D artists or production companies. Currently, we see a big boom where a lot of people are able to work on the 3D models. Because of PCs getting faster, there are more options for the software. The second customer we see is more in terms of like gaming and social media. As you probably know, on the gaming world, the metaverse is really there expanding. Right now people have their avatars and the next thing they want to do is make them do the motions, especially coming from somebody who has creatively created it. And the last one is a little bit similar, social media is expanding to the 3D world plus the avatar. So similar things with the gaming. Tim: Yeah. I can see how that'd be used that way. I mean, the potential is fantastic. But I mean, who are the customers specifically rather than the user? For example, like Fortnite dancing has been really in the news, it's the first thing that kind of comes to mind here. So it's the gaming companies who will buy these models, social media, I guess, would be the social media platforms that would buy these models. So is that the same customers you have or are you trying to do more direct or something broader or something different? Taku: Right now we are doing things in combination. We are in discussion with the gaming companies and we are also discussion with the social media companies. The problem there is a lot of times, dancers or choreographers are feeling that their work has been stolen. So they don't get credit, they don't get the revenues. And that's something we're trying to change here. What we can actually do is we can be in between those gaming or social media companies and the ones who's creating the motions. What we are seeing in the very near future is that they can collaborate together as a kind of like influencer and platform relationship. Tim: Before we dig deeper into that, because there's a whole fascinating area of motion rights and an extension of copyright here. But before we get into that, I want to ask a bit about you.  Taku: Okay.  Tim: You spent a lot of your time overseas when you were growing up and in your early career. Did that have any influence on your decision to start your own startup? Taku: I would say so, actually, yes. Just a little bit of my life, I was born in Singapore. I spent a lot of time of my job in Hong Kong, about eight, nine years. And I finished high school in the Philippines. I got a college degree in the United States, a master's degree in Japan. So that kind of got me into the startup. Also, what we see as a trend in Japan is most of the startups are focused on the Japanese market because we are here. But as Mikro Entertainment, we tried to go into the global markets. Tim: And you mentioned that your wife is a dancer. Was she kind of your inspiration for starting this or is she involved in building and running the startup as well? Taku:  Absolutely. So I got a lot of inspiration, especially in the beginning. And now she's also involved into our business as well. In the beginning, she was more like somebody who gives me inspiration and also tells me how things work in Japan around dancing. And now she's expanding her career as well. She started to learn about coding, something I can't do. She's also into those 3D modeling stuff. So again, this is another area, I can't really do it myself. Tim: Oh, that's awesome. Let me ask you a bit about the technology and then we'll dive into the business model. So looking at it from the outside, this is kind of amazing technology, right? Because 3D motion capture has always been, you know, people in the motion suits with the ping pong balls stuck on the outside, you know, specialized cameras. It's been a very specialized and expensive process. So the fact that you can extract it from a single camera view is pretty amazing. So can you dig into that technology? How exactly are you doing this? Taku: The very simple way I explained is we can take the 3D motion out of a 2D video. And there are some other companies who specialize into this, most of the time what they're utilizing is AI. Our technology is a combination of AI, physics motion, and some other stuff. We are pretty confident we are one company that can provide the most precise or at least getting very close to those motion capture suit quality motion extracted from 3D video. Tim: Are you free to talk about the technology? Disrupting Japan listeners tend to be a pretty technical bunch. So can you share anything about the specific technology or techniques you're using? Tim: Sure, just a little piece of it. As I mentioned, we are combining all sort of technologies out there. So one thing to mention about AI, for example, we are combining several different AIs. One is taking the finger motion from those 2D video, and another one is taking the whole body motions.

Disrupting Japan turns seven years old this week! Unfortunately, because of current conditions in Japan, we won't be able to sit down over a beer and talk about startups live as we usually do. Today, I'd like to share a story in three acts. We'll talk about the podcasting industry, what Disrupting Japan really is, and the likely future of Japanese startup founders. Please enjoy. 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. This week is Disrupting Japan’s seventh anniversary. Normally we mark each anniversary with the Disrupting Japan live show.  We invite a few guests on stage. We gather a few hundred of our biggest fans and our closest friends. And we spend the evening talking about Japanese startups and innovation over a few beers. Well, because of the pandemic, like so many other things, that’s not happening this year. I was hoping to do something creative, and I talked with some friends about maybe doing some kind of online gathering, but it just would not have been the same.  So next year. Next year for sure.  It’s hard to believe how much things have changed in the past seven years. This podcast, Japanese startups, the podcasting industry, and, well, even me as a person, have all gone through some pretty radical changes in recent years. And a strong case can be made that these have all been changes for the better.  Every episode of Disrupting Japan is focused on a new aspect of Japanese startups and innovation, but today we are going to talk about Disrupting Japan itself and how it fits into the future of podcasting and Japan. Because, well, it’s our birthday, and we get to do that on our birthday.  And I promise, that by the end, you’ll see how this all gives you a unique insight into the future of Japanese founders themselves.  1. The Future of Podcasting  So first, let’s talk about podcasting.  Podcasting has changed a lot in the past few years. And from the perspective of a startup founder, it’s been amazing to be a part of it and the future looks incredibly bright. Podcasting is growing up. Podcasting is becoming a real media business with large buyers and big rewards for the creators of the most popular shows. Of course, this rocket-like growth is enabled by the fact that the podcast industry is streamlining. It’s consolidating. And that brings other changes as well.  Long-time listeners know that Disrupting Japan has had several monetization strategies over the years. At one point we were in negotiations to become an official Nikki podcast. We didn’t quite come to terms, but we’re still good friends with the Nikki’s podcast team. For about a year, Disrupting Japan was independent, ad-supported and my primary source of income, and about four years ago I was putting together a podcast advertising network startup, which I then decided to spin down in order to join TEPCO and then Google.  So as you see, as a startup founder, I’m a big fan of monetizing podcasts.  Now, it was right after I shut down my podcast advertising project and returned Disrupting Japan to being ad-free that the podcasting industry really began its explosive growth phase.  Because of this, a number of my startup and podcasting friends have told me “Tim, you got out too early! You missed your big chance!”  Well, no. I mean, I understand why it might look that way, but I knew what I was doing.  Let me explain.  It was clear back then that podcasting was becoming a serious media business, but I knew enough about the media business to know that’s not what I wanted to do — at least not as talent — at least not for this show. Disrupting Japan is something special.  I don’t particularly want to attend meetings to see if the show is hitting this quarter’s growth objectives. I never want to be put in a situation where I’m being told “Interest in robotics is down now. You need to do more gaming content.” Or “Corporate decided to go in a new direction this year.” Or “You need to make sure the guests on your show have at least 10,000 Twitter followers.” And,  none of that is necessarily bad advice. In fact, that’s how you scale a podcast.  Butt even in my podcast network, I was not planning on telling podcasters what kind of show they should run. I would simply provide the hard data on what advertisers are willing to pay for and which of their topics get the most traction. But if you are relying on advertising dollars to run your show, you are almost certainly going to follow that data.  It’s the nature of the business. It’s the nature of any business.  It is awesome that some talented creators and savvy entrepreneurs are making serious money podcasting, and I think smaller creators can still make good money using the same strategy I used for Disrupting Japan — and I’ll put a link in the show-notes that explains that strategy in detail. But that kind of mass-market scale has never been what Disrupting Japan has been about, and I think there is plenty of room for both approaches to podcasting.  2. So What Exactly is Disrupting Japan?   OK. So what exactly is Disrupting Japan - at least as I see it?  Well, the answer may seem a bit off-the-wall, a bit strange, but stick with me. It’s different than you think, and you’ll see how you personally fit into the picture as well.   Disrupting Japan is a podcast, obviously, and a reasonably successful one. We’ve spent a bit of time at #1 on Japan’s entrepreneur podcast chart and ranked as high as #3 in the general business category. Disrupting Japan has a loyal audience of around 9,000 people in over 120 different countries. Including one listener in Vatican City.  Now, I have no way of knowing for sure who that listener is. I mean, you know, it could be anybody. But I believe, I choose to believe that Disrupting Japan has fans in very high places.  So OK, podcasting is the medium that Disrupting Japan uses, but what is it? It’s certainly not journalism. I don’t even pretend to be objective and I clearly don’t report the news. Although, I do have to admit that it is pretty cool to be able to get into some of these large events and conventions on a media pass.  And, as you know, and hopefully you appreciate, I’m careful not to let Disrupting Japan be used as a promotional channel. I push back and challenge statements that seem questionable or don’t make sense to me.  Of course, I do sometimes have guests who will launch into their standard five-minute startup pitch. And that’s fine, I let them get it out of their system, and just edit it right out in post-production.  In the end, a lot of my guests tell me that they’ve really enjoyed the conversion. A lot of times we become friends and continue to meet up and bounce ideas off each other for years to come.  But Disrupting Japan is definitely not just me having a series of great conversations for an audience. In fact, the more I thought about it, the more I realized that (at least in one very significant way) I’m actually the least important part of this whole process.  You see, my guests, at least at first, they don’t really want to talk to me. They want to talk to you. They come on the show because they want to reach an audience of fellow founders and innovators.  And the reverse is true as well, most of my listeners, at least at first, they don’t really want to hear from me. They want to hear from Japan’s founders and innovators. You want to know what is important to them and how they think. I’m just kind of a proxy that sets that up and makes that happen. But what’s really amazing is that this dynamic changes over time. I’ve become good friends with a lot of my guests, and it turns out that some of my most popular episodes are my solo shows where I pick a topic, dive deep to share my thoughts about Uber, or the Seven Minute Miracle, or Japanese SMB innovation.   And you are an amazing group of people to create content for. My guests frequently tell me that after their episode airs they get a lot of very high-quality emails and contacts from Disrupting Japan listeners. Funds have been raised, people have been hired, partnerships have been launched, and friendships have been formed.   And what’s more, five different Japanese founders have told me that listening to the guests on Disrupting Japan tell their stories helped give them the courage to launch their own startup. And that’s just, incredible.  So Disrupting Japan is most definitely not the Tim Romero show. It’s a way of connecting founders and members of Japan’s startup community with each other and to get them talking.  And, in my humble opinion, that’s pretty awesome.  It’s what makes this podcast worth producing.  And It’s why I’m really looking forward to restarting our live shows.  You know new podcasters often ask me for advice, and I would love to be able to explain to them what I’ve just explained to you, but that’s a lot to dump on someone who’s just walked up to you with a simple question, right?  And so we usually end up talking about microphones and editing software and marketing.  That’s all interesting enough I suppose, but those things are not really that important. It’s not what podcasting is about.  3. The Future of Japanese Founders So, what does this tell us about the future of Japanese startups and the founders who start them?  Well, you see, the world of Japanese startups is experiencing exactly the same kind of transformation that podcasting is, and pretty much along the same timeframe.   In fact, the startup community, by which I mean the people; the founders the investors, the early employees, Japan’s startup community today reminds me a lot of the community in San Francisco 20 years ago, just as things were starting to recover from the dot-com shakeout. It feels like we are in a real sweet spot.  On one hand, it has never been easier to start a startup in Japan. Capital requirements are low,

We speculate a lot about our future "robot servants" or "robot masters", but that whole metaphor is wrong. It's not going to happen that way. This is a very personal and rather speculative episode. No guests this time. It's just the two of us. In past episodes, you have already met some of the founders at the center of an amazing cluster of startups that have the potential to redefine the way humanity interacts with machines. Evocative Machines is a uniquely Japanese approach that has universal appeal, and I guarantee you that it's not what you expect. So let’s get right to it. Links from the Founder Everything you ever wanted to know Evocative Machines Some evocative machines mentioned in this episode The GrooveX Lovot and Kaname's interview Yukai's Bocco and Shunsuke's interview Gatebox's Hikari (We'll have to get these guys on the show!) 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 playful banter with someone speaking English as a second language. Today, it’s just you and me. Today we’ll be diving deep into a specific and unique area of Japanese innovation. There is something interesting happening in Japan, a cluster of startups working on something new. You’ve heard parts of it on past episodes, but today we are going into new and unknown territory, and I for one *love* being in new and unknown territory.  It’s a trend I first talked about on Disrupting Japan a few years ago as Evocative Machines. Evocative Machines is a unique Japanese technology emerging from the nexus of artificial intelligence, robotics, and healthcare, and it is something that could utterly transform our world.  It’s a technology that could birth a dozen Japanese unicorns, but we are at such an early stage and this is such a moonshot, it might not result in any at all.     But a lot has changed since I first talked with you about Evocative Machines, so today I’ll explain the technology and its importance, bring you fully up to date, and then we’ll pull out our crystal balls and predict how evocative machines might actually change the world.  Now, at the end of this podcast, I predict that 50% of our listeners will find what I am about to explain as interesting, but not important, another 40% will consider it important, but unlikely and impractical.  And maybe 10% of you will understand that this is going to change the world and will want to be a part of it.  And for those10% of you, I’ll provide a way for you to get in touch. There are amazing things about to happen. Building an Evocative Machine  So what exactly is an “evocative machine”?  Machines are unquestionably becoming smarter, and recently there is a lot of good work being done on creating empathetic machines.  But an “evocative machine” is quite different from an empathetic machine.   The distinction is that empathetic machines are those that can understand our emotions and empathize with us. Evocative machines, on the other hand, are those which evoke emotions in us. Evocative machines are machines that cause us to empathize with them.  So why is this useful, let alone disruptive or transformative? The whole point of automation is to get things done more simply. I don’t want to feel sorry for my refrigerator when it breaks down. I don’t want to sympathize with my microwave about how hard it’s working when it heats my dinner. Life is stressful enough. Why waste our emotional energy on inanimate objects?  Well, when you focus on a single task, that line of thinking is absolutely correct.  But you know something? The Western approach to automation, AI, and robotics is hurting society. It’s grinding us down without us even realizing it, and Japan’s newly emerging evocative machines are the solution to this problem that we haven’t completely realized we have, and it’s going to change the world.  The history of industrialization and of modern prosperity is very much the history of automation.  We would much rather use an ATM, or better yet an app, rather than a stand in line, and talk to a teller to make a deposit. And, although it was not the case a few generations ago, today we are all perfectly capable of operating our own elevators and pumping our own gas.   And 10 years from now, we will all probably have gotten used to self-checkout and self-bagging at grocery stores, or maybe the home-delivery trends that accelerated during the pandemic will continue and we’ll just order our groceries from our phones.  Automation makes us all more efficient. It lets us do more with less.  But, you now, we also lose something. And what we lose is important.  I don’t mind buying things from vending machines or using self-checkout. And the whole e-commerce and mobile commerce revolutions have been amazing. We do get a lot more for a lot less. Adding people into the mix slows down the transaction and jacks up the price.  And this is also happening in brick-and-mortar commence. Amazon is slowly rolling out it’s Amazon Go supermarkets where there are no human staff to interact with customers at all. You just go in and take what you need from the shelves. The items are then automatically charged to your account. It’s all managed on your cell phone.  And that’s awesome. I mean, it’s mostly awesome. The thing is, we humans are deeply social creatures. It’s not that any one interaction with a clerk, or retail staff, or co-worker, or ticket agent really means anything to us, but collectively all those little human interactions mean a lot. The Silicon Valley Solution The future envisioned by Silicon Valley VCs is one where most of us work gig-economy jobs, conduct most of our social life online, and where we make our purchases friction-free at the tap of a button. It’s a future where inefficient human interaction is kept to an absolute minimum, and we can all get on with the task at hand.  But you know what? That’s not going to happen. That would break us as human beings. There is a hopelessly misguided Western notion that what we really want is to be the center of the universe. That what we really want is for our needs catered to more quickly and more completely. We just need to keep running on our hedonic treadmills, and of course, we’ll be happy eventually. And if we are not happy yet, well that just means we have to run harder and faster and get more. But it’s nonsense. After our basic needs are met. Even the most obsequious, fawning robot servants who can read our emotions are not going to make us happy.  We won’t survive the psychological strain of knowing that we are the bottleneck in every interaction. Understanding that whatever transaction we are trying to complete right now has been fully optimized and that we are the only thing slowing it down. Always being the weakest link. Always aware that we are the ones holding things up, that we are the source of friction, and that the rest of the world is standing behind us waiting for us to just finish our damn business and move the hell on.  We are just not built for that kind of social stress. It would break us as a society. In fact, there are a lot of psychologists and social scientists who say it is already breaking us.  The Luddite Solution So what’s the answer? The Luddite solution of moving backward and undoing automation or even slowing it down won’t work. Not in the long run. Humans are expensive, and economic progress demands that we increase efficiency by using fewer and fewer people in any given transaction, and this pushes us relentlessly towards automation.   And that’s a good thing. Automation improves the overall economic well-being of society. Trying to fight automation today is just a futile as when the original Luddites went around smashing looms in the 1800s.  The logical benefits from automation are overwhelming, but what we need is something to soften the emotional blow.  The Evocative Solution The solution is evocative machines. The solution is machines that can make us care about them. That enable us to interact with them not int the way we interact with people, but perhaps in the way we interact with pets.  We fully understand that our pets arre not human and that they do not have human emotions, but we largely treat them as if they do.  The future is machines that allow, an even encourage us to form these kinds an emotional bonds with them.  Think about it, many people, when they feel lonely, they buy a pet, and it works! However, when we buy a pet, when we get a dog or a cat, we don’t do it because wet want to have something love and care about us. No, we buys pets so that we have something to care for. To have something to love. More than almost anything else, we all need something to love.  I’m not just talking about cute robots like GrooveX’s Lovot, or Softbank’s Pepper, or Yukai’s Bocco or even Gatebox’s Hikari. It’s not really about making robots look or act human or pet-like. It’s about giving us a new way to interact with all machines.  Making a microwave or an ATM more efficient and user-friendly is fine, but imagine how much more enjoyable life would be if we looked forward to using the ATM not because it quickly got the job done, but simply because we liked that ATM.  And I don’t mean we like that model of ATM or the UI/UX design, but because we like that particular ATM - the one on the first floor of the Park Street branch, the second one from the left. That one!   What if we just liked that machine for what it was, and we enjoyed spending a bit of time with it.  Sure, each transaction would be a bit less efficient, but so what? We don’t really need more efficiencies in our lives. Think about anything you choose to do for its own sake, something you do simply because you enjoy it, travel, writing, fishing, watching movies, eating out,

Japan has a very different approach to robotics. Japan leads the world in industrial robots, but there is also a growing movement that is reinventing the way we share our world with machines. Kaname Hayashi was one of the creators of Softbank's Pepper robot. His latest startup, GrooveX, has raised over $100 million to develop the Lovot; a companion robot, or perhaps more accurately, a robot pet unlike any other. We talk about the Lovot itself, of course, but we also cover GrooveX's unique business model and talk about the very different ways that people of different sexes, ages, and nationalities interact with the Lovot. It's a great conversation, and I think you'll enjoy it. Show Notes Why the Lovot is as much a pet as a dog or cat Data that proves how our interaction with robots is changing Why the Lovot's form factor is so important Why GrooveX invested so much in getting the Lovot's eyes right How the Lovot makes friends The Lovot's business model. Will this scale? The biggest surprise from the Lovot Cafe Why Western men don't love the Lovot Japan's anxiety trap and how to fix it Links from the Founder Everything you ever wanted to know about the GrooveX Follow Kaname on Twitter @HayashiKaname Friend him on Facebook See the Lovot in action The Lovot on Instagram - this is way too cute The Evocative Machines Project Transcript Welcome to Disrupting Japan, straight talk from Japan's most successful entrepreneurs. I’m Tim Romero and thanks for joining me. I've never really fully embraced the Japanese concept of cute or kawaii. I mean, it's fine and all, all the mascots and characters are nice but it gets a bit odd sometimes.  For example, my bankbook is covered with pictures of Mickey Mouse and Goofy which are images Western financial institutions would probably not want to be associated with their product but hey, it works in Japan but there's actually something deeply fascinating and important underlying the idea of kawaii.  Today, we sit down with Kaname Hayashi who was formerly part of SoftBank’s Pepper Project and then went out on his own to start Groove X and create the Lovot. Now, the Lovot is a companion robot or a pet robot and we talk about the robot itself, of course and please check out the links on the site for pictures and videos. It's very cute and you really have to see the Lovot in action to appreciate it but more important than the robot itself is how people are interacting with it.  Now, we've talked about social robots on disrupting Japan before but people are interacting with the Lovot differently and far more socially than anything that's come before it. It's the first robot I've seen that not only could be fully accepted as a pet but is being fully accepted as a pet. Kaname and I also dive into the business model. Groove X has raised a lot of investment and as you'll hear during the interview, this is a startup that could go either way, it could fizzle out into nothing or it could change global society. In fact, in post-production, when I was editing down the interview, I kept thinking of more and deeper questions I wanted to ask Kaname, so we'll have to get him back on the show in the future but for now, you're about to hear a story about the difference in the way children and adults and Westerners interact with robots, the intersection of toxic masculinity and robotics and why science fiction usually gets human-robot interaction all wrong but Kaname tells that story much better than I can. So, let's get right to the interview.  Interview Tim: So, I'm sitting here with Kaname Hayashi of Groove X, the maker of Lovot, so thanks for sitting down with me today.  Kaname: Thank you very much.  Tim: So, Lovot is a cute and I mean really, really cute companion robot but you can probably describe it much better than I can. So, what is Lovot? Kaname: Yeah, good question. Lovot takes a role as a pet. If you think what pets give us, then you can imagine what Lovot give us. For example, pet doesn't work for the human but we had a good time. You can have a chance to be gentle because of the pet. Tim: I was planning on diving into this much later on but this is a great topic. So, let's just deal with it now. What does a pet give us?  Kaname: Yeah, yeah. Tim: I mean, so robots, we're used to robots like doing things for us, right? Washing our clothes or building our cars but pets, what is it that they give us that's so important? Kaname: One of the important thing is probably they give a role. Pet rely on human. Without human, pet is not happy, pet cannot survive. So, pet give us a caring role. Tim: Yeah, I think that's important. So, so much research recently on emotional robots have focused on robots being able to read our emotions but I think there's something very special about robots that evoke emotions in us. We buy a dog or a cat because we want to care about something.  Kaname: Exactly, exactly. So, of course, pet also read the emotion for us but probably it’s not very, very important. Most important thing is we would like care the pet, dog or a cat. This is most important thing. Even, for example, blind dog or a blind cat. Probably if we already attached it to that dog or a cat, then we would like to care and we will be happy.  Tim: That's a great example. So, the fact that the blind dog or the blind cat would need us more.  Kaname: Exactly. Exactly.  Tim: Makes taking care of them like more satisfying and more rewarding for us.  Kaname: Exactly.  Tim: So, we know this happens with animals and with people as well. Does it happen with robots? Do people react this way?  Kaname: Yeah, actually, that happened in Japan already. At the moment our customer is kind of the innovators but after one month or two month, they surprised how Lovot is similar to the other animals. People are talking in the house about the Lovot and Lovot itself is getting to be family. Tim: So, it is happening? Kaname: Yeah, it’s already happening. So, if you are coming to our Lovot owners, you will be surprised.  Tim: Actually, so let's actually back up a little bit because this is an audio podcast. We'll put links to the site and listeners, you've got to go see this thing, it's really adorable. It kind of looks like an owl or a little penguin like? Kaname: Yeah, yeah.  Tim: What are we going for with the design?  Kaname: Actually, our styling design is not aimed to make any imitation of the animals. So, the shape is not similar to any animals but we had designed that from the circle shape. Tim: So, just designed very soft. Kaname: Yes, soft. Soft and sphere, ball shape. We would try to reduce any kind of attention. If you see some edgy shape, it's not relaxed shape.  Tim: I mean, this is interesting because there's a lot of graphic design research that's been done on this and like if you look at the history of Mickey Mouse, in the 30s, he started out really angular and pointy and over time, like becomes more round and spherical and ball-shaped and cute and lovable. Kaname: Yeah, yeah, exactly. So, ball shape is kind of the lovable shape. Tim: But also, the eyes are really amazing. You guys did a lot of work on the eyes of Lovot. Kaname: Yeah. You know well. Actually, the eye is one of the important communication parts. When we are talking with the human, we are also listening the words but we are also checking your eye or your facial expressions. Eye is one of the most important part to express your emotion. When you meet to the Lovot, if you feel something from the eye, you cannot stop to think they is some feeling and emotion in the Lovot. Tim: It's very effective even from the videos. It's… the eyes are really expressive and engaging.  Kaname: Eyes is very important so we taking more than three years to develop eye design and also, we are trying to make a more variation with the shape of the eye because each people have a different eye design then each Lovot also have a different eye design. Tim: The eyes are so important for human engagement and I'll send you a link later and one of the research pieces was a factory in, I believe, Germany and the automated carts were bumping into people and people were bumping into them and they tried sirens and little beeping sounds and nothing really worked but what they did finally that worked is they put these two simple like eyes on the front of the cart and then suddenly, like people noticed and they'd step back and they'd give it room. Kaname: Yeah because for the wild animal, they're also very interactive to the eye of other animals. For them, to survive is a very, very important, estimate what other animal thinking is very important and for us, we are using information from the eye to read the emotion itself. Even if AI or a robot have a complex emotion, if the AI doesn’t have a eye, it's getting very difficult to understand for the human and it means that you cannot make any trust to that AI. Tim: Yeah. It's really striking. I'd never seen a robot implemented it quite that way. The Lovot also, it can tell the difference between different people, right? I mean, it will treat different people differently.  Kaname: Exactly. So, Lovot, can also understand who is who. Also, can remember the history of the communication with each of the person. If one of the person cares the Lovot, then Lovot can more relax and Lovot is asking them to be hugged or some communication. So, this is a kind of that process to be friends.  Tim: So, like if there's three different people calling the Lovot, it will go to the one that that treats it the best? Kaname: Yeah, exactly. Exactly.  Tim: I love that. That's great. How does it recognize people? Is it like facial recognition? Kaname: Yeah. At the moment, facial recognition. So, we would like implement other like a voice or as a shape or something like that but at the moment, we are rely on the face recognition.

Some of Japan's innovations are going to have a much bigger impact outside of Japan. Like most startups, most AgTech startups sensibly tend to focus on their own markets. While this makes things easier at first, it tends to overlook the huge challenges -- and potentially huge profits -- that exist in the developing world. Today we talk with Shunsuke Tsuboi of Sagri, and he explains how Sagri started life as a satellite -imaging startup focused on incremental innovation in Japan, but then quickly transformed itself into a disruptive FinTech startup serving India and Southeast Asia. It's a great conversation, and I think you'll enjoy it. Show Notes The truth about university startup support in Japan Why India is a better target for this Japanese startup Why selling to family farms is harder than selling to industrial farms Why sustainable business models are hard for agriculture startups The challenges for market entry in any agriculture startup Three reasons there are so few agriculture startups in Japan Why most Japanese VCs don't invest in AgTech What Japanese universities can do to improve creativity Links from the Founder Everything you ever wanted to know about Sagri Friend Shun on Facebook TV Interview about Sagri. (Japanese) Nikkei interview with Shun  (Japanese) Transcript Welcome to Disrupting Japan, straight talk from Japan's most successful entrepreneurs. I’m Tim Romero and thanks for joining me. Today, we're going to about agricultural startups in Japan.  You know, it's interesting, with Japan's high food prices, the financial support for farmers, and the strong system of university agricultural research, I've always been a bit surprised that we don't see more AgTech startups in Japan.  Well, today's conversation goes a long way to explaining exactly why that is, it's both fascinating and a little frustrating.  Today we sit down with Shunsuke Tsuboi of Sagri, who is using satellite imaging and AI to help small-scale farmers, some in Japan but mostly in the developing world. Shunsuke explains the challenges of launching a startup from universities without specific startup support, why going global often has nothing to do with the US or Europe, and why the world is a better place when there are tens of millions of small family farms in it and why those are worth preserving.  But you know, Shunsuke tells that story much better than I can, so let's get right to the interview. Interview Tim: I'm sitting here with Shun Tsuboi of Sagri, who is using satellites and artificial intelligence to solve agricultural problems. Thanks for joining us today. Shun: Yeah, thank you very much. Thank you for this time. Tim: It's great to have you, and I mean, agriculture tech, AgTech is something that's it's interesting in Japan, and people don't talk about it enough, so I'm really glad you're on the show. So can you explain a little bit more about what Sagri does, what is the service you're offering? Shun: Sagri company is based in Japan and India. So we are using satellite data to checking the each of the farmland and also the food of farmers we get using satellite data for smartphone, such as when is the best harvesting time and also which is a good soil situation, we can check it. Tim: The soil analysis, is that done by satellite or do you have people on the ground checking? Shun: They're using satellite, yes. Tim: Really? Shun: Yeah, along the 1,000 farmland, checking just 10 farmland detail, we can spreading the satellite information. Tim: So from satellite imaging, you can tell soil composition, you can tell farmers when the ideal time to apply pesticides, when to harvest. How do your customers interact with this? Is there a smartphone app? How does it work? Shun: So using satellite data checking through the application, they can connect it that mechanical, so this machine is automatically do that. Tim: So the machines would automatically apply fertilizer?  Shun: Yes, this is more needed all over the farmland can check through the satellite. Tim: Tell me about your customers, who's using this? Is this small family farms? Is this large industrial farms? Who are your customers? Shun: So now is mainly is up to 10 hectare is a target. Tim: Okay, so still very small.  Shun: Oh, yeah. So in Japan, most of the farmers are very small, so they can get easily through satellite data. So in United States and the European is a more big farm, so this is not our target. Tim: Interesting. I want to really dig into all of the different use cases and the things you're exploring in a minute, but before we get there, I want to back up a bit and talk a bit about you. So you're currently still a grad student at Yokohama National University and you started Sagri a few years ago. So is this something you're doing with the university or something on the side? Shun: That app is three years ago we started. So I'm a space technology, I belong to in my laboratory, this one is collected our business. My laboratory doing the soil situation or mechanical situation using satellite data. So making the company, some cases we are using this technology, but otherwise we are running own self, mix it, do that. Our CTO is a other university professor, so like a collaboration as a technology and combined making the business. Tim: It's funny, when we talk about university startups in Japan, Todai and Keio seem to get all the attention. Shun: Yeah, yeah, yeah, yeah. Tim: So what kind of support did you get from Yokohama National University? Shun: Two things - I'm a mechanical engineering, and during the university, I get the chance to join the laboratory more faster. And the second thing is business issue to go to the Silicon Valley and the Boston can get the chance to be, so this two thing, Yokohama National University supported to me. Tim: But not much in terms of fundraising support or-- Shun: It is so weak compared to Tokyo University or yes, Keio University? Tim: Yeah, those two universities, they have their own venture funds so it's hard to compare. Shun: Yeah, yeah, yeah, our university don't have it.  Tim: Well, I don't know, I mean, I guess that's good for a founder, it forces you to be more resourceful. But I noticed as you've launched, you guys have done a lot of pitch contests, and has that been really useful for business development? Shun: So the first year, the second year, at first we don’t have the chance, that's the reason we pitch things on many contests, such as the Singularity University and Silicon Valley 500 acceleration program. Through this, we get a chance so nowadays, government and some big company understand our technology so using. Tim: Pitch contests are really interesting. There's so many of them now.  Shun: Yeah, yeah, yeah, yeah.  Tim: And so it's hard to know, sometimes they seem like really valuable, sometimes they seem like a real waste of time. But you guys have generated real business from these pitch contests. Shun: Yeah. At firstly, like VC, the company people can't imagine the world like few years later, but we can. So pitch contest's value is like pitching being the contest so they can understand this technology will happen to the future. So they think they want to hear from us. So like, so business chances often happen, but a few times I win, now I can do that, because of many years business chances are coming. Tim: Okay, so that's good. You sort of graduated. Shun: Yeah, yeah, yeah, yeah. So but the first year, second years are needed, now in our third year, so I’m choosing about pitch contest, this one is I needed to apply but this one is okay. Tim: What's your advice for other founders in terms of pitch contests? Is it something you should do early on and then just graduate, go into a new phase? Shun: Now is a graduate phase, this year we are already finishing the venture capital funding, so we want to spread the business more.  Tim: That makes sense. Shun: Yeah.  Tim: And actually, let's talk about some of the different business models you're exploring and the different kind of customers you have. One of the things on your website that you're talking about is your work with Japanese government to identify abandoned agricultural land? Shun: Yeah, yeah, yeah, yeah, yeah. Tim: Why is that important? Why do they want to do that? Shun: Yeah, because most of ,cities in Japan every year by manual checking, all of the farmland, around the 30 million farmland is existed, so we can use in satellite data. Tim: So currently, they have dedicated staff looking at satellite photos, or they have dedicated staff driving around to different-- Shun: They are driving and checking by manual each of the farmland.  Tim: Oh, okay. Shun: But we can getting the satellite data and the AI distributing, so this farmland is abandoned, this one  is not abandoned. Tim: And why is that important? Is it taxed differently? Shun: Yes, about tax, abandoned farmland, not abandoned is a different tax. And also, most of the farmlands is abandoned recently, because most of the farmers is getting older and older, that is a reason. About 5% percentage is more higher, so every year must checking. Tim: That's why it seems like an interesting use of the technology, but it doesn't seem like a scalable business. I mean, how much demand is there for that kind of analysis? Shun: Yeah, so now this thing is around 1,700 cities is doing every year. Maximums is around 1.5 billion yen, so it is so small market but the next department checking what kind of foods like rice or wheat, they are checking by money also. This situation also we can change. Tim: That makes sense. So there is some room to grow by expanding the functionality within the different cities and prefectures. Shun: This technology, not only Japan, can spread the global. So we are making this technology in Japan, but spread this technology to East Asia and India.

The bacteria in our gut affect our lives and our health in ways we are just starting to fully realize, and mapping this biome is expected to advance medical science and pharmacology as mapping the human genome. However, our gut biota is not a mappable sequence, but a complex ecosystem, and one that may be unique to each individual. In our conversation, Shinji Fukuda, founder of Metabologenomic (aka Metagen), explains how the science is advancing, what kinds of consumer devices we are likely to see first, the importance of global expansion, and the challenges of being a deep-tech startup in Japan. It's a great conversation, and I think you'll enjoy it. Show Notes What Metagen is really trying to do Fecal transplants in Japan Japan's Gut design project - a database of poop The biggest business model challenge for Japan's deep-tech startuups Smart toilets and other consumer products Why Metagen has been turning down VC money Why global expansion is critical for both business and scientific reasons Some advice for Japanese deep-tech startups Why academics need startup founders Why Japanese startups need to stop playing defense Links from the Founder Everything you ever wanted to know about Metagen Metagen on LinkedIn Transcript Welcome to Disrupting Japan, straight talk from Japan's most successful entrepreneurs. I’m Tim Romero and thanks for joining me. Today, we're going to talk about the future of poop, and I promise you that it is both a lot more interesting and also a lot less, well, strange than you might think.  Shinji Fukuda is the founder and CEO of Metabologenomics, a startup which is usually, and thankfully, referred to as Metagen. Shinji and Metagen are mapping out the complex biome of the human digestive tract.  Our gut biome is an incredibly complex ecosystem that exists within all of us, and it is an ecosystem. These bacteria don't share our DNA and they're not simply along for the ride. We couldn't function without them, and there's a lot of variation between cultures and between individuals.  Metagen is now working with some of Japan's largest healthcare, pharmaceutical, and chemical companies to commercialize this research. Of course, Metagen is not the only startup in this space, and Shinji and I talk a lot about when and how this tech is going to roll out to consumers, some of the scam startups that are already trying to get into this bandwagon, and we dive deep into one of the biggest problems facing deep tech startups in Japan.  But you know, Shinji tells that story much better than I can, so let's get right to the interview. Interview Tim: So, I'm sitting here with Shinji Fukuda of Metabologenomic who's researching and monetizing the gut biota, so thanks for sitting down with us. Shinji: Hi. Tim: And by the way, is it okay if we call the company Metagen the way people tend to do in Japanese? Shinji: Yeah, Metagen. Tim: Okay, good. So, listen, I think you can explain this much better than I can, so what exactly does Metagen do? Shinji: Our goal is to create the digital society, so we have a huge number of microbes in the gut and the gut microbiota has a lot of function, and maybe you know it's very important that the imbalance in the gut microbiota are related to some disorders like colon cancer, inflammatory bio-disorders, and also, the microbiota induce some systemic disorders like metabolic disorders and also meta-disease. That's why gut microbiota is really important to keep our health. Tim: It's amazing the amount of research that's being done on this right now and it's still a relatively new field. So, for Metagen, what is the main goal of the company? Are you trying to develop more targeted medicine? Is it better food? Is it a healthier population? What is it that the company is focused on? Shinji: Here, actually, everything, but we have a priority. Our goal is healthcare, to develop the technology to keep our health, healthcare, and also, last year, we established our company Metagen Therapeutics which focuses on the cure for patients with IBD, so the company is now trying to prepare that fecal microbiome juice. Do you know the fecal microbiota transplantation? Tim: Yeah, yeah, the fecal transplants. Shinji: Because our feces contain a huge number of microbes, so they can improve that sickness. Tim: I didn't even know our fecal transplants are that common in Japan, I didn't even know if that is legal and approved yet. Shinji: Not so common but in clinical trials, researchers proved the effect of the FMT in IBD patients. Tim: So, it's still, all of this technology, these treatments are sort of in the clinical trial phase? Shinji: Yeah. Not only in Japan, also in the US.  Tim: I want to get back into the research and business model in a minute. So, tell me about your customers, so how are they using your services? Shinji: Metagen is now providing R&D support service, and the main target is the food and supplement companies. Actually, our goal is to control the gut microbiota using some food or supplements because our gut microbiota is affected by our long-term food habit, but we don't know yet how we regulate the gut microbiota. Tim: So, I noticed you've put together the gut design project. It looks like about 40 very large Japanese companies in a variety of industries. What is that about? Shinji: Actually, we have to develop the gut microbiome database, we are now collaborating with many companies. Tim: So, before, you were kind of jokingly referring to this as a poop database, but well, I mean, it kind of is. Shinji: Yeah, actually, in the Japanese company, they have this yogurt supplement but yogurt cannot improve the - everyone has microbiota, we don't know yet what kind of products are good for the person, so we need a database, so that's why we collaborate with many companies to perform the clinical trial, which kinds of products are good for you? Tim: It's a range of food companies and insurance companies, and chemical companies, are they all doing research and contributing to this database, or are they customers or sponsors of the research that's being done? Shinji: Less than half of companies develop the database but the other is running about the gut microbiota. Actually, I have been working on the gut microbiota for other 20 years, and now, many people are publishing regarding gut microbiota, and the importance, so that's why they are to join our gut design project, yeah. Tim: Those sort of open corporate collaborations are funny things. They're useful but it very rarely develops into sort of a center of revenue, so how do you imagine this consortium in five or 10 years? Is it something that you think will help map out and fill put out this database, and then sort of drift apart? Do you think it's going to form the core of the technology you're bringing to market? What role do you see it playing? Shinji: The gut microbiota is really important to keep our health, so do you know your gut microbiome profile? Tim: Not a clue. Shinji: Yeah. Tim: I don’t. It's something I probably should know. Shinji: Yeah, but actually, gut microbiota is tightly affecting our health condition, so that's why our first goal is to develop a new society which everyone knows their own gut microbiome profile. Tim: One of the things I find fascinating about what you guys are doing, not just the research itself which I think is fascinating, but Metagen is an example of one of these deep tech startups that are happening in Japan. I think there is so much incredible research being done that is just now starting to get commercialized. So, you were founded about five years ago, 2015 or so, right?  Shinji: Yeah. Tim: It was a joint collaboration of Keio and Tokyo Institute of Technology? Shinji: Yeah. Tim: From a research point of view, it's clear why this is an incredibly important topic, but let's talk about the business side, let's talk about your business model. So, how do you make money? Shinji: Yeah, so at this time, we collaborate with big companies to perform the clinical trials like a CRO because we have the service to analyze the gut microbiome, but in the future, we develop B2C service to analyze your gut microbiome and we recommend some solution to improve your gut microbiome. Tim: Oh, I definitely want to talk about that in a minute, but right now, I want to back up and talk about your current model. Are you strictly doing a services model where the various companies contract the research to you or are they kind of a joint development project where you would get royalties on treatments that you jointly discover? Shinji: Both sides are there, but now, we get some money from the company to perform the clinical trial and also other R&D support services, and also, we now try to prepare the fecal microbiome juice. Tim: Selling to academics and research support, I imagine that market is fairly limited size, so you were talking about direct to consumer products or B2B2C products. What does that commercialization look like? Shinji: We developed a new kit to collect a fecal sample and actually, we had a patent, stabilization of the feces under room temperature because feces contain many bacteria and if they are room temperature, the gut microbiome will change and also metabolites are altered. Tim: That's not really a consumer product per se, that might be something hospitals will use to send out to collect samples before a physical or something like that? Shinji: Yeah, yeah, yeah. Tim: Okay. Actually, I think maybe it was in an interview that you did a while ago, but you were talking about making a toilet that analyzed the feces. What happened with that? Shinji: Yeah. In the future, we will develop the smart toilet to detect health conditions. You rinse your poop, but we don't know yet what kind of index should be required to develop the smart toilet. Tim: So,

A lot of great ideas seem crazy when you first hear about them. Today Ryotaro Ako, founder of Atopiyo, explains not only why this is a great idea that is deeply valued by his users, but he also frankly talked about the difficulties in bringing it to market. We talk about the challenges of forming a long-term, core team and of developing a steady cash flow while trying to focus on a social good, and the risks involved in monetizing a community. Ryotaro also explains why extensive press coverage and shelves of startup awards don't make developing a sustainable business model any easier. It's a great conversation, and I think you'll enjoy it. Show Notes Why share photos of skin conditions? How to find a technical co-founder, and what to do if you can't The two challenges all MedTech startups face The danger of long-term plans without short-term action How to monetize a community, and why it's risky Possible competitors The myth of Japanese conservatism Links from the Founder Everything you ever wanted to know about Atopiyo Download the Atopiyo App Friend Ryotaro on Facebook Transcript Welcome to Disrupting Japan, straight talk from Japan's most successful entrepreneurs. I’m Tim Romero and thanks for joining me. Today's conversation with Ryotaro Ako, founder of Atopiyo, is going to be a little bit different than usual.  I first met Ryotaro several years ago at a Disrupting Japan live event, when he had just launched Atopiyo, an online community in which people with atopy and related skin conditions can support each other and exchange information about treatments and progress. Since its launch, Atopiyo has gone on to build an engaged and growing user base, attract extensive and positive press attention, and win a lot of startup awards from press, government, and industry.  This is the kind of startup I really want to succeed; the kind of startup I think everyone really wants to succeed, actually. They're using startup techniques and technology to solve problems and actually make the world a little bit better.  At least in theory.  You see, Ryotaro and Atopiyo have a bit of a problem, and it's a problem that almost all social entrepreneurs run into, but very few managed to solve. If in this interview, I sound like I'm beating up on my guest a bit (by polite Japanese standards anyway) it's coming from a place of desperately wanting to see him succeed.  Everyone who has an idea for a social startup and a passion to change the world can learn a lot from Atopiyo's story and this discussion. But you know, Ryotaro tells that story much better than I can, so let's get right to the interview. Interview Tim: So I'm sitting here with Ryotaro Ako of Atopiyo, which helps people with atopy understand the disease and connect with each other, so thanks for sitting down with me. Ryotaro: Thank you very much, Tim. I'm very glad to talk with you. Tim: And we're glad to have you. I gave a really brief description of Atopiyo but I think you can explain it much better than I can. So what exactly does Atopiyo do? How does it work? Ryotaro: Atopiyo is Japan's first visual SNS for atopic dermatitis. It's like Instagram specializing in atopic dermatitis. Tim: Okay, I mean, at first reaction, sharing pictures of atopy and skin conditions does not sound that appealing. Ryotaro: Yeah, yeah, yeah. Tim: So I mean, tell me about your users. Who uses this? Why do they find it valuable? Ryotaro: Yes, yes, our images can be this. So I think it is not so photogenic or happy images but patients want to know the other patients, their skin disease, how are getting better or how getting worse because of these drugs or other drugs, and they want to know their process of the skin disease. So it's useful for the patients, and what's more, they want to choose their images into their private mode. So if you set it to the private mode, this image is only for users. Tim: Okay, so the main benefit the users get is they can compare their treatment and their progress with other people that are having similar treatments and things like that. I can certainly see why that would be valuable, and I guess we got to point out emphatically this is not for medical diagnostics or treatment, right? It's just a social community. Ryotaro: Yes, it's not a medical treatment or a diagnosis, yes. Tim: And we'll dive into that a bit later when we talk about the business model. Ryotaro: Okay, yeah. Tim: But before that, let's talk a bit about you. Ryotaro: Okay, yes. Tim: Yeah, before you started this, I mean, you had atopy yourself and you'd volunteered at a number of patient support groups, right? Ryotaro: Yes. I'm a recovered patient of atopic dermatitis. I recovered, but there are other patients are suffering every day, so I interviewed and I researched their troubles and I decided to develop this app. Tim: When you decided to do this, you didn't have a technical co-founder? Ryotaro: Yeah, yeah. At first, I tried to find programmers for three months, yes, but I gave up because — Tim: It's really hard.  Ryotaro: Yeah, I gave up four or five years ago.  Tim: I understand. I get contacted by probably, I don't know, four or five people every month, who have this great ideas and say, "Well, I'm looking for a technical co-founder." It's like, man, that's hard.  Ryotaro: Yeah, very hard for me. And so, yes, so I participated in a lot of events such as Disrupting Japan Site Anniversary or — Tim: Thank you. Ryotaro: Yeah, yeah, yeah, a lot of events I participated, but it's difficult. Tim: So you finally took matters into your own hands? Ryotaro: Yes, I entered the programming school, an online programming school in Japan. It's called Tech Academy. I studied there for five months. Tim: And that was enough to launch back in 2018, right? Ryotaro: Yes, 2018 is the first launch. Tim: I think this is a story a lot of founders are trying to figure out, you know, they're one person with an idea of how to make something that's worthwhile, but you managed to learn enough to launch the app in five months. Ryotaro: Actually, programming school is five months and after that, I developed myself two months, maybe seven months and more. Tim: But that's great. I mean, I think a lot of people are interested in just how do you go from one person with an idea on how to help people build the app, and how do you turn that into a business.  Ryotaro: Yes, yes, yes.  Tim: Which is what we want to talk about next. And actually, you've just established a godo gaisha recently, right? Ryotaro: Yeah, last week I founded Atopiyo LLC.  Tim: And I'm curious, why a GK instead of a KK?  Ryotaro: Because GK is very easy to found and really easy to manage so I chose it. Tim: And I mean, a GK is very easy to convert into a KK later on if you decide to. Okay, so let's talk about the business model. So what's the plan? How is Atopiyo going to make money? Ryotaro: Atopiyo is largest database for atopic dermatitis patients. So now, many pharmaceutical company develop new medicine. Atopiyo provides information about their patients to the pharmaceutical company without their personal information. Tim: At the moment it's just photographs, are you planning on collecting more deeper and detailed information about the users? Ryotaro: Yes, yes. Now, we had profiles like sex or age or atopic period. In the future, we would like to have more deeper information.  Tim: Looking back over the past couple of years, you guys won actually a lot of awards from both universities, government programs, incubators, pitch contests, the string of awards for an interesting idea. And I'm curious did those awards help you land the business connections? Did those awards help you get the business or was that almost a separate — Ryotaro: These awards helped me to spread this Atopiyo app, because Atopiyo app is just a volunteer for me so we don't have any budget. So I would like to spread it to atopic patients in Japan so this will help me to efficient spreading in Japan. It’s been shown in more than 100 media.  Tim: So the pitch contest was mostly about more of a marketing strategy than a business model development.  Ryotaro: Yes. Tim: But I mean, you mentioned you have been working with pharma companies and medical institutions for some time now. So getting them data on atopy patients, it's one of those things that sounds worthwhile as a first step, but let's dig into that a little more. So, you know, the pharmaceutical companies, they already have lots and lots of pictures of atopy and different types of skin diseases. So what are they getting here that's really unique? What is the value they find in this community? Ryotaro: A pharmaceutical company have a data from doctors or a hospital but they don't have the data from patients. Direct patients' data, that's kind of the data called the "real world data". They are thinking -- they are about data and they want to know their suffering, and they want to use it for the new medicine. Yes, that is a new trend for the company. Tim: So for example, the pharmaceutical companies could follow the progress of individuals that are going through a certain kind of treatment or that are taking a certain medication? Ryotaro: A pharmaceutical company, they want to find female situation or a male situation, and children situation or some situation. Tim: One of the challenges in med tech across the board, it kicks in from small one person startups to, you know, very well-funded. Medical technology and medical information is really highly regulated, which is good for the most part. Do you run into any problems with Japan's law on personal privacy and on storing medical information with this app? Ryotaro: Yes, right now, we don't encourage such medical information or medical treatment but in the future, we want to collaborate with hospital or pharmaceutical company. So now,