[Podcast] Foreign founders are changing how Japanese start startups (Part 4)

For the last 150 years Japan has made a science of borrowing the best ideas from the West and transforming them into her own.

The startup world is no exception. Japanese startup culture is heavily shaped by western ideas, but not in the traditional top down way where leadership chooses which ideas are introduced. Japan’s startup ecosystem is being shaped by bottom-up experimentation by both Japanese and foreign founders on the ground here in Japan.

Today we talk with Sandeep Casi, an entrepreneur and Partner at Antler. We talk about the challenges foreign founders still face in Japan and how they are changing Japanese entrepreneurship for the better.

It’s a great conversation, and I think you’ll enjoy it. 

Welcome to Disrupting Japan, Straight Talk from Japan’s most innovative founders and VCs.

I’m Tim Romero and thanks for joining me.There is a truism in venture capital that states no one invests in an idea.

This references the fact that ideas are easy to come up with and they have very little value on their own. But it seems that this truism is not completely true.

Today we sit down with Sandeep Casi, the general partner at Antler Japan, and he explains how Antler does in fact invest in ideas. I mean, in one sense, the truism is still true. Antler only invests in companies. But if you come to them with an idea, they’ll invest a lot of resources to help get you from idea to startup.

We also talk about some of the challenges foreign entrepreneurs still face in Japan, the myth of Japanese founders not being able to speak English. And we dive deep into how foreign entrepreneurs are changing how Japanese founders start startups.

But, you know, Sandeep tells that story much better than I can. So, let’s get right to the interview.

(Continued from the previous part)

Tim: Oh, this is a great model. So, where are the CEOs coming from? Are they students? Are they other operators?

Sandeep: It’s a mix. For example, we are one of the startups here. The PhD candidate is from Osaka University, but the business person is from University of Tokyo. That’s a very interesting combination because in the US it happens all the time. But in Japan, they’re siloed in, Osaka doesn’t work with Tokyo. Tokyo doesn’t work with Toto.

Tim: Even Tokyo within two different departments, they don’t speak to each other. It’s silos within silos.

Sandeep: So, Antler, it’s a Switzerland. So, we really don’t care to align with any university or any governmental organization. Our whole focus is to basically build entrepreneurship in Japan. We actually match the right person to the right team. Not because they’re from Kyoto University or not because they’re from Amazon. It has to match what that particular startup needs. And lately we’re also bringing executives from outsiders of Japan to work with the Japanese startups.

Tim: Is there a particular focus? I mean, is it deep tech?

Sandeep: The first two startups were only holding Japanese. They were not so much on the deep tech space. They were like e-commerce, beauty, and all those domestic market stuff. The last batch, we started to get into AI and we have like three or four startups in ai three in medical, one in Space Tech, last batch, this batch we had T Tech, we have companies like that are going after edge AI, robotics, and then a brain disease using AI and construction.

Tim: Well, I mean, this is good. Japan does have great tech in all of these areas. So, I mean it’s encouraging that that’s coming out. Talking about like university innovation in general, because a lot of people are talking about it. I mean, everyone knows there’s this fantastic research that’s just not getting commercialized. And even some of the most famous flagship university spinouts from let’s say 10 years ago have been professor led. They’ve received a huge amount of funding. They just don’t seem to be able to bring a product to market. Everyone knows it’s a problem. Everyone has good intentions. Everyone wants this to be solved. Why is this so hard?

Sandeep: It is hard because they only have one variable to solve just because there’s a great technology, they think that there is a market for it. In many cases it’s not about the technology, it’s about the execution. Just because you have a great technology, you can’t just walk into GE and say, just buy it.

Tim: Well actually that’s a really good point and that actually makes me kind of question what I said before about having the professors identify what the promising technology is, because they probably would have no idea. So, who does that analysis? Who sifts through the patents and the IPs and like, hey, I can sell this.

Sandeep: So, that is a discovery issue. We have to look at that manual at first and then hopefully using AI downstream.

Tim: But who is that? Antler staff? Is that Antler? Is that you?

Sandeep: That’s me.

Tim: Okay. Getting back to your roots.

Sandeep: Getting back to my roots. Yes. So, I do university circuits and I speak to a lot of these researchers and I look at what patents they have and then look for use cases. So, what we will do is we will go into corporates and find out where the issues are, gaps are, and then we’ll run those challenges within the universities. If there is opportunities within the universities to bring those IPs to market, then this is an exact way that you want to bring to market because it is not some prototype, it is basically a full on integration into a corp for your product to basically expand from university out. And I think Antler is the only one that is poised to do that. And I’ll tell you why. Antler partners around the world are operators. They’re not bankers. Most of them have actually started a company. The DNA is an entrepreneurial DNA and they all have domain expertise. So, for example, if you have an energy company that needs to like expand, we can call up on Antler Nordics and get access into an energy company down there.

In the 5th part, we will discuss the regional differences in the programs offered by Antler, as well as the use of intellectual property (IP) in deep tech and gaming.

Top photo: Envato

Click here for the Japanese version of the article