Interviewed & written by Isao Tokuhashi
Mail to: firstname.lastname@example.org
Today’s interviewee is Taichi Ito, an entrepreneur. We were introduced to him by Tomo Akiyama, a venture capitalist whom we interviewed in June 2012. Now Ito produces a future world-class photo-posting/sharing mobile application. He will launch an e-commerce website and give a shot at interaction between app & e-commerce system. When it’s achieved, people who have different backgrounds share their hobbies and enjoy communication with each other through selling and buying on his web services. Ito is now busy building such a world.
We tell you his project and future outlook on another page, for now here are career and stories of a man of baby-boomer junior generation (*people who were born in the early ’70s) up until starting his own business.
Now that things change at an unprecedented speed, we need a man like him who picks his route carefully, faces the future and steps forward – we thought so while we were hearing his stories at an “office” of a garage venture entrepreneur who works in a clothing warehouse.
New business which has stocks come to life
When I established a company called “Cellbridge Co.,Ltd.” I had two ideas. One was “meshtiles“, an SNS in which you can share your hobbies with others through photos, and another was a product sales strategy using a flash marketing method. I started from the latter because a free app is not income-producing and time-consuming to generate revenue.
Around the time of founding a company, a flash sales, which is typified by Groupon, became a hot business model. But no one sold products by using that method. I really wondered why and there was no reason for hesitating to do it, so I decided to try.
I thought that one of the most inefficient things in the world is dead inventory. I thought that a flash sales method would be useful for disposing it or popularizing unknown wonderful things, such as local-area products, efficiently. Limited time offer, limited quantity, but low price. For example in the fashion industry, if you cannot sell out the clothes, dead stocks are incinerated at the end. I wanted to resist this flow and turn the stocks into money, I wanted to try to push up demand for the stocks by showing affordability and thus an advantage in its purchase. So I started flash sales business right before 3.11 Earthquake.
“Epoch-making idea” blew up
I think there were many people who thought it was an interesting idea, that’s why many sellers gathered to the website. But only a few users, I mean consumers, visited us. It’s hard to attract many users when the service is not brand-name, but we cannot continue to offer service unless we attract them. Actually existing flash sales services acquired buyers at their expenses, but we didn’t afford it.
So I drew a conclusion – shutting the site down. Then we switched to meshtiles, a photo sharing app.
We try to attract users to a free app first and start business that services people who get interested in our e-commerce – That’s more suitable for a start-up company like us who cannot spend money on attracting people to an e-commerce. We realized that and switched to the present path four months after the launch. Then finally we shut it down in early 2012. We said to users that we would certainly restart the e-commerce website someday.
“I’ll quit this company five years from now.”
I’d wanted to go independent and test myself since I was a college student. My family runs a Japanese restaurant, I think that’s the main reason for it. My father’s family and my mother’s family come from long lines of merchants.
The first company I entered after I graduated a university was a textile trading company. I didn’t want to work at a big company. In a job interview, I said to an interviewer, “I’ll quit this company five years from now!” because I dreamed of starting my own business. Actually I left there four years after I joined them because I accomplished the goal which I set.
Then I joined an IT venture company. I wanted to gain a lot of experiences to launch a business and to be involved in a business-to-consumer project, not a business-to-business one. That company was in charge of building distribution systems, so working there meant that I made a step toward consumers.
Great leader’s philosophy
Uniqlo was already a brand-name, but people were really entrepreneurial. Tadashi Yanai, a president of First Retailing, is the first corporate manager whom I worked with from up close. I was ingrained with his philosophy and it is still implanted in my mind.
Here’s an unforgettable experience that I’ve had. When I was in charge of a women’s cloth line, I thought that we should raise a price of a main line and raise its quality, then switch the target from women in their 30s – 40s to women in their 20s – 30s. Because there was no clear picture of the future of Uniqlo’s women’s line unless they changed their policy. I couldn’t cite the specific evidence in the figures at the moment, but actually some customers were not satisfied with our product lineup. I could tell them how much the expected revenue would be if the customerwould come and buy. I was working at the headquarters but I went to each shop every weekend. I often engaged in give-and-take with store managers.
I made a presentation on the hypothesis which I formed, but it was rejected by president. However I believed my hypothesis seriously, so I remade the document and faced the president over and over again. Then he said OK when I made the 5th presentation to him.
I guess he wanted to tell me, “Think more”. There could be people who withdraw their ideas as soon as Mr. Yanai says No. If so, he may think they are not serious about their ideas. He may think, “If you’re serious about your idea, you should brush it up more and come to me until I say Yes. He says No, but not because he is denying your idea but because he wants to make sure how serious you are about it.
Giving up going independent
To me, First Retailing where I worked when I was in my late 20s through early 30s taught me the basic of the business depends on the customer. But on the other hand, I almost gave up going independent.
While I worked with Mr. Yanai, I thought that I should not start business with a half-hearted attempt. It’s a little embarrassing to say, but I’m originally a serious person, so I thought, “I must not set a low goal or future aim. If I cannot give everything I have to what I want to do, I’m not eligible for opening up my own business”. I couldn’t find something that I would be able to devote myself like him.
Trying to start from scratch
Before I started business, I was involved in expanding the operation of existing companies or existing business. Those were literally “existing”. I had no experience of founding a company from scratch or starting business with nothing, no human resources, no money and no products. I was like that even when I was a CEO of a company before.
I had been a president of a company which is in charge of apparel planning, manufacturing and distribution, for three years. There were about 30 staffs and its annual sales were 2 billion yen (about US$ 2 million), not such a big company, but I experienced financial affairs and cash management for the first time. Especially as importers and sellers of the product, we would pay importers first and then earn back the amount of payment from selling. So money goes out first. If you need money now, you have to get a loan from someone else.
Then I thought, “If I have something I want to do, I think I can be responsible for it on my own”. I met many different types of corporate managers other than Mr. Yanai and learned that each manager was unique. That experience ignited a passion for starting my own business again.
What does it mean to be a president?
The reason I became a president of the apparel company was because I was aiming at making a new project our core business instead of moving away from its existing business such as apparel planning, manufacturing and distribution. But we had no choice but concluding that it would be difficult to switch our business because of some problems such as Lehman’s fall.
But after that, I wondered if I would have to be a president. If I were a founder of the company, I wouldn’t have lost enthusiasm because of that. But if I would have to continue to do what I didn’t really want to do in consideration of shareholders – I know you would say, “You can’t be that naive” – actually it was hard for me to stay motivated using personal guarantees as a method and borrowing money. Above all I wouldn’t be happy with being a president. If I allowed the feeling to linger, I would feel bad for my former employees.
I opened up about my feelings to the parent company and they understood. Also I had an interesting idea as I told you before and I believed that our future would be much more exciting if I developed my idea so I wanted it to reach fruition. So I found a company.
Ignore age, stride ahead
I’m one of the baby boomer juniors (*people who were born in the early ’70s). When I was a student or in my 20s, there were just a few entrepreneurs but now the environment has changed and the number of students who start their business has risen. That’s wonderful.
How about our generation? We are thickly-populated so we’ve been locked in stiff competition with each other since we took college entrance exam or started job hunting. That tough situation continued even after we entered companies, but we have such a common experience and can be very competitive. So I think our generation should establish more businesses.
People who will lead the Japanese economy from now on must be from our generation, I think. Some of you may think you’re too old to start your own business, but ignore your age and try things more. I believe those attitudes are necessary for us. I want to be a role model of the challenging baby boomer juniors.
If you don’t think you have a large vision, that’s OK. Your plan for after you start business has been drawn up and step toward when you think it’s time to implement it.
Click here and learn about his sweat and tears called “meshtiles”.