YC
Hiroshi Mikitani at Startup School 2012
@ Y Combinator
10/25/13
Takeaways
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
I founded Rakuten in 1997 with an initial capital of $200,000 and never raised money from venture capitalists; instead, I hired young graduates and focused on building the company organically.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
Rakuten is now the number one e-commerce platform in Japan, holding a 35-40% market share, and we operate in over 13 countries, including acquiring Kobo, a major e-book company.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
In Japan, the venture capital ecosystem is not as robust as in Silicon Valley; while there are venture capitalists, they typically do not get involved in management, focusing mainly on providing capital.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
To ensure cash flow, we asked our merchants to pay $500 per month, requiring six months' payment upfront, which made my company cash flow positive from the second month of service.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
We were patient in the first three years, focusing on creating a strong business model to support small to medium-sized merchants rather than copying models from Amazon or eBay.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
We differentiate ourselves by facilitating communication between merchants and consumers, believing that the buying experience should be enjoyable and engaging, not just about price and efficiency.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
Our growth strategy includes organic growth and acquisitions; we built a strong brand through sports sponsorships and created a robust loyalty program to cross-sell our services.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
When acquiring companies, we look for alignment with our culture and mission; if a potential acquisition does not fit our values, we will not proceed, even if the service is appealing.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
Our only significant failure was in China, where a partnership with Baidu did not work out, leading us to withdraw from the market after mutual agreement to shut down the business.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
To maintain a successful company culture, we emphasize both innovation and strong operational practices, using quantitative and qualitative measures to manage effectively.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
I invested in Pinterest because I see it as a unique social network that appeals to users on a deeper emotional level, differentiating it from other platforms. Pinterest is the best social network for influencing buying behavior and decisions in e-commerce.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
The future of e-commerce will see a shift towards digital products, with logistics becoming increasingly important due to innovations in automation and robotics.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
Mobile devices, especially smartphones and tablets, will become the primary means for consumers to shop online, with mobile transactions growing significantly year-on-year.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
I don't fear competition; instead, I learn from competitors. Our approach to e-commerce is fundamentally different from Amazon's, as we focus on facilitating transactions for small to medium-sized merchants.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
When hiring, I prioritize younger people to maintain our original corporate culture and to adapt to the evolving market, especially after going public.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
We converted our internal communication language from Japanese to English to create an open culture and improve collaboration across our global business.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
Sharing information openly is common in Japanese companies, which helps in transferring expertise and fostering collaboration.
HM
Hiroshi Mikitani
10/25/13
@ Y Combinator
My first encounter with Paul Graham was when I was exploring the internet shopping idea, and I felt the excitement and energy of his entrepreneurial spirit.