How Israeli Startups Get Big in Japan

  • Choose your partners carefully: Entrepreneurs, investors, and corporations should work with trusted representatives from both sides to facilitate successful engagement. Facilitators who have spent time in both regions could help ensure nothing significant gets lost in translation and create an environment for real connections to emerge.
  • Learn to appreciate the middleman: In the financial services, IT, and telecommunications sectors particularly, Japanese companies are less inclined to work directly with vendors and customers and are more likely to employ an IT integrator. This is how they do business. One of the best strategies to enter the Japanese market is to find these integrators and seek out a collaboration. It means sacrificing margins but they will put you in front of their biggest customers and may prove pivotal to your success.
  • Trust is key: Building a business relationship with Japanese partners requires a meaningful investment of time, effort, consistent communication, and reliability. It is very much a long-term commitment but there are high rewards. Firm, authentic ties will earn you loyal customers who will be hard-pressed to abandon the relationship when a cheaper product, for example, comes to market. Once trust is built, your partners will go out of their way to help you.
  • Time is not an abstract idea: Israelis have a very different perception of time than the Japanese do. If you tell a Japanese person that you will be sending them an email in the evening, they expect to receive your message that evening. This speaks to reliability and accuracy, traits that are revered in Japan. Israelis’ more fluid concept of deadlines and dates can be a detriment in this context.
  • Don’t go in too early: The product or service doesn’t have to be bulletproof, but it needs to be established, well-rounded, and stable. The excellence and maturity of the technology you are offering is a key pillar.
  • Do your homework: Israelis like to move fast and improvise, while the Japanese tend to take things slower, looking carefully at the details on the path to a deal. Be prepared. Keep in mind that everything that you are offering them, they may already have to some degree. And you are being compared to what’s already out there. If you want to be seriously considered, you have to play by their rules.
  • Have an edge: Japan is a big country with a population of over 120 million people. Entrepreneurs should strive to have customized, localized documents and materials that will show careful consideration of competitors and comprehensive thought and preparation.

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Red Dot Capital Partners

Red Dot Capital Partners

We are an Israel-based early growth-stage venture fund investing in breakout technology companies.