Venture Samurai

by Daniel McInnes
samurai In a conservative business culture where reputation and relationships are everything and startups have neither, entrepreneurs need something special to succeed.

The Japanese entrepreneur is far from an extinct species. He—or she—may have taken something of a beating in the dark economic days of the 1990s, when companies were thinning down and banks were less willing to lend, but even then there were opportunities. Anyone with a winning idea just had to know where to look, says Yoshito Hori.

The 46-year-old founder of Glob is Capital Partners and president of Globis University, which has branches in Tokyo, Osaka and Nagoya, insists Japan has plenty of people with bright ideas. “Look at Kenji Kasahara; he has just turned 30,” Hori says from his office in the Australian city of Perth, where his five sons are at school. Kasahara is a billionaire in U.S. dollars after dreaming up the Mixi social networking site. Another example is Yoshikazu Tanaka, also aged 30, who set up the Gree mobile phone and web-based social network in 2004.

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Japan has long had a poor reputation as a destination for venture capital—attracting a mere $1.8 billion in 2005, a fraction of the amount available in the United States, for example—but Hori is aiming to improve that figure.

“You need to have a strong entrepreneurial spirit, and that is something I learned at Harvard Business School,” he said. “You have to believe in the possibility that something can be done. I’m trying to create the Number One business school in Asia from scratch and I have to believe that I can do that.”

Right now, the university is ranked in the top three in Japan and enrolls more than 180 students each year on MBA programs, many dispatched from some of the biggest names in Japanese industry, including Toyota. That’s a far cry from the first day of classes, in 1992, when Hori had initial capital of $8,000, a single rented classroom, and he used his apartment as an office.

“I graduated from Harvard in 1991 and at that time there were only two business schools in Japan,” he says. “I had been deeply impressed by the method of teaching at Harvard, which used the case study-approach. There was no right or wrong answer, but the process was more important.

“We didn’t learn from a book but from other people, through exchanges and sharing opinions. I thought I needed to create a school like that in Japan.”

As an employee of Sumitomo Corp., Hori knew how difficult it was for full-time staff to take time off to study, so his university enables anyone keen on earning an MBA to study in the evening or at weekends. His professors are from practical backgrounds, rather than the academic, theory-based teachers used elsewhere.

Hori says he is creating “visionary samurai,” the leaders of tomorrow, who will have learned their own capabilities for growth, both personally and professionally, developed connections with other, likeminded student entrepreneurs around the world and, ultimately, discovered their own purpose and formulated their own futures.

Hori identified his own ambitions while he was at Harvard and is now helping others achieve their aims, but with a unique added positive under the Globis umbrella.

“I have a strong spirit and believe I can do anything, without limits,” he says. “Together with that, I will always try my very best in whatever I do and there is a culture of working hard in the company. I can also think outside the box.”

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Hori did not want to create a school that was similar to others in Japan and so linked it to the Globis Capital Partners arm of his operations, which has three funds managing some $400 million in assets. By combining the school with the venture capital, he is getting the most out of his students and the investments at the same time, as both sides are enhancing their knowledge and understanding.

Harvard’s techniques have a tried and-tested history for bringing through entrepreneurs—he points to Hiroshi Mikitani of Rakuten Inc. and Tomoko Namba, chief executive officer of online auction company DeNA Co., both o f whom studied at the Boston landmark’s business faculty.

“When you become successful, other people can become envious,” warns Hori. “You have to be very careful about what you say and how you act in public. It’s part of the business culture in Asia, but when you are doing well in business, it is best to keep a low profile.”

He quotes the Japanese proverb: “When the rice becomes ripe, that is the time to bow.”

Japan’s economic data have not been impressive in recent months, but Hori is optimistic over the state of the nation.

“I started in 1992, after the bubble had burst, so there are chances created by a bad economy,” he says. “I’m not too worried about the economy at the moment as I think it is quite strong at the corporate level. There has been restructuring, companies have become more resilient, their debts are low and earnings are high; they are focused on their core businesses and managements are more sophisticated—partly because we are teaching them.”

Hori must collect his sons from school and take them to the pool or to play tennis, clearly having found a good work-life balance that so many strive for.

And he would suggest to any budding entrepreneur to have fun. “I would tell them to work hard, but try to enjoy it at the same time,” he said. “Enjoy the whole process of entrepreneurship.”