New businesses and initiatives that emerged from the TRIBUS program have received media coverage and wide acclaim. Many people, though, know the program only as an accelerator program. TRIBUS, in fact, is not confined to the Ricoh Group and (inevitably) has a significant social impact, as many Ricoh Group employees and participating startup teams are likely realizing. What is the social significance of TRIBUS? Where does it stand internationally? What is its significance for Japan?
To get a sense of where TRIBUS is today, we asked 01Booster, the accelerator management pro that has been with us since the program’s inception, to share its objective insights and more.
Ricoh “was more flexible than expected”
――Where does 01Booster fit and what is its role in this program?
Goda Normally, we specialists come in and take the lead in these in-house entrepreneurship and startup support acceleration programs. That is how it often works. But this time, Ricoh took much of the leadership. The administrative office is very active. Our role is to help them. For example, it is hard for 01Booster to conduct in-house outreach. On the other hand, 01Booster can help attract external startups.
Sakata The accelerator is a long project, lasting a year or more, so we play different roles in each phase, such as the planning, screening, and program phases. In the first year in particular, one of our roles was to lay out the agenda for creating the accelerator and get the program moving. Last year, for example, in the planning phase, we began by holding a workshop to deliberate the purpose of the program.
Kimoto In the first year, the program was carried out under our proposed plan. This year, my sense is that Ricoh is actively brainstorming and implementing the program, drawing on last year’s experience. Basically, one thing we are doing this year is firmly building on the path Sakata laid out last year. In addition, since the launch of TRIBUS, we have received various ideas from the administrative office, so we are exploring a new path. Especially with COVID-19 this year, we became more creative online. Reverse pitch* is one example. I think such efforts have been really effective.
*Reverse pitch: In general, a pitch is a short presentation usually made to investors or companies by a venture or startup company with a business idea in order to obtain capital or other resources. A reverse pitch is the opposite. It is a presentation in which a company’s challenges are raised with entrepreneurs in order to solicit solutions.
――What did you think when you first heard about this program?
Goda To tell you the truth, before we were approached by Ricoh, I imagined high obstacles stood in the way of innovation in the manufacturing and precision industries. As a general rule, large organizations with a long history have policies and systems that have been developed over many years. Even if there is a “right way” to innovate, the organizations decide, “we can’t do this in our company,” “it’s OK up to here but not beyond,” or “we can’t do this because our boss says so.” As a result, the approach gets distorted, and we move farther away from innovation. “I understand what you’re saying, but we can’t do it,” they say. It is an industry that has been built on a stable business model for many years. Since I had heard of such rumors, I pictured Ricoh as an extremely rigid company. But when I first talked with them, I was like, huh? What’s going on? They earnestly listened to what we said, and to my surprise there was nothing rigid about them at all.
The people running the program are very flexible, so much so that we are left wondering. They strive to get close to the “right way.” If 100% is impossible, then they try to get even 5% or 10% closer. Their attempt to make steady, step-by-step changes toward starting a business is very characteristic of them. They do not seem to have the peculiar desire for career advancement that you often see. More specifically, I think they are people with what Horowitz calls the “right kind of ambition.” It is really rare to be so open in this industry. After all, reverse pitch involves disclosing your current business and strategy ideas to those outside the company. In general, companies don’t like it when other companies in the same industry come to an information session, but you don’t see this. This is the right approach considering the flow of innovation. This has become common practice globally as well. Innovation will never happen if companies continue to insist on using only their products and technologies and concealing ideas within the company. This program seems to be in line with the global trend, which is to co-create by proactively disclosing even vague ideas.
Sakata I have been involved in this program since about two and a half years ago. Before I first visited the company, I expected there would be intellectual property handling and other difficult issues faced by manufacturers. However, once I sat down with them, they started explaining what they wanted to do, i.e., the purpose, and I found out that they were trying to overcome existing ideas about rules and systems. As collaboration between in-house entrepreneurship and external startups is unprecedented, I envisioned rigorous work involving a lot of man-hours. But once it got underway, I saw that they understood quickly. The process has been problem-free. They are able to work on the essential points. The fact that they declared they will continue the program for the long term is significant. I think this is due in large part to President Yamashita’s commitment to this program, and the atmosphere in the company has become quite positive. It seems to have taken root as a culture of the company.
The significance and possibilities of an integrated program
――What do you consider are distinctive to this program?
Goda The people who applied as a catalyst* are distinctive I think. In fact, catalysts are generally young people, mainly those in their 30s and 40s, with occasionally one person in their 50s mixed in. This is common in the programs of other companies. But when Ricoh conducted a call for catalysts internally, people from truly a wide range of ages responded. Many experienced employees took part and brought tremendous energy. Other companies frequently do not understand the importance of this company culture or environment. In many cases, they hope a hero-type entrepreneur or internal entrepreneur like Steve Jobs will emerge. They do not realize that the environment, in other words, the foundation that encourages and supports them is what is really important. I also feel that the undaunted spirit of the Ricoh Group is evident in their attempt to implement this internally. It will be transformative if this becomes the standard in Japan.
* Catalyst: A person who acts as a catalyst connecting startup companies and members of the Ricoh Group to promote co-creation of businesses
Kimoto Ricoh comes with us when we go to external startups and ventures to give explanations during the program’s application period. Believe it or not, Ricoh is okay with the startups and ventures not applying for the accelerator program. Normally, you would want them to apply. But Ricoh does not mind a collaborative business model. Some startups are surprised when a company like Ricoh gives a talk and says they are okay with the startups either applying for the accelerator program or engaging in a collaborative business with them.
――What do you think about the integration of external startups and in-house entrepreneurial teams, something which is unprecedented in Japan?
Kimoto There is simply a lot of work to do, making it challenging. You won’t find many pitch contests with 20 teams giving presentations. It certainly requires more time and effort than a regular program, even just to recruit people and find a venue. But the work is no doubt interesting. Ricoh seems to be giving it their all. I don’t think there are any companies out there today that can do as much.
As for how the two sides will work together, there is probably no answer. I think it is something they will begin exploring. There are differences in level between external startups and in-house entrepreneurs. There are also differences in the method between last year and this year. I personally think we don’t have to have one method. I am looking forward to seeing how the two sides will be integrated.
Goda If I may talk about myself, as a person who left a large company to join a venture, I for one thought in-house entrepreneurship was unimaginable. Launching a business as a startup is a battle of life or death. In-house entrepreneurship, on the other hand, does not push people to the edge as much. I thought delivering outputs would be impossible unless you had considerable motivation. However, last year’s in-house entrepreneurship generated outstanding outputs. They were very well received not only by the judges but also by those outside the company. I have to say I was pleasantly surprised. Also, the startups were extremely satisfied with Ricoh’s provision of company resources in the form of catalysts and supporters. Normally, many large companies tend to be conceited toward ventures and startups. However, as far as I know, that did not seem to be the case at all.
I think in-house entrepreneurship and startups were able to advance in parallel in the first year. Going forward, we need to figure out how to integrate the differences in the levels and phases between in-house entrepreneurship and external startups. In fact, this collaboration between in-house entrepreneurship and startups pursues the global standard. In Japan, there is a culture of a company being a family, making it difficult to envision creating innovation in an ecosystem of partnerships with outside companies. However, globally, it is rare to have a single company innovating alone. They are always building an ecosystem involving outside companies. Silicon Valley is an entire city making innovations, and individual companies are growing as a result. In Europe, large companies are actively sharing resources with startups to create new value. I think what Ricoh is trying to do is to create an ecosystem for this global standard. As far as I know, it is quite rare for a Japanese company to advance such an initiative.
Boosting in-house entrepreneurship
――Please tell us about any new initiatives for this year or if there are any differences from last year.
Kimoto Reverse pitch is a new endeavor. We are currently discussing with the administrative office about how to proceed with collaborations between the company and external companies. A major difference from last year is the considerable increase in number of applications. Along with the number, the quality of the applicants was high. Fascinating startups applied, and we even had a hard time selecting them. It is an interesting trend that many applications were received from HR-related fields this year.
The number of applications for catalysts also more than doubled from last year. We are very happy about this. It was unfortunate catalysts could not be featured last year. This year, we hope to bring them to the forefront as much as possible. The presence of catalysts is not only beneficial for startups; it also has a significant impact in increasing the number of people with the Ricoh Group who have contact with outside companies. Catalysts will have an even greater understanding of the company than before, which will also help to foster the company culture.
Goda This year, the catalysts include a wide range of participants. Last year, they were mainly experienced male employees. This year, there seem to be more women and young people. Also, this year, we intend to increase networking among catalysts. Last year, they met once or twice a month to share information, and that was about it. We hope to create a mechanism that will enable them to discuss and collaborate with each other. Catalysts are entrepreneurs who act as go-betweens to get things done. Serving as a catalyst develops their skills and also leads to establishing an entrepreneurial spirit at the company to collaborate with outside companies. That is where we are aspiring toward.
Sakata We asked the startups that were selected last year to come to the information session and talk about their experiences, both good and bad. Last year’s applicants had to apply having little information. They were adventurers. This year, I think we were able to allay some of the concerns of the applicants.
Goda Another major difference from last year is our interaction with in-house entrepreneurs. Last year, we practiced effectuation (a model of entrepreneurial thinking characterized by designating oneself as the starting point, minimizing losses, and so on). This year, we provided more input and included lean startups etc. We are taking a much more hands-on approach.
This is because, last year, the in-house entrepreneurs were given freedom to move. There were let loose so to speak. On the one hand, people on the move moved, and they carried out a tremendous amount of activity. On the other hand, there were also people who could not move very much. Although it was great that people could move freely, they consequently lacked the mindset to calculate numbers, scale, and consider business potential—aspects they rarely come into contact with when working as usual.
This may be fine if you are a sole proprietor. But is it fine if you are an in-house entrepreneur at a large company? Large companies have their disadvantages, but they also have resources, which is their biggest advantage. It is better to have the mindset to utilize those resources and create a large business. We want people to be free to do what they want, but that means they will not be able to aim for something bigger. After all, in-house entrepreneurship is like putting a person who has only played soccer into the batter’s box in baseball. There are both good and bad things. We provided a lot of input to the teams selected this year. However, it is also true that if they only use the input, they will not be able to see outside the box and think small. Therefore, we are again and again encouraging them to move.
The potential of TRIBUS, capable of transforming Japan and the world
――This is a new initiative that integrates external startups and in-house entrepreneurs, and you are collaborating with other companies to create an ecosystem externally. How do they compare globally?
Goda I believe this program will offer great insights on the future way of life in Japan. The key factor is in-house entrepreneurship. In fact, in-house entrepreneurship has not really taken off in the world. This is because it is faster to use outside venture companies. When I ask people in the United States and Europe, I rarely hear about any successful cases of in-house entrepreneurship. This actually has to do with cultural differences as well.
For example, the term “digital transformation” is often used in Japan. However, the word “transformation” is not used in the world as much as it is in Japan in relation to companies. In the United States and Europe, the concept of “building” and “development” as in creating something new has gotten stronger traction than the notion of changing. Companies also have clear distinctions, as in this company is cars, this company is electricity. There are few conglomerates. Rather than existing companies changing to do something new, there is a greater emphasis on establishing a new company to do something new. There isn’t really this notion of large companies transforming or transitioning as with Japanese companies. Japan may be able to establish itself in the world in this niche. Due to the family-run structure of companies common in Asia, Japanese companies tend to do almost everything on their own via their member companies. Like the way Toyota Industries Corporation makes cars, there are millions of such cases in Japan. The lack of a clear definition of an industry, this ambiguity, you can say, is almost Shinto-like.
I think Ricoh’s program is an attempt by a company to expand beyond its limits and realize continuous but discontinuous transitions building an ecosystem, beginning by combining in-house entrepreneurs and external startups. When this is realized, I believe a new form of innovation will emerge in Japan. Globally, we are beginning to see a struggle between the Western development model and the Asian transition model. It has been 150 years since the Meiji Restoration and nearly 80 years since the end of World War II. I think Japan’s existing system has reached its limits and we are entering a period of major transformation. If we had tried to implement Ricoh’s program 10 years ago, it might not have gone well. The time to implement it has come. If we can make this program a success, I expect it will transform Japan.