Monday, January 23, 2012

Interview 2: Video Game Development Company CEO, Tokyo

To help me get an idea of what to expect running my own business I am speaking to a few people who have had experience setting up their own shop, running a food business in Japan, or running a business as a foreigner in Japan. Here is one of the interviews.

Could you describe your company and what you do? What sets you apart?
We’re a video game development company, we make video games. We started initially with iPhone games because it was an easy in, but we do home console game development (Playstation, XBox, etc.) and basically anything that comes up or takes our fancy.
We’re still a small company and we are all foreign, which is a thing. We do plan to hire Japanese staff but the thing that will set us apart, and sets us apart now, is our Western approaches to video game development, which are vastly different from the Japanese ones - more efficient, we feel - in a time where Japan is struggling to compete in a global market. Because of this we also attract some of the best talent in Tokyo in a time when companies are having a hard time finding experienced developers.

Why did you set up your own business, how did the idea come to you? What were you doing at the time, work-wise and how did you make it happen?
The main reason was, more or less, to put our money where our mouths were, Me and my co-founder had been working at Japanese game development companies for quite a while, getting more and more frustrated at the slow pace of much-needed change that we decided to put our theory into practice and use Western sensibilities in most aspects of game development keeping, is the plan, that what we still feel works well in Japan, the creative and visual sides of it.
To make it happen we basically just took the plunge, we quit our jobs and started working from home. It was a bit of a wild move which made our start quite rough - we bootstrapped the whole endeavour. I guess I, personally, was just about frustrated enough with working within Japanese companies and trying so hard for so long and so pointlessly to effect change, that I more or less didn't have a choice but to start up on my own.

What have been some of the challenges and highlights in running the business so far?
Not going for investment and bootstrapping everything ourselves has been a huge challenge, but it has taught us a lot about fiscal prudence and drive. I wouldn't have had it any other way!
Dealing with the ever astounding amounts of paperwork that come with running a company, let alone in Japan, is something I still struggle with every day, especially as I started the company as a creative person who now more and more finds himself a manager and accountant.
The first fiscal year we posted a profit and the slow growth getting our first-choice employees on board have been amazing highlights for us.

What are you currently excited about, and what do you plan for the future of the company?
We still need to fill out some specific roles, to create a core team with which we can more easily tackle projects. We have some people lined up we want to get on board. We still want to keep the company small and lean, though, and avoid the pitfalls of rapid growth that plagues and eventually kills so many companies in our business.
I am also writing a book on working in this business in Japan which shouldn't take too much longer. We’ll self-publish, initially, digitally. Hopefully it’ll help people who want to work in video games in Japan to make the plunge like I did so many years ago. (Edit: Since this article was written, the book has been published! More information here - Japanmanship - the ultimate guide to working in video game development in Japan. )

Could you give an example of something you've learned through starting your own company?
Everything. That is to say: I didn't do a lot of research in advance and picked it all up as we went along. It’s doable, but we did fall into a few traps. It’s crazy the first year we had a nice profit only to realise, for tax reasons, that is the worst situation to be in and we had very little time to spend as much money on the company legally before the taxman took his rather generous slice (40%!) Companies in Japan aim to operate on a loss, if it can at all be helped.
Other unexpected costs also tripped us a little. Advance payments for next fiscal year’s tax, employment insurances, etc. A lot of it we should have researched more. It’s important to have a local accountant who knows about all this to consult you.

What advice would you give to someone thinking of starting up a business in Tokyo?
Get a bi-lingual lawyer to help you with the incorporation paperwork. It’s fairly cheap but doing it yourself will probably put you off from the get go - it is daunting, or rather, the stack of paperwork our lawyer went through on our behalf looked daunting, had I been the one to have to tackle it.
Get a good accountant. This will cost money but not having one will cost you much more. You need someone who can point out all the many little foibles of the Japanese tax system that you can legally exploit. We followed a recommendation from a friend, which is the usual and probably best way of finding a lawyer or accountant to help you out.

Of course if it’s something you want to do you should basically just do it. It’s overwhelming and a bit scary but it can be extremely rewarding. 

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