Terrie Lloyd couldn’t speak a word of Japanese when he arrived in Tokyo, so he started a translation company. Now he’s at the head of a multimillion-dollar publishing and technology empire. Karryn Cartelle meets the Kiwis running Japan Inc
James Porteous remembers when it was tough to be taken seriously in Japan. “Even in the late 90s you could go to a business meeting and propose a business plan,” he says. “They would let you speak, then they would clap, comment on how great the idea was, and then ask if you could teach their daughter English.”
Perhaps that was reasonable; for decades, most westerners in Japan were limited to earning a living through teaching or, if lucky, some were transferred through a larger corporation, allowing them to lead a plush life while giving the firm a face amid the millions there.
Times change. Porteous is now general manager of Japan Inc, a Tokyo-based English-language business magazine, and prospects for foreigners in Japan have never been better. Japan has the world’s second-largest economy with a domestic market of 127 million, but because of its aging population it’s likely to lose up to 15 million workers over the next 15 years. “Huge demographic changes are driving opportunities in health, biotech, and ICT,” says Shaun Conroy, New Zealand Trade and Enterprise director for North East Asia.
Some Kiwis who stuck through harder times are now thriving. Tim Williams founded Internet marketing company ValueCommerce in 1996. The company now trades on the Tokyo Stock Exchange and has 100 of the biggest corporate advertisers in Japan on its books. In 1998, Jonathan Hendrickson started ValueClick, an Internet advertising agency, and sold it in 2004 to Japanese firm Livedoor for US$24 million. Terrie Lloyd, a dual national of New Zealand and Australia, is the founder of 15 companies in Japan (including Japan Inc), the CEO of six companies, and a director or shareholder of many others. Last year, Japan Inc bought Tokyo’s number-one weekly English magazine, Metropolis.
“Make a profit, and have mutual respect. Everything falls under these two things”
Jack Turner, the chief operating officer of Japan Inc, reckons New Zealanders have some advantages doing business in Japan. “There is a lot of language and cultural exchange between Japan and New Zealand,” he says. “As cultures, Kiwis and Japanese are similar—a bit more reserved and placing a stronger importance on relationships. It really matters who we do business with.” And the give-it-a-go attitude helps too, adds Porteous.
Lloyd claims on average New Zealand entrepreneurs do better in Japan than any other nationality. The most successful, he says, “all have a tough mentality. Japanese people like mental toughness.” He likens himself to a weed in a sidewalk. “Over the years many have tried to beat me down, but I keep coming back.”
Now 50, Lloyd has spent half his life in Japan. Born in Helensville and raised in Tauranga, he arrived in Japan in 1983 on a working holiday visa and, despite not speaking the local language, promptly set up his first company: a translation service.
That small company morphed into the technology and communications empire he runs today. At the hub is LINC Media, a systems integration and incubation company he established in 1996. Linc was affected by Japan’s dot-com bust, but is returning to its roots and beginning to turn a profit. Annual revenue is currently around US$15 million and the company has 140 employees. Japan Inc is Lloyd’s communication side of his business portfolio. Under the Japan Inc umbrella fall publishing, consulting and marketing services, and the Japan Inc business magazine.
Lloyd runs his companies with two concise mottos: “Make a profit, and have mutual respect,” he says. “Everything falls under these two things.”
“Since we were all brought up in New Zealand we have a very similar value system,” says Porteous. “We can speak our mind without fear of retribution and we have open and frank discussions about the direction of the company. In a Kiwi way, we think: if it’s a good idea, let’s do it.”
Not that they run a completely Kiwified company. Porteous and Turner each spent five years studying Japanese through the government-funded Monbusho scholarship. “To make things work here you need to have bilingual staff,” says Porteous. “The people who studied at a Japanese high school are the ones who have really got it.”
Despite the attention directed at China’s rampant economy, Japan remains the bigger market. “There are huge opportunities for New Zealand companies but it requires commitment,” says NZTE’s Conroy. “We have advantages geographically due to the time zone, and we are culturally perceived well in Japan. While meeting Japanese quality standards can be challenging, once you have made the effort Japanese customers tend to be loyal—and those difficulties you faced become barriers for your competitors.”
Most major New Zealand companies already have a presence here but smaller companies sometimes find it difficult to get traction. Join with a local, says Lloyd: “In the Japanese market there is a partner for everything—there is nothing that can’t be sold. But you need to gain the interest of the partner, find a unique positioning and tailor the product to Japanese tastes.”
And Japanese business doesn’t always move at bureaucratic speed. “There is the impression that things take a long time but it can move quickly,” says Porteous. “You need to talk to the key decision-maker, which is not always the person at the top … sometimes the man at the top just puts his stamp on it.
“Japanese culture is all about taking a step back. In Western culture we step forward and say our comment. In Japan, awkward silences are never awkward. When you add your own opinions you also add assumptions. Try to let your literature speak for itself. Read the signals and don’t push it.”
Still, says Lloyd, be yourself. “People feel you need to be different here but that’s not the case. You will need a middleman to explain what’s going on, but you don’t need to change who you are. The middleman acts to smooth the relationship taking a good cop, bad cop approach.” Business in Japan can be difficult but it’s satisfying, he says. “If you do it and do it well they will look after you as a vendor. The Japanese are honest people and if they say they will do something they stick to it.
“People look at Japan as being difficult and don’t know if what they want to do will work,” says Turner. “If you never try, you’ll never know.”