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Tech stars at Slush Asia: Now's the ideal time for startups

Slush Asia was held on May 13-14.

CHIBA, Japan -- For Peter Vesterbacka, the startup convention he helped to create is not just a place to network and pitch ideas. "It's more like a movement," he said, dressed in a red hoodie emblazoned with the face of a large and decidedly displeased bird.

Gaming industry watchers know Vesterbacka as the chief marketing officer at Rovio, the Finnish company behind the smash hit smartphone game "Angry Birds." Less well-known is that he is the co-founder of Slush, a global startup event launched in Finland in 2008 and exported to Asia last year.

The original Slush, held annually in November, has seen its attendance soar from 200 the first time to more than 10,000. The second Slush Asia was held this month in Chiba, near Tokyo.

"It is the third arrow of Abenomics delivered, the structural reform, because everybody here wants to do their own startups and is full of energy, passion," Vesterbacka said of Slush Asia. "I think that you can really feel the energy and things are about to change."

Focus on big data

Like any big startup event, Slush Asia 2016 featured keynote speeches from technology luminaries, outlining the developments they see driving the world in the near future.

"I think we are going to see, in the next 10 years, an explosion in the connectivity of things, what people call the IoT," said Nikesh Arora, president of Japanese telecommunications company SoftBank, using the acronym for the internet of things.

"We have only connected people [to the internet] so far," Arora said. "We are going to connect things in the next five to 10 years. That's just the first step, because when you connect anything, we are going to [have] this huge explosion of data. When you have a lot of data, you can use that data to improve things tremendously."

Wang Jian, chairman of technology at Chinese e-commerce giant Alibaba, agreed. "This is the first time for humans to get a new natural resource created by ourselves, called big data. With more data, we can do more things. Data is something more than just bettering your business. It's something that we can [use to] get more out of human beings."

Sixty ventures pitched their concepts to investors during the two-day event, and perhaps unsurprisingly after those keynote addresses, a company that analyzes data took the top prize. SkyREC, from Taiwan, offers brick-and-mortar stores video and big data analytics on customer behavior. In the pitch contest, it beat competition from the likes of Meleap, a Japanese startup focusing on virtual reality entertainment, and Giroptic, a French manufacturer of 360-degree cameras.

Apart from offering insights on the future, Arora and Wang were keen to encourage the young Asians attending the event to venture down the entrepreneurial path.

"It has never been a better time to be an entrepreneur," Arora said. "It has never been a better time to change the world. Everything around us has to be rethought ... Because we have the creation of new utilities, we have the ability of doing business much more easily than ever before."

Now, Arora said, "We can sit back and think about disrupting."

Wang echoed Arora: "I think we are in the best time in human history" for entrepreneurship. Eventually, Wang continued, a country's power will depend not on resources but on computing power. "With the internet, and computing power, big data, it is an era [in which] we can imagine a lot of new things happening."

Their comments, however, raise a question: If now is the ideal moment to be an entrepreneur, why aren't there more startups in Japan?

Building an ecosystem

One big reason may be the country's culture, suggested Taavet Hinrikus, the first employee of Skype and now the CEO of fintech venture TransferWise. "I think culturally, Japan is quite set in the way they do things," he said. "People don't switch jobs, lifelong employment ... all of these things aren't really making it a great place [for startups]. So these kind of attitudes need to change, but it takes time."

According to the Venture Enterprise Center, a Japanese foundation that provides information on the nation's startups, domestic venture capitals invested $1.08 billion in fiscal 2014, as opposed to $49.3 billion by their U.S. counterparts in 2014.

"People are starting to change, and the number of investors is increasing, but it's still way too small compared to the U.S.," said an investor from a Japanese company, who asked not to be named. "I hope this movement continues, but in order to do that we need to build an ecosystem."

A venture CEO at Slush Asia expressed his dismay at the state of the Japanese startup scene. "We came here today because we wanted to talk to investors from abroad, not the Japanese ones," he said. "The speed at which they operate is much faster than Japanese companies."

Vesterbacka believes Slush can help Japan change, because of its distinct culture and its emphasis on the grass roots. Whereas many startup events focus on glitzy technology, Slush is centered on the human factor.

"It's very important that it's grass roots, it's done by students here themselves -- not, 'OK, let's just fly in a few people from Silicon Valley and they will tell you to fail fast and whatever,'" Vesterbacka said. About 300 student volunteers helped to organize the event.

"It's building the community, and then once you get this grass roots going, then there is no stopping it. We did the same thing in Finland for the last few years and we have seen a huge cultural change. I think that is exactly what is needed here in Japan."

Another proponent of emphasizing people is Paul Bragiel, an internet entrepreneur and the managing partner of i/o Ventures. "Technology is not going to save everything, it's amazing people that are going to save it," he said. "Driven, crazy motherf------ that go out there. It's still the people at the end of the day."

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