Japanese houseplants e-commerce site HitoHana raises $890K for service expansion

At HitoHana’s fulfillment center in Saitama
Beer and Tech CEO Norihisa Morita (right) and CTO Yoshiaki Ito (left)
Image credit: Beer and Tech

See the original story in Japanese.

Tokyo-based Beer and Tech, the Japanese startup behind a houseplants delivery flower delivery service called HitoHana announced on Wednesday that it has fundraised 100 million yen (about $890K US) in the latest fundraising round. This round was led by Global Brain with participation from Anri. Technically it was the series B round, but due to Beer and Tech pivotting the direction of the business since the latest funding is actually equivalent to a series A round. In the previous rounds Beer and Tech raised funds from Anri, Primal Capital, and East Ventures.

Norihisa Morita, who previously worked for an internet ad agency, and his team founded Beer and Tech in August of 2014. In October of the same year the company announced its Smart Reservation service at Incubate Camp 7th, the bootcamp program by Tokyo-based VC firm Incubate Fund. The company continued the service for almost one year, but decided there was a limited scale, and Morita, who comes from a family of orchid farmers, has since pivoted to focus on problems that crop up in the flower and plant industry by starting HitoHana in 2015.

Honing in on consumers’ demand for interior decoration

HitoHana
Image credit: Beer and Tech

As a variety of products are being sold online, the flower and plant industry is one area where digitization has not advanced. In fact, many of current flower and plant e-commerce site basically offer the same potted plants and bouquets which can be bought in offline stores; so, the realization of the long tail for products, which is one of the big advantages of e-commerce, is by and far not being accomplished.

site for businesses, but then judged that it is impossible to make the service stand out because the orders stemming from corporate demands concentrate on obtaining adequate products, cheap and fast. He decided to specialize in the demand for individual’s interior decoration in accordance with the texture of the room and furniture which is paid for by themselves.

In physical flower shops in town, there are limitations on the variations of products, so consumers are limited when choosing products that suit their tastes. HitoHana has established a fulfillment center that can freely combine plants, vases, bowls and the like to create innumerable variations of products. Based on a multitude of order information, the company built a system to accurately discover the hit products and predict future big sellers in order to replenish stock.

When we think about potential competing companies in the Japanese flower and plant industry, online and offline, we come up with names like Hibiya-Kadan Floral, Aoyama Flower Market, Hana Cupid, E-flora, etc. Unfortunately, statistics relating to the number of orders and e-commerce sales are not disclosed anywhere, but based on the premise that the number of website accesses converts at a certain ratio, the ranking of the number of accesses should generally reflect the permutation of their online sales. HitoHana, with less than two years since the start of the service, has surpassed veteran businesses and ranks in the top five, largely thanks to the success of its product variations and SEO (search engine optimization) measures. Currently HitoHana deals strictly in potted plants, but even so, it is just a matter of time before they reach the top in this field.

Leveraging fine-tuned logistics for consignment business

HitoHana
Image credit: Beer and Tech

Although there are exceptions, it is generally difficult to send plants such as potted plants by ordinary courier service. Considering constraints in packing, attending to those plants that require temperature control and delivering tall or irregularly-sized plants, in the end, it seems that it is more efficient for the company to create its own logistics network.

When ordering a plant with HitoHana, your item will be delivered using the company’s own logistics network if your address is within the Tokyo metropolitan area. However, Beer and Tech also conducts consignment sales at storefronts of retailers throughout the city by delivering products making the use of vacancy in the logistics. For example, consumers can purchase furniture and potted plants together in these stores while coordinating their interiors. Morita related confidently that here, as with e-commerce, the company uses its own logistics to efficiently deliver goods and replace products in addition to applying a data-driven approach, so depending on store campaigns and consumer needs it is easy upgrade the product lineup.

One example of placing the burden of the logistics of physical stores onto e-commerce businesses, and taking efforts to optimize over-the-counter product lineups, can be seen in the recent tie-up of Japanese major sports retailer chain Alpen and a big name in shoe-centric e-commerce site Locondo. As major chains with physical stores shift to SPA (Specialty retailer of Private Apparel) in order to reduce costs and gain profits, they learn more about the D2C (Direct to Consumer) model, so we can expect to see more linking up of e-commerce companies, with their ability to offer variety and efficient fulfillment and logistics, with physical stores in the future.

Currently, HitoHana operates in the Tokyo metropolitan area under its own logistics, and for other areas the company users regular delivery services to convey orders from interior coordinators and renovation companies, meaning there is no need for stock replacement.

Based on the funds raised this time, the company will open fulfillment centers in Osaka, Nagoya, Fukuoka and other areas and wants to expand its own logistics network so that services equivalent to those in the Tokyo metropolitan area can be offered nationwide. The company deals only with potted plants for now, but plans to adopt flower experts like florists to handle cut flowers, etc.

In this same field, Bloom & Wild, which was founded in the UK in 2013, has raised about 6.25 million pounds (about 930 million yen) while US benchmarks include 1-800-Flowers (NASDAQ:FLWS) and The Bouqs Company established in 2012 (which has raised $43.1M US so far).

Translated by Amanda Imasaka
Edited by Masaru Ikeda

Japan’s Sora raises $710K to help hotels set competitive but profitable prices using AI

The Sora management team along with some of their investors
Image credit: Sora

See the original story in Japanese.

MagicPrice and Hotel Banzuke are both AI-powered pricing strategy support platforms for hotels, helping find them the optimal price, i.e. not too expensive but also not too cheap for lodgings. Tokyo-based Sora, the Japanese startup behind these platforms, announced on Tuesday that it has fundraised 80 million yen (about $710K US) in funding from 500 Startups Japan, Daiwa Corporate Investment, several angel investors, and loans from the Japan Finance Corporation. The funding round is unknown.

Sora was founded in 2015 by Daiki Matsumura, who previously worked in ad-tech at Yahoo Japan. In March of 2016 the company won the Colopl Prize at Tech Lab Paak’s 3rd batch Demo Day, and in July 2016 the team participated in Incubate Camp 9th, followed in August 2016 when it was adopted as a participating team in the 500 Kobe Pre-accelerator. Due to its participation in these three events, in July 2016 Sora secured 20 million yen (about $178K US) in a seed round from 500 Startups Japan, Incubate Fund, and Kotaro Chiba (the judge in charge of awarding the Colopl Award at Tech Lab Paak’s 3rd batch Demo Day).

A screenshot of MagicPrice
Image credit: Sora

MagicPrice, which launched as a beta version in July 2016, allows hotels to calculate optimal prices based on machine learning  using imported their reservation history data and curated pricing data of their neighboring competitor hotels. The prices will be reflected on companies’ website or ticket reservation / OTA (online travel agent) website via ‘site controller’ systems. As hotel back offices are usually busy, the service operates without functions that require literacy, and seeks to automate operations as fully as possible. It can be labeled an RPA (Robotic Process Automation) for hotels. In March of this year, Sora partnered with Dynatec, a Yahoo Japan subsidiary and a  leading system integrator for the hotel industry.

A screenshot of Hotel Banzuke
Image credit: Sora

Meanwhile, the Hotel Banzuke platform was started in late August and allows hotel owners to view how much the competing hotels in their vicinity were reserved for and how many sales they had compared with the users’ own on any particular day. According to calculations using the room price and the number of available rooms open to the public on websites, more than 10,000 cases of hotel data can be calculated automatically every day. Hotel Banzuke is provided completely free, and is assumed to be an introductory promotion for MagicPrice.

Sora has not released the current number of MagicPrice users, but for the time being it is aiming to acquire 5,000 users, which is about 10% of Japanese hotels and ryokan. With regards to Hotel Banzuke, the company has revealed that more than 500 individuals in the hotel sector have completed user registration since its launch about a month ago.

Translated by Amanda Imasaka
Edited by Masaru Ikeda

Japan's LaFabric, shirt and suit tailor startup, gets $6.6M to enrich original product lineup

Image credit: Lifestyle Design

See the original story in Japanese.

Tokyo-based Lifestyle Design, running the LaFabric online store focused on made-to-measure shirts and custom business suits for men, announced on Monday that it has secured a total of 740 million yen (about $6.6 million) from Globis Partners, Nissay Capital, and Spiral Ventures Japan (previously known as IMJ Investment Partners Japan) in funding with loans from Japan Finance Corporation. Detailed financial terms have not been disclosed.

Coinciding with the funding, the company appoints their former CFO Kenichiro Mishima as a managing director while adding Globis Capital Partners’ Yuki Watanabe and Nissay Capital’s Kenko Nagai to the management board.

Following the launch of online fashion store back in February of 2014, the company successfully fundraised 100 million yen from Nissay Capital in 2015. Subsequently they launched a real flagship store in Shibuya back in 2016 while having been occasionally opening pop-up stores here and there before. They secured 400 million yen (about $3.5 million) in funding back in January this year, seeing a steady growth in these days.

In order to the strengthen direct-to-consumer model, Lifestyle Design will use the funds to improve user experience at both their online and offline stores while enriching the lineup of their original fashion products.

LaFabric Real Store in Shibuya
Image credit: Lifestyle Design

Translated by Masaru Ikeda

Japan's Spectee, news video aggregator for press, snags $2.3M series B for global push

Spectee
Image credit: Spectee

See the original story in Japanese.

Tokyo-based Spectee, the startup behind the artificial intelligence(AI)-powered platform offering news materials based on social media analytics, announced today that it has fundraised 260 million yen (about $2.3 million US) in a series B round. This round was led by YJ Capital with participation from Kyodo News Images, Mizuho Capital, Arco Partners, Quaras (an ad agency of Japanese media conglomerate Fuji Sankei Group), Makoto Naruke (former president of Microsoft Japan, angel investor now), and an unnamed angel investor. This follows the company’s series A round conducted back in July of 2016.

Spectee was founded in February of 2014 (previously Euclid Lab), and it graduated in October 2015 from the 11th batch of Open Network Lab’s incubation program. The team has been offering a service called Spectee (previously known as Newsdeck), curating images and video clips for live events from social media and offering copyright clearance for use by broadcasters and news organizations, similar to Banjo in the US. The AI technology for analyzing curated image and video clips has been filed as a patent.

See also:

• Japan’s Spectee files patents for news writing bot

Spectee
Image credit: Spectee

In Japan, Spectee is currently serving almost 100 companies including 86 TV broadcasters plus 4 newspaper publishers, such as Nippon TV, TV Asahi, TBS (Tokyo Broadcasting System), Fuji TV, and the Yomiuri Shimbun. We were told that they have a project collaboratively working on with a certain Japanese public broadcaster but details were declined to be disclosed. As a news distributor based on the social media-based aggregation technique, the company claims it has a 92% market share in Japan by the number of clients.

In June, Spectee launched news video distribution via Associated Press’ Video Hub targeting the global market, seeing a steady growth and trying to expand it further. The company also got a subscription contract with New York Times because of the partnership with the global news agency. Kenjiro Murakami, co-founder and CEO of Spectee, told The Bridge that they expect sales expansion through news material sales in the global market while securing stable revenue through subscription contracts with media companies and news publishers in Japan.

Murakami explained:

With the personnel in Berlin an Los Angeles in addition to Tokyo, we are running a 24-hour nonstop operations such as the distribution of news materials on platform and gaining approvals from social media users who posted images of live events that are likely to be used by news media outfits.

However, video editing and distributing operations are still centralized to our Tokyo office. Because of a fierce competition with other news video providers on AP Video Hub, we want to increase the operating weight at overseas locations to provide news materials as fresh as possible. To make this possible, we expect to focus on securing new staffers at these locations.

AP Video Hub
Associated Press

Spectee is now selling video materials to 33 markets, namely the US, UK, Thailand and Brazil in order from the top. The company’s global sales still depends on AP Video Hub but is considering to build up their own video sales portal for global media publishers because the agreement with Associated Press is not exclusive.

It is interesting to see how they can expand globally from here.

Japan's Skydisc raises $6.5M to bring one-stop AI and IoT solution to various industries

See the original story in Japanese.

Fukuoka-based Skydisc, a Japanese startup focused on developing and offering a one-stop solution from artificial intelligence to IoT (Internet of Things), announced today that it has fundraised 740 million yen (about $6.5 million) in the latest round. It’s supposed to be a series A round. Investors participating in this round are Nissay Capital, DG Daiwa Ventures (the joint venture of Digital Garage and Daiwa Securities), Energy & Environment Investment, Yamaguchi Capital (the investment arm of Yamaguchi Financial Group), Kaga Electronics (TSE:8154), Dogan Beta (the investment arm of a Fukuoka-based financial consulting firm) and Archetype Ventures. For Skydisc, this follows their seed round raising 100 million yen (about $855,000) back in January of 2016 which Nissay Capital, Dogan and Archetype previously participated in too.

See also:

• Startups spring into action to secure apex access
• Myojo Waraku: Japan’s rendition of SXSW begins in Fukuoka with showcasing prominent startups

Skydisc founder and CEO Osamu Hashimoto was onstage at the Toryumon startup event in Fukuoka in September.
Image credit: Masaru Ikeda

Since its launch back in October 2013, Skydisc has been developing a variety of detachable sensor devices and the cloud for storing, then analyzing data from these devices. Offering products include SkyLogger (previously known as Ginga Box), the company’s flagship sensor product line-up, allows users to choose up to three detachable sensors out of 14 different sensors to plug into a circuit board. Data acquired with these sensors can be monitored on SkyAnalyzer (previously known as Ginga Cloud), the company’s data management and analysis platform. Especially for the agricultural industry, Skydisc already started offering an optimized package called Hatamori, literally meaning vegetable field keeper.

Starting off with connected sensors and the analytics cloud, the firm’s services have been further evolved so that they are playing an important role in automated oeprations, especially in the industries suffering from the lack of successors of skilled workers.

In the factory safety sector, Skydisc has introduced an AI and IoT-powered machine fault detection system to a major power plant, succeeded in detecting faults with 95% accuracy. The firm, together with Kyushu University, has been conducting a joint research of automated fault detections around factory equipments and ball bearings, with the aim to improve the detection accuracy. The firm claims their technology is highly evaluated because of succeeding creating fault case data model by simulating from normal time data, which it’s told is the most difficult in the AI technique.

In the field of mechanical safety, Skydisc released a mobile app called Smart Choshinbo, literally meaning a smart auscultation rod, which allows users to predict possible faults and failures based on the sound collected with a smartphone. Going forward, the firm plans to provide it as part of a service package that enables users to predict possible faults and failures based on fluctuation data of vibration and electric current. They are collaborating with Kyushu Institute of Technology for a research applying AI and IoT into nursing care services.

Screenshots of Smart Choshinbo, the “smart auscultation rod” mobile app

Thanks to a high reputation to SkyAI, Skydisc’s IoT data analytics cloud, the company was recently approved by Nvidia, the world’s leading chip maker, as a partner for the latter’s AI and deep learning-focused startup incubator Nvidia Inception Program.

Skydisc uses the funds to secure AI engineering experts and business developers from Japan and the rest of the world, aiming to assign them to collaborative research and development with Kyushu University and Kyushu Institute of Technology.

Japan's Nulab gets first cash injection in 13-year history, poised for exponential growth

Masanori Hashimoto, Co-founder and CEO of Nulab
Image credit: Masaru Ikeda

See the original story in Japanese.

In an interview with The Bridge back in September of 2015, Nulab CEO Masanori Hashimoto told us that the firm was about to graduate from startup mode toward a sustainable growth but it seems like things were not going as expected. Offering three cloud services such as Backlog, Cacoo and Typetalk, Nulab had been exponentially growing since 2015 when they stopped entrusted system developments but started focusing on the SaaS (software as a service) business. He said jokingly:

We couldn’t graduate but still need to repeat years as a startup (laugh).

The Fukuoka-based company revealed today that it has secured its first cash injection from an external investor. It’s 100 million yen (about $884,000) funding from East Ventures, a seed round for the 13-year-old company. Nulab has a relatively long history but had been initially focused on entrusted system developments, subsequently making a total shift into the SaaS business in as recently as 2013. Quoting Chatwork (previously known as EC Studio) as an example which has also a 17-year history but shifted into the SaaS business several years ago, Hashimoto explained:

We (virtually) started as a startup back in 2013 when we made a total shift into the SaaS business. That’s why both our mindset and our team members are pretty young.

The company’s user base is currently comprised of 780,000 people across 50,000 companies in Japan using the Backlog project management and collaboration tool as well as 2.8 million people (86.2% of them are from outside Japan) using the Cacoo visual collaboration tool. They introduced a chat communication tool called Typetalk back in February of 2014, allowing users to complete various team work and remote work tasks within the Nulab platform. The Nulab Account single sign-on scheme enables customers to use all the three web services with a single user account.

The Nulab team
Image credit: Nulab

The company has now grown up to a 80-people team based out of Tokyo, New York City, Taiwan and Singapore locations in addition to their headquarters in Fukuoka City. In view of such a high number of users and employees, we can assume that they have less urgent needs in funding because they may generate ample cash flows from their business. However, it seems like that the latest funding at this time around is intended for strengthening global expansion and preparing for a future initial public offering. We can also see the reason behind their choice of East Ventures as a sole investor in this round, which is highly evaluated in terms of global investment and hands-on support.

Hashimoto elaborated:

Based on our achievement, we may create a tunnel that can carry Japanese SaaS products (including third-party products) into the global market. In a way like the global market adopting Japanese project management methods developed by Toyoda, Honda and others, I believe there are many spaces that Nulab and other SaaS companies can expand into.

Regarding the reason why Nulab is looking at an IPO while they used to be less aggressive about funding from an external investor, he added:

Companies and businesses are different. Nulab is a company, and has three businesses (like three startups): Backlog, Cacoo and Typetalk. Now that these so-called startups have further grown up than I thought, I turned to think I need to focus on stabilizing our management base. Otherwise they wouldn’t be able to concentrate on their business but might get up shit creek.

Since Nulab is focused on pursuing people’s diversity of both their in-house developers and user community, it employees many international staffers in the team (like a Canadian assistant to Hashimoto-san). As part of this effort, the company revealed that they will set up a new location in Amsterdam, the Netherlands.

There are not many Japanese startups looking at the global market yet, but it’s interesting to see a startup from Fukuoka seeing such an exponential growth. Encouraged by their progress, I really hope that more startups from across Japan will be motivated for aggressive global expansion.

Edited by “Tex” Pomeroy

Japan's Xenoma, body-tracking outfit maker, lands $1.8M after big success on Kickstarter

See the original story in Japanese.

Japan’s Xenoma, developing a smart apparel product called E-skin, announced today that it has fundraised 200 million yen (about $1.8 million) from UTokyo Innovation Platform (an investment firm backed by the University of Tokyo) in addition to two existing investors; Beyond Next Ventures (BNV) and Japan Science and Technology Agency (JST). This follows their previous 180 million yen (about $1.6 million) funding from BNV and JST’s SUCCESS Program.

Using the funds, the firm will strengthen their company structure so that they can receive orders for a customized version of the business-use product while aiming to develop an optimized technology to produce a low-price version for consumers.

E-skin consists of a compression-fit E-skin shirt with 14 stretch/strain sensors and a controller named E-skin Hub which is attachable to the shirt. These sensors are directly mounted on shirts, so that it is lightweight and can detect the user’s motion accurately. The controller has a 3-axis accelerometer and can monitor overall body motion without requiring Lighthouse or other 3D scanner motion capture devices.

The firm had been running a crowdfunding campaign on Kickstarter from August 2nd to September 7th, where they made an amazing success by raising more than their initial target of $50,000 during the period.

See also:

• 77: The Real Reason Japan Can’t Innovate & What to Do About It – Xenoma (Disrupting Japan)

Edited “Tex” Pomeroy

 

Japan’s Firebug wants to redefine TV viewing experience for mobile-addicted millennials

See the original story in Japanese.

Shogo Sato is known for having experience as a manager of famous Japanese comedian groups such as Ninety Nine and London Boots at Yoshimoto Kogyo (TSE:9665), a major Japanese entertainment conglomerate, and as the founder of Qreator Agent providing agent service for creators in 2015 as well. He had also been involved in managing and promoting celebrities like Rika Shiiki (female university student / entrepreneur) and Yoichi Ochiai (Assistant Professor at University of Tsukuba).

Sato has been managing a TV program production company called Firebug as well as Qreator Agent. Firebug recently launched a video app focused on 30-second episode broadcasts, named Thirty. The app is available for Android and iOS, so one can download it from Google Play or iTune AppStore (the app was initially named VEM but appears to have been rebranded).

TV programs for millennials become mobile viewing-optimized

Firebug has taken on production of programs or killer contents for famous video distribution services thus far. Based on such  experience and knowledge, Sato felt certain of demands for single and short-length contents in the video viewing experience by smartphone. Thirty, the first service by the firm, focuses on 30-second videos in vertically long screen optimized for smartphone display.

When one starts the Thirty app, a list of videos is displayed. Users can watch a 30-second video to the end or skip to the next one by swiping. Thirty learns each user’s taste by analyzing what videos he / she watched to the end or skipped viewing at the beginning. Applying cooperative filtering between users having similar attributes, the app displays a video considered to suit user’s taste on the top list and prompts them to view it preferentially.

Currently, the app prepares channels such as variety, information, comics or lifestyle as of the launch mainly providing contents to the general public, and allows users to view all of them for free of charge. Sato answered THE BRIDGE’s interview by noting that he would like to try establishing rather specialized channels such as fishing or documentary, as well as pay contents in the future:

In the future, we may introduce a charging system depending on contents. For example, we allow users to watch the first three episodes for free but charges for the rest. However, that would be after our users are fully established, which means six months or one year later.

Many of contents from Thirty will be provided as commercial spots to be inserted as in the way TV broadcasters handle them. Since the commercial spots have to be optimized for vertically long screen, advertisers will arrange for conventional TV commercials or produce original ones.

Through the experience of viewing video with smartphone, a combination with  user location information becomes available hitherto unable to be realized using  conventional TV. Utilizing the combination of location information and videos, Sato showed us some ambitious concepts: Thirty displays certain commercial videos only while riding on Yamanote Line, or users can watch certain programs only when climbing Mt.Fuji. In addition, he mentioned the possibility of O2O (Online-to-Offline) and geomarketing.

Production cost of each program becomes almost zero

Since Thirty can designate the time range to display each program episode freely, the program organization becomes flexible unlike typical TV or radio. Although it is a contrast to the live commerce growing lively, the firm does not plan to carry on live streaming at the moment, unless it has contents exceptionally acceptable by a mass audience. In short-length movie creation, creators can shoot 20 episodes together at one time and that contributes to reduction of performance fee or production cost per episode. Sato told us about the future vision for Thirty.

We will also invite posts of excellent short-length videos from public. The Firebug staffers will evaluate, edit and display them on Thirty. We want to make Thirty a place for select people, not for anybody.

This July, Firebug fundraised from an interesting line-up of investors, RKB Mainichi Broadcasting and Avex Ventures. If the app stored an overwhelming number of short-length videos, cinematization or provision of TV programs may be possible through rearrangement of these videos. As the number of Thirty users increase, the firm can construct a financial system returning a part of the profit to actors or creators.

Shogo Sato (R) talks with Yoichi Ochiai (L) at a startup event in Fukuoka by F Ventures earlier this month.
Image credit: Masaru Ikeda

Translated by Taijiro Takeda
Edited by “Tex” Pomeroy

Japan's Oneteam, collaborative business communication tool for Asia, raises $3.4M

See the original story in Japanese.

Updated: Some part describing Profile Book has been deleted because the company says it has no longer intention to sell Profile Book individually.

Tokyo-based Oneteam, developing collaborative business communication tool under the same name and an employee profile management tool called Profile Book, announced today that it ha fundraised 380 million yen (about $3.4 million) in the latest round. Participating investors in this round are Daiwa Corporate Investment, Nissay Capital, FFG Venture Business Partners, Iwagin Jigyo Souzou Capital, and Fringe81 (TSE:6550). Detailed financial terms, such as which round this is or who leads this round, have been still unknown.

We were told that the company uses the funds to strengthen sales, system development and marketing effort with the aim to expand their business and to evolve the company’s flagship communication tool product. Prior to this, Oneteam unveiled last week that it has welcomed Daisuke Sato, former CTO at Japanese cloud-based personnel management startup SmartHR, as a new employee in addition to appointing Atsushi Nagase, CTO at Japanese crowdfunding site Campfire, who recently joined the company’s advisory board.

For the company, this funding follows their series A round raising about $1.8 million from Nissay Capital back in January of 2016 as well as their seed round raising about $480,000 from CyberAgent Ventures back in May of 2015. Coinciding with the latest funding, Oneteam claims that it has partnered with Fringe81 to work together on sales and product development around the SaaS (Software as a Service) business for both firms.

Founded back in February of 2015, Oneteam has been developing a collaborative communication tool under the same name, specifically designed aiming to improve the productivity of employees working apart. Their paying users are now about ten times than that at the time of the tool’s official release back in June of 2016. The company revealed then that it was serving over 2,500 businesses centered on the Southeast Asian market (including freemium users), aiming to acquire 100,000 users within the year of 2016.

AirX officially launches 'Uber for helicopters' service in Tokyo

Some AirX members: CEO Kiwamu Tezuka (second from left) and Director Taiki Tada (third from left)

See the original story in Japanese.

Tokyo-based AirX announced last week that it had officially launched a helicopter ridesharing service called CodeShare, enabling cheap use of helicopters through utilization of idle inventory at helicopter operations. The firm provides ridesharing from Tokyo Heliport in Shinkiba to Narita Airport, Hakone and Hatsushima, targeting users who do not wish to waste time on traffic congestion.

For conventional charter flights, it costs 880,000 yen (about $7,800) on average from Tokyo to Narita Airport (this service is also being provided by AirX as Airos), but CodeShare reduces this price to 59,800 yen (about $530) by utilization idle inventory and rideshares with other passengers. It charges 69,800 yen (about $620) per person to Hakone and Hatsushima.

Comparison of typical required time in using helicopters and automobiles
Image credit: AirX

This service was realized due to the cost structure of typical helicopter flight services. According to AirX, fixed costs account for 85% of the total operation costs in the helicopter management. In other words, whether a helicopter flies or not, huge costs mount constantly just as long as a helicopter operator owns it. Since charter flights are the mainstay of helicopter operations conventionally, operating companies have to set higher airfares in order to hedge risks due to uncertainty in terms of passenger numbers.

CodeShare matches helicopters of ideal size from among idle inventory of partnered helicopter operators according to the number of passengers, as based on reservation information. By minimizing risks related to costs, AirX realized this affordable flat-fee service. Reservations are accepted until three days before boarding (or 24 hours before at the shortest if without baggage). AirX also provides a transportation service from departure place to heliport and a baggage delivery service from departure place to final destination as a standard package without requiring additional fees (same-day delivery costs extra).

CodeShare
Image credit: AirX

AirX, currently consisting of eight members, was founded in February of 2015 by Kiwamu Tezuka (CEO) and Taiki Tada (Director), both from FreakOut. While Tezuka had engaged in research of formulation / algorithm design of transportation optimization at university and Tada led a busy life requiring frequent long-distance movement, they came to develop this service aimed at disrupting means of transportation.

AirX fundraised tens of hundreds of yen (hundreds of thousands of US dollars) from Anri and individual investors in its seed round in 2016. Speaking of a benchmark for the service, New York-based Blade has been providing a similar service in the US and had secured more than $6 million in total through its seed / series A round. In South America, Voom had a smooth launch based in Brazil’s Sao Paolo, a city known for heavy traffic.

Translated by Taijiro Takeda
Edited by “Tex” Pomeroy