Unlocking the Japanese Market: Insights from Star Web3 Fund, Meteorite Labs

A Content-Rich Q&A Session - Star Japanese Web3 Fund, Meteorite Labs, Uncovers How to Penetrate and Integrate into the Japanese Market

HOST: Hello everyone, it's a pleasure to engage in a discussion about the Japanese market with you. Today, our conversation will focus on the nuances of the Japanese Web3 market, particularly in relation to project operations. I'm delighted to introduce our esteemed guest, who is deeply involved in the Japanese Web3 market. Umi possesses significant industry experience in Japan and is a highly regarded Web3 professional. This dialogue will allow us all to gain a deeper understanding of the Japanese market and provide insights that may prove helpful for project operators seeking to enter this market. Firstly, I'd like to invite Umi to introduce herself and answer the inaugural question of this session: From your personal experiences living and working on projects in Japan, could you identify some unique features and trends within the Japanese Web3 market? How do these aspects influence the operation of projects?

UMI: Hello everyone, I'm Umi. I'm the BD Lead of Meteorite Labs based in Japan. Meteorite Labs is not just a foundation, but also functions as an incubator. As an early-stage Web3 investment fund, our portfolio boasts an impressive line-up, including projects like Galaxy, Fusionist, and Stepn, all of which we had invested in at an early stage and introduced to Japan.

Addressing your question aboutwhat makes the Japanese market distinctive, two characteristics come to mind: loyalty and purchasing power. Japan has one of the highest levels of customer loyalty and purchasing power worldwide. Projects like Stepn and Fusionist, which I mentioned earlier, have been remarkably successful, gaining favor with platforms like Binance. Interestingly, during the early operational phase of the Stepn project, nearly half of its 800 users were Japanese. Even now, as the project has grown considerably, the Japanese still make up 20%-30% of its user base.

Why is this so? One possible explanation lies in the structure of Japanese households. Unlike Chinese families, which often consist of a single child, Japanese families typically have three to four children, in addition to parents. This means that if one family member begins using a service like Stepn, they are likely to share it with the rest of their family. It's not uncommon for entire families to engage with the platform, perhaps buying multiple pairs of shoes. This trend speaks volumes about the strong purchasing power inherent in the Japanese market.

Take Fusionist, for instance, our involvement was not just in the form of investment; we also assisted them with strategic planning for marketing in Japan. Leveraging our extensive experience in the Japanese market, Meteorite Labs was able to craft custom strategies for their venture into this region. After these strategies were implemented, the company revealed that 30% of its user base is Japanese. This has led us to believe that trust is crucial in the Japanese market. Once the consumers trust and know you, and find your project interesting and engaging, they'll remain loyal for a long time.

Recently, we invested in a game project: Mahjong Meta. We plan to continue aiding their expansion into the Japanese market, using our operational experience in the region. We'll open a brick-and-mortar mahjong parlor in Shibuya, which will serve as a gateway from Web2 to Web3, embedding the concept in the minds of Japanese users.

We also have an example involving a cryptocurrency exchange. Our founder had previously assisted FTX Japan in cementing its foothold in the Japanese market. In its initial six months, FTX Japan didn't make a profit—it was purely an investment stage that required extensive market cultivation, finding ways to establish trust and stimulate Japanese Users’ purchasing power. Hence, loyalty and purchasing power are distinct traits of the Japanese market.

HOST: Considering the user characteristics of the Japanese market you just mentioned, while there is a significant number of crypto users with considerable purchasing power, engaging these users presents its challenges. What are some effective strategies for customer acquisition in the Japanese market? How can we increase Japanese users' understanding of, and participation in, Web3 projects?

UMI: From an operational standpoint, for example, with Stepn, Meteorite Labs has conducted numerous ground-level real-world events. These events were quite straightforward, allowing real users of Stepn to gather and form an organic community. The idea is not to have the project party exert significant effort in event planning but to let the community naturally converge, fueling user motivation.

The social structure in Japan allows for a variety of tribes and communities, fostering a sense of belonging for individuals. This is a defining characteristic of society. During my university days in Japan, there were many community activities. Individuals often sought their sense of belonging and self-identity by participating in these communities and organizations. This approach holds for Stepn and our upcoming project, Mahjong Meta. We drive users to spontaneously form communities via various offline activities, thereby amplifying the brand's influence.

For foreign projects entering Japan, partnering with local big corporations or notable investors is an excellent strategy. For instance, there's a renowned company called Bandai Namco in Japan, holding many famous IPs. We maintain a close collaboration with several well-known Japanese funds, such as Emoote and MZfund. Therefore, when we identify promising early-stage projects or projects we've previously invested in, Meteorite Labs can introduce them to these leading fund teams. These funds can then offer unique resources, such as recommending tailored activities, thus giving projects an opportunity to accurately identify their user base and engage more directly with users in the real world.

HOST: It's widely known that, due to language habits and social-cultural differences, brand implantation in the Japanese market can be challenging—it's a relatively closed market. What's the most effective strategy for Web3 projects to establish brand awareness and promote projects in the Japanese market? How can they forge close connections and collaborations with local Japanese communities and homegrown projects?

UMI: When a foreign project aims to penetrate the Japanese market, it is essential to establish a favorable and familiar impression. Ideally, community moderators or core members should be Japanese, or at least, they should be fluent in Japanese. This approach helps foster a strong sense of camaraderie. Peace and safety are core values in Japan, which is why it's crucial.

Another key factor is the comprehensive vetting of your Key Opinion Leader (KOL). It's vital to deeply understand their user base, the content they focus on, and their overall influence. To illustrate, there was a project that engaged a KOL named KazMax, known for negative content, during its promotional activities in Japan. This resulted in substantial harm to the project's brand in the early stages of its entry into the Japanese market. This underscores the importance of discerning the type of KOL during the selection process.

In Japan, multiple small groups are formed by various KOLs, all supporting each other within different communities. Hence, if you engage a KOL and things become somewhat awkward, other high-quality KOLs might be reluctant to promote your project. This has happened in real life. Consequently, discerning the abilities of KOLs is extremely important when promoting in the Japanese market.

For project developers, identifying the right KOL becomes a major challenge. Recognizing this, Meteorite Labs has invested in the Aki Network. On the surface, Aki Network might seem like a tool for an event planning platform, but it differentiates itself by emphasizing the influencer's impact. It uses numerous indicators to assess an influencer's core influence. The platform not only measures the interaction data between influencers and users but also evaluates the derivative interactions that the influencer generates and the volume of referral data. This holistic approach assesses an influencer's account quality. All these precise records are maintained on the Aki platform, enabling project developers to understand their true capabilities as well as those of the influencers they collaborate with.

Mature project developers attach great importance to this aspect. Whether it's about entering the Japanese market or other international markets, you might collaborate with a famous KOL who has hundreds of thousands of fans, only to realize that the attention they generate is not as significant as anticipated. The Aki Network reveals this hidden information, allowing users and project developers to access this crucial information. Therefore, for projects looking to penetrate the Japanese market and establish close connections with KOLs, they can use tools like Aki Network to discern KOL's capabilities, thus saving cognitive costs.

HOST: When dealing with cultural differences in the Japanese market, what challenges have your projects encountered? How have you addressed these challenges and successfully integrated into the local culture?

UMI: Honestly, it requires patience. Integrating into the Japanese market means investing time, building relationships, making friends, and fostering trust. Once trust is established, users will reveal many truths. However, this trust-building process takes time. Also, having Japanese team members or those fluent in Japanese who can connect deeply with people is beneficial. The majority of the Meteorite Labs team comprises Chinese who have lived in Japan for over a decade, so there are minimal cultural differences.

Meteorite Labs' founder, Melody, has many years of experience in this field. Before moving into investment, she helped many projects get listed on Japanese exchanges. For instance, she orchestrated IOST's listing on CoinCheck, marking the first overseas listing. She also has experience with exchanges and venture capital, giving her a comprehensive and multidimensional perspective of the Japanese market.

As we've guided numerous projects into the Japanese market, we've identified several rules to follow. The core of Japanese culture values quality, rejects impulsiveness, and embodies the spirit of a craftsman. This characteristic extends from the Web2 to Web3 era. As a result, projects that lean towards hasty operations or a short-term, money-oriented approach may not find an easy fit within the Japanese market. This is because our approach extends beyond just interacting with Key Opinion Leaders (KOLs) and fostering their trust and loyalty; it's also about helping the mainstream users to gradually accept and embrace the project. In this field, Meteorite Labs brings extensive experience and a rich array of resources to the table. Also, the Aki Network, as mentioned earlier, can serve as an effective and streamlined tool for ventures looking to infiltrate and broaden their reach within the Japanese market. Should anyone harbor an interest in Japanese local funds or community resources and desire to delve deeper into these topics, I extend an open invitation for contact and communication.

About Meteorite Labs

Meteorite Labs is a fundamental research-driven crypto fund with extensive experience and connections in Asia, particularly Japan. Its multidisciplinary team combines expertise in investment, marketing, mathematics, data analysis, arts, game industry, and law. Meteorite Labs invests in venture and liquid opportunities within the blockchain sector through intensive research, investigation, and data analytics. We actively evaluate blockchain projects and ecosystems, with a focus on those that instill positive values in the web3-based world economy and experience, as well as the bridges between them.

About Aki Network

Aki Network is the first Web3 growth stack to track real promotion performances of crypto influencers with on-chain data-driven products. Since its launch in July 2022, Aki Network has been growing rapidly, collaborating with 200+ campaigns while connecting them with 2400+ network influencers and 310k+ community members via 303k+ successful user referrals. Aki Network's approach to data-driven influencer marketing, combined with its strong network of influencers and community members, makes it an indispensable asset for businesses looking to grow in the Web3 space.

In-Person Contact Telegram：

BD Director @Umiii_xh | Meteorite Labs Founder @melodysyz