Most great startup ideas don’t grab your attention right away. It takes a while before the founder’s vision becomes obvious to the rest of us. On the other hand, the startups that immediately grab all the press attention often go out of business shortly after shipping their first product. Reality never seems to live up to the promise.

And then there are products like Orphe. This LED-emblazoned, WiFi-connected, social-network enabled dancing shoe seems made for fluffy, flashy Facebook sharing, but only when you really dig into it, do you understand what it really is and the potential it has in the marketplace.

Today we sit down with Yuya Kikukawa, founder of No New Folk Studio and the creator of the Orphe, and we talk about music, hardware financing, and why this amazing little shoe is finding early adopters in places from game designers to hospitals.

It’s a great conversation, and I think you’ll really enjoy it.

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Show Notes

  • The inspiration for musical shoes
  • Why Yuya’s first musical instrument attempt was a failure
  • The biggest challenge in moving from prototype to production
  • Orphe’s technical specs
  • How Orphe is being used in hospitals and other healthcare applications
  • How small Japanese startups can achieve global distribution
  • Where the next big startup opportunities in Japan will be
  • Why most hardware startups fail

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Transcript

Welcome to Disrupting Japan, straight talk from Japan’s most successful entrepreneurs.

I’m Tim Romero, and thanks for joining me.

As expected, my new Google duties are taking a lot of my time and taking me out of Japan quite a bit. Things will be returning to normal soon, but in the meantime, I wanted to bring you a special selects show with a really interesting update.

Yuya Kikukawa first sat down together a few years ago to talk about shoes, but if you listened to the last episode of Disrupting Japan you know that when you are talking about shoes you are never really talking about shoes.

In this case, the shoes in question are the Orphe, and they are a combination musical instrument and social network, and yeah that will make a lot more sense when you listen to the interview. And we also talk about what defines a musical instrument, the unique challenges of Japanese hardware startups, and the nature of innovation.

Oh, and I also have some news. In our conversation, Yuya and I debated a strategic decision that all hardware startups face, and just last month we finally got our answer.  I’ll tell you about it in the update after the show.

Intro

You know, most good startups are obvious. I don’t mean that I could have had the idea before the founders did. By obvious, I mean that right away you can understand the problem the company is solving for their customers and how they’re doing it. Naturally, that makes it easier for the customers to buy.

Most non-obvious startups are in reality still struggling to find the product market fit and are probably not long for this world. And then there are products like Orphe, an LED-emblazoned WiFi-connected social sharing enabled dancing shoe. Yeah, it sounds like something you would find on Indiegogo and that one time not too long ago, it was. But when I sat down with Yuya Kikukawa, founder of No New Folk Studio and the creator of the Orphe, it became clear that this was not some quirky side project or some overfunded crazy hardware startup.

This was something really different.

We talked about the original inspiration for the shoe and what does and does not qualify as a musical instrument and how Orphe is being used by the artistic community in Japan. But we also dive into the technology inside it, and that, well, that’s something special. That’s why this quirky little blinking shoe is starting to get used by game and UI designers, as well as hospitals and sports trainers in Japan. It’s a fascinating discussion but you know, Yuya tells the story much better than I can.

Interview

Tim: I’m sitting here with Yuya Kikukawa of No New Folk Studio. Thank you for sitting down with me.

Yuya: Thank you for inviting.

Tim: Now, you guys make Orphe which is an LED dance shoe but it’s so much more than that. Can you describe what Orphe is exactly?

Yuya: Yeah. Orphe is kind of world’s first smart LED shoes. Smart means it has a computer inside of the sole, at the same time there are about 100 full color LEDs. The computer can control each pixel. So the user can change the color through the smartphone application.

Tim: Okay. It’s always so hard to describe dance and visual effects on an audio podcast.

Yuya: Okay.

Tim: So it’s basically a dance shoe with an array of LED lights around the sole that are controlled interactively both from the cellphone and from motion sensors in the shoes, right?

Yuya: Yes.

Tim: Okay. On a high level, the idea of putting lights in shoes isn’t new. I remember back in the ‘90s, there was a company, LA Gear or something, that made a shoe that lit up. Was that an inspiration or is what you’re doing completely different?

Yuya: To be honest, I don’t think it’s completely different because the inspiration was actually come from the LED shoes itself. My idea is combine instrument function and LED shoes. I combined the two ideas.

Tim: So your inspiration was really viewing the shoe as a musical instrument?

Yuya: Mm-hmm.

Tim: Well, actually when you think about it, there are some cases where the shoe is a musical instrument, right?

Yuya: Flamenco, tap dance.

Tim: So like tap dancing or lots of folk music. So yes, okay, that’s not so strange at all. Do you have global competition now? Are there companies doing what you do or is this truly unique for the moment?

Yuya: In the genre of smart shoes, there are some startups. For example, Under Armor is making smart running shoes. It has sensor in the sole. There are some competitors.

Tim: Okay. But they seem to be going after a very different market. Nike also released a product that had fitness tracking. But you seem to be more targeted at performance art, at least for the moment.

Yuya: Mm-hmm.

Tim: All right. Actually, tell me a bit about your customers. Other than having cool blinking lights on your feet, how are people using Orphe?

Yuya: Our main target is — so dancer and performers. Orphe can react with performance motion. For example, the steps. There are already some users before Orphe, wearing LED shoes and dancing but it can’t react with motion and music.

Tim: So for example when the dancer takes a step, the impact sensor could trigger lights in the background or sound effects?

Yuya: Our shoes can send the information in a step. For example, background lights can be controlled by the step.

Tim: Right. That’s what I was thinking. Once it’s connected to the smartphone, it’s just data input?

Yuya: Mm-hmm.

Tim: Actually, we’ll talk about that a little later because I think that’s one of the most exciting things about this shoe.

Yuya: Okay.

Tim: For the moment, it’s dancers and performance art?

Yuya: Mm-hmm.

Tim: Okay. Another thing I find interesting is, you mentioned there’s also a social sharing component. So people can share their color patterns, their pre-programmed dance performances. Are people doing that now?

Yuya: The user can download the lighting pattern from the cloud but the motion sharing is not open yet.

Tim: Okay. So it’s just people sharing the lighting patterns?

Yuya: Yeah. It is important idea because now we are more open platform for the shoes. We are now developing the system to share the sensor data, for example.

Tim: Well, actually, before we talk about that, I want to take a step back and let’s talk about you for a minute.

Yuya: Okay.

Tim: How did you get into this? Because you originally wanted to make musical instruments, right?

Yuya: Yes, yes.

Tim: Tell me about that. Actually, you did create a different musical instrument, PocoPoco, right?

Yuya: In graduate school, I was major in Industrial Art Design and I studied designing musical interface in a laboratory. At that time, I came across the idea of mixing light and sound in one musical interface. So PocoPoco is one example. Now, PocoPoco is an instrument. It is black box shape and it is a kind of sequencer to make loop music. Just by pushing the buttons, it makes some loop sounds and not just sound, it light up at the same time it has a haptic interaction. Haptic means it has a solenoid magnetic power actuator.

Tim: So it gives a touch feedback as well?

Yuya: Yes, yes. Exactly.

Tim: It sounds like a really interesting project. What happened with it? Did you try to commercialize it?

Yuya: After the prototyping, we made video in a laboratory and it has big feedback from all over the world. So after that, I thought about commercialize the product but problem of design. It is very costful.

Tim: So it’s too expensive to produce?

Yuya: Mm-hmm. For business, it is not good.

Tim: Okay. All right. So a great project, lousy business?

Yuya: Mm-hmm.

Tim: I’ve had a few of those.

Yuya: So after that, I thought about what product is good for merchandise.

Tim: Just thinking about it, it’s very difficult to introduce a new musical instrument. Even something like the invention of the guitar took about 200 years to become popular or even the piano for that matter. It took over a century before it really became widespread. It’s hard to get people to make music on something new.

Yuya: I think there are two ways to solve the problem. Now, one is design; more intuitive, interaction designing. For example, the shoe, all the people know how to walk wearing shoes, so the gesture is already learned by the user. It is one idea of me. I used the gestures people already know.

Tim: Okay. So in other words, in the same way that synthesizers were new instrument —

Yuya: Exactly.

Tim: — that were keyboards. It was kind of co-opting the piano. The Orphe shoes are basically kind of synthesizers or new instrument that’s co-opting tap and folk dancing and flamenco, and things like that?

Yuya: Yes.

Tim: Okay. That makes a lot of sense.

Yuya: Another way is using IOT. My lab idea was collecting the sensor data from the interfaces, I can improve the interactions for the musical instrument.

Tim: What do you mean? Do you mean like you would use the data to create music algorithmically?

Yuya: It is more lab idea it took several hundred years to improve the guitar but the — it is loop of players and craftmans. I tried to make the feedback automatic system to improve the instrument.

Tim: Okay. So more of music composition, a tool to help people compose music and to generate new sounds rather than a traditional instrument?

Yuya: Mm-hmm.

Tim: That sounds like what PocoPoco was.

Yuya: Mm-hmm.

Tim: All right. Actually, the prototype for these shoes, you developed for a Music Hack Day in Barcelona, right?

Yuya: Mm-hmm.

Tim: What were you doing in Spain?

Yuya: At that time, I was studying musical interfaces in Universidad Pompi Fabula. It is a really big famous university for musical interface design.

Tim: Tell me about the original prototype. What was it?

Yuya: It was very dirty prototype but —

Tim: It’s a prototype.

Yuya: To be honest, the Converse All Star, it has LED taped outside of the sole and there is Arduino maybe.

Tim: Yeah, I do know. Sure.

Yuya: The micro controller and YRS and pressure sensor in-sole. Just dirty prototype.

Tim: How was the reaction?

Yuya: Pretty good.

Tim: Yes?

Yuya: Because concept is same. When I step, it react to my step and light up and it wirelessly send step information to the computer. The computer makes some sound feedback and visual feedback. Function is very similar to now.

Tim: Like any good prototype. So after Barcelona, how did you end up teaming up with DMM.make?

Yuya: After the Musical Hack Day, I was seriously thinking about commercializing the musical shoes. I talked this idea to the Abba Labo.

Tim: Incubation for IOT companies, right?

Yuya: Yeah. How to be a startup. They decided to help us, funding.

Tim: Tell me about the team. Is it all like hardware guys or do you have dancers or musicians? What’s the team like?

Yuya: Most of them are engineers. Half is hardware and half is software.

Tim: That’s a good balance. How big is the team now?

Yuya: Now, seven.

Tim: Okay. Cool. After the prototype and after the funding, you launched an Indiegogo campaign back in March of 2015 that was more than 200% funded, very quickly. Tell me, what were the challenges of going into production? What was difficult about going from a Converse All Star with LED lights taped around it to this mass production shoe I’m holding here?

Yuya: In short, to make inside the shoes, in the dirty prototype, electric parts were all outside of the shoe. So it is kind of attachment but now I decided to make it inside of the shoes.

Tim: Of course.

Yuya: So we have to study about the mechanism of shoe itself.

Tim: So what was the biggest challenge? Because I could imagine weight would be a really big issue for you, durability, putting electronics in shoes is going to put a lot of stress on the electronics.

Yuya: Yeah. Durability is most big problem. I bought many LED shoes and I broke many, many shoes in studying the inside of the shoes. Yeah, biggest problem was mechanism, the durability. We made many, many models, the CAD models and 3D printing and silicon. We made so many prototype soles.

Tim: From the end of the Indiegogo campaign to the product, it took about a year, right?

Yuya: One and a half year.

Tim: A year and a half.

Yuya: Yeah. Indiegogo to shipping.

Tim: Did your backers get impatient?

Yuya: Yeah, I think so. Yeah. At first, we promised one year but there were some hard problem so it is prolonged.

Tim: Okay. I want to talk about the tech a bit but before that, I’ve got to ask, what does the name mean? No New Folk Studio. It’s an unusual name.

Yuya: It is a mix of No New York and Folk. No New York is a famous record produced by Brian Eno. It is a record of no wave jam. My inspiration is mixing the no wave and folk and making new jam, and a new expression.

Tim: Okay. Now, the shoe itself, you mentioned it has 9-axis motion sensors. I only know 3-axis. So we have like three accelerometers, three gyroscopes, and three — what’s the third?

Yuya: Compass.

Tim: Three compasses, of course. With this 9-axis, the computer knows the orientation of the shoe pretty much completely, right?

Yuya: Yes.

Tim: How accurate are the sensors plus or minus 10 degrees?

Yuya: Depend on case but basically it is 1 degree.

Tim: Really?

Yuya: Mm-hmm.

Tim: Well, that’s quite accurate then. Well, that actually leads to what I think might be even more interesting uses. So what do you think the real market is for? I mean it’s cool, it’s novel but how are you going to make sure that this is not just another fad?

Yuya: At first we concentrate to make some niche product. The LED shoes, even if it is interactive, it is kind of niche in the market.

Tim: It’s pretty niche, yeah.

Yuya: But my concept is not just making LED shoes. The important point is there are input and output and we provide the open SDK to the developers. So any developer can design interaction for the shoe.

Tim: Okay. So even just putting the LED is a side from it, just the motion sensors. That is really interesting. Do you have anything planned? Do you have early access partners working on something? Are you guys going to be running a shoe hackathon?

Yuya: Yeah. Actually, after releasing these shoes, many other people are asking to collaborate with us. Now for example — now, we are developing shoes for healthcare.

Tim: For healthcare?

Yuya: Yeah.

Tim: What application?

Yuya: For example, the walking method is very important for the health. Now, we are collaborating with medical doctors. The shoes will teach how to walk.

Tim: So this is for like rehabilitation, that kind of thing?

Yuya: Not just rehabilitation. The normal people can improve their walking method.

Tim: Interesting.

Yuya: So the big point is, our shoes sensing is real-time. Now, for example, Under Armor has sensor shoes but it is kind of logged. It is more —

Tim: Yeah, that’s different. It’s data collection more than anything else. I don’t think those are designed to be interactive.

Yuya: We add interactive real-time sensing. So after that, we built more specific data. So it is useful for for example , healthcare, medical.

Tim: It would also seem to be very interesting as a VR controller.

Yuya: Yeah. These days, we released the SDK for Unity, Unity game library and we built a sample application, they’re walking in VR world.

Tim: All right. What about things like gaming, like rhythm games, like Dance Dance Revolution kind of game?

Yuya: Exactly. Now, we are looking for collaborate to make Dance Dance Revolution.

Tim: Excellent. So what is your marketing plan and you distribution plan for these shoes? If I want to get a pair, are you going to be selling internet only or are you trying to partner up with retail channels?

Yuya: Now, we are looking for partners. We are now just selling it mainly in Japan only, only in Japan. There are some department stores but worldwide, we don’t have enough partners to distribute Orphe. So now we are talking with some.

Tim: What would be the ideal channel for something like this because it seems to be too specialized for a shoe store? Would you be selling these through more electronics stores?

Yuya: Currently, we are thinking about more — for example, IOT gadget shop.

Tim: What do they cost?

Yuya: Expensive, maybe than you think.

Tim: How expensive is?

Yuya: In SRP, it’s around $400.

Tim: So $400, that’s getting expensive but not crazy expensive.

Yuya: Thank you.

Tim: People will pay more than that for a pair of Nikes.

Yuya: Yes. Exactly.

Tim: Do you expect that price to come down as you produce more of them and you get kind of economies of scale?

Yuya: Basically, yes but we are thinking about two ways. Now, more branded, now more fashionable, now products and more reasonable products. We are developing both sides because our product is not just IOT, it is kind of fashion. So we thrive to make more beautiful, more fashionable one at the same time, for the functions, the user needs more reasonable ones. So now, we are developing two sides. Anyway, now, we design and we produce shoe itself but now we are thinking about making partnership with other shoemakers because now we are more tech company. Of course we have to study about shoes all the time but we don’t have to make shoe itself.

Tim: Sure, sure. That way, you don’t have to scale up production yourself. You can rely on the expertise of people who do that.

Yuya: Yeah. We try to build community, so developer and shoemaker. We make the relationship.

Tim: Let me ask you just a general question about Japan. Because right now, internet of things is so popular, there are so many new hardware startups popping up in Japan. What’s the best advice you can give to someone who wants to start a new hardware startup today?

Yuya: I’m thinking about after hearables. There are many displays now but hearables can be an alternative control information. Audio can be controlled. After that, people wants something new so I’m thinking about new things after hearables.

Tim: By hearables, you mean sort of the audio interface like Alexa?

Yuya: Mm-hmm.

Tim: So what’s the next logical interface after that?

Yuya: My hypothesis is beyond control something. So no control, no UI. Products have to know before controlling something by the user.

Tim: Okay. So you think the next big opportunity is in controllers or invisible controllers like the shoe?

Yuya: Yeah, invisible controller. Yes. So products have to guess next action of the user without controlling something.

Tim: So controllers that the user or the wearer don’t think of as controllers?

Yuya: Mm-hmm. Now, for example, our shoe, without controlling anything, it can’t be logged. That just wearing shoes can be log of something. It can guess the user’s running, walking, what is the direction, what is the goal. We can guess without controlling.

Tim: Okay. Excellent. You mentioned before with your PocoPoco project, which you were very excited about and you stopped because you realized it was going to be a bad business. I’ve noticed a lot of hardware startups in Japan are passionate about what they’re making. They’re making really interesting things but they’re not really thinking much about the business.

Yuya: I think so.

Tim: So what made you realize that as much as you love the PocoPoco instrument, it was not a good business?

Yuya: Just estimate the cost. It is easy to know.

Tim: It is something that is very practical and easy to do but for some reason many people don’t do it.

Yuya: I asked some instrument company, for example, Korg, about the PocoPoco but the feedback is not good. About the shoes, many people felt some possibility of next of shoes.

Tim: So with Orphe, potential users were excited and said, “I want to use this.” With PocoPoco, potential users were sort of, “Well, this is interesting but no.”

Yuya: One interesting point is almost all people are interested in using smart shoes for something. So all the people think about possibility. How to use this shoes and what is the useful point. They automatically think about that vision.

Tim: I think that’s important, yeah. When your potential customers are so engaged and they’re imagining themselves using it, then you’ve got something valuable.

Yuya: Yes. Our task is just make a relationship for the customer and developer, shoemakers. We have to arrange just environment for the smart shoes.

Tim: Right. Listen, before we wrap up, I want to ask you what I call my magic wand question. That is, if I gave you a magic wand and I told you you could change one thing about Japan, anything at all, the education system, the legal system, the way people think about risk, anything at all to make it better for startups in Japan, what would you change?

Yuya: In Japan, most of people talking we need more startups, we need more challenges but if someone starts challenge, that they’re severe about the result. I want to change the atmosphere about the results. They have to be more kind for challengers.

Tim: So do you mean that you would make people more supportive of people who are trying to make changes or you would make people more accepting of failure?

Yuya: Yeah, yeah. Failure. Because before starting challenge, they are very kind but after doing challenge, they are very severe about the results.

Tim: That’s really bad. So you’re saying when you’re starting, everyone’s very supportive and say, “Yeah, you should do that.”

Yuya: Yeah, yeah. Exactly.

Tim: But when you fail, they’ll say, “I told you you should not have done that?”

Yuya: Right.

Tim: That’s not good.

Yuya: So I wanted to change the atmosphere.

Tim: That’s interesting. I think maybe it’s almost a good sign in that Japan had solved half the problem. When I started my first company here 20 years ago, everyone said, “No, no. Don’t do that. You shouldn’t do that.” So they were not supportive in the beginning and they were also very judgmental when you failed. But at least now, at least they’re supportive in the beginning.

Yuya: I think so.

Tim: We just have to complete that and make them supportive even if you fail.

Yuya: There are many hardware startups, they release their concept of the hardware but they couldn’t release the hardware as a mass product.

Tim: Why is that?

Yuya: Maybe it’s a very severe environment to release mass product.

Tim: Is it the lack of experience from going from prototype to production? Is it difficulty getting distribution with large companies? Is it just an attitude? Why do most of them fail?

Yuya: All. For example, concept can be positive. They support the concept but the product, the hardware, the result, they are very severe about the quality. When we do some crowdfunding, they are maybe kind but after the shipping and receiving of the product that they are kind of professional.

Tim: So were your Japanese customers a lot more demanding than your overseas customers for your Indiegogo supporters?

Yuya: I feel so. After receiving the product they are normal customer, no supporting mind.

Tim: Okay. This happens with B2B companies as well. For example, for a B2B startup, an American customer is wonderful because American companies will work with the startups and they’ll say, “No, you need to fix this,” and they’ll be a little tolerant of mistakes and missing documentation but Japanese companies compare startup service to IBM and NEC service. They want that level.

Yuya: Exactly.

Tim: In the B2C space, it’s the same thing?

Yuya: I think so.

Tim: That’s tough. But the upside is that if you can keep Japanese consumers happy, you’re pretty much okay anywhere in the world.

Yuya: I hope so.

Tim: Cool. Listen, Yuya, thanks so much for sitting down with me today.

Yuya: Thank you so much.

Outro

And we’re back.

Yuya gave some good advice about when to abandon a hardware startup or any kind of startup really. The trick is not to follow your passion. Despite what everyone tells you, simply following your passion is the express lane to failure. What you want to do is to be passionate about following your users’ passions.

Like most founders, Yuya was passionate about his first project, PocoPoco but he set it aside when user response was only lukewarm. Only when he saw the passionate reaction to Orphe among potential users did he know he was onto something. Now, it’s a delicate balance, of course. You might have something that is truly transformational and it might take while for your customers to get that. But please remember, in the end, it’s not about your passion, it’s about your customers’ passion.

Yuya’s scaling strategy is smart and it’s kind of a trend among Japanese hardware startups today. It’s relatively inexpensive for startups to create prototypes and go into small lot production, selling thousands of units. Taking things to the next level, however, moving into a real mass market, hundreds of thousands or even millions of units, well, that still takes some serious capital. Dedicated machines need to be purchased, custom production lines configured, and a supply chain needs to be developed and managed.

Successful U.S. startups have access to that kind of capital but at the moment, Japanese startups don’t. So the best way for them to scale is to license their technology or their entire product to larger companies capable of mass production. This is a good and a necessary step but I think it’s a temporary one.

While the previous generation of CEOs, of Japanese small and mid-sized companies were perfectly happy to have their technology quietly and invisibly power some of the world’s greatest brands, and we’ll talk more about this next week, but many of the current generation of hardware startup founders think differently. Many take their inspiration from Akio Morita, the founder of Sony who famously and steadfastly refused all licensing and OEM deals. Morita insisted that Sony products only be sold under the Sony brand. And this may come as a surprise to our millennial listeners, but at the time of Morita’s death in 1999, Sony had the best consumer brand in the United States, far ahead of icons like Coca Cola, GE, or Apple. And as more and more growth capital becomes available to Japanese IOT startups, we’re going to see a lot more Japanese brand names come into their own around the world.

Update

Alright, time for an update.

Over the past few years, Yuya and the Orphe team have gone through the same trajectory that so many really innovative Japanese hardware startups follow. they develop a large niche following. They become stars of innovation events. The partner with NGOs and government agencies for outreach and awareness events, but they never really achieve mass-market success.

I think a big part of this trajectory is the scalability issues that Yuya and I talked about during the show. That gap is very real both on the production side and on the marketing and consumer perception side.

Well, last month Non ew Folk Studio announced an investment from and partnership with ASICS the major athletic shoe brand and the prototype ASICS running show with Orphe technology was on display at this year’s CES in Las Vegas.

I think this kind of startup-enterprise paring, partnerships that combine a startup’s innovative technology with the enterprise’s manufacturing and marketing power is something that we’ll be seeing a lot more of in the future. And we’ll be talking a lot more about this on future podcasts, and there are solid cultural and historical reasons for it, but there is a lot more genuine trust in the Japanese business relationships than there is in the US. Trust that enables stable long-term partnerships to form.

And it’s one of the important ways that the Japanese startup ecosystem is developing very differently from that in Silicon Valley.

If you want to talk more about shoes, but of course when we are talking about shoes we are never really about shoes, Yuya and I would love to hear from you. So come by DisruptingJapan.com/show159  and let’s talk about it. If you leave a comment I guarantee Yuya or I or maybe both will respond.

If you get the chance, check us out on LinkedIn or Facebook, but even better. If you like the show, tell people about it. Disrupting Japan has grown not by social media marketing or advertising, but because listeners like you enjoy it and tell their friends about it.

But most of all, thanks for listening and thank you for letting people interested in Japanese startups know about the show.

I’m Tim Romero, and thanks for listening to Disrupting Japan.