It’s a great time to be a programmer in Japan. Everyone is hiring and there simply is not enough talent available.
But why is that?
The truth is that until about 10 years ago, programming was considered kind of a blue-collar, low-skill job. It was OK to start your career as a programmer, but if you had not moved into management by the time you were 30, clearly you weren’t that bright.
The startup boom has changed that, and developer salaries (and respect) has improved significantly.
But the education system has not caught up, and far too few people know how to code.
Today we sit down with Masa Kato, founder of Progate, and discuss how Japan got herself into this situation, and what Progate is doing to fix it. The problems run deeper than expected.
It’s a great conversation, and I think you’ll enjoy it.
- The problem with computer science in Japan
- Why Japanese universities resist change – even when they know they need it
- The flaw in most online programming courses
- Can online education ever really be global?
- Why B2B edTech companies have trouble in B2B markets
- How English skills are holding back Japanese startups
Links from the Founder
Welcome to Disrupting Japan, straight talk from Japan’s most successful entrepreneurs.
I’m Tim Romero and thanks for joining me.
You know, I spend a lot of time talking with startup founders in Japan. I also spend a fair amount of time talking with policymakers and academics, and even executives of large companies who want to support startups in Japan.
Two of the most concerns I hear revolve around the lack of qualified developers in Japan and how the Japanese education system doesn’t really prepare students for a world that demands that they innovate.
Well, today, we’ll be tackling both of these issues head-on. In a few minutes, I’d like you to meet Masa Kato, the CEO of Progate. Progate is an online platform that is teaching young people to code, and yeah, yeah, there are a lot of startups doing that, but these guys are onto something.
As Masa will explain, he actually started Progate when he was majoring in computer science at the University of Tokyo, and he didn’t start Progate as a side project, he started it because even though he was majoring in computer science, he wasn’t learning how to program in his computer science classes.
Now, all of this will make much more sense when Masa explains it to you, but this foundation might be why Progate has seen so much success so quickly. Progate is now being used in high schools and elementary schools all over Japan, and they have expanded into overseas markets as well, but things didn’t work out exactly as they plan and they had to change their business model to survive.
But you know, Masa tells that story much better than I can. So, let’s get right to the interview.
Tim: So, I’m sitting here with Masa Kato who wants to teach the world to code. So, thanks for sitting down with me.
Masa: Thanks for having me.
Tim: Masa, you are the founder and CEO of Progate. I explained it a bit in the introduction, but why don’t you tell us a bit about what Progate is?
Masa: So, basically, we are a company that teaches programming and we teach it online. The content we teach is mainly web-related, so it’s about teaching people how to make websites, make web services.
Tim: So, HTML, CSS, this kind of –
Tim: Okay, so is Progate, is it an app, is it a video?
Masa: So, we do have an app as well, but we started off as a web service, and instead of using videos, we used slides to teach the students, and we also have an online coding environment, so the users can actually test out their knowledge on the browser without any like, pre-setup.
Tim: And, is it just sort of like, basic courses or is it basic to advanced?
Masa: So, it’s basic to intermediate, I’d say. So, we teach the fundamentals of these programming languages and eventually, lead them onto programming frameworks, and then yeah, we lead them to develop their own services.
Tim: So, is the primary interface the app or is it the browser?
Masa: The browser.
Tim: Yeah, I can understand that. I mean, trying to code on a smartphone would be kind of challenging.
Masa: That’s true, that’s true, but we do have a special keyboard to make that easy.
Tim: Yeah? People do that? I mean, really?
Masa: Yeah, yeah, yeah.
Tim: Wow, I can’t imagine that! Maybe it is a generational thing, but for them even like, laptop screens seem kind of small. I can’t imagine doing it on a smartphone.
Masa: Yeah, that’s true. We do provide Progate to high school students and junior high school students, and actually find it easier to learn on the mobile app.
Masa: Yeah, because some of them don’t even know how to type emails to register on Progate because they are so used to clicking on their smartphones. They can’t type. Even if they can, they struggle with finding how, with Japanese and English, they have to convert.
Tim: Right, right.
Masa: Yeah, so the accidentally type in Japanese and they’re like, “Ah, it’s not working.”
Tim: Oh, okay, so in that case, like having a really controlled environment, even with a tiny screen?
Tim: Alright, that makes sense.
Masa: And even for adults because a lot of Japanese people travel on trains and stuff. They can use that time to review the content they learned on the web version and try it on the app version.
Tim: Alright, cool. So, the last time I checked, you had something like 600,000 users now, right? So, tell me about your customers – who are they? You mentioned like, some are high school students, is it mostly younger programmers, older
Masa: Okay, so our main target is people in their 20s, I’d say – 20s to 30s, so people who already have a job not in IT and who want to look for other jobs in IT or something IT-related, but recently, over the past two years or so, many teenagers are starting to learn on our platform as well, so that’s starting to change a little bit, yeah.
Tim: Okay, so it’s really people who are looking to move into IT jobs. They are not like, hobbyists.
Masa: Both, actually, like university students, especially in Japan. It’s becoming a trend to learn programming just as a skill, not to get jobs, but people are starting to think that it’s really important to be like, programming-literate.
Tim: I think that makes a lot of sense, really. I mean, programming today is like, I don’t know, knowing how to use the email. It opens so many doors in business.
Masa: Exactly, yeah, so technology is all around you and it’s becoming very important, especially since programming will be a compulsory thing to learn in high schools and junior high schools, and even primary schools in Japan in two years.
Tim: Really? I didn’t know that.
Tim: So, the Ministry of Education has said all students are learning programming?
Masa: Yes, that will be included in the actual curriculum. Even parents are starting to get more interested in learning to code.
Tim: What language are they going to be teaching in schools?
Tim: Yeah, I kind of had the feeling.
Masa: Yeah, yeah, but Python is starting to get more attention, and yeah.
Tim: That’s really encouraging. Actually, you mentioned university students and you started Progate back when you were studying at Tokyo University, right?
Masa: Yes, yes, exactly, yeah.
Tim: So, was it a hobby project that just got out of hand or did you start it knowing you wanted to make a company out of this?
Masa: So, I guess it was a little bit of both. When it first started learning programming, it was at Uni in my third year of Uni, so that’s when people started to choose their major is at Tokyo University, so I chose computer science and that’s my first experience of programming, and I wanted to learn how to make web services and iPhone apps because like, five years ago, everyone started getting iPhones and I thought it was really cool. I thought programming was really cool, so I wanted to learn that, and I majored in computer science with high hopes, but what I actually learned there was not quite what I expected. It was more academic.
Tim: Yeah, let’s dig into this because this is something I thought has been a little odd about computer science in Japan. So, what were they teaching you?
Masa: So, they were teaching me like, the history of programming, like how it was first made.
Tim: Like the Babbage engine and things like this? Okay.
Masa: Yes, yeah, yeah.
Tim: I mean, that’s interesting.
Masa: That is interesting, yeah. I mean, I’d love to learn it now, now that I’m an actual programmer, I’d like to learn deeper into it, but back then, I wanted to know more like practical stuff, but all the professors of there didn’t really teach me that, and that is understandable because they aren’t really doing the latest web stuff.
Tim: I mean, honestly, I don’t think I’ve ever met a computer science professor in Japan who has ever had to deliver a project to a customer.
Masa: Yeah, that’s true. Yeah, exactly, yeah. So, I didn’t know that before, but after majoring in computer science, it just didn’t feel right, you know?
Tim: Yeah, so is that a common feeling among your classmates, that you just wanted to build something?
Masa: Not really.
Tim: That’s disappointing.
Masa: Yeah, they are pretty satisfied with it. So usually, students in computer science, they have to get a Master’s degree after that and try to get into a big company in Japan, but I could’ve taken that option as well. Since I was very passionate about creating my own services, I had to find other friends she felt the same way as me, and I was lucky enough to find them, and they are the founders of Progate.
Tim: So, when you and the team first made Progate at university, your first users, I assume, were fellow classmates and people at the university.
Masa: yeah. So, it actually didn’t start off quite well. Since I was a beginner and all my friends were beginners as well, we were struggling, and so we had a programming community kind of thing, but it didn’t really work out because there wasn’t anyone who could teach us programming.
Tim: Yeah, just teach each other.
Masa: Yeah, that didn’t quite work because we were just a bunch of beginners who didn’t know anything, so we were just always stressed because we were not getting anywhere, but after a while, me and my cofounder, we were lucky enough to find this person who works for an IT company in Japan and he showed us all the things that we had to learn, like all the milestones that we had to accomplish. After that, me and my cofounder, we stayed at this share house for a month, and we just code and code, and code – yeah, with the help of that person. We were able to release a web service, and that experience was really big for me, it had a really huge impact.
Before that, I thought that the only option that I had was to get into a big company in Japan like all the other people, but after learning to code, I felt that I had other options because I was not just making money, but adding value to the world and that felt really good.
Tim: Yeah. Well, I mean that is one of the things that I love dearly about programming in general, and I miss it because nobody lets me program anymore. – with good reason, but it is this wonderful combination of artistic expression and building something that is truly useful but I don’t think there’s anything quite like it.
Masa: I agree.
Tim: So, once this was up and running, were other university students interested? Were other university students like, registering and say, “Yes, we want to learn programming this way”?
Masa: Yes. Once my cofounder and I got the hang of programming, the programming community was up and running again because we could teach them now. So, for a while, we were teaching them in person, but we were teaching so many people that just got out of hand, you know? So, that’s when we came up with the idea of Progate, a platform that is online, and anyone could use it, and our target users were our friends wanted to teach our classmates, wanted to teach community members, and yeah, we wanted to help people who are struggling to learn to code, just like we were struggling a couple of months ago.
Tim: So, was it effective? Did it help the other students learn to code?
Masa: It did, yeah. It was, it was, yeah.
Tim: Getting back to kind of how Japan approaches education in general, but CS education in particular, was there any interest from the University saying, “Wait, this is a better way to teach students”?
Masa: Actually, the University of Tokyo, they have this program called Entrepreneur Dojo which is for people who are interested in building their own startups and stuff, and they actually offered us to teach programming for them. So, I think universities definitely have some interest in teaching of them to learn practical coding, but not many yet.
Tim: And, what about the CS department in particular?
Masa: I guess not so much. We haven’t had much attention from the CS department.
Tim: So, it sounds like that if things are going to change, it’s going to change from outside of the mainstream if it’s from high school or independent studies.
Masa: I think the problem with all these educational institutions in Japan is that as you said, a lot of the teachers have no experience in any practical programming, so the lack of teachers is a big issue.
Tim: Yeah, I agree, and I mean, I think it’s great that Japan is going to start teaching programming in elementary school in junior high school, or high school, but in the back of my mind, I have this fear that like, okay, in the 70s, Japan said, “Okay, everyone in Japan needs to learn English,” and so English is taught from elementary school in Japan. Everyone studies English, but almost no one can really speak English.
Masa: That’s true, that’s true, yeah.
Tim: I worry that this programming education might suffer the same fate.
Masa: Yes. I tell people the exact same thing. Actually, over 100 high schools and junior high schools in Japan are starting to use Progate as a part of their curriculum because it is an online service and anyone can use it, even teachers. So, what they do is they get the students to learn on Progate and the teachers only have to support them.
Tim: Okay, so that bypasses the problem of the teachers not knowing how to code.
Tim: Fantastic. So, there’s hope?
Masa: I guess so, yeah. So, I have the same fear, but I think programming can be a really fun thing to do if you learn it the right way, but if they don’t, it can be something really boring like learning English for students in Japan.
Tim: Well, let us take a look at Progate’s business model. So, is it a freemium model?
Tim: Okay, so is it subscription or per course?
Masa: Subscription, yes. We have, I think like, 15 programming languages and the first course or the first few courses of each programming language is provided for free, but in case the students want to learn more, they have to pay a monthly fee of 980 yen, so that is about $10.
Tim: Using a subscription model, how do you manage customer retention and churn, I mean, because what stops people from like, just taking one course, and then leaving?
Masa: With Progate, it’s not just about learning programming languages. All the courses are connected into a single path. Just completing one course of HTML does not change much, but completing a path will give you an overall picture of what it’s like.
Masa: Yeah, yeah, exactly.
Tim: I see, okay.
Masa: Yeah, I think the average lifetime of a user is like, 6 to 7 months at Progate. So, yeah, I think that’s how long it takes for a user to actually complete a path, like a course on Progate.
Tim: Okay, and how many courses are in a path?
Masa: So, we have different paths, like we have full stack web development path which consists of like, 20 to 30, 40 lessons, we have a simple PHP path which is like, 10 lessons, and yeah, students can choose according to their needs.
Tim: So, online courseware is a really, really active market, and there’s a lot of startups active here. So, what do you think is the biggest difference between Progate and companies like Coursera or Udemy?
Tim: That makes sense. It’s a much lower kind of barrier to entry to programming.
Masa: Yeah, yeah, yeah.
Tim: Okay. So, all of the course is created in-house?
Masa: Yes. So, we did consider asking other people to make content, but with programming, everything is just so connected together that we thought it was better for us to find the best path for the…
Tim: Alright, that way, you can credit control the journey.
Masa: Yeah, yeah, especially if you are a beginner, everything has to be right. Evil, especially in Japan, have this image that programming is something that is really difficult and something that is not for them, but we want to change that mindset, so we want to remove as many obstacles as we can and we thought that doing it in house would make that easier.
Tim: That makes sense. Alright, let’s talk about your plans for global domination.
Masa: Okay, yup.
Tim: So, last year, you opened offices in India and the US, right?
Tim: So, do you notice any differences in behavior among the Japanese students and say, the Indian or American students?
Masa: Yeah, so there are a few differences like users in India, they tend to be more interested in getting jobs as an engineer whereas in Japan, it is more about getting a new skill. It doesn’t have to relate directly to a job.
Tim: So, in India, they are looking more for certifications?
Masa: Yes, yes, yes, exactly.
Tim: Ah, I see. I see.
Tim: How do you respond to that?
Masa: So, with the English version of Progate, we do provide certificates for completing your course or a path, so that is one thing we did, and also, another big difference with the Indian market is that students start to learn programming at a really young age compared to Japan. In Japan, so I started learning to code when I was like, 20 years old, but in India, primary school students, they learn the basics of HTML when they are like, 12 or 10, or something. Yeah, so we felt that our main target was a younger age in India. So, right now, we’re trying to introduce Progate to more schools – high schools, junior high schools, and university students as well, but freshmen, mostly.
Tim: So, it’s a more B2B model?
Tim: Okay, and if you are targeting younger users, have you had to change the courses, have you had to change the interface much?
Masa: Not really. I think the really good thing about programming is that it’s a universal language. I mean, does it matter how old you are, it is a matter what gender you are or what race you are, what social status you are, as well as you can code, it is the same, right?
Tim: And I guess, that kind of cute characters sensibility in Japan translates really well to younger students abroad.
Masa: That’s true, yes. That’s true. Yeah, yeah. So, a lot of students in India, they love Japanese anime and they love our characters as well.
Tim: It sounds like you are taking some of the learnings from the Indian market and bringing them to Japan because you were mentioning that you are doing business with about 100 schools in Japan?
Masa: Yeah, but actually, that came first. Initially, we were not planning to do any business with these schools, but as I mentioned before, these teachers are struggling with methods to teach their students. This one teacher from Shimane, he contacted us through the platform and he asked us if he could use the platform to teach his students, and since that was very successful, we thought why not provide Progate to other schools as well? Since then, we have added this academic plan on Progate where teachers can choose to programming languages on Progate and if they can use the two languages for free, and the reason that we are making it free at the moment is that because we want to make sure that these students, while they are starting to learn programming, have the best experience.
Tim: So, is that a strategy or the thinking of going forward? Because sort of the B2B marketing and the product and features you need for a B2B sale are really different from a B2C where the user is the one buying it for himself.
Masa: That’s true, but as long as all the lessons are the same and I think we have to make too many changes, so we do have a dashboard where teachers can manage the students’ progress, but that’s pretty much all that we had to change.
Tim: So, the hundred schools that are using Progate, is it mostly teachers independently saying, “This is great, I want to use it for my students”?
Tim: So, it wasn’t the school itself saying, “We’re standardizing on Progate”?
Masa: No, it’s mainly teachers. Yeah, so they do have a teacher’s community, like a computer science teacher’s community. Yeah, we have been going to those events.
Tim: Alright, step by step, one by one, right?
Masa: Yeah, yeah.
Well, listen, Masa, before we wrap up, I want to ask you what I call my “Magic Wand” question, and that is, if I give you a magic wand and I said that you could change one thing about Japan, anything at all – the education system, the way people think about risk, the legal system – anything at all to make things better for startups and innovation in Japan, what would you change?
Masa: So, I think I’d try to make everyone in Japan become more fluent in English.
Tim: Why is that?
Masa: Because I think Japanese startups and Japanese engineers are very talented. They come up with really good products and they are very passionate, but I think it’s always this language obstacle that is stopping them from challenging overseas, and if that were to change, I think more startups, not just small startups, but I guess the world could benefit more from the products that we make.
Tim: So, in terms of English, is it an input problem or is it than output problem? Is it that the engineers can’t read and understand all of the latest technology or that they can’t clearly express what they have created and explain the value they are creating?
Masa: I guess it’s a bit of both, so since a lot of us can’t get the latest information that is provided in English, that is definitely stopping us from learning quicker, and in terms of output, since we can’t speak English, I don’t know how to put this, but I guess people are afraid to express themselves and their product overseas because they don’t want to lose face, kind of?
Tim: I agree with you. There is so much interesting technology, interesting products made in Japan and that Japanese companies are pretty bad of telling the world about what they are doing, and I think you are right, a lot of it is English skill, but I think there’s this other cultural component to it.
Masa: That’s true, that’s true.
Tim: Like, America’s startup founders and Japanese startup founders are almost the extreme opposites in the world on this where in America, everyone sort of expects that you will make these crazy claims and be talking about 10 years in the future us if you are launching it tomorrow, and in Japan, everyone is very careful about not wanting to seem like they are bragging very much.
Masa: I guess that’s true. Yeah, yeah, that’s true, but I think that’s also starting to change. Yes, so I think five years ago or 10 years ago, there weren’t as many ambitious startup people building their own services, but lately, during the past five years, a lot of younger people in Japan are starting to build their own companies and build their own products, and many of them are very passionate and very innovative. They are more confident and even arrogant, sometimes, and yeah, I guess it’s not the stereotypical shy Japanese businessman kind of thing. I think it is starting to change.
Tim: That’s great. I think they’re definitely has been a big change in the last 10 years among Japanese university students and there is a huge number now who not only want to start their own company but are doing it, but one thing that I’m not sure if it’s changed or not are Japanese parents.
Tim: They are still against the…
Masa: Yeah, so yeah, even at Progate, many of our members have to have many talks with their parents because they weren’t very understanding of what we were doing, and that’s understandable because getting into a good University in Japan is a really important thing and after sending their kids off to the University of Tokyo, they definitely want them to graduate and get a good job.
Tim: They are expecting them to go into government or Mitsubishi.
Masa: Yes, exactly, yeah. Yeah, that’s still a struggle, I guess. So, back when I was a student which is like, five, six years ago, none of my classmates were interested in doing a startup, but lately, even students at the University of Tokyo – oh, I think the reason is because there is been some successful young entrepreneurs in Japan as well and many students do internships at those companies and they have a role model.
Tim: Yeah. I think role model, that is really key, I think so. Actually, two things struck me about what you were talking about. One is in America, it is simply unimaginable that you would have a computer science department where most students have no interest in starting a company. It just doesn’t happen, but second, yeah, the emergence of role models I think has been so important.
Masa: Yes, definitely.
Tim: And I think for example, like 10 years ago, when students would look at someone like Mikitani-san or Son-san, like the gap was just too big.
Masa: Yeah, yeah. They couldn’t really relate, right? Yeah, and that’s also another reason why are trying to provide Progate overseas, because there haven’t been really good role models where a Japanese entrepreneur went overseas and came up with a global service, and we really want to be the first example of that, so that the students who are learning now can see us as role models and be more ambitious, yeah.
Tim: So, you see a really big difference just in the last five years?
Tim: Well, that’s great. Well, I certainly hope that continues, and it looks like it’s going to.
Masa: Yeah, I hope so, yeah.
Tim: Well, listen, Masa, thank you so much for sitting down with me. I really appreciate it.
Masa: Thank you, thanks for having me. It was very fun.
And, we’re back.
It really is amazing how much and how quickly things have changed in startups and innovation in Japan. When Masa was at Todai only four or five years ago, almost none of his classmates even considered starting a company, but today, Todai has one of the largest best-funded innovation programs in Japan and it is spinning out a steady stream of startups.
But, back to Progate.
The biggest challenge facing Progate is the same challenge that almost all EdTech startups face – finding a sustainable and profitable business model.
Now, I’ve given this problem a lot of thought, and I’ve talked with a lot of really smart at tech founders who have given it a lot more thought than I have, and I think the core problem is that the real product of the education system or all of the developed world is not education.
In general, people are not paying for education; they are paying for certification. When a student attends Yale or Todai, or when they take an Oracle or Microsoft training course, they certainly do receive an education, but that’s not where the real value is.
The value is in the certification. Yale or Oracle’s stamp of approval. If a startup is able to teach students everything they could learn at Stanford, but at half the price and in half the time, that’s great, but they still would not be competing with Stanford. Even though they provide the same medication, it’s the certification that has the economic value.
So, where does this leave innovative companies like Progate, companies who are genuinely committed to helping people learn, who are genuinely committed to providing education rather than certification? Well, as long as the demand for programmers, even self-taught and uncertified programmers, as long as the demand for programmers remains high, Progate will be fine, and I think that demand will remain high for the foreseeable future.
But the broader question is an important one: in a society and economy that is changing faster and faster that is demanding that we be able to learn new skills fast and learn them continuously throughout our careers, we need to find a way to shift the business model away from certification.
We need to find a way to change the education system to actually make it about getting an education.
If you want to talk more about coding and learning programming, Masa and I would love to hear from you, so come by DisruptingJapan.com/show139 and talk to us, and also, be sure to check us out on LinkedIn or Facebook, but even better, if you like the show, tell people about it. It’s Tell-a-Friend Tuesday or Welcome-a-Friend Wednesday, or something appropriate for whatever day you happen to be listening to this podcast on. In today’s world of social media, an honest recommendation means so much.
But most of all, thanks for listening and thank you for letting people interested in Japanese startups and innovation know about the show.
I’m Tim Romero and thanks for listening to Disrupting Japan.