Last week, NIFTY, a leading (over $1 billion) internet service provider in Japan, announced a major partnership with New York-based startup Noom to co-create Noom Coach, a diet coaching application for the Japanese market. Noom, backed by VC heavyweights Kleiner Perkins and Qualcomm Ventures, is a leading startup in the mHealth (mobile health) and quantified self space.
Azusa “AZ” Kawahara leads startup partnerships for Nifty in the Silicon Valley. Since Nifty is one of the oldest members of RocketSpace Corporate Services, our corporate innovation program, we were able to interview AZ for an exclusive “straight from the horse's mouth” conversation revealing the details of the partnership.
John Pryor: AZ, Tell us a bit about your role at Nifty.
AZ Kawahara: I have a business development role at Nifty corporation. Nifty is focused on the Japanese market but also seeking partnerships with global startups to help develop and expand new services worldwide together. I am based in the Silicon Valley and my job, with support from RocketSpace, is to scout for startup partners.
JP: Why does Nifty care about diet and mHealth?
AZ: A large portion of the customer demographic of Nifty is between 30 and 50 years old. When we spoke to our customers, we found that health is very important to them. Smart phones are increasingly being used to help people lead healthier lives, and Nifty wants to be a part of that.
Beyond that, we also own a large portal for searching fitness gyms called Nifty Sportsclub and have partnerships with 7 large sports gym brands in Japan. The large customer base we have on this site is very interested in health and fitness, another reason we care about mHealth as we look at the future of our industry.
JP: Why did Nifty choose Noom to partner with? What factors were considered before you selected Noom?
AZ: Two reasons: first off, they already have a strong reputation and customer base in the US and global markets (Noom Coach already has 12 million customers globally).
Secondly, their reputation among VCs and health industry experts is very strong. This reputation is built on the back of their technology. Noom's lead engineer was responsible for building Google Maps and brought unparalleled data mining capabilities to both companies. For this reason, Noom has the highest rate of returning users in its category.
Noom is also extremely good a drawing insights by leveraging user activity data. Our partners, gym and sports clubs, but also insurance companies will be able to leverage this data.
JP: How long did it take to construct the partnership from start to end?
AZ: The deal happened very quickly! Just a matter of weeks. From early July to the middle of August, we finished everything from scouting to diligence to agreement on terms of cooperation between both parties.
Between the middle of August and last week, we co-created the marketing plan for the partnership's launch and prepped the press release for public announcement. Then two weeks ago, the Noom team visited Japan to meet with the executives from our HQ, and last week the partnership went live!
JP: Why do you think Noom wanted to work with Nifty?
AZ: I think that our existing partnerships were critically important to them. We have a ready-made customer base for Noom to tap into. They are very focused on the updated iOS 8 version of their application. In Japan, iOS has a strong market share, so Nifty is a strong partner to help them extend their customer base in Japan.
We have already launched a promotion campaign for one sports gym with Noom. We’re also planning another launch and promotional event with Noom in Japan on October 10th. Of course, we will also continue to promote Noom through our networks.
JP: Did you learn anything from the Noom partnership that you would take into future startup engagements about how Nifty can be more startup friendly?
AZ: For Nifty, communication between the US team and the team in Japan is key. Speed is so important for startups but, in some cases, Japanese corporates can move more slowly. So part of my job is to train the team back in HQ on how startups operate and make sure that the whole company is ready to move at startup speed so the deal can be done. I see a big part of my job as instilling a startup culture into Nifty.
JP: Can you talk a bit about your time at RocketSpace so far?
AZ: RocketSpace helped me scout for a health and fitness project. The Corporate Services team helped me analyse the startup landscape and subtrends within the health and fitness space. Once we understood the landscape, we were able to focus on the startups that were the best solution for our own needs. RocketSpace then introduced us to the relevant startups that they found for us. For Nifty, connecting with these new startups was crucially important. This helped us move much more quickly through the partnership process.
We physically sit on the Rocketspace campus so we work very closely with the Corporate Services team on these scouting projects. We also promote our activities in Silicon Valey through events at RocketSpace Studios. RocketSpace helps us with these activities, which have been a great way for us to get our message out.
JP: What areas has Nifty focused on in the last 12 months and what do you think the next 12 months will look like for Nifty?
AZ: The last 12 months have been a trial for us. RocketSpace is our first office in the U.S. and I have been leading our first full-time partnership team in in the U.S., which has been very exciting. The next 12 months you can expect us to scale our partnership activity in the valley, with a heavy focus on the areas of IoT, omni-channel and the sharing economy. You can expect a lot more partnership announcements in the next 12 months!
JP: Any final comments?
AZ: Our corporate motto is “With us, you can.” If startups are interested in entering the Japanese market, we would love to speak with you to see if we can help.
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