On Saturday, Jan. 30, three local policymakers, members of the Indian business and student communities and those with an interest in local investment came together to be part of a seminar with representatives of The Indus Entrepreneurs [Link], the world's largest nonprofit association of entrepreneurs. Founded to create a network of Silicon Valley engineers and entrepreneurs from India and Pakistan, the association became a major powerhouse behind Silicon Valley's rise to the status of entrepreneurial Mecca in the early Internet Era. The seminar's speakers included TiE founding member and web pioneer Dr. Kanwal Rekhi [Link], and luminaries of Japan-India trade and business relationships Sanjeev Sinha [Link] and Dr. Devadas Parakkal [Link]. The seminar focused on TiE's strategies for fostering and mentoring entrepreneurship, and Dr. Rekhi spoke in no uncertain terms about what Japan needs to do to stimulate entrepreneurship in its economy: first, inspire dynamism and confidence in young people, and then most importantly, "step out of their way". Dr. Rekhi is not necessarily how you'd picture a millionaire entrepreneur, philanthropist and web pioneer. A calm and unassuming figure following his commanding participation in the TiE seminar, the Indian-American engineer and businessman was surrounded almost constantly at the reception by well-wishers, meishi-holders and those hoping to catch a grain of wisdom from the man introduced as a "godfaza" of Silicon Valley Entrepreneurship. FN was lucky enough to have ten minutes On Record with the guru about his work and the lessons Japan can learn both from Silicon Valley and from the Indus region. FN: In your work you speak a lot about Silicon Valley, but I wondered whether you think Japan has any lessons to learn from India in terms of its capital development and knowledge industries? Dr. Rekhi: India twenty years ago didn't have the large companies that Japan had, and they were much poorer because of it. But the whole of industry has changed since then, and what India shows is that if you allow entrepreneurs to function, trust them to conduct their business, then they can change your society overnight. India's GDP has skyrocketed in the last few years: it's not rich, but a lot richer than it used to be. If you inspire people to become entrepreneurs, give them incentives to do so, and then step out of their way, they can change your whole economy. Japan's problem at the moment is that it's very stable. People are relatively well off; everyone can get a good job, so they don't have the incentive to start their own business. In India many people start at the bottom, with nothing, and so becoming an entrepreneur is the only way to go up in the world. In Japan, if you don't follow along and do as everyone else does, people start to think there's something wrong with you. Entrepreneurs don't do well in that climate. Look at China: China's economy was ten times smaller than Japan's before its economic reform, but because China has allowed entrepreneurship to happen it's grown incredibly fast. FN: What advice would you give to a Japanese potential entrepreneur?Entrepreneurs need encouragement. One issue in Japan is that failure is unacceptable, so there's no culture of risk-taking, because of the notion of "loss of face". Entrepreneurs fail all the time: in fact the majority don't succeed on the first or even the second attempt. That kind of failure is a learning process. I tell people: the sense of shame, the sense of failure is personal: you start to feel like everybody else thinks that you're a failure. But that sense of shame is only inside you. I tell entrepreneurs not to worry what people think. When you fail the first time, because you're just starting out, you don't know how to market, and so on, you just have to say "I wasn't paying attention to something and that made me fail, so next time I'm going to pay attention to it". When you stumble and fall, you don't stay down there, do you? It's my first visit here [to Fukuoka] and I've been very impressed. I'm happy to see here at the University level and the Government level investment is being made and "incubation chambers" are being set up to encourage entrepreneurship. My advice is to follow your dream. Give yourself a chance. And by the way, don't fall in love with your idea. The world is changing very rapidly, your idea might have become obsolete very quickly. In the world today opportunities arise every day. Don't be distracted from other opportunities because you can't change your idea. But most of all, don't let anyone talk you out of your dream. When I was starting, everyone said "Indians can't do this, Indians can't be managers. If I had listened to them, I wouldn't be here. FN: You've been quoted as saying that an economic downturn is the best time to start a company.That's right. Employment is low, rents are low and resources are available. When the market returns -and they always return- you can ride it back up to the top. I always tell people: when you're at the bottom of the mountain, the next step is always up; when you're at the top, the next step is always going to be down. But in the last twenty years all the jobs created in America have been created by entrepreneurs. All of them. You have an idea and you make it your job, and then your job creates a thousand jobs. Look at Yasufumi [Mr. Yasufumi Kanemaru [Link], CEO of Future Architect, Inc. and Keynote speaker at the seminar]. He started by himself in 1987, now he has 1200 people working for him. There's no greater satisfaction than being master of your own destiny. Japan had a history of entrepreneurship after the war. Honda, Sony, all entrepreneurs, but sometime around the 70's and 80's, something changed. Especially the 80's, I think. But during a downturn, there aren't any jobs so you have to create your own. These days Americans who've worked for bigger companies and who've now been laid off, first they get mad, but soon they realize "I worked for IBM for thirty years, and they laid me off." and they decide "I'm never going to let anyone lay me off again." IBM now has half as many people working for them as they did in 1980. People realize now that big companies don't necessarily offer any job security. FN: And there will be better economic times for entrepreneurs to benefit from?The economy will definitely change. In the last twenty years American consumers have been consuming too much, and saving too little. Everyone's been selling to them, but they've been buying with borrowed money. Now the paradigm has to change. Countries like India and China need to consume more, save less, America needs to save more, spend less. Japanese people especially do save too much, spend too little, with too little support for innovation. I believe Japan has to open up its immigration. In 1958, Russia won the Space Race. America realized it didn't have enough entrepreneurs, enough scientists, and it couldn't create them fast enough. So they opened up to experts, they recruited scientists from China, from all over the world to catch up. That's Japan's problem now, with a shortage of new ideas. Japan needs a Sputnik. - Robert Morgan (for Fukuoka Now)