Koots Green Tea

Abstract

“When I first met my wife in college I brainwashed her into believing that I wanted to start my own business in the future,” said Kouta Matsuda, a 37-year-old entrepreneur to his companions over lunch at the first Koots Green Tea store in the Akasaka district of Tokyo, Japan, in mid-December of 2006. Matsuda did not mention that what he had once proposed to his future wife was not only unusual, but also would require him to overcome overwhelming odds. Japanese entrepreneurs faced numerous challenges, including a very small domestic angel investment and venture capital community relative to the United States, a society that preferred the job security of elite government ministries or large corporations to risk taking, and a culture characterized by “rigid corporate norms” that led to the imposition of severe penalties for failure.¹ Since the early 1990s, the number of business start-ups in Japan were lower than that of closures (Okamoto, 2006). This decline in the entry rate of entrepreneurial businesses and the reversal of the entry rate relative to the exit rate came to be recognized as important policy issues that needed to be addressed. One researcher attributed this decline in the rate at which new businesses were being established in Japan to deteriorating economic conditions in the 1990s, which created a hostile environment that was thought to hinder new business start-ups, rather than to a decline in entrepreneurial potential (Harada, 2005).

Kouta represents a new breed of entrepreneurs in Japan. He is a hero. He is extremely committed. Before I met him, most of the Japanese entrepreneurs I had known were “drop-outs” of the traditional business culture. Their ethics were somewhat suspect, in that they tried to cheat or bypass the system. Kouta is different. He is well educated, persistent, and has a business background. When I first met him sweeping the street outside of his first [Tully’s] coffee store on the Ginza, I asked him one question: “Do you want to grow or not?” He answered, “Yes, but I need help.”

—Hitoshi Suga, Vice Chairman and Board Member, Tully’s Coffee (Japan)