Your Japanese analysts arrive tomorrow

Before moving to the UK a year ago, I lived in Japan for six months, Australia for about a year and Thailand for seven months. In the three months before Thailand I visited about 30 different countries in Europe as part of the Free Market Road Show.

So it’s been a strange few years. But the next four days promise to be the strangest yet.

My sister-in-law, who lives with us here in London, has invited her two best friends from Japan. I don’t think they’ve travelled much. Which makes them the perfect forward guidance on what to invest in.

Technology is tough to predict. What’ll work, what won’t and why. But if something has worked in a foreign country, that could be the edge investors need in predicting whether it’ll go global. Whether the company is worth buying into or not.

A lot of mobile phone fintech is tested in Africa, not the UK, despite our fintech scene. 5G was rolled out in South Korea first. Netflix, Facebook and many others began in the US. Predicting that all these would roll out globally would’ve made investors a lot of money.

When I lived in Japan, it was easy to notice which tech would soon be imported to the UK and Australia. And which tech would soon reach Japan from home.

Taxi doors have opened and closed automatically in Japan for years now – even old cars have the feature. But hailing a cab with an app on your smartphone isn’t big in Japan.

Japanese people overwhelmingly use cash, despite the availability of cards much like ours. My father-in-law plans to use his Japanese credit card on the Tube because his bank offers no fees or foreign exchange costs for doing so. Good luck finding a UK bank that’ll offer this in Japan.

This hodgepodged mix of tech usage highlights the gaps between nations. And those are often investment opportunities. Which is why I’ll be listening very closely to my guests for the tell-tale noise Japanese people make when they find something surprising (“Whoeeeaaaa?”), as well as the common “Kawaiiiii!” when they find something so backward that it’s cute.

Most of those exclamations won’t be useful to tech investors. Such as commentary about the inability of English people to queue properly.

But I bet there will be some gems. Tech opportunities highlighted by cultural differences I didn’t notice before.

It’s tough to give you examples of something I’ve not noticed before, so here are some more examples of what I have noticed…

The speed of trains is a big one. Or trains being late because Transport for London (TfL) has to raid the Transport Museum for spare parts.

Even more astonishing to Japanese people, the Mayor of London was the one who admitted this is where TfL sources its replacement parts. And he admitted it without apologising, resigning, or worse. That’s “Whoeeeeeaaa” to a Japanese person for sure. In Japan, train drivers apologise to customers in person if they arrive late.

UK transport infrastructure is in dire need of an overhaul. And that means a whopping demand for tech gear. More hydrogen buses. New trains. And a lot of rail equipment from the current millennium as opposed to the last one. Who provides all this? Back to that in a moment.

Another shock for our Japanese guests will be the tap water. London’s is not up to Japanese standards. Very obviously not.

Not that the UK is behind on all measures. My other sister-in-law is convinced I’m unemployed after she came to visit us. Nobody could possibly wear the clothes I do to work…

UK grocery delivery provider Ocado just announced that the Japanese shopping company Aeon will be using Ocado’s tech to manage its warehouses. Ocado’s share price was up more than 10%.

I used to go shopping at Aeon. It’s better than any UK supermarket, but quite similar. I didn’t see any home delivery of groceries option though.

Then there’s the small matter of insulation. The Japanese don’t bother with it! They’d rather create a table with an inbuilt blanket and heating system than insulate and heat their houses.

I’ve tried to explain to Japanese people that insulation works both ways – cooler in summer, warmer in winter – but I never got anywhere.

The problem is so severe that gaijin (foreigners living in Japan) use puchipuchi as a solution. They cover their single glazed windows in bubble wrap during winter…

Whoever sells insulation to the Japanese upon their awakening to the modern age (the ancient Greeks used insulation…) will make a lot of money. Until then, I will get sciatica each time I travel to Japan in winter.

The same goes for central heating. When I turned it on, my wife and sister-in-law were convinced the floor would heat up, but the air in the room would still be cold…

I’ll be sure to report back what tech innovations we’re falling behind on.

Until next time,

Nick Hubble
Editor, Southbank Investment Research

Category: Technology

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