More foreigners than ever are becoming entrepreneurs in Japan. So how did the humble gaijin go from teacher-romancer to founder-disrupter? As we’ll see, it’s all about making Japan a better place to live. But first, a gaijin history lesson.



FIRST WAVE: 1868-1899


If you shipped up in Japan as a foreigner anywhere between 1635 and 1868, the omotenashi was frankly terrible. According to the Sakoku Edict issued during the rule of Iemitsu Tokugawa, foreign sailors trying to enter the country faced immediate and grisly death, unless they were among the Dutch and Chinese merchants granted limited trading rights. Conditions could be described as below-par for anyone looking to start a business in Japan.

Things changed with the opening of Japan and the Meiji Restoration of 1868. The oyatoi-gaikokujin (‘hired foreigners’) were academics, technologists and military men brought to Japan at the invitation of the Meiji Government. The aim was to close the economic and military gap between Japan and western nations, before closing the country again to foreign influence. At the peak of this enormous technology transfer, foreign experts are said to have accounted for a third of the national budget.

It wasn’t planned to last and nor did it. A series of military victories helped to consolidate Japan as a regional power. The Imperial Rescript on Education of 1890 reinforced the divinity of the emperor and curtailed foreign influence. Special rights for foreigners were revoked in 1899. This first wave of foreign influence on Japan had depended completely on patronage, which could be withdrawn as easily as it was granted. The era of the foreign expert was over, or so it seemed.

SECOND WAVE: 1980-2007


Technically, you could trace the second wave of gaijin influence on Japan as far back as 1945 and the occupation years. That period certainly threw up individuals who crossed the cultural divide and became Japan Hands, people who could be trusted to interpret Japan for the outside world and bring it into the postwar political consensus. However, for the sake of our story, we’re going to start in the 1980s, the era of Japan Inc. and the most urgent demand for internationalisation since the Meiji era. Suddenly, Japan became more than an exotic diplomatic posting; it was now a fabulous place to launch one’s career and earn some yen.

The fabled JET Programme, established in 1987, had little to do with education. Stung by criticism of its trade surplus with the USA, the Japanese Government – or rather the Ministries of Internal and Foreign Affairs – devised a programme that would create jobs for young Americans and foster a more sympathetic attitude towards Japan. The programme was quickly expanded to other English-speaking nations and continues to this day. For those who couldn’t get onto JET, there were private-sector alternatives that promised tickets to the same party.

Another kind of playbook emerged for making it in Japan. First, learn the language and drink deeply in the culture. Then, master a skill considered quintessentially Japanese. Finally, attain Buddha status. Or at least enjoy reasonable fame as a gaijin ‘talent’. To this day, Japan maintains a weakness for basking in the admiration of its foreign acolytes. That these Japanophiles were also considered experts on all things outside Japan remains a problematic feature of the national psyche.

The late 20th Century also witnessed the first genuine stirrings of gaijinpreneurship. Foreigners could and often did establish businesses of their own. But these ventures tended to cluster in the linguistic and cultural divide between Japan and the world. Language schools, translation agencies, and business consultancies proliferated. Entrepreneurial as they were, such ventures continued to depend on Japanese custom and cultural smarts for their existence.


A few short years would see a massive flux in the foreign population of Japan. In 2008, the global financial crisis drove out much of the expat set. Belt-tightening across Japan also meant the near-collapse of the English conversation school industry, traditionally the largest employer of foreigners. The Great East Japan Earthquake of March 2011 prompted a further exodus.

Population decline, first recorded in 2011, was the trigger for an aggressive expansion in the numbers of foreign students and tourists. There would be an increase in foreign graduates of Japanese universities and a surge in short-term visitors. If you were here the whole time you could easily have missed it, but something fundamental was changing in the foreign community in Japan.



Today, there’s no lack of entrepreneurial hustle among the foreign community in Japan. But today’s gaijinpreneurs view Japan as simply a base, not an identity. They want the obvious benefits of living in Japan, but not necessarily the role of cultural ambassador. They want to create and build, not just interpret and explain. Third-wave gaijinpreneurs do much more than simply connect Japan to the outside world, though there’s still quite a lot of that too.

Think of the breathtaking pleasures of living in Japan. The misty mountains erupting out of the plains. The train weaving reliably through the boxy clutter. The air-conditioned stillness of the combini with everything in its place. The sense of order and a well-curated life. Gaijinpreneurs get to enjoy it all. But they may get around to solving the imperfections too, the things one could previously only complain about. The language barrier. The banking system. The price of fruit. The peculiar difficulty of finding a decent sandwich.

The more you look around, the more you see it. Old gaijin rivalries have been replaced by a hyper-networked community that’s not so much disrupting Japan as making it a more livable place. Matching platforms, wayfinders, rentals, meetups and experiential travel are some of the products of third-wave gaijinpreneurship. A lot of this is servicing the huge growth in inbound tourism; in fact, it’s now possible to run a successful business in Japan without a single local customer.

Long-term, expect more Japanese people to become users of these products as well. Both the local and foreign startup scenes are already well integrated. Ecommerce, fintech, coworking spaces, virtual teams and social media are the pillars of a new floating world of entrepreneurship that makes many of the old assumptions about doing business in Japan redundant. The media and business establishment have also lost their power as the final arbiter of what gets accepted in Japan.




The smartphone has already been a game-changer for gaijinpreneurs. Smartphone penetration rates in Japan are among the highest in the world and, unlike ten years ago, most handheld devices run on global-standard platforms like iOS and Android. The best digital products are intuitive and work across linguistic barriers. And it helps that Tokyo is a first-class world city for attracting developers and designers.



Explosive growth in foreign tourism since 2012 has caught much of Japan off-guard. And it’s foreign residents who are filling in the gaps with their own media, tours and rentals. Foreigners used to want to keep Japan for themselves, but such attitudes are all but extinct today. Contrary to the domestic narrative of omotenashi, it’s actually gaijinpreneurs who are anticipating the needs of foreign visitors.



Opening a school in Japan is hardly a new idea. But education is undergoing an agile transformation. The future lies more in reskilling and credentialisation than degrees on campus. Delivering global-standard education in Japan through a blended learning model of online study and real-life workshops is fertile ground for a gaijinpreneur. See our interview with Le Wagon Tokyo for inspiration.



It used to be video games or anime, but these days much of the world experiences Japan through its food culture. As the Japanese countryside empties, we predict the next frontier for gaijinpreneurs will be agribusiness, combining techniques from agriculture and marketing to deliver Japan-branded produce for global markets. The sector combines nicely with tourism for a gaijinpreneur double high-five.


    Ian Michie co-founded Globalwheels, a startup that offers high-performance road bikes and gear for rent in Japan. City bike rentals were already available, but Globalwheels was the first to cater to cycling obsessives who want to go off the beaten track. Ian says: “I’m a firm believer that foreign entrepreneurs can bring and offer a lot to business in Japan. Of course the tourism industry offers solid opportunity for English and other language speakers to serve and assist foreign tourists coming to Japan. In this area, the generally low level of English in Japan provides a great opening for English speakers. We receive mails from all over the world in English and when we respond as native English speakers a lot of our clients are relieved and have peace of mind that we are going to understand their needs and be able to manage their trip smoothly.”

    Nizar Grira founded opendoors, a marketplace that connects language learners with conversational bots and human teachers. Like many entrepreneurs, he got the idea after observing a system that wasn’t working, and decided to create something better rather than work within the failing system. He thinks foreign entrepreneurs can bring new ideas and a risk-taking culture, something that Japan has lost: “Unfortunately I’ve witnessed both sides of commitment: a foreign community that is not very attached to Japan and another that thinks Japan belongs to the Japanese and there’s no point in trying to change things. Usually the committed foreigners grasp the culture better and try to add value through entrepreneurship.”

    Workers University is an example of foreigners and locals getting together to create a new type of institution that serves the global community. There were already sites like that had profoundly changed the way people socialise in Japan. But education wasn’t always at the forefront of people’s minds. Workers University is changing that with social learning in English and events like TOKYO IDEA FEST that are a platform for foreign entrepreneurs. This is based on the realisation that “Tokyo maybe be an amazing city, but one thing it lacks is a global heartbeat. The energy and influence of an organised foreign community. We’re all just too busy doing our own thing. Let’s change that. Let’s help each other out.”



Workers University

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