For successful collaboration between startups and business firms, it is essential for both sides to recognize challenges and undergo mindset shifts. JAFCO's Business Development Division, which has been facilitating business matching between its portfolio startups and business corporations, is now focusing on supporting not only its portfolio companies but also other business firms.
One such initiative was the support provided for the business matching program at Japan Mobility Show Bizweek 2024 (formerly Tokyo Motor Show), held in October 2024 at Makuhari Messe. JAFCO assisted 10 participating auto parts companies in preparing for reverse pitches and business meetings at the event.
This time, we will introduce the case of Beyonz Co., Ltd., one of the participating companies. Representatives from Beyonz, JAFCO's Business Development Division, and the Japan Auto Parts Industries Association, which co-hosted Japan Mobility Show Bizweek 2024, were invited to share their perspectives on this initiative.
About Beyonz Co. Ltd.
Founded in 1937, Beyonz is headquartered in Fuji City, Shizuoka Prefecture. The company has an Automotive Division, which manufactures mass-produced parts for automobiles, and a Mold Division, which specializes in the production of molds, jigs, and tools, as well as PVD coating. Beyonz has three overseas locations in addition to its domestic operations.
Interview Participants
■ Beyonz Co., Ltd.
Shinya Takase - Director, Head of Business Operations Department & General Manager
Masahiro Akiyama - Director, Head of Mold Parts Division
Kenta Matsuno - Mold Parts Division, Mold Parts Technology Section
■ Japan Auto Parts Industries Association (JAPIA)
Atsushi Otani - General Manager, Technology Department
Saki Sudo - Section Manager, Technology Department
■ JAFCO Group Co., Ltd.
Takayuki Nishinaka - Principal, Business Development Division
Atsushi Yamamoto - Senior Associate, Business Development Division
Auto Parts Industry Facing Crisis of Decline: What Are the Challenges?
From left - JAFCO's Yamamoto and Nishinaka; Beyonz's Akiyama, Matsuno, and Takase; JAPIA's Sudo and Otani.
-- To begin, can I ask our JAPIA participants if they could tell us about the background behind Beyonz's participation in the business matching program at Japan Mobility Show Bizweek 2024?
Otani (JAPIA): The automotive industry has been rapidly shifting toward electrification in recent years. If this trend continues, about 70% of auto parts manufacturers will see a significant decline in business.
To overcome this crisis, eight companies within JAPIA that already have experience with open innovation formed the Open Innovation Study Group. This initiative aims to support mid-sized and small-to-medium enterprises in launching new businesses and transitioning into new areas.
Around this time, the Japan Automobile Manufacturers Association, which organizes Japan Mobility Show, presented us with the idea of a business matching program. We saw this as an excellent opportunity to take the first step in supporting open innovation. We invited 10 promising mid-sized auto parts manufacturers from the industry to participate, one of which was Beyonz.
Sudo (JAPIA): The Japan Mobility Show is an event that was reborn from the Tokyo Motor Show in 2023. While the 2023 event was a B2C event as in previous years, the 2024 edition was held as a B2B event under the name Bizweek.
As the secretariat representative of the Open Innovation Study Group, I provided behind-the-scenes support to help the ten participating companies succeed in their reverse pitches and business negotiations.
-- JAFCO's Business Development Division was asked by JAPIA to provide support as a mentor to the 10 participating companies. What is the reason for this kind of initiative in addition to supporting portfolio companies?
Nishinaka (JAFCO): Our Business Development Division focuses on enhancing the value of our portfolio companies by providing HR support, marketing & sales support, and back-office support.
For nearly 20 years, we've also been facilitating business matching between our portfolio companies and large or mid-sized corporations. However, successful collaboration isn't just about startups. Addressing the challenges on the corporate side is equally important.
That's why we actively engage in initiatives like this.
One of the biggest challenges for corporations in open innovation is the difficulty of applying existing corporate assets to new business ventures.
This challenge isn't just about organizational culture and employee mindset. It extends to infrastructure and equipment. Even when corporations and startups are interested in collaboration, their assets and services often fail to align effectively.
Otani (JAPIA): The automotive industry follows a pyramid structure, where OEMs (automakers) place orders with Tier 1 suppliers, who then work with Tier 2, Tier 3, and so on. Traditionally, parts manufacturers receive orders based on their expertise rather than proactively pitching their capabilities.
This means that auto parts companies struggle to promote their own strengths. It's like being skilled at arranged marriage but not good at casual dating where self-promotion is required.
Nishinaka (JAFCO): Exactly. Open innovation works best when both parties are on equal footing and one side clearly takes the lead.
It could be a startup supporting a business firm's new project or a business firm backing a startup's vision. Either way, having a clear grasp of one's own assets is crucial to driving collaboration forward.
-- What's Beyonz's perspective? What are the challenges of open innovation?
Takase (Beyonz): I completely agree with what's been said. For decades, our company has been dedicated to manufacturing high-quality, cost-effective parts on time, strictly based on blueprints from clients. Changing that ingrained corporate culture is no easy task. We had discussed exploring non-automotive business opportunities, but to be honest, we didn't know where to start.
Otani (JAPIA): When we conducted a survey on open innovation among automotive parts companies, most of them responded that they felt a sense of crisis about the current situation but did not know exactly what to do.
-- So the offer to participate in the business matching program was a godsend for Beyonz?
Takase (Beyonz): Yes, but I think the feeling "we have to do this" was stronger. There was a lot of anxiety, but we decided to take on the challenge as a first step toward open innovation.
Transforming What's Common in the Industry into Assets is Important
-- What kind of support did JAFCO provide to Beyonz?
Nishinaka (JAFCO): Our first meeting with the Beyonz team was in July, in preparation for the Japan Mobility Show in October.
After that, we conducted a three-hour workshop to establish a mindset for open innovation and to organize their challenges and assets. Using that as a foundation, we then worked on materials for the reverse pitch.
Beyonz put together the initial version, and we provided feedback to refine it. On the day of the event, there was a business negotiation session after the pitch, and we supported them through that as well.
Sudo (JAPIA): I heard that among the ten participating companies, Beyonz was the most proactive in communicating with JAFCO.
Takase (Beyonz): That just shows how anxious we were! (laughs) We scheduled meetings almost every week and gradually shaped our approach.
-- How did the three of you at Beyonz divide your roles?
Takase (Beyonz): I was in charge of the project. Akiyama led the mold manufacturing division, which drives our open innovation efforts, and Matsuno handled the pitch on the day of the event.
Matsuno (Beyonz): It wasn't decided from the beginning that I would be the one to present. As we refined the pitch materials, the discussion came up--"Who should actually present?"--and I ended up being chosen about a month before the event. (laughs) I had only ever spoken in front of colleagues before, so it was completely new territory for me. But in the end, it turned out to be a valuable experience.
-- The large sheets of paper on the wall behind you were used to organize your company's challenges and assets, correct? What kind of advice did JAFCO provide?
Nishinaka (JAFCO): We gave specific advice on how to structure the pitch itself. However, when it came to organizing challenges and assets, we didn't offer direct guidance. Instead, we acted as facilitators, encouraging the team to think critically and come to their own realizations.
Even with nearly 20 years of experience supporting business collaborations between corporations and startups through our investments, we still find that achieving open innovation in a sustainable, repeatable way is extremely difficult.
It's a challenge on the scale of Japan's entire industrial sector, so it's not as if we have all the answers. That's why, rather than giving easy solutions, we focused on thinking through these issues together.
Yamamoto (JAFCO): About 20 employees participated in the workshop, and it was clear that Beyonz is a company where ideas flow freely.
One moment that really stood out was during our factory tour. Someone went out of their way to point out to me that Mt. Fuji was in view, and I was touched by their thoughtfulness. I told them, "That kind of consideration is great," and suddenly, everyone started saying, "Maybe that's one of our strengths!"
Their eagerness to learn while enjoying the process was impressive, and we could feel the positive momentum building.
Akiyama (Beyonz): We've been competing within a specific industry for so long that we never realized things we take for granted might actually be unique.
Mr. Nishinaka mentioned that they "don't give direct advice," but even a casual comment from him or Mr. Yamamoto could spark new ideas. It happened multiple times throughout this project.
-- You mentioned that recognizing the difficulty of open innovation is important. What did Beyonz find to be the greatest challenge?
Takase (Beyonz): While we feel a strong sense of urgency about pursuing open innovation, we don't yet have a clear vision of what our company wants to become. Open innovation is about combining our assets with external ones to create that ideal future. We do have a revenue target of 10 billion yen, but we're still figuring out how exactly to get there.
Nishinaka (JAFCO): During lunch, Mr. Akiyama casually said, "Honestly, I don't even know what I really want to do." That stuck with me. When you're deeply engaged in your business, it's easy to get caught up in what has to be done, making it hard to pinpoint what you want to do.
But when taking on something new, that personal drive is the strongest fuel for success. That's why realizing you don't know what you want is actually an important starting point. Recognizing that is a big step forward.
Akiyama (Beyonz): Through this project, we actually found something we do want to pursue. We haven't fully fleshed it out yet, but we plan to explore its feasibility through market research and such.
Connecting with Unfamiliar Industries and Moving Toward Collaboration
Mr. Matsuno from Beyonz speaks at the reverse pitch session
-- How did the pitch go on the day of the program?
Sudo (JAPIA): Beyonz conducted 26 business meetings. The average for the ten participating companies was about 13, so they were among the top in terms of engagement.
Matsuno (Beyonz): Both corporations and startups could request meetings, and we decided to take full advantage of the opportunity by actively engaging with industries we hadn't connected with before.
We spoke with companies in mobility beyond automotive, robotics, healthcare, drones, and more. Right now, we're moving forward with concrete discussions with two or three of them.
Nishinaka (JAFCO): For large and mid-sized companies, just having conversations with different industries can be a challenge. Many hesitate to take action, thinking that they don't understand it or don't need it. But Beyonz was one of the most proactive companies in requesting meetings. I sat in on a few, and it was impressive how thoroughly they researched the other companies before engaging in discussions.
Aiming to collaborate with other industries by utilizing know-how cultivated in the automotive parts and mold field
-- Before this, what hurdles did Beyonz face in talking with people from different industries? And why were you able to overcome them this time?
Matsuno (Beyonz): Different industries have different norms, and that unfamiliarity made us assume, "It's probably not possible."
But this experience changed our mindset. Now there's a more positive atmosphere within the company, where we think, "Let's just give it a try" and "Maybe we can do this." That shift led us to take action.
Yamamoto (JAFCO): When you think "It's probably not possible," that feeling could stem from different factors; technical limitations, lack of capacity to explore new ideas, or doubts about whether the effort would even be worthwhile. What was the biggest reason for your hesitation?
Matsuno (Beyonz): I think we assumed the benefits wouldn't be significant enough to justify the effort.
Akiyama (Beyonz): We were also afraid of the risks that come with success. But through this project, we realized that if we clearly define what we can and can't do, we can mitigate risks. Understanding that helped us move past our fear.
Otani (JAPIA): In the automotive parts industry, our approach to business has always been about seizing opportunities handed down from above. Once we latch onto something, we gain visibility into the future, and our revenue stabilizes.
However, open innovation demands that we create the future ourselves, and shifting that mindset isn't easy.
Nishinaka (JAFCO): Speaking of what is and isn't possible, one thing that struck me during the business discussions was the stark difference between how established companies and startups define "possible."
For Beyonz, "possible" means they can envision the entire process up to delivery. But for startups, "possible" simply means they can get started. Aligning these definitions is crucial.
-- To successfully advance open innovation, you'll need to foster understanding and support beyond the core members directly involved. Do you see any challenges in that?
Takase (Beyonz): Communicating the importance of new business initiatives across the company is definitely an ongoing challenge. For frontline employees, existing business naturally takes priority.
Nishinaka (JAFCO): Balancing new initiatives with core operations is always tough. But we actually learned something valuable from Beyonz this time. When companies pursue open innovation, they often create dedicated teams to speed up the process. But this can create a disconnect between the core team and the rest of the company.
Beyonz, on the other hand, had frontline employees involved from the initial workshops to the exhibition day, while still handling their regular duties. Assigning already-busy frontline staff to such initiatives can slow things down due to internal coordination challenges. But in terms of internal collaboration, this approach could be a key to success.
Becoming Evangelists to Spread Open Innovation to 6,000 Automotive Parts Companies
-- Lastly, could each of you share your thoughts on the future?
Takase (Beyonz): Having the chance to interact with startups in an unfamiliar field was incredibly valuable. What matters now is ensuring this isn't just a one-time effort. I've already started visiting startup exhibitions myself.
Moving forward, the key challenges will be shifting the company's mindset and clarifying our vision for open innovation. We may continue seeking JAFCO's expertise, but with professional support, we're determined to push ahead.
Akiyama (Beyonz): The biggest takeaway was meeting companies we wouldn't normally interact with and hearing firsthand about their industry needs. If we can create successful case studies, we could significantly expand opportunities for collaboration. Our next step is to carefully organize these needs and work towards implementation.
Matsuno (Beyonz): This has been an invaluable experience. The program itself is over, but now the real work begins. Through this process, we've gained a clearer picture of market needs and industry direction. We hope to expand our business beyond the automotive sector by engaging with diverse partners. But first, we need to turn our ongoing discussions into tangible results.
Otani (JAPIA): The automotive industry accounts for 10% of Japan's economy, and it's supported by 6,000 automotive parts companies like Beyonz. If they face difficulties, it's not just the automotive sector at risk. Japan's entire industrial landscape could be affected. With that urgency in mind, we've been working in a win-win relationship with professionals like JAFCO. But at our current pace of supporting 10 companies per year, we'll only reach 100 in a decade. That's why we need Beyonz to become an "evangelist," to create success stories and actively share them with other companies.
Sudo (JAPIA): When talking with automotive parts companies, a common request we hear is that they want to see case studies from businesses of similar size within the same industry that have successfully engaged in open innovation.
Of course, launching a new business would be ideal, but even just sharing Beyonz's honest experiences and current situation could be incredibly valuable for others. We plan to enhance outreach through new events and seminars to further expand the impact.
Yamamoto (JAFCO): Beyonz is at a pivotal moment, realizing the importance of cultural transformation and taking action. Workshops like this can sometimes be just a formality, but Beyonz approached each step with sincerity. That tells me they already had a foundation for embracing challenges. As they continue exploring their vision, we want to consider how we can support them.
Nishinaka (JAFCO): This initiative made me truly sense the potential of open innovation in tackling industry challenges. I've been facilitating business matching at JAFCO for nearly 15 years, and I've often felt like introducing startups to major or mid-sized corporations was like punching at air. Nothing would happen.
But this time, working alongside Beyonz, even from different positions, we tackled the same challenges together. That gave me a glimpse of a breakthrough. If corporations and intermediaries like JAFCO can genuinely collaborate on open innovation, we can better leverage Japan's existing assets to drive growth in emerging fields. This initiative reinforced that potential for me.
