Allen Miner - SunBridge Group

May 6, 2019

Allen Miner was born in 1961 in Utah, United States. After graduating from Brigham Young University in 1986, he joined Oracle Corporation in the United States. From 1987 he assisted in the launch of Oracle Japan as its first representative and laid the foundation for growth of record-setting magnitude. Even after that he continued taking an active part in the management of Oracle Corporation’s headquarters in the United States. As the representative director of SunBridge which was established in 1999 solely on Mr. Miner’s own funding, he invested in venture businesses such as IT Media, Salesforce.com, OKWave, Gaia X, Macromill and G-mode, and undertook IPO’s for no less than seven companies. He has invested in over 55 venture businesses thus far, making him an active contributor to the discovery and development of new businesses and industries. In 2007, he was included in Forbes Magazine’s Midas list as a venture capitalist considered to have made remarkable contributions to the value growth of venture businesses in Japan. Furthermore, he was a founding member of the Japan Venture Capital Association and currently serves as its adviser. In February 2011, he participated as a U.S. representative in a roundtable discussion part of “U.S.-Japan Dialogue to Promote Innovation, Entrepreneurship and Job Creation”, an event hosted at Stanford University by the U.S. Ministry of Economy, Trade and Industry, and JETRO. His publications include “I’m Betting on Japan” (Shoeisha, 2001), and a contribution to “Reimagining Japan: The Quest for a Future That Works” (VIZ Media LLC, 2011).

 

Bio source: minerfdn.org

 

Transcript:

 

 

Alan: Welcome back and visiting here today with Allen Miner. He's the CEO and founder of the Sunbridge group. Welcome to today's show.

 

Allen: Great to be here.

 

Alan: So Alan for the listeners, can you establish your history from your educational background to how you came to where you are today?

 

Allen: Probably at the roots of everything I'm doing today is the fact that I was raised as a well behaved Mormon boy in Provo UT. In High School in 1976, I had my first exposure to computer programming in a math class. And about a year later, the Radio Shack TRS80 came out and I became quite an avid hobbyist programmer. And it turns out that in my local church was a leading Professor of Computer Science at Brigham Young University, who when he discovered that I was curious about computer science, gave me access to a very large scale, deck mini computer, helped me find part time work working with a student programmer that eventually became the founder and chief architect of Novell Netware, sSo growing up in a tight knit Mormon community, where people were aware of what one another were doing, and always looking out to help the young kids find their path was critical to my exposure to computer science early on. And then the next thing that you know, Mormons do when they turn 19, we volunteer to go serve as missionaries somewhere in the world and in the church sent me to Hokkaido, Japan. So the fact that I've been in the software industry and now in venture capital industry, in Japan for all of my career, really goes back to my experiences as a well behaved Mormon high school boy in Provo, Utah, with the community of support in my local what we call a ward. The more familiar term for people who don't know the Mormon faith would be parish. So my local church, the community of support and adults around me, kind of set me on a path to be doing something with computers in Japan, which is how my career since 1986 has played out.

 

Alan:  So 1986 when you went over there, and right now you're one of the leading venture capital groups out of Tokyo, but how did you get started?

 

Allen: It's really interesting, because in high school & college, I knew that I wanted to be a computer scientist. So I knew how to do programming. I loved it. And so I had a computer science degree, but I also felt like doing computer science was too technical. It was too much of a trade school type of thing. And I'd have friends taking business classes, and I said, “why would you spend four years in a university learning business? Why aren't you learning the art or history or philosophy?” And so I wanted a second major and I looked at philosophy, I ended up settling on Asian studies as a dual major with computer science. Well, interviewing time comes around and Steve Jobs just started NeXT Computer, and he was talking about AI, I thought as  a computer scientist, 1986, I wanted to do something in the emergence of computer graphics. They were just trying to figure out how to render wood, how to have algorithms create things that look like marble, so computer graphics was just starting to get interesting. AI was still a wild frontier back in 1986. I wanted to do something programming in AI, or computer graphics, and different companies were coming to interview on campus as they do. And the professor that had gotten me access to the deck mini computer years before in high school, was in charge of the research lab that I was heading a research project for. Because I senior and he said, there's this company called Oracle, they do databases and they want to come to interview some candidates. You might want to meet with them, and they were paying a salary about $4,000 a year higher than anything I'd heard from anybody else in my interview process. Sounds like a high salary but database sounds kind of boring, but I'll take the interview. Well, Larry Lynn, this was the very first year that Oracle recruited anybody in colleges. And Larry Ellison was sending his recruiter Larry Lynn, to Harvard and MIT, Carnegie Mellon Cappelli, all the great schools and was trying to recruit the best students out of the best schools. And at the time, the head of sales for the United States at Oracle was Gary Kennedy, an active Mormon Bishop from Chicago. He said, Larry, you should interview at Brigham Young. And this story, the way I heard the story, Larry Turner said “Why would I try to hire anybody from Brigham Young?” And Gary said, “Just trust me on this.” And so I was one of four students out of the initial cohort of 45, hired by Oracle in 1986 that was recruited from Brigham Young. In my interview with Larry Lynn, he looked at my resume, at the bottom of it said, I'm bilingual, fluent in Japanese. Having spent two years as a volunteer for the Mormon Church in Japan. And the first question he asked me was, so you speak Japanese? And I think I'm interviewing for a computer programming job. And I said, Yes, I do. But why is that? Why does that matter? And he said, Well, we are having difficulty with our distributors. In Japan, we don't have a Japanese language product. And they're saying they need it. And we're looking for someone who can speak Japanese and do programming to figure out how to get our software working in the Japanese language. That's kind of interesting. So I came down to the interviews in California, database, as a category didn't seem terribly interesting to me as a software category. But all the people I met at Oracle were very bright, very dynamic. The idea that I could combine Asian studies with computer science in a career was something had never occurred to me before that question from Larry Lynn. And that kind of set me on the path to being deeply engaged in the evolution of Japan's IT industry. From the emergence of Oracle in Japan to today.

 

Alan: In the last segment, we talked about how you started a career with Oracle and Oracle had an interest in placing you in Japan. So let's pick up from this transition. When did you decide, hey, I'm going to jump out of Oracle and into the venture industry?

 

Allen: Well, when I was with Oracle for about 13 years, along the way we worked with a distributor for a couple of years, got the Japanese product working and there came a time when we were looking to hire a leader out of Japanese, IBM, to grow the company from $10 million a year business to $200 million. And in that transition, we also put a plan in place to eventually take the Japanese unit public on the Japanese stock market. That happened in 1999. And by 1999, there were about 1500 people in the company in Japan, I was back at headquarters working on projects supporting Japan. And I was feeling like what in Japan, they call this the salary man, nine to five job, easy, well paid great people. But I was starting to get bored with the daily routine of being in mid management at Oracle. And this was also towards what we didn't realize was the at the end of the internet bubble. I t was very much in the middle of the internet bubble in California. Amazon had gone public, Yahoo had gone public. And I looked at the landscape of internet startups in Japan and realize that it was still very early stage very much anymore and thought, once Oracle Japan has its IPO, I should look at either starting an internet company in Japan or potentially investing in and helping internet startups catch up and grow in the way that Silicon Valley startups can. And in a nutshell, the Oracle Japan IPO was much more profitable than I had imagined it could be. And so I decided to apply the wealth that I had earned at Oracle, Japan, in developing the next generation of talent, and helping to develop an ecosystem for startups in Japan, involving work with the government involving IT Training coaching other VCs collaborating with other VCs, coaching entrepreneurs on the Silicon Valley way in order to try and find a unique Japanese approach that balances their diligence and focus on operating profits, with the Silicon Valley approach of financing the growth ahead of the business and sharing the world more broadly, where Japanese startups tend to concentrate the wealth in the in the founder alone, and Silicon Valley companies, as you know, spread the wealth more broadly in the company to reward and engage everyone in the process of creating the business.

 

Alan: So in the in the funding of these early, early stage companies you were working with personal funds who else was funding these companies?

 

Allen: The initial $10 million of investment came from the proceeds of the Oracle IPO from myself, the Japanese president that we had recruited and a couple of other of the executives from Oracle, Japan, all pulled together about $10 million, that initial 10 million went into about a dozen startups in Japan, and also into the creation of a joint venture with Salesforce to take Salesforce into Japan. This was a year after the company been started, they hadn't even started shipping commercial product United States. So Mark, and I had worked the end of our career at Oracle on introducing the network computer concept that Larry had designed, which is essentially the architecture, the conceptual framework, the model, that is what we call cloud competing and SAS today that was successfully implemented, unfortunately, not at Oracle, but by Salesforce and NetSuite and others. So for our last year at Oracle, Mark had been running marketing for the network computer in the United States, me figuring out how to get Japanese partners to engage around it and roll it out in Japan. And a couple years later, he starts Salesforce. I start some bridge, he's looking to do something in Japan, and we worked we designed a new model for bringing software companies into Japan. That was quite successful. And this was all kind of in that initial wave of investing.

 

Alan: How do you decide which companies get funded in which don't?

 

Allen: The core thing that we look for in my group is the global potential of the company. And there are two types of companies that we work with. There is a subunit of Sunbridge  now called Japan Cloud Computing, which focuses on bringing US SAS companies into Japan. We've worked on the success we had with Salesforce, we've subsequently brought in Concur, Marketo, Kyriba are working right now with New Relic and Black Line and Walk Me. And for those come projects, we look for companies that have hit about $100 million in revenues. They have expanded to England and Australia, they're usually doing business in the English-speaking countries worldwide. They recognize that Japan has reputation derived from the reality of Japan of being one of the most difficult markets for us software companies to crack and are open to doing that together with a partner and replicating the model that we did with Salesforce and others. So because they are viable hundred million dollar companies in the SAS world, which is our domain expertise, it's relatively easy to determine that the leadership is good, the product is good and our assumption is that business problems are shared worldwide, that the kinds of problems that American software companies solve for American companies outside of the regulatory space and to some degree, HR is so tied to regulation that HR continues to be challenging, but in general, a company successful the United States should be successful in Japan. And so essentially it with those companies, is the management team flexible about the approach, are they open minded about empowering, truly empowering the CEO that we find for their business in Japan and flexible and open about accepting the advice with third party on how to approach Japan accepting the approach that their CEO might take, which may be slightly different for Japan than the approach that works United States? So is the management team committed to doing Japan well? And are they flexible about the approach? And then it becomes a conversation about how to fairly share the upside and   how to properly fund it, so it becomes an execution question. There's a completely different side of the business, which is investing in local Japanese startups. And there again, we're engaging at a much earlier stage with the companies, some of these are two, two or three guys with a prototype, sometimes their companies with 4 to 5 million in revenues, but they're all very early stage. And with those companies, we're looking for a product that we think if done well, could be viable outside of Japan, that is not just a product for the small business or enterprise business community in Japan. Again, we're looking primarily at software and internet businesses. But it's very early stage and with people that we believe have a product and a personality and a goal to ultimately grow their businesses beyond the Japan, whether before or after taking it public. And so the unifying principle is global potential for the business, a global passion and interest and flexibility and commitment of leadership. And whether it's being cubbies into Japan or finding companies in Japan that have global potential and credible presence around a global opportunity, credible leadership and willingness to engage in meaningful conversation about how to execute on the global passion is I think, the passion, the leadership, the product potential, and the flexibility and openness to ideas from the outside.

 

Alan: What are some of the companies that you've worked with in Japan,

 

Allen: So I've mentioned all of the companies that we've taken into Japan already, some of the companies in Japan are Macromill, which was-  survey monkey is the most equivalent company here or Qualtrix . They were the original online survey company in Japan, one of three, and they ended up acquiring the other two and are the soul winner of the online survey and online market research space in Japan. G-mode is another one, which is the very first company in the world to introduce games on mobile phones. It's also it was the fastest company to go public, it was one and a half years before did its IPO listing in Tokyo. The downside of that was that they traded off the opportunity to go global until they done the IPO. So they thought that setting a record for the speed from founding to IPO would be a cool goal to accomplish. And as they were preparing for their IPO Sprint and AT&T and others discovered they had Tetris working on mobile phones in Japan and they wanted when they rolled out phones here in United States with programming capability. They wanted this company G Mode to introduce Tetris on the US for the US market. And they were in the middle of their IPO their underwriters said don't distract yourselves with anything like that now. And by the time they've gone public six months later, 40 companies had been funded with a total of $300 million to go after mobile gaming and Silicon Valley. And so it's my most bittersweet investment because they were first in the world with a category that is huge today. It's a category that I wonder whether it was a good business to create for society. But you know, as an investment, they were they were very quick on that opportunity. They were quick to go public. Look, they were quick to have an international opportunity. But very sadly, we made the decision together to prioritize a quick IPO over the long play of becoming the dominant global leader in online gaming.

 

Alan: So Allen, how does an aspiring entrepreneur who wants to get funded reach you?

 

Allen: For us companies coming into Japan, the Japancloud.com website is a place to start and for entrepreneurs in Japan- the short is everybody knows how to reach me in Japan.

 

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