Shownotes
Kendrick Wong
Bio
Kendrick Wong is the Founder and CEO of Kasagi Labo, an anime venture studio bringing authentic Japanese anime to global audiences. A seasoned entrepreneur and investor with successful exits across Asia and Europe, he was named a Forbes 30 Under 30 honoree in 2019. Under his leadership, Kasagi Labo has raised $20M to drive innovation in anime licensing, distribution, merchandising, and original productions.
Kendrick Wong was named a Forbes 30 Under 30 honoree in 2019. Link here: https://www.forbes.com/profile/kendrick-wong/
Intro
Kendrick Wong's groundbreaking endeavors in the anime industry signify a profound transformation within a realm traditionally dominated by Japanese conglomerates. He has established the first foreign-owned anime production fund, thereby gaining unprecedented insider access to one of the world's most insular entertainment ecosystems. Throughout our discussion, we delve into the intricate nuances that differentiate anime from Western animation, particularly focusing on frame rates and storytelling techniques. Kendrick elucidates the remarkable shift in global anime revenue, which has now surpassed domestic sales in Japan for the first time in history, reflecting a burgeoning interest and demand that transcends cultural boundaries. This episode serves as a testament to the power of cultural bridges and the recognition of niche subcultures poised to explode into mainstream success, offering invaluable insights for aspiring entrepreneurs and investors alike.
Conversation
A profound exploration of the anime industry unfolds as Kendrick Wong, a visionary entrepreneur and investor, shares his transformative journey through the intricate landscape of animation. With a background steeped in manga, Kendrick's profound appreciation for the art form propelled him to establish the first foreign-owned anime production fund. This pivotal decision emerged from his recognition of a seismic shift within the anime market, where global revenue has now eclipsed that of domestic Japanese sales for the first time in history. Kendrick articulates the nuances of anime's unique frame rates, contrasting them with Western animation practices. He elucidates the artistic choices that underpin the distinct aesthetic of anime, revealing how historical economic constraints have shaped its evolution into a celebrated art form. Throughout the discourse, Kendrick emphasizes the importance of cultural sensitivity and strategic partnerships as he navigates the traditionally insular Japanese entertainment ecosystem. This episode serves as a testament to the burgeoning global appetite for anime and the innovative pathways being forged by those who dare to bridge cultural divides.
Takeaways
- Kendrick Wong's journey into the anime industry showcases the intersection of passion and entrepreneurship, emphasizing the importance of cultural sensitivity in global markets.
- The anime industry's significant shift towards global revenue surpassing Japanese domestic sales reflects changing consumption patterns among younger audiences.
- Kendrick's approach to investing in anime IPs highlights the necessity of strategic partnerships over mere financial input for successful market entry.
- The unique frame rate of anime, traditionally lower than Western animations, creates a distinctive aesthetic that has become an art form despite its origins in cost reduction.
- Kendrick's fund, Kasagi Labo, operates as a content production fund rather than a traditional venture capital fund, aiming for complete ownership of IPs to control their success.
- Understanding the cultural nuances and history of the anime industry is crucial for foreign investors aiming to penetrate this complex market.
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Transcripts
Hello.
Speaker B:Please meet today's guest, Kendrick Wong.
Speaker A:How is it different than, you know, other kinds of animations, cartoons, those sorts of things.
Speaker C:So it's based upon the frame rates.
Speaker C:Basically, let's say in western animation.
Speaker C:Let's go into things like Pixel for example, you have basically at 24 frames per second.
Speaker C:So, so you have created four different like moving images or you can go up to the 36, even of some 48.
Speaker C:So every action looks very fluid.
Speaker C:So let's say a hand movement, if you're moving your head up and down, for example, it looks very fluid like this.
Speaker C:But anyway, their frames is only 12 frames per second.
Speaker C:So your hand frames, let's say here, here, here, here, here.
Speaker C:It just, it keeps changing and you can't.
Speaker C:And because it's 12 frames per second, your eyes have to fill in the gaps themselves.
Speaker C:So that's the main difference between an anime animation.
Speaker C:That is the storyline, the plots, those kind of things.
Speaker C:The design style is based upon the frames per second.
Speaker B:What happens when you read manga every day for 30 years, then decide to disrupt a $25 billion industry dominated by Japanese conglomerates?
Speaker B:Today's guest has done exactly that.
Speaker B:Building the first foreign owned anime production fund and gaining insider access to one of the world's most closed entertainment ecosystems.
Speaker B:From Malaysia to Singapore to twice monthly flights to Tokyo, Kendrick discovered that anime has hit a massive inflection point.
Speaker B:For the first time in history, global anime revenue now exceeds Japanese domestic sales.
Speaker B:We're talking about a market that just crossed 25 billion and shows no signs of slowing down.
Speaker B:You'll hear how he convinced legendary anime veterans to back his vision, why he chose a 100% ownership model over traditional investment approaches and the fascinating cultural bridges he's building between Eastern storytelling and Western distribution strategies.
Speaker B:But this isn't just about anime.
Speaker B:It's about recognizing when niche subcultures are about to explode into mainstream markets.
Speaker B:The power of authentic passion and business.
Speaker B:And why sometimes the best funding strategy is isn't about needing money, but about needing the right partnerships.
Speaker B:I'm Jothi Rosenberg and this is designing successful startups.
Speaker A:Well, hello Kendrick and welcome to the show.
Speaker C:Thank you.
Speaker C:Thanks for having me.
Speaker C:Appreciate this.
Speaker A:Yeah, I always start with this, which is, you know, context, setting.
Speaker A:Could you tell us where you're originally from and where do you call home now?
Speaker C:So I'm originally from kl, from Malaysia, but I call Singapore home at this point in time.
Speaker C:I traveled to Tokyo like twice a month for the past maybe like 18 months so far.
Speaker C:So I'm not really sure where my home is at this point.
Speaker C:But given that I'm always like in between cities and countries and in fact.
Speaker A:Right now, this moment, you're sitting in Chicago, you told me.
Speaker C:Yeah, yeah, yeah, I am.
Speaker C:I'm just here for a quick conference and then after just meeting a few people, have a few meetings, and then I'll be flying off tomorrow night.
Speaker C:It's literally just a very quick trip.
Speaker A:So for those of us that don't jump on a plane and fly for 18 hours routinely like you do, what is your secret for getting through such a long flight?
Speaker C:You know, it was easier when I was younger.
Speaker C:It's getting harder as you, as you age.
Speaker C:The only thing that helps me now is that I like to take day flights because I tend to work on the flights.
Speaker C:Night flights or ring eyes are very rough for me because I'm neither here nor there.
Speaker C:I just pop a melatonin and it helps you sleep as well.
Speaker C:But I try to prioritize daily flights as much as possible just so I can get there fresh.
Speaker C:And I tend to then change my sleep cycles depending upon where I'm going.
Speaker C:So if I know that it's morning that time, then I would just like, I'll stay awake.
Speaker C:If I know it's night, I'll just force myself to sleep just so I don't get jet lag.
Speaker C:That is like a main killer for me.
Speaker A:Your focus, the.
Speaker A:The market that you're in is the anime industry.
Speaker C:That's correct.
Speaker A:You've been in that industry.
Speaker A:But.
Speaker A:And, and you.
Speaker A:And you've built some companies and.
Speaker A:And I hope you'll tell us about that in a second.
Speaker A:But, but you're also an investor now and you're investing and you've created a fund.
Speaker A:So why don't you start by telling us how you got into this industry, the anime industry.
Speaker C:So the anime industry is.
Speaker C:I mean, I've been reading manga, so anime comes from manga.
Speaker C:And I've been reading manga since I was 8 years old every single day, even to this date.
Speaker C:Is that one of the only things that keeps me like.
Speaker C:It's my place of relaxation.
Speaker C:So when I read a manga, I just feel relaxed.
Speaker C:The storylines are interesting and that naturally progressed into more anime as I started getting a bit older.
Speaker C:So when I was like 8, I was manga all the way.
Speaker C:When I was 15, I started becoming anime all the way.
Speaker C:Now it's more of a mixture of both.
Speaker C:So when my period started, I didn't work out, and when I didn't work out, I got quite burnt out and during that burnout period, I just wanted to find a way to center myself again.
Speaker C:And I found out that the centering point of that was going back into manga and anime.
Speaker C:So one of my first trips, my first holidays in like 13 years was to Tokyo.
Speaker C:And my only mission in Tokyo was to figure out how to enter the anime industry.
Speaker C:Because I just simply wanted to be part of this industry that I really enjoyed.
Speaker C:And at that point in time I realized how closed off the industry was as well, which was an interesting challenge to solve.
Speaker C:And I'm very like problem solution oriented.
Speaker C:And I.
Speaker C:The more I started understanding around the industry, the more I got like, like I fell in love with it.
Speaker C:That's how I ended up over here.
Speaker A:Was there something about the, you know, the, the jerky.
Speaker A:I mean that's not the right word, I'm sure, but.
Speaker A:But the jerky motion that, that they wanted, you know, as opposed to the western style of, of, you know, large numbers of frames per second.
Speaker C:There's a lot of money.
Speaker C:So when anime started, Japan was going through like a recession and the cost of paper was quite high and everything used to be hand drawn, so to say, for the cost of paper they did 12 sheets per second.
Speaker C:So it was more of a necessity than anything else.
Speaker C:And it stayed that way.
Speaker C:And you know, so because people started liking it and their style got very used to it, I mean, they saw no reason to change it.
Speaker C:But a lot of craft and artwork from Japan starts out with necessity and then becomes an art form.
Speaker A:Okay, that's very interesting.
Speaker C:Yes.
Speaker A:This fund that you have now, that's not the first thing you did in the industry.
Speaker A:So what was the first thing?
Speaker A:Did you start your own anime company?
Speaker A:What was that first step?
Speaker C:So the first step was that I simply wanted to enter the anime industry.
Speaker C:And I found that I wanted to invest into anime IPs because I figured that one of the best ways for me to showcase my love for the industry is to help contribute to his growth.
Speaker C:So I went around the anime industry in Japan and I started talking to a lot of animators, the studios, the IP owners, the publishers, basically the entire food chain.
Speaker C:And I started getting know a lot of them better.
Speaker C:And I made a couple of investment offers as well as I did a couple investments in the end.
Speaker C:So all of those came out of like my personal pocket at that point in time.
Speaker C: t into a company beginning of: Speaker C:And the reason why I did that was because I just realized two points in particular.
Speaker C:The first thing was that the Anime industry focuses a lot within Japan and they market and heavily within Japan, despite how big the global anime industry was.
Speaker C:So that was the first interesting point to me.
Speaker C:The second point to me was that the anime industry historically seems a niche subculture, but you find that 1 in 3 gen Zs watch anime at this point in time and they consume it religiously.
Speaker C:So anime has moved away from a niche subculture into more mainstream.
Speaker C:But it's very hard to see this unless like, unless you're part of the Gen Z ecosystem at this point in time or you've actually seen the growth with the conventions.
Speaker C:So one easy example is that in la, there's a convention called LA Expo.
Speaker C:It's the biggest anime expo in the world.
Speaker C:You just go there for one day, two days and you just get immersed in the crowd.
Speaker C:You see the thousands, hundreds of thousands of people that are just flying around from all across the world just to attend the event.
Speaker C:So that's basically how big anime is getting towards.
Speaker C:But most of the time, most of the investors they see as a very new subculture.
Speaker C:So I thought I want to change the perception of anime as well.
Speaker A:This fund is at all like a traditional venture capital fund.
Speaker A:Have you gone out and found limited partners that are your backers?
Speaker A:What is the structure that you've come up with?
Speaker C:It's a very similar structure to a typical fund VC fund.
Speaker C:We have LPs that will back the fund, but it's a content production fund compared to a venture investment fund.
Speaker C:So what we do is that we invest into enemy IPs into and then the proceeds of those of the fund is then distributed towards limited partners.
Speaker C:So the main way that we monetize the fund is through the distribution of the ip where there is content distribution, whether that is, let's say secondary revenue distribution such as licensing, the gaming rights, merchandising rights and the like of those.
Speaker C:So it's a, it's more of an atypical fund targeted towards a different kind of like risk profile compared to venture capital funds as well as different type of like group of investors.
Speaker C:Because historically and even today access to like Investing to anime IPs is almost impossible for any, any foreigners in the world.
Speaker C:It's a very largely Japanese owned conglomerate investment vehicle.
Speaker A:Your fund is more like a Hollywood movie production company, right?
Speaker A:Isn't it?
Speaker A:Because you know they have to come up with the money.
Speaker A:They, they get the, the, the IP produced and then they start making money when it's distributed.
Speaker A:Is, isn't it similar like that?
Speaker C:It's somewhat similar so I've actually like invested into a couple of Hollywood production funds.
Speaker C:It wasn't typically to my liking for two reasons.
Speaker C:The first reason is that you have to be the first window of investment for you to make money.
Speaker C:If you're a second window in Hollywood, you tend to lose money.
Speaker C:And the second reason is that most of the money that comes from lease are very largely the box office revenue.
Speaker C:And rarely does it go into more secondary revenue streams.
Speaker C:Which again, it would be the merchandising, the gaming rights, the music rights.
Speaker C:I mean, it goes on quite a bit, but those are the parts that's more interesting to me.
Speaker C:How do we monetize that particular part of the ip?
Speaker C:How do we grow that?
Speaker C:So that's the main difference between the production fund for anime as well as Hollywood IPs.
Speaker A:And the name of your fund is Kasaji Labo, is that right?
Speaker C:Yes, correct.
Speaker C:So Kasagi Labo is the name of the company as well as a fund, Kasagi.
Speaker C:If you look towards like the Japan, the Kasagi basically means a bridge and Labo is labs.
Speaker C:So it's meant to represent the, the bridge between the east and the West.
Speaker C:Because a lot of our approach to like anime investments comes more the Hollywood style.
Speaker C:Like we want to market the IP like 18 months ahead of schedule compared to typically 3 months ahead the release.
Speaker C:But we want to also appreciate the Eastern culture, the Japanese culture, because it's very important that when you enter into a new industry as well as a new country, you do so by respecting the culture that you're entering into.
Speaker A:Has the Japanese industry accepted you or are they treating you like an outsider?
Speaker C:Interestingly, they've accepted this.
Speaker C:It took a couple of months to get it done.
Speaker C:Like maybe, I don't know, six months, nine months.
Speaker C:But we really actually see as an insider at this point in time, we're invited to a lot of other investment deals to sit the table to represent the global interest side.
Speaker C:It's actually been a very enjoyable experience for us.
Speaker C:So one of our advisors is a guy, he's called Masa Maruyama.
Speaker C:He's an extremely gentleman figure.
Speaker C:He founded a studio called Mapa, which is one of the biggest anime studios in Japan.
Speaker C:So someone like him basically has been supporting us since the inception of the company.
Speaker C:Once we explain our vision to them, the ones that start believing in us, going to their friends, explaining to their friends what we're trying to achieve as well.
Speaker C:And that has been extremely helpful for our growth.
Speaker A:Hi there.
Speaker A:I hope you're enjoying the show.
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Speaker A:Now back to the podcast.
Speaker A:So there are other funds that all invest in anime.
Speaker A:How is yours?
Speaker A:What's the fundamental difference that yours has?
Speaker A:Besides the fact that you're not just focused on Japan, you're really broadening the market.
Speaker C:So at the moment in the market, there's no existing anime production fund.
Speaker C:The only ones that are different days, this would be like entirely Japanese owned or owned by the banks in Japan.
Speaker C:But it's also a bit harder for them to gain traction.
Speaker C:And the reason why is that their distribution model is very different from our distribution model.
Speaker C:So they try to go off to maybe invest into 10, 20% of the production committees which creates an anime.
Speaker C:But our production fund wants to own 100% of the IP, which means that we take 100% of the production committee system within the anime investments and we decide the success or failure of the ip.
Speaker C:And we heavily market the IP to ensure they're successful as well.
Speaker A:So in the anime industry, are there the equivalent of stars?
Speaker A:I mean, and it would, you know, are they the artists?
Speaker A:Are they the, are they writers?
Speaker B:They're writing, are they writing the scripts?
Speaker A:Who, who is sort of the, the, you know, other than the funder, you know, the money, who, who is the, what type of person is the leader in terms of the creativity behind anime?
Speaker C:So interestingly on this as well, it's less on the individual and more of the company that represents its interest.
Speaker C:So in the anime industry, it starts with manga, right?
Speaker C:And in manga you have a publisher who publishes the manga.
Speaker C:So it's like Penguin books in the US for example.
Speaker C:And this publisher has a lot of control within the industry.
Speaker C:So very largely they are the ones that decide the success of PLL or something.
Speaker C:Now the writer is very valuable as well, but they're less like hit writers or manga cast compared to the publishers.
Speaker C:So the publishers are the deal makers, they're the realists and dealers over there.
Speaker C:You work with the right publisher, you can be successful.
Speaker C:Now the challenge in this same component, right, is that if you think about it from a perspective of the west, where you have the stars and the stars depict whether you get any viewership or not.
Speaker C:In this case, it's the voice actors that plays into it.
Speaker C:It's a studio that works on it.
Speaker C:And then eventually it's a marketing that's done behind it as well.
Speaker A:So you've entered this, you know, this Japanese originated industry.
Speaker A:Do you speak Japanese?
Speaker C:I wish.
Speaker C:I'm learning at the moment.
Speaker C:So I understand Japanese, but I don't speak Japanese.
Speaker C:But it's helpful enough for me to like understand what everyone is saying in the meeting.
Speaker C:But my replies are a bit poor at this point in time.
Speaker A:You know, is there another language like English that you can use as a.
Speaker B:As an intermediary?
Speaker A:Do a lot of the people that you're talking with speak English or not?
Speaker C:So I typically like I have 50 members that are fluent in both English and Japanese.
Speaker C:So they help translate everything within the meeting itself.
Speaker C:So every single meeting I always bring a translator with me.
Speaker C:But the CEO of my Japan office is an industry veteran in the industry as well.
Speaker C:And he speaks fluent English and Japanese.
Speaker C:So he is also a huge part of the webex successful.
Speaker C:His name is Tony Izumi.
Speaker A:That's super helpful.
Speaker A:So is there a market for this in Europe as well?
Speaker A:And I guess you're working on expanding into the us so where else besides the US will you be going?
Speaker A:Is it Europe or not?
Speaker C:Europe is one of the markets we want to go after Latam as well as India.
Speaker C:So basically hyper social markets that has a huge demand for anime.
Speaker C:Have you heard of cosplay before?
Speaker C:Cosplay is basically like your cosplay as a character.
Speaker C:So you're dressing up as a character within either.
Speaker C:I mean the western sides.
Speaker C:Like let's say you can dress up as Sonic the Hedgehog.
Speaker C:I mean that's easy as well.
Speaker C:But let's say in the west you can do like Deadpool for example.
Speaker C:Or let's say.
Speaker C:So let's say you dress up as Deadpool.
Speaker C:So that's cosplay.
Speaker C:Cosplay is huge in anime culture.
Speaker C:If you go to anime conventions, you'll find that maybe like 5% of the guest does cosplay.
Speaker C:Now cosplay originated from France, not from Japan.
Speaker C:Because if you think about it, the French, I mean the fashion scene there is very strong.
Speaker C:Right?
Speaker C:Which is how cosplay originated from.
Speaker C:So I mean, just to say that Europe is massive for anime, so is Latam as well as India.
Speaker C:So those are the markets we're going after outside The US has everything in.
Speaker A:Your building up this, this fund.
Speaker A:Has everything gone smoothly or have you had to, you know, you make, you know something bad happens and then you have to sort of work around it.
Speaker A:Have there been those kinds of big challenges?
Speaker C:Not yet.
Speaker C:But I think that the reason I say not yet is because I think that every time we do any form of business there's always a challenge.
Speaker C:You don't anticipate that Rails is ugly hate once you're like you least expect it.
Speaker C:So today the answer is no.
Speaker C:Tomorrow I'm not so sure.
Speaker C:But there's nothing that we've anticipated most of the possible challenges already and we haven't encountered anything yet.
Speaker C:But I'm just like always like yeah, I'm always hopeful but also like doubtful and always like I'm always like thinking about what could occur.
Speaker B:And when you first got started you.
Speaker A:Were able to self fund, you used know your own money.
Speaker C:Yes.
Speaker A:And, and, and had you been in business before that where you were able to you know, generate some returns so that you had the money to, to go do this?
Speaker C:Yeah, I had a couple of like non startup traditional businesses before and those like perform extremely well.
Speaker C:You can think of it as like trading before Alibaba was around those kind of things like physical goods trading.
Speaker C:But I also did private equity as well as digital trading.
Speaker C:So those were very largely successful for me and those were how I gained the profits to be able to invest into anime it's and other things directly.
Speaker C:So my entire idea was actually to not go down the route of raising external capital was to initially fund everything myself.
Speaker C:But the reason why we moved away from that is because of partnerships.
Speaker C:We found that for us to win more and more deals in Japan we had to showcase who the partners were.
Speaker C:So it was very important for us to work with distribution partners or find people who can help us.
Speaker C:The distribution of the IPs that we then invest into for us to be able to even win the IPs over.
Speaker C:So that's the reason why we started raising external capital for this.
Speaker A:What types of Companies are these LPs.
Speaker C:Mostly so they fit into two types of groups.
Speaker C:Typically the first one is maybe less strategic but very strong interest as well is ability for us to raise follow on capital.
Speaker C:Those are more the family officers.
Speaker C:So typically it's the second generation that access to their family office at that point in time and they grew up reading manga, watching anime, same like me.
Speaker C:Then the second group of people are more the conglomerates.
Speaker C:These actually largely exist in Japan.
Speaker C:So that one the portfolio approach to investing into any IPs.
Speaker C:Since they're investing directly into the IPs, they want to invest into a number of IPs.
Speaker C:So they found that the portfolio approach first is a better bet for them.
Speaker C:Given that, I mean IP is the same as venture capital is.
Speaker C:Like you're looking for the hit.
Speaker C:So something that can return 100x over.
Speaker A:Like what is the size of the market today for Animate the market size.
Speaker C:At the moment, 25 billion USD huge.
Speaker A:Okay, so what percent of that is is still Japan.
Speaker C:Japan is 40% at this point in time.
Speaker C:60% is overseas already.
Speaker C:That's the reason why Japan, the Japan.
Speaker C:I mean, that's the reason why the animation is focusing outside Japan at this point in time.
Speaker C: It was: Speaker C:That was the first time ever that global sales outpaced Japanese sales.
Speaker C:And that was a huge like news to the anime industry because that showcased that global demand.
Speaker C:But if we trace back towards it, right?
Speaker C:The reason why this ended up happening was also during COVID During COVID you couldn't produce Live Actions, right?
Speaker C:Because I mean, you're all restricted.
Speaker C:So what ended up happening was that you can still produce anime, given that you can produce anime from your home.
Speaker C:So anime was still being released and Live Actions had a huge decrease in productions.
Speaker C:And then you had to write a strike after that in Hollywood.
Speaker C:This means that the shows that were readily available was anyway and that became people's choice.
Speaker A:Where do you think this will go?
Speaker A: Because you just described: Speaker B:And here we are just three years later.
Speaker A:Where, how big do you think the market will be and where will be the fastest growth areas, say in five years.
Speaker C:So let's look towards other like initially niche subcultures to eventually hit mainstream and how quickly it grew.
Speaker C:You can see it from let's say the sneaker market.
Speaker C:You can see it from K Pop.
Speaker C:Once the inflection point happened, the growth rate of subcultures goes exponentially fast because it moves from being something that you're shy to talk about to something that you want to talk about.
Speaker C:So that's the same pace for anime.
Speaker C:I'm quite sure it hit maybe around 50, 60 billion dollars in the next five years.
Speaker C:It really will go through accelerated pace of our growth because it has hit the inflection point for it to grow already.
Speaker A:Wow, that's amazing.
Speaker A:Doubling in five years.
Speaker C:Yeah, there's a hope.
Speaker C:That's a dream.
Speaker C:But I'm pretty sure it's realistic as well for that.
Speaker A:What advice would you give for founders in general because you've had a pretty, you know, pretty amazing path.
Speaker A:I mean, you made an interesting decision and it wasn't based on the fact that you needed the money, but you needed the partnerships to sort of attract more people.
Speaker A:What would you say to founders about whether they should really try hard to bootstrap or raise some money from venture capital so they can grow faster?
Speaker C:I think something really strongly depends upon like what is your expected outcome that you want to achieve.
Speaker C:So when you bootstrap and the entire decision making process belongs to you and the timeline belongs to you, but once you take external capital, there's a cost of the capital as well and you have a responsibility to capital towards the investors who have invested into your company.
Speaker C:So because of that there's expected return.
Speaker C:So unless a company that you have has an exponential possibility of doing 100x from where you are today for the seed round at least then it doesn't make sense for you to take venture capital.
Speaker C:You're better off like going after typical bootstrapping model or going after a loan.
Speaker C:99% of companies actually should go after that model and not go after the VC model.
Speaker C:VC model is actually very high growth, high stress and you're looking for very outsized outcomes to achieve.
Speaker A:Well, in my case, so I'm still working on my ninth startup and it's a hardware based startup, so the capital requirements are quite large.
Speaker C:So how do you raise the rally?
Speaker C:What was your story that you told?
Speaker A:Well, what I told was that this was an enormous market because it's a cybersecurity hardware play and it gets cybersecurity right in the chip.
Speaker A:No one else was doing that.
Speaker A:And the need is, is, is really extreme because you know, right now the, the bad guys are starting to figure out how to make cyber attacks that hurt people or kill people.
Speaker C:Yeah.
Speaker A:And so they're getting more and more dangerous and, and really need to be stopped.
Speaker A:And, and you can't stop them with software based cybersecurity because what they're doing is attacking software that has bugs in it.
Speaker A:Yeah, software has bugs in it, of course.
Speaker C:So.
Speaker C:Well, amazing.
Speaker A:So tell me something, and this is going to be sort of my, my closing question.
Speaker A:You have clearly, and so do a lot of founders.
Speaker A:I mean most founders have grit, by which I mean resilience and drive and just able to, able to withstand, you know, any of the, the bumps along the way and able to withstand 18 hour flights.
Speaker A:What, where is, what is your source of grip?
Speaker A:Where did it come from for you?
Speaker C:It was my grandfather.
Speaker C:He was an entrepreneur.
Speaker A:He.
Speaker C:He came from nothing.
Speaker C:He made something for himself.
Speaker C:And the way he did it was that he simply, like he had perseverance.
Speaker C:He tried a lot of things, a lot of things failed.
Speaker C:And his entire, like, philosophy in life is that if you don't try something, you never know whether it's going to work or not.
Speaker C:So he also said that he always told me that hard work always pays off, but you just have to think about where you want to spend your time as well.
Speaker C:So it was really my grandfather that actually got me to this, to become who I am today.
Speaker A:Well, that's great.
Speaker A:And what sort of things was he ultimately successful building?
Speaker C:He built one of the largest or the largest, like car company in Malaysia.
Speaker C:So he became very successful for that.
Speaker C:And that's always a learning that I took away from it as well because he did something in the industry whereby it was very difficult.
Speaker C:Building a car company is a bit challenging.
Speaker C:So a lot of times when I go through like, tough times, I always think about what he went through.
Speaker C:I realized that a lot of things I do is very minuscule compared to the amount of, like, challenges he had for himself.
Speaker A:Is that company still in existence?
Speaker C:Yes, it's still in existence.
Speaker C:It's doing extremely well at the moment.
Speaker C:My brother has passed away, but his company lives on.
Speaker A:Wow, that's great.
Speaker A:That's.
Speaker A:Sorry that he's passed away, but that's a great story.
Speaker C:Thank you.
Speaker C:Thanks for having me.
Speaker A:Do you have any other last words for people that might be watching or listening to this podcast episode?
Speaker C:Yeah.
Speaker C:If you want to make money, startups is the worst way to do it.
Speaker C:It's the worst chance of success, but it's the most enjoyable thing you can ever do.
Speaker A:I totally agree with that.
Speaker C:Yeah.
Speaker A:Yes.
Speaker A:Thank you.
Speaker C:Yeah, Appreciate it.
Speaker C:Thank you.
Speaker C:Thanks a lot.
Speaker B:Before we wrap up, here's your founder toolkit from Kendrick's Journey.
Speaker B:First, recognize inflection points in subcultures moving mainstream.
Speaker B:Kendrick saw that one in three Gen Z watches anime religiously.
Speaker B:But most investors still see it as a niche.
Speaker B:Look for markets where consumption patterns have shifted but perception hasn't caught up.
Speaker B:That's where massive opportunities hide.
Speaker B:Second, respect the culture you're entering, especially in international markets.
Speaker B:Kendrick spent months learning Japanese business customs and brought on local industry veterans as partners.
Speaker B:Don't try to disrupt by bulldozing.
Speaker B:Success comes from bridging cultures, not replacing them.
Speaker B:Third, consider strategic fundraising beyond pure capital needs.
Speaker B:Kendrick could self fund, but raised external capital specifically for partnerships and deal access.
Speaker B:Sometimes the value of investors isn't their money, it's their relationships and credibility in your target market.
Speaker B:That's your toolkit.
Speaker B:Now go find your inflection point.
Speaker B:That's our show with Kendrick.
Speaker B:The show notes contain useful resources and links.
Speaker B:Please follow and rate us@podchaser.com designing successful startups.
Speaker B:Also please share and like us on your social media channels.
Speaker A:This is Jothi Rosenberg saying TTFN Tata for now.
