Father of rapidly growing VTuber agency Hololive Productions and CEO of Cover Corporation Motoaki Tanigo talks about what it takes to be an entrepreneur
Cover Corporation runs Hololive Productions, a VTuber agency that posts videos using CGI-generated characters as YouTubers, with a corporate vision to “Make fans around the world go crazy for virtual talent IP from Japan.” Cover Corp. announced a total of approximately 700 million yen in funding in May 2020, including funding from DIMENSION. In this interview DIMENSION business producer Noriyuki Ito talked with the key driver behind Cover Corp’s rapid growth CEO Motoaki Tanigo, asking him about the qualities needed by an entrepreneur and pointers relating to business growth.
The importance of having a genuine vision
ーーWhat are the three key qualities you consider any entrepreneur needs?
If I were to name three, they would be “vision,” “do battle based on what you are good at,” and “never throw the towel in.”
There are two types of “vision” that an entrepreneur can have: a genuine vision, which is based on a realistic outlook for the future of their company, or a fake vision that is a superficial cobbling together of various current trends.
I think it is possible to tell whether an entrepreneur is real or not by determining whether their vision is the genuine article.
Born in 1973. Founder and CEO of Cover Corporation. After graduating from the Faculty of Science and Technology of Keio University, he joined Imagineer Co., Ltd., first working on game software production, before moving onto the mobile phone official site-related business. He launched e-commerce business at istyle Co., Ltd., operated by cosmetics word-of-mouth site @cosme, and was involved in the founding of mobile advertising company UNITED, before going on to establish San Zero Minute Co., Ltd. He developed an O2O business centered on the smartphone application “30min,” the first-ever GPS compatible smartphone app in Japan, before selling it to IID, Inc. He established Cover Corporation in 2016.
ーーSo are you saying that a fake vision is meaningless?
Compared to years ago, IT has helped to lower the hurdles to starting a company, and the financing environment has also improved, meaning that it is now easier than ever before to create services. Having said that, however, it is no easy matter to make a successful business out of internet services.
You cannot build a business by only being good at talking or by having wild ideas.
You need to deeply understand user psychology to be able to create a product that fits the market. And then must scale the company in line with the product. In my view, this is the only way for a startup to grow.
Recently you see cases where startups are repeatedly trying to raise funding based on a vague message that “there kind of seems to be a market here,” and making their companies look bigger than they are. This is a ploy that ultimately won’t end well.
A vision will only ever be genuine if it is a part of an entire package that includes the actual skills to create a product needed by users.
Focusing on what you are good at
ーーSo, once you’ve acquired the capability to actually make a product, is that where your next entrepreneurial quality of “doing battle based on what you are good at” comes in?
You should focus on what you are good at, rather than what you want to do. I think that’s particularly important.
To take an example from the restaurant industry, a person who is skilled at creating French cuisine will naturally make a success of a French restaurant. The same goes for startups. No matter how much of a growth market you are operating in, only companies capable of “doing battle based on what they are good at” will succeed.
This links back to what I was saying about vision, but you can guarantee that the most unsuccessful pattern is working backward from some kind of vague vision of the future and choosing a business without any idea of what it will actually be. That simply won’t be good enough to beat competitors who are good at what they do.
It is precisely because you “do battle based on what you are good at” that you can make a product with market value that will survive, and demonstrate genuine vision.
ーーAt first glance, it may seem the right choice to devise a business by working backward from the future that you want to realize. Do you have some kind of formative experience of your own in which you felt the importance of “doing battle based on what you are good at”?
It is my own past failures that form the basis for this concept.
Prior to Cover Corp., I ran San Zero Minute Co., Ltd., and ultimately I was able to sell it off, but my own view is that I was a failure as a manager.
San Zero Minute was truly a case of me selecting a business based on a vague and nebulous vision. I started the business based on the idea that as the number of dual-income households increases, there will be a need for a service capable of sharing local community information. Even though the vision was an excellent one, I failed to recognize whether I was truly the best person to bring such a vision to reality.
In the end I decided to sell the business because it would function better if it was led by someone more qualified and more appropriate in the position than myself. This gave me a real sense that unless you have the power to realize your vision, ultimately your plans and efforts are of little use to the world.
ーーSo it is this experience that impressed on you the importance of “doing battle based on what you are good at.”
Cover Corp. was created based on exactly that concept: fighting in areas where we can win.
I joined a game company straight out of university, so it was with a youthful eye and sensitivities that I invested at the very least 10,000 hours of my time in contents. I have also had the opportunity to work with many well-known content holders in the industry. Over the course of the years, therefore, this has naturally become my area of expertise.
Even so, with my previous startup, I chose the business area of “sharing local community information,” which is completely unrelated to what I am good at, with the outcome being as I have just explained.
This time, Cover Corp. is right at the heart of the content business, a business area where we are confident that even if other prominent entrepreneurs enter the market, we can definitely win.
My belief is that being useful to the world comes as a result of giving back to the world the things that you are really good at. We should all take a hard and deep look about the meaning of what we do, and not just because it is a good-sounding cause.
Interviewer Noriyuki ITO
DIMENSION Business Producer: Graduated from Waseda University, School of Political Science and Economics. After working at Rakuten and EdTech startups, he invested in and analyzed domestic startups and provided management support for their IPOs at Dream Incubator Inc. In 2009, he joined Dream Incubator Inc. In 2009, he participated in the MBO of DIMENSION Fund from Dream Incubator Inc. He is working to revitalize the Japanese economy by providing support as a capitalist to ambitious entrepreneurs. He is an outside director of FinTech startup 400F Inc. Also teaches "Venture Strategy Planning" and "Business Analytics" at a business school.