mac in japan

A Business Mac Report

As a change of pace from all the Apple-bashing articles that have been in the press recently, I'll focus in coming months on business use of the Macintosh. This interview is the first in a series of reports on Macintosh professionals in Japan.
by forest linton

Paul Raudkepp is cofounder of Metasys, an Internet software solution provider. He first dreamed up the basic idea in late 1994 while running a First Class-based online service for Paradigm in Tokyo. Bitten by the entrepreneurial bug and itching to do his own thing, Raudkepp was interested in the functionality attained when integrating a database with a Web front end. He was convinced that there was a huge potential market for this type of system so, soon after quitting Paradigm, he joined up with Andrew Smith Lewis, owner of the Japanese franchise of Princeton Review, a well-known test-taking and tutoring company. Raudkepp set up shop in March 1995 with a single Mac and a desk in the Princeton Review offices. Today, Metasys occupies an entire floor and has nine full- and part-time employees. Metasys has developed and markets over a half-dozen software products, with several more in development.

Tell me a bit about your business. What kind of software do you develop?

Paul Raudkepp: When I started Metasys, my goal was to develop products that linked the Web to database back ends. At the time all I knew was the Macintosh, so Butler SQL was the database I standardized on. I focused on creating solutions centered around Butler, using Tango and our own custom software.
Our first product was Mango, a kanji search engine. Then we came out with Web Forum (a Web-based conferencing program) and Quiz Maker (an online test-creation tool).

So, you focus on the education segment.

Raudkepp: Yes. A lot of inspiration came from seeing the need for these types of products at Princeton Review. There is a lot of synergy between the two businesses.

Are you still primarily a Mac shop?

Raudkepp: Although we do most of our development work on the Mac, we are a cross-platform solution provider now. With all of Apple's recent troubles, we would be foolish not to spread our bets.
When Everyware released Tango for Windows, we started developing for it. We still develop all our products on the Mac first, as it is a much easier environment to develop in. Then we port them to Windows NT.

How much of your business is derived from custom solutions vs. software sales?

Raudkepp: I actually got Metasys off the ground by doing consulting for Uchida Yoko (the distributor of Butler SQL in Japan), and that led to other projects. So you could say that in the beginning Metasys was 100% custom solutions.
Today, we are able to leverage a lot of the custom code that we write into shrink-wrapped products, so we are gradually building a lineup. Metasys now generates about 20% of its revenue from software sales.

What is your take on the Japanese Internet solution market?

Raudkepp: It definitely is not as mature as the US market. We find ourselves spending a lot of time educating potential customers Ñ although it is much better than even a year ago. The flip side to this is that there is a lot of potential business out there, a lot of opportunity.

You have a multilingual office. Is it tough managing Japanese staff as a foreigner?

Raudkepp: It is very interesting and challenging. My Japanese wasn't very good when we got started, but that has certainly improved exponentially. I am getting good insight into the different business practices, things like that.
Actually, the Japanese staff are quite easy to deal with. The non-Japanese staff can be harder to manage [since] they are not native to Japan and have special living and visa needs. We are also in the rare situation that everyone is still doing what they want to do, so we haven't hit any serious growing pains yet.

Is it tough to find new people?

Raudkepp: We get our leads from contacts, referrals, word of mouth... plus, we also have the benefit of Princeton Review being close by so we can share resources.

What is your goal for the next two to three years?

Raudkepp: We are seeing a shift from service revenues to software product sales. This will continue until software makes up a majority of our revenues. I hope to be at 20 people and $10 million in revenues by the year 2000. I guess my ultimate dream is to do an IPO [in Japan].

So you must be pleased by the success of companies going public here, like Yahoo! Japan, and the interest they are generating with the individual investor.

Raudkepp: Yes, this is the direction I think we all want to see Japan go Ñ an environment ripe for new ventures, startups, individual investing, and entrepreneurship in general. That is the Japan that I would like to see emerge in the 21st century.

You'll find Metasys online at http://www.metasys.co.jp/.



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