Why Artificial Intelligence Is The Key to Fixing Japan’s Rigid Education System

Using artificial intelligence to change the way the education system works seems like a fool’s errand.

When you combine the fluid and opaque nature of AI technology with the slow, bureaucratic decision making of education, you usually wind up with the perfect storm of stagnation, frustration, and rapidly burning through investor capital.

Out guest today, however, thinks he’s found a way to make it work. Daisuke Inada, founder and CEO of Atama+, left a promising career at Mitsui to start an EdTech company he believes will change the way children learn.

Interestingly, Daisuke’s vision is not the standard EdTech dream of online classes and automated learning. It’s one where human instructors are still very much involved and critical to the success of both the students and the programs. Of course, their role will change and the overall structure will look quite different from what we know today.

It’s a fascinating discussion, and I think you’ll really enjoy it.

Show Notes

How to find a customer willing to fund changes in education The challenge in exporting the Japanese education model How to find co-founders when you are a mid-career executive What most people over 35 misunderstands about starting a startup Why education is hard to disrupt Why online education will not work in Japan or any other country How Japnese AI companies can compete against their better funded foreign rivals How to convince more Japanese to start companies

Links from the Founder

Check out Atama+ Follow them on Facebook

[shareaholic app="share_buttons" id="7994466"] Leave a comment Transcript Welcome to Disrupting Japan, straight talk from Japan’s most successful entrepreneurs. I'm Tim Romero and thanks for joining me.

Today, we're going to talk about artificial intelligence and natural intelligence. In fact, we're actually going to talk about using artificial intelligence to improve natural intelligence, so yeah, and tech. Education is one of our institutions that is both most in need of disruption and most resistant to disruption, and there's probably no small amount of cause and effect in that statement. I mean, the reason education is in such need of disruption is because it has been so hard to change for so long although almost every other aspect of our lives has been transformed. Education has changed over the past 100 years, not just in Japan, mind you, but all over the world.

Well, today, we're going to talk about exactly why that is and what the hell we can do about it. So I’d like to introduce you to Daisuke Inada, founder and CEO of Atama-Plus. Now, Daisuke left a long and lucrative career at Mistui because he believes he has a better way to help people learn. Now, in the interview, Daisuke and I talk about jyuku and for those of you outside japan, I should probably explain what jyuku are and why they're important to innovation and education.

Jyuku is usually translated as cram school. They don’t really have a parallel in the west, but they're very common in Japan and in other parts of Asia. Jyuku are school run by private companies and Japanese high school students attend jyuku after they finish their regular classes and on weekends, and on holidays. The purpose of these schools is to help the students score higher on their college entrance exams or in the case of junior high school jyuku, to increase student scores on their high school entrance exams. Unlike the high schools and junior high schools themselves, however, jyuku are private companies and some are even publicly traded. Jyuku compete fiercely for students and they're evaluated based on how well their students do on the tests. It's no surprise that they're willing to try new technology and why most education innovation in Japan focuses on jyuku.

Now that you have that background, our conversation with Daisuke will make a lot more sense. Of course, we also talk about the challenges he faced when deciding to leave Mitsui and he has some practical advice for how people who are not plugged into the startup scene can find co-founders. But you know, Daisuke tells that story much better than I can so let's get right to the interview.

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[Interview]

Tim: So we're sitting here with Daisuke Inada of Atama-Plus which is AI for education. So thanks for sitting down with me today.

Daisuke Inada: Thank you very much for coming to our company.

Tim: Well, listen, AI for EdTech is really vague and there's a lot of companies doing it so why don’t you explain what Atama-Plus does?

Daisuke: We are trying to provide AI program to high school students and junior high school students in Japan. We provide a personalized curriculum which consists of video lecture, exercises, and tests analyzing the data of the students such as proficiency, learning history, consideration level, and so on.

Tim: Okay, well, what kind of classes are you targeting? Is it like Mathematics or Language, or History?

Daisuke: At this moment, we provide Mathematics contents to high school students but we are preparing other subjects, so we will launch our new products of English grammar, Physics, and so on.

Tim: Tell me about your customers. Who’s using Atama-Plus products now, is it the government or jyuku, the cram schools, or universities?

Daisuke: Our business model is based on B2B2C, especially B to jyuku to students. I don't know if you are familiar with the term of jyuku.

Tim: It's, for our listeners overseas, a jyuku is – prep school doesn’t quite get the intensity of how cram school is good. So it's for students, many, many Japanese students go to cram school after their regular lessons to study for university exams.

Daisuke: The last year of high school, almost 70% of students go to jyuku after their regular schools and almost 80% of third-year of junior high school go to jyuku. The concept of jyuku is very popular in Japan.

Tim: Yeah. Well, later on, I want to talk in detail about innovation and education, and EdTech, but I find it interesting that in Japan, jyuku will be innovative. They are private companies that are competing with each other. It's not like high schools or universities, so jyuku seems to be the ones that will try new technology in education.

Daisuke: Yes, that’s why we want to innovate the education together with jyuku.

Tim: Well, listen, before we dive into EdTech and AI for education, I want to talk a little about you. So looking at your history, you seem like a very unlikely entrepreneur. So you graduated from University of Tokyo, you worked at Mitsui which is a well-established, well-respected Japanese company for like, 11 years, why leave Mitsui to start a startup?

Daisuke: During Mitsui, I had been in Brazil for five years. I started education business in Mitsui. Firstly, there was no education business in Mitsui. We founded a joint venture between Mistui and Benesse which is the largest education company in Japan, in Brazil, so that’s why I started education business. We tried to bring Japanese education know-how from Japan to Brazil.

Tim: How did that work out?

Daisuke: Unfortunately, financial result was not good. They decided to close the company so we closed the company and I stayed in Brazil and I started another business of education in Brazil again.

Tim: With Mitsui?

Daisuke: With Mitsui. Actually, we invested in EdTech company in Brazil and I was working there.

Tim: But what was the trigger that made you leave Mitsui and start Atama-Plus?

Daisuke: I returned to Japan, I was trying to start new education business inside Mitsui but it was difficult and slow to innovate education in a huge company so that’s why I thought it would be better to start from scratch.

Tim: Let’s talk about that because I think it is – I work with a lot of different Japanese companies. Some are startups and some are really huge companies, and the larger companies, the problem is not that there aren’t creative innovative ideas. There's plenty of people with great ideas but they have trouble getting the ideas to go sort of up the chain of command so that people will make a decision and act on them. Was that your experience in Mistui as well?

Daisuke: If I continued to work in a traditional huge company, I wouldn't have any option to work in another huge company, but compared to a startup company from scratch, I thought it would be more speedy, it would be more creative because we could start from there.

Tim: Was your family supportive of that? because that’s a pretty big change from going to like, University of Tokyo and Mitsui, that’s a definite sort of lifestyle track and then leave and join a startup. It must have surprised a lot of people.

Daisuke: Yes, it was surprising but for me, much more important to realize my dream.

Tim: So are you married?

Daisuke: No, no, I'm single, yeah.

Tim: That must make it easier to make the decision.

Daisuke: Yeah, I think so, and also, I started the company together with my co-founders and we then thought that it would not take a huge risk.

Tim: So after 11 years in Mitsui, how did you meet your co-founders?

Daisuke: Actually, my friends at the university, I called my friend who his the best guy of business who worked for Recruit as a CEO in China. Also, I called a best guy of engineering who studied together with me in same class.

Tim: So was this part of just like the University of Tokyo alumni association or were these people, you were calling them for like, the first time after 10 years of graduating?

Daisuke: The co-founder from the business side (our COO), I was talking with him about the possibility to start a new business always even during the time of the universities. When it comes to the co-founder for engineering (our CTO), I spent a lot of time to get his decision.