"Entrepreneurs' Aspiration" tells a story of their passion to start a business, the background and difficulties to overcome until the business gets on track, and their desires to realize through the business.
In this 41st installment, Motohiro Kizaki, President of MI-6 Ltd. talks about future challenges of his business with a perspective of Ryukichi Miyabayashi, a capitalist in charge of MI-6.
【profile】
Motohiro Kizaki, President, MI-6 Ltd.
After graduating from Kyoto University, Faculty of Law, Kizaki joined an IT venture company and contributed to its listing on Mothers as a pivotal player in charge of sales and business development. After working at ORIX Corporation, handling open innovation and then, at Mobike (China's first bicycle-sharing company) as the responsible official in Japan, he founded MI-6 Ltd. in 2017.
While searching for a business theme with his life mission of "creating a business in Japan, which will be able to compete globally," he happened to find "the fun of the materials industry" and at the same time "inefficiency of the industry caused by only depending on experience and intuition" at his previous job, and founded MI-6 to solve a wide range of social issues.
What's MI-6 Ltd.
MI-6 develops and provides "miHub," a SaaS that utilizes a technology which accelerates materials development through data science (Materials Informatics: MI), "Hands-on MI," a hands-on analysis support service, and "MI Robotics," an automatic and autonomous experiment service that combines automation technology with MI, mainly for materials and chemical manufacturers. The number of clients has exceeded 100 in total. The cumulative amount raised is approximately 1.5 billion yen (as of July 2023)
Advancing Society with DX in Materials Development
Please tell us about the current state of the materials industry, which is MI-6 's business domain.
Kizaki Industrial products such as electronics, home appliances and furniture are essential to our daily lives. These products are made of "materials" such as plastics, fibers, glass, and chemicals for electronic devices. Without progress in research and development of materials, we cannot achieve both of "making people's lives more convenient" and "aiming for a sustainable society" simultaneously. Researchers are working day by day through trial and error to realize these goals, but materials R&D is a process which is full of trade-offs. Customer needs, laws and regulations, environmental regulations, costs, quality stability, availability of raw materials...there are various issues must be addressed and it takes an average of 20 years for materials development, during which many failures are repeated. This style basically has not changed since the time of Edison.
The materials industry is Japan's strength. It has maintained international competitiveness with its high technological capabilities and has supported the growth of the automobile and electronics industries since the end of World War II. Its market size amounts to approximately 20 trillion yen. In recent years, however, the industry has been forced to change by increasingly sophisticated and complex materials development, shorter development cycles, and intensified domestic and international development competition. By streamlining and accelerating approaches to materials development, we hope to contribute to the realization of a more convenient and sustainable society.
How do you improve the efficiency of materials development, would you explain details of your business?
Kizaki We operate a business to support our clients' materials development using MI, which streamlines materials development through technologies such as machine learning and computational chemistry.
The first of our service is hands-on support by our data scientists, who provide detailed support for analysis and help to accumulate knowledge within the company since MIis a new method that has become popular just over the past decade and is not yet fully utilized by many companies. The second service is "miHub," SaaS for MI, which enables researchers without programming or statistical knowledge to utilize state-of-the-art MI with no code. And the third is a robotics service that combines MI with robots to support an actual experimental process. Materials development is a field which is difficult to accumulate data enough to be big data because each experiment takes a very long time, and so, to increase the data, it is necessary to improve the efficiency of the experiment. Therefore, we provide support in carrying out the whole process from imputing instructions to data accumulation fully remotely by automating each of the experiment steps and connecting them to speed up the process. We have already been able to handle specific materials and will expand our services to cover a wider range of materials in their development processes.
Our Data Science Team develops core technologies and provides hands-on support, while our Product Team commercializes core technologies, and our Sales Team and Customer Success Team utilize their knowledge of materials development and data science to make business proposals and provide hands-in support. We have this system that can provide our services through all the processes of value chain, which I believe is a major strength of our company.
With which companies do you have business now?
Kisaki We have more than 100 clients, (as of June 2023) who are leading Japanese manufacturers in various industries, such as chemical, petroleum, metal, and glass. One client, for example, introduced our hands-on service along with "miHub" when they promoted MI in-house, and successfully discovered new materials which enable them to achieve their goals in about half of their usual man-hours. We heard that their next project using this data is expected to be developed even in a shorter time, about a quarter of the time. In this way, if you continue using MI, more and more data will be accumulated, and as a result, development is becoming more efficient in an increasing number of cases.
Please tell us about your career before starting your own business.
Kizaki I went to law school to become a lawyer, but I found the study of law was not for me and decided to pursue a different career path when I was in my third year of college. I took a year off from university during which I joined various startups as an intern and had chances to talk with many business persons. That experience made me aware that it is indeed entrepreneurs who have advanced society, and I really felt that I too wanted to start a business that would advance society.
After graduating from university, I chose to work in businesses that I could find a meaning in, such as crowdsourcing and healthcare, and I began to focus on "materials development" when I was working for a startup of bike-sharing service. They were developing materials for bicycles in cooperation with a major chemical manufacturer, but the development was not on track because the time frame was very different between a startup who considers speed is of the essence, and a manufacturer who spends 10 to 20 years in research and development. Then I learned about the real situation and challenges in the materials industry for the first time and became interested in it. It was during that time when I became acquainted with Professor Koji Tsuda of the University of Tokyo (now Technical Advisor of MI-6), who specializes in MI, which led to the foundation of MI-6.
You said you were looking for a business in which you could find meaning. Did you have an intuition that this was it when you encountered "material development" and "MI" for the first time?
Kizaki No. To be honest, I became more and more convinced as I worked on them. MI itself was in its infancy and we had to create products and solutions with no right answers, which made our decision-making very difficult. We thoroughly talked with our clients who were to be actual users of our products and services and discussed technical visions together withthe CTO to determine the direction we should go. After actually delivering our products to our clients, we received their feedbacks such as "good materials were produced thanks to your product" and more and more members joined us, sharing our vision... By accumulating these experiences, I have cleared my doubts and become more convinced.
Attracted by the thorough support system of the whole JAFCO Group
Mr. Kizaki and Ryukichi Miyabayashi , JAFCO's Capitalist in Charge (left)
In May 2023, you raised 650 million yen in a Series A round led by JAFCO. Please tell us about your encounter with JAFCO.
Kizaki As "miHub" was growing steadily, we started considering fundraising in the fall of 2022 for two purposes: to strengthen our sales structure to accelerate the growth and to strengthen our development structure to further expand the value of offering the product. I got an interview with Mr. Saka (Yutaro Saka, Partner) and Mr. Miyabayashi of JAFCO for the first time through our existing investor's introduction In January 2013.
I had an image of them being a little square because JAFCO is a time-honored VC, but they were both very frank, and that image was quickly changed.
I was pleased by their attitude that both of them researched our company and industry in advance and frankly told me they didn't understand what they didn't know, trying to understand the essence of our business.
Miyabayashi Mr. Kizaki, despite being involved in a highly specialized area of business, is able to talk to us from the same perspective as those of us who are not specialists. He has a good balance of expertise and business language, and I felt that he is a kind of business person who is hard to find. The more I listened to his stories and researched his business, the more new and unfamiliar things came up, and we had meetings three times a day (laughs).
As a capitalist, what did you find is the potential of MI-6?
Miyabayashi I have always been interested in businesses that were born in the Japanese market, of which origin can be a global advantage, and I paid much attention to such areas as university-launched deep tech, climate tech, and entertainment. The materials industry is an industry that is often discussed in terms of climate issues due to its high CO2 emissions, and I was attracted to MI-6 from an early stage because it was a startup that was aiming to become a DX company in the industry. And when we looked at its possibilities from three perspectives of "market," "business," and "management team," we felt that MI-6 had all these three perspectives of "market", "business" and "management team", I felt that this time we had three foundations in place from the start. So, in a slightly different way from the regular process, we took a process as if we were trying to unravel "why it is possible for MI-6 to be what it is today."
What struck me as most strange was the diversity in its organization for a company at this early stage. Data science, software, materials, robotics, business development....it had a various range of sections and people from all over the world, including foreign nationals and women who are working while raising children. I thought this is because Mr. Kizaki himself has a vision that attracts many people and encourages them to take on challenges, so I had many meetings with him and we delved deeper into the matter.
Mr. Kizaki, what were the deciding factors for you to ultimately choose JAFCO as your lead investor?
Kizaki With VC you will have a long-term relationship, and so I was looking for a funding source from a perspective whether or not we could build relations of complete mutual trust with each other. I think it ultimately comes down to a person-to-person matter people, and I felt I could trust Mr. Saka and Mr. Miyabayashi not only as an investor but also as an individual person because of their attitude.
Considering advantages for our company, JAFCO's large funding ability was very appealing with no doubt, but more than that, its attitude "to provide thorough support by the entire group" was really reassuring. I talked to some friends who are business persons, and JAFCO's reputation among them were surprisingly high. They all said, "They don't just give you advice but they really make full use of their resources to support you." Now that we have completed our fundraising and their support has started, I realize that the reputation was true.
Record and pass down all trial and error as digital assets for the future.
Please tell us about the future you hope to achieve through your business.
Kizaki The materials industry involves a series of process; research and development, mass production and market release of materials. I would like to digitalize and connect all the trial and error that occurs in this process of "materials development". Successes which our ancestors strugglingly have achieved through trial and error are based on a hundred times more failures, most of which are not recorded as "knowledge." We would like to digitize all of these 99% of failures and 1% of successes and record them as knowledge so that future generations can use them at any time they want. We believe that this will lead to the progress of the materials industry in order to realize a convenient and sustainable society.
How do you think the innovative changes of materials development can contribute to the realization of a sustainable society?
Kizaki For example, it is said that water-absorbent polymers used in such products as diapers can be used to help prevent the progression of desertification. If we can develop polymers that can hold water in the soil, we can create an environment where plants can grow without new greening. There are still many issues to be addressed on biodegradable plastics, which have been developed in recent years, but the potential for solutions will expand through more efficient material development.
Also, when recycling and upcycling materials, it is important to ensure that "no waste" and "no hazardous substances" are generated, but unfortunately the reality is that knowledge and information obtained through research and development of materials are not fully utilized in the recycling and upcycling process. We believe that by acting as a bridge to connect the supply chain, we can improve recycling efficiency and ultimately contribute to the preservation of the global environment.
Lastly, please tell us what you value as an entrepreneur.
Kizaki As Mr. Miyabayashi mentioned earlier about the diversity of o organization, I always place importance on respect for diversity and how to make the most of each individual as my management policy. I leave what I can leave to my employees and I myself focus on sharpening my vision and making sure that the vision and strategy and organization are well connected. I am not a researcher, an expert, nor anybody. I just confront my management on a daily basis, feeling my personality is growing through various influences of my employees and customers.
Comment of Person in charge: Takayoshi Miyabayashi
DX in the materials industry is an urgent issue from various perspectives, such as reducing CO2 emissions by improving R&D efficiency, developing new materials that can contribute to environmental preservation, and improving recycling efficiency. Japan's materials industry is in particular home to world-class companies, with a market scale of approximately 20 trillion yen in value-added, exceeding that of the domestic automobile industry. Quick innovation is required. MI-6 is a rare player that can attack this difficult challenge. Diversity of organization is requisite for addressing complex issues and Mr. Kizaki, as the president of MI-6, demonstrates his strong vision and management skills to lead the organization which is comprised of a diverse range of personnel who specializes in, for example, data science, materials, and business development. Expanding innovative solutions created in Japan into the world to transform not only the industry but also the whole society. I am confident that MI-6 will be able to accomplish this very significant challenge.
