Tag Archives: Japan

Market Cap / Employee

Monday I caught up over lunch with long time friend and superb Japanese entrepreneur, Nori Matsuda.  Matsuda-san is the CEO & Co-Founder of Sourcenext, a publicly listed consumer software company in Japan.

During the discussion, he talked to me about how he thinks about building public technology companies.  He mentioned a metric he thinks about a lot: Market Cap per Employee.  He thought that this was an interesting expression of a company’s culture, of how much opportunity, how much energy there likely was at the company.  He then rattled off the Market Cap per Employee of several large public tech companies.

I built this simple chart below, and I think it’s telling:

Company Market Cap (B) Employees (K) M/E (M$)
FB 52 4 $13.0
APPLE 528 73 $7.2
GOOG 219 54 $4.1
MSFT 227 94 $2.4
AMZN 107 51 $2.1
YHOO 21.8 14 $1.6
CSCO 98 67 $1.5
Zynga 1.8 3 $0.6
Nokia 13 105 $0.1
HPQ 23.6 350 $0.1


If you’re thinking of working at a public company, then this is probably an interesting metric to look at and consider.

Alternatively, if you’re running a startup, it’s also an interesting metric.  You might consider your current valuation and divide it by the number of employees.  See where you stack.  It’s probably at least some kind of indicator of the opportunity and the momentum in front of you.


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Geeks on a Plane Update — Tokyo


Image by whaleforset via Flickr

I’m writing this on the Narita Express from Tokyo station to Narita Airport early Saturday morning.  Geeks on a Plane is finishing up here in Tokyo, and we’re heading on to Beijing.  It was my first time back to Tokyo in about a year, and what a year the country has gone through.  In addition to being politically as gridlocked as ever and with a moribund economy, Japan has seen an unimaginably devastating earthquake and aftershocks and deadly typhoons.  It is more than any nation should have to bear, and my heart goes out to everyone here.

In my short time here, I have a few observations.

First, the sense of steadfast optimism from the teams and people I interacted with in Japan was inspiring.  Open Network Lab’s Hiro Maeda’s presentation encapsulated this.  To illustrate the earthquake’s impact, he showed both a photo of the tsunami coming ashore, as well as video shot by one of his colleagues during the earthquake of their office.  The office lamps were shaking back and forth very strongly, and we watched for about a minute, before he shut it off and remarked that it went on like that for at least 3 minutes.  Sobering stuff.

After this intro, he jumped right in to the optimism and enthusiasm that he sees in Japan.  His view is that all the negatives–the impact of the earthquake, the flat economy and job market–is actually catalyzing a new entrepreneurship in Japan.  He sees a a group of young technical talent here that is shaking off the traditionally risk averse cultural attributes and stepping up to creating a new startup future for Japan and the world.  This is totally needed and it is great to hear.

The second key observation I had was that the Japan teams I met were really starting to integrate learning and methodologies from the startup cultures and approaches commonly seen in tech centers like Silicon Valley.  I saw this in the descriptions and approaches companies are taking to building their companies.  Dave McClure and the whole GOAP effort I’m sure deserves at least a hat tip of acknowledgement for this.  Groups like Digital Garage based here, as well as the whole open sourcing of knowledge coming from US sources as broad-based as TechCrunch, Fred Wilson’s AVC, to Yokum Taku’s StartupCompanyLawyer all are adding information to the knowledge base here.

This knowledge integration is important, as one observation that I’ve sometimes had of Japan culture is that it can at times insist on building its own way of doing things.  At times this is terrific and lead to unique differentiation, but it can present challenges.   Broadly, what I saw was Japanese companies that looked as though they could by and large work out of the US just as easily as here.  That I think is a good thing, given the state of entrepreneurial activity here.

The other thing that really struck me was the level of English proficiency in Japan on this trip.  This seems to have really increased since I was last here, and is markedly up since I first moved here in 2004.  This is not to say that English is a be all end all type thing.  In the startup world though, if a company is going to look for Western VC finance, which si where most of it still is, English language skill is pretty important.  I was really impressed with what I saw, and I think its a great sign for the future.

I love Japan and the Japanese culture.  The country and the people treated me and my family extremely well when we lived here during 2004-2007.  I was very pleased with the momentum I saw in the startup community here in Tokyo, and I’m hopeful that this continues and that we continue to see great companies like MyGengo, and others continue to thrive and grow, setting examples for others to follow here.  I hope to be able to come back soon, and if there’s anything that I can do to help along the way, don’t hesitate to reach out.


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