welcome to disrupting Japan. Straight Talk from Japan's most successful entrepreneurs I'm Tim Romero and thanks for joining me. I've got a special show for you today. There will be no guests, no beer, no playful banter about making marketing or monetization for the next 20 minutes. It's just you and May. It's been a while since I've done a solo show, and these shows tend to be some of my most popular. So today I thought it would be a good idea to share with you some of my thoughts about podcasting and to tell you the story of disrupting Japan itself, why I started it, how I grew the audience, how I turned the show into over $8000 a month of income and how I started to put together Japan's first podcast advertising network. And more importantly, perhaps, why I walked away from all of that and returned, disrupting Japan to the non commercial sponsor free format we've all grown to know and love.

Our talk today will explain why a number of the more unusual things about disrupting Japan are the way they are and, you know, disrupting Japan has been growing even faster since we went commercial free. Today we have over 10,000 listeners in over 100 and 60 countries, including one listener in Vatican City. Now I have no way of knowing for sure exactly who that one listener is. I mean, sure, it could be anybody, but I like to think well. I choose to believe that disrupting Japan has fans in very high places. But it wasn't always this way. In fact, Japan is a very hard place to launch a podcast. You see, Japan is not a podcasting nation.

Most popular podcasts here are recycled radio that's produced by the major media companies. Good independent shows exist, of course, but you need to look for them now. I've built a few startups in Japan, and the podcast was supposed to be me just talking with my founder friends about startups and innovation in Japan about what it's like to be an innovator in a culture that prizes conformity. I christened this show disrupting Japan and launched two decidedly little fanfare in September of 2014. The podcast told him 42 downloads that month, and I thought that was great. Disrupting Japan's audience grew steadily each month and after six months I had about 400 listeners. At this point, I decided to invest in growing my show. But most of the common sense marketing and production approaches I tried either had no effect at all or actually backfired on me. I rented a studio to improve production quality, but that made my guests uncomfortable. Most people simply could not relax in an unfamiliar environment and spent the whole interview looking at their mike rather than at me.

I tried this with three different guests, and I didn't get a single usable conversation. It's obvious in retrospect, but few things make people more nervous than shoving a microphone in their face. So I gave up on this studio. I started going to their offices and using a pair of small lapel mikes. The sound quality was lower, but after a few seconds my guest forgot they were wearing these little microphones, and we could talk like two human beings showing up with a couple of beers, also helped my guest relax and made recording less of an interview and more of a conversation. It turned out that sacrificing a bit of production quality and so called professionalism form or personal honest conversations was one of the best decisions I made Marketing. Disrupting Japan proved counterintuitive as well. None of the full proof techniques everyone uses worked for me. I've had good results using social media advertising for some of my startups, but it was worthless for podcasting. I poured money into multiple campaign strategies on Facebook and Twitter,

but I saw no real increase in listeners. These platforms reported lots of so called engagement with my ads. But whatever form that engagement took, there was no significant difference in site visits or downloads between the episodes I advertised and those I did not appearing. Another podcast is also supposed to be a great way to grow an audience, but it didn't work for me. I really enjoy the conversations I've had with other podcast hosts, but my appearance has never resulted in a noticeable bump and listeners. The other problem I ran into here was that most of these podcast appearances are expected to be reciprocal. I go on their show to tell my story. They'll come on mine and give theirs well. The obvious problem here is that disrupting Japan is a show about startups and innovation in Japan, and if you don't have a meaningful experience in that area, it doesn't make a lot of sense to bring you on this show. Most of the podcast host said they understood and politely withdrew their requests to have me on their show. Two of them were clearly irritated with me,

and they told me that since they're listener, ship was so much larger than disrupting Japan that I should be grateful that they were even giving me this opportunity. And of course, a few said they didn't care and just wanted me to share my thoughts with their audience. I appeared on all of those shows, and I enjoyed it. I had some great conversations, but those appearances didn't really impact my download numbers. Now these techniques do work for a lot of podcasters, and if you are starting a podcast, they may work for you and they're certainly worth trying. But they clearly weren't working for me, and I finally realized why disrupting Japan was addressing a very small niche innovation and startups in Japan and there were simply not enough existing podcast listeners who were interested in that topic, so I'd have to build an audience from scratch. So what really worked? I mean,

at least for May, the most effective way I found to grow disrupting Japan was via interaction online. This meant finding a handful of Facebook and linked in groups interested in Japanese startups. And then in joining in the discussions, most groups welcome to my contribution. However, it was my offline efforts that made the biggest impact. I sought out any event or seminar where I could speak about Japanese startups and innovation. And every time I spoke, I saw a small uptick in listeners and an email subscriptions. Oh, and by the way, that email list turned out to be far more important than I expected for two reasons. First, casual surveys showed me that about 25% of disrupting Japan fans were not subscribing to the podcast, but they were going to the site and listening from the browser or simply reading the transcript.

Second, people seem to be far more willing to engage over email. Even today, when an episode is released, one or two people may comment on the site, but around 20 will reply to the email announcement. Disrupting Japan's were and still are extremely engaged, and most guests tell me they receive a lot of positive feedback about their appearance on the show. September of 2015 was the show's first anniversary, and 120 disrupting Japan. Fans paid a $20 cover charge, tow watch a live podcast and to meet and hang out with each other. Now Inmate 2016 This start up I was building kind of blew up, and at that point Japan had about 3500 listeners. Three of my friends urged me to try podcasting for a living. Now I had no better options,

so I gave it a try, and I wound up becoming Japan's first professional podcaster Now. My first problem as a newly minted professional podcaster was that there were no ad agencies serving podcasters and no sponsors who understood the medium, so there was a lot of work to do. Disrupting Japan's audience consists of startup founders, aspiring founders and other people interested in innovation in Japan. Now that's an important and influential group of people. So I sat down and I brainstormed about what kind of companies really wanted to connect to this audience, who were the specific companies that really needed to reach disrupting Japan listeners. And who would I feel good about recommending? After a week, I had a list of 50 likely sponsors. Of course, almost none of these companies had ever heard of me or disrupting Japan or even of podcasts. But that could be fixed. I began sending emails,

making phone calls, knocking on doors and pitching in Power Point. It was tedious, but the feedback from potential sponsors was invaluable in helping me craft my final sponsorship package. You see it. It turned out that my sponsors didn't really want what I thought I was selling. Let me explain direct response advertising, where every clique and impression is measured that dominates podcasting in America. But it's a losing game for most podcasters. The industry focuses on CPM rates. The rate advertisers pay per 1000 listens because that metric CPM, it's easy to standardize, and it's easy to measure. But with that standardization comes commodification. If you ever buy into the idea that you're simply selling impressions or downloads, you resign yourself to competing with a nearly infinite number of other podcasts.

No, the secret to making real money with a small podcast is helping companies build their brand. So with this in mind, I crafted sponsorship packages that combined podcast ads, banner ads and in person appearances at my sponsors events. These in person appearances required a significant time commitment, but the's live appearances both consistently drew people to the events and brought new listeners to disrupting Japan. And so a virtuous cycle with set in motion. Now I have some advice for any aspiring podcasters who are thinking of going this route. You need to be prepared to spend at least a CZ much time on your sponsors, as you do on your podcast, writing and rewriting ad copy, explaining metrics, brainstorming messaging and creating custom presentation for your sponsors events. This will place huge demands on your time, but it's worth it.

In America. Podcast advertising companies like mid roll or pod grid are great, and it's tempting to just let someone else bring sponsors to you. However, you give up a lot when you make that decision. In the end, your sponsorship and advertising rates are directly proportional to the effort you're willing to put into finding the right sponsors. So, nine months after going pro disrupting Japan had an amazing group of sponsors and about 4000 listeners. I was releasing an episode a week with three ads per show at $680 per insertion and earning a bit of additional revenue selling banner ads. So I was earning well over $8000 a month at this point, and since it was still a one man show with minimal advertising costs, this was mostly profit. Disrupting. Japan had become financially successful, but I was spending 70% of my time finding and working with sponsors and only 30% of my time actually creating the podcast.

And then it hit me. God help me, I'm running a media company. And as far as media companies go disrupting Japan was at a really awkward size. It wasn't generating enough revenue to let me hire someone to handle the advertising in the business side. So the logical step seem to be to start selling ads for other podcasts. This would increase the amount of revenue coming in and give me the cash low. I'd need to bring together a real team to grow this business so bootstrapping. This podcast advertising venture was pretty simple. I went down iTunes lists of the top 200 podcast in Japan crossed out the ones that were produced by major media companies and then I e. Mail. The remaining podcasters I introduced myself explained that I had been selling ads on disrupting Japan, and I asked if they were interested in sponsorship. Most of them were finding sponsors wasn't really difficult either. But I found I couldn't command the high rates that I could. When I was selling ads for my own show,

sponsors paid an average of about $42. CPM and I kept 30% his commission. Both the sponsors and the podcasters seem pretty happy with this arrangement. I also pitch Dentsu and a few other large ad agencies on podcast sponsorship, and several had clients they felt would be interested in experimenting. Unfortunately, they make financial sense. Even on an experimental level. These companies would need to sell at least $100,000 in podcast advertising every month, and there was nowhere near enough podcast inventory in Japan for advertising at that scale. But I had a plan to fix that. Podcasting may not be big in Japan, but YouTube is huge. I was confident that with a bit of training and the promise of a tenfold increase in their CPM rates, I could convince a number of high profile YouTubers to take up podcasting on the side. As you can imagine,

I was pretty busy at this point. I was interviewing potential co founders and sales staff to help get this podcasting empire off the ground. And I was, of course, podcasting. I still had a weekly show to put out, and here our story reaches its anti climax. Looking at this podcast advertising business in startup terms, I had a good product market fit and a path towards scalability. At this point in the story, the start of narrative practically demands that I pulled together a fanatically dedicated team to pursue the vision and fast track the company towards AIPO our acquisition. But that didn't happen. It could have happened. Perhaps it should have happened, but it didn't happen. I was working 80 hour weeks.

I was making progress, but I wasn't finding anyone who really shared my vision of what podcasting could become in Japan. Frankly, I was burning out. It was right at this time when TEPCO, Japan's largest electric utility asked me to help them set up their innovation and startup investment program. It seemed like interesting work, and it paid a lot better than podcasting. I took the job and I walked away from podcast advertising. Yeah, I know that's not the ending you expected, but it actually is a happy ending. From a start of perspective, my decision may look like selling out, but from a podcasting perspective, it's exactly the opposite.

Sure, my podcast advertising empire was a failure, but my podcast is a success. Disrupting Japan has been ad free for well over a year, and it's slowly and steadily continues to gain listeners. People still occasionally tell me that disrupting Japan was what turned them on to podcasting. And so far, four Japanese startup founders have told me that listening to the guests on this show is what gave them the courage to start their own startups. And that means a lot to May. Our fourth anniversary show had 230 people show up. Once in a while, I'll see a disrupting Japan sticker on a random laptop or two in a co working space, and it it makes my day podcast and could be a great business. But podcasting and the podcasting business are very different things, but I'm not really a podcaster. And many of the other independent voices in podcasting aren't really podcasters either.

Were people who create podcasts, and that difference is important. Our medium is not our message. Even when I was a full time podcaster, my podcast did not define me. None of my sponsors were really paying for ad space in the podcast. What they were really paying for was a chance to deliver a sincere message to a community they could not reach any other way. Podcasting lets us tell stories that can't be told in any other medium. It let me create a community that could not have formed around video or print. Podcasting has been financially rewarding and an amazing tool for networking and building a personal brand. All those benefits you hear about podcasting are absolutely true. But there's also something I never expected going into this project. Podcasting made me a better person. I discovered that interviewing people is easy, but having a meaningful conversation that's hard. It's hard to get people to go off script,

particularly if they're not media trained, and they're not speaking in their native language. I wanted people to open up about what really worries them and talk about the problems that keep them up a night. But that takes a level of empathy and sincerity that I simply didn't have when I started this project. Ironically, it turns out that the best way to get people out of their comfort zone is for lack of a better term, being comfortable outside my own comfort zone. Everyone is happy to give abstract advice and recite clever anecdotes. But I found that if I wanted people to open up and to be honest with me, I had to go first. Being an objective, detached observer simply didn't work on Lee when I shared my own hopes and fears and my own insecurities were others willing to share theirs with me. And I discovered this was true not only in podcasting, but personally as well. Every time I push myself to talk candidly about something that made me uncomfortable, whether that was the search for my birth parents,

for the catastrophic failure of a recent startup, I was rewarded every time this stream of support was overwhelming Every time I shared something riel, people contacted me to let me know that they were in or had been in the same place. A lot of people told me that it made them feel a little bit better just to hear someone else talk about it. Podcasting changed. May I listened Maur and talk less than I used to At parties, I find myself subconsciously slipping into interview mode, and people I've just met end up telling me their life stories. I enjoy those parties a lot more than I used to. People are a lot more interesting than they used to be. But of course I'm the one that's changed. These people have always been interesting. I just hadn't noticed before. I've become friends with a lot of my guests, not expanded my network or leverage my platform, but but simply become friends.

We get together for drinks and exchange crazy ideas. Our world today is filled with Clickbait content, influence marketers and fake it till you make it founders. We're all desperate for honest connection. I think the reason people have responded so passionately to my stories is not because they're exceptionally interesting, but because it gives them permission to share their own. And podcasting is uniquely suited to intimately sharing oneself. We have the ability to literally whisper in people's ears and to tell them our secrets and our truth and that kind of honesty in connection. It's rare today. It's valuable and and I don't mean valuable in the simplistic capitalist sense of creating something that could be monetized. I mean it in the the whole is greater than the sum of its parts sense of value, that kind of personal, honest communication. That kind of connection is a big part of what makes us human. And so listen, I want to thank you not just for listening to disrupting Japan,

not just for coming along with me on this journey, but for making the whole journey possible. And I promise you, we're just getting started. And most of all, thanks for listening and thank you for letting people interested in Japanese startups know about the show.