Technically speaking, setting up a company in Japan as a foreigner is not that hard. What is harder to come by are the cultural differences.
Speaking, reading, and writing Japanese matters when doing business in Japan. Unless your Japanese is immaculate, and you have years of experience dealing with Japanese professionally, direct business with Japanese clients will be challenging. In that case, hiring Japanese staff may help but won’t suffice. The foreign community is a smaller but welcoming market.
Paperwork
Starting a company involves stacks of paperwork, unfamiliar procedures, and official stamps. Many firms handle all of this for a fee. Trusted Japanese contacts can recommend one, and from there professionals can manage the process. The same applies to accountants.
For a small business, secure some starting capital, at least 30,000 USD for a solo founder. Income can take time to appear.
Create a business plan, update it quarterly, but avoid over-planning. Start small, get things moving, then refine your direction based on real numbers and real feedback. This approach beats getting stuck in theoretical forecasts.
Work Ethic
Startup or not, if you hire Japanese staff or deal with Japanese customers, you will at some point have to deal with Japanese business culture.
Work ethic in Japan differs sharply from Western norms. Long hours with limited compensation are common. The kanji for company (会社) combines the ideas of meeting (会) and shrine (社), and the boss (社長) is understood as the elder (長) of the shrine (社). Work functions almost like a belief system. While things are changing, the culture still treats business norms as something that cannot be questioned.
Hours are long, and presence often matters as much as productivity. Staying at the office until midnight, then joining colleagues for drinks until very late, shows how closely identity is tied to the company. But like athletes who train past the point of benefit, at some point, anyone will simply feel exhausted. To stay sharp, we need to enjoy what we do.
Competing on hours is unrealistic, but foreigners can keep up by focusing on their cultural strengths. A different view point and efficiency are advantages foreigners can bring. But don’t mistake lack of open resistance for agreement: Doing things differently will be met with carefully guarded, deceptively polite skepticism.
Creativity
Japan’s creativity is remarkable. Tokyo is a firework of creativity in every thinkable way, and viewed as a whole, the country produces remarkable creativity. Japanese cuisine alone proves this point.
Japanese employees may struggle to express themselves freely, and not just because work culture leaves little space for self expression. Japan is notorious for taking decisions collectively.
Being seen as “wagamama” (selfish) is a deep cultural fear beyond business culture. Originality is not celebrated as a value in itself. Japan has a healthy understanding of imitation as the foundation of true originality. Writing, cooking, drawing, and music all begin with imitation.
Western culture places heavy weight on self-expression, sometimes to a point of shameless self embarrassment. Japanese creativity tends to grow from careful consideration rather than individual expression.
We cannot be what we are not. And Japanese culture won’t let us become Japanese to begin with. A foreigner that speaks perfect Japanese is still considered to be somewhat odd exception. Almost like an insult. Imagine a dog that recites Shakespeare. To become a dog that recites Chikamatsu Monzaemon (the Japanese Shakespeare) will eat the time and energy you need to build your business.
You should learn Japanese as much as possible, but, at the same time, make sure that you don’t over-adjust. Over-adjustment is a trap a lot of foreigners fall into. Being different remains an important asset for foreigners building a business in Japan. We will always be seen as different, so we may as well use our difference, and the extra leeway we are given, to our advantage.
