Mercari’s Shintaro Yamada discusses what makes a truly strong “organization and person”
Eight years since the company was established in 2013, Mercari has grown into Japan’s top unicorn company—a privately held startup valued at $1 billion or more. Superior product development, marketing activities that capture user insights, global challenges…
It was people who supported all of that growth.
Mercari has continued to attract talented people since the company was founded, backed up by a history of investing in people more seriously than any other company. Around half of the engineers at their Tokyo office are from overseas, and diversity is progressing within the organization.
What is Mercari’s idea of a truly strong organization or person? We sat down with founder, Representative Director and CEO Shintaro Yamada and asked him about his future outlook to uncover the source of Mercari’s strength.
※This article is a repost from Newspicks
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Shintaro YamadaAfter graduating from Waseda University, Shintaro Yamada established Unoh Inc., where he launched various internet services including “Movie Life,” “Photozou,” and “Machitsuku!”.In 2010, he sold Unoh to Zynga. After leaving Zynga in 2012, he went on a trip around the world. In February 2013, he established Mercari, Inc.
The unchanging unifying force behind Mercari
Yamada: “Let’s create an Internet service that is used around the world.” This feeling hasn’t changed since the company was founded.
I took this on because wanted to do something bigger, not just by myself, but as an organization, as a company. That’s why bringing together the right people has been so important. We take a lot of pride in that.
Our business has grown, and the organization has always changed rapidly, but my personal approach toward people has remained basically unchanged over the past eight years.
The core of our approach to gathering people together is to find people whose goals resonate with our mission, to “create new spaces in a global marketplace.”
We want to know whether someone can embody our three values: Go Bold, All for One and Be a Pro.
Mercari as a product of individuals
What’s important for the individual working with us, though, is whether what they can do at Mercari matches what they want to do.
What kind of opportunities can Mercari provide? What will they get in return?
More than just making money, what’s important is the individual’s desire to have a positive effect on the world, to leave their mark on society, and whether that matches with the direction of the organization.
At Mercari, we have a lot of excellent members who each have the potential to create their own businesses.
These kinds of people have options. They don’t have to work for Mercari, they could go wherever they want to. If you tell these people that you want them to do this kind of work because you want to do this kind of business, it won’t resonate with them.
It doesn’t matter how hard we might try to recruit them, because they won’t be interested if it deviates too far from their own goals. The biggest impact on their performance is whether they’re enjoying what they do.
I try to meet up with friends from various industries on a regular basis. They inspire me. These days I’m always keeping in touch with them, checking what they want to do.
If I think it’s something they can achieve at Mercari, I tell them about the different opportunities that we can offer. Those people that we’ve gathered together have helped build Mercari into what it is today.
Of course, some people join and others leave, but there are some people who come back again after leaving us.
Our long-term vision remains unchanged, but the challenges in front of us that we have to take on now are always changing. So there are times when people think, “what I wanted to do matched the company when I first joined, but now they’re in a different place.”
Moving on to another path is, in a sense, a natural thing. You can graduate from Mercari and do whatever it is you want to do, and if we have a chance to work together again, that would be great.
The relationship between people and organizations is fluid, and as management, I believe that being able to provide a variety of opportunities leads to organizational strength.
The desire to bring together a multinational organization
As a result of promoting the recruitment of excellent candidates, around half of the members working as engineers at Mercari today are non-Japanese.
Our group of engineers are from all over the world: India, China, Taiwan, Singapore, Belgium. It’s turned into an environment where people speak in English with each other naturally.
They all have their own reasons why they chose Mercari as a place to work. Japan has a long history and culture, and the gaming and manga subcultures, low crime rate and delicious food are all things that draw people here.
That said, I believe that our mission of creating a global marketplace is the central, unifying force in the company.
C2C personal transactions are a very primitive desire.
You could say that the exchange of goods and services was the origin of civilization. With Mercari, there’s something very appealing to a social animal to think that other people would be thrilled to have something that you don’t personally value very much.
There is a kind of emotional exchange in Mercari’s buying and selling process.
I think a lot of our members joined the company because our idea resonated with them. They liked the idea of building a universal human activity, sharing and recycling, into an Internet service.
As our company expands, so does our responsibility to society
Our goal is to build a recycling-oriented society.
As we continue to grow, I am keenly aware that we need to take on some kind of public service and think more about our responsibility to society.
We aim to create a recycling-oriented society by integrating primary distribution and secondary distribution
By providing secondary distribution (Mercari) purchasing/preference data to primary distribution partners (manufacturers, retailers, etc.), we can optimize product development of primary distribution, from production to sales and demand forecasting.
In 2017, there was an issue of sellers listing cash, and the media and customers pointed out that “a ‘platformer’ called Mercari was leaving malicious listings unchecked.”
We really regretted how unaware we had been of our position in society. It made us take a step back and really consider our social standing, what’s good and necessary for society.
If we want to expand our business as an indispensable presence in society, it has to be a service that can be widely accepted by customers with a wide variety of perspectives.
I realized that we can’t keep on being so aggressive, we can’t keep pushing forward without thinking. Not if we want to keep growing.
During the COVID-19 crisis, we also got a lot of criticism for expensive listings for masks during a shortage.
We had already been holding meetings within the company every month, but we thought that we needed more general principles for judging the listing criteria. So we worked together with outside experts to formulate our new “Marketplace Principles,” and we will continue to review them in the future.
In March 2021, we announced an alliance with Fast Retailing to pursue a range of resale measures. We share product and launch information beforehand so that popular items are not resold in bulk on Mercari.
I believe that Mercari has a key role to play in deepening alliances with other companies and bolstering the retail and distribution sectors as a whole.
Confidence gained from D&I
In addition to recognizing the importance of social responsibility, I have personally undergone a big change in my thinking towards diversity and inclusion (D&I).
A D&I perspective is essential for expanding globally and domestically, as well as for developing services for diverse customers.
Of course, the more members with diverse values there are, the more difficult it becomes to reach a consensus. Internal discussions take that much more time and energy.
But now I’m very confident about the quality of ideas that come out of those discussions. We get opinions from different angles and deeper discussions, we find the important, essential points. When the products reflect those answers, we have extremely solid services.
Look at iPhones and Google’s services. They’re very simple, used throughout the world, regardless of the users’ backgrounds. They don’t need instruction manuals because they focus on universal elements among diverse values.
This is not just something for internet companies to think about. It’s an attitude that any consumer-focused business needs to have.
I am confident that D&I will make services universal and be a source of corporate competitiveness.
However, although diversity within the organization has progressed, it’s just the beginning for us in terms of true inclusion.
We want to overcome the boundaries of nationality and gender, but we want go further than that, to create an environment that respects diverse experiences and perspectives. That’s why we’ve established a D&I Council as an organization directly under me, and we’ll continue to take it seriously.
Organizations do not change immediately, but I have high expectations that we’ll be able to establish a concept of D&I unique to Mercari, working year by year to keep making progress.
With its foundation firm, what’s next for Mercari?
Management is like a game of shogi with infinite moves. You have to move your pieces according to the rules.
In a world with any number of choices, those daily decisions pile up to determine the direction of the company.
It’s important to make correct decisions, not quick decisions.
But what’s correct at the time will depend on where the company is at the time and what we’re trying to do. Nobody can really know whether it’s the right decision in the moment.
That’s why I try to collect as much information as I can and decide after considering all my opinions. Even if we come to a conclusion that isn’t my own first choice, if everyone discusses it and agrees, in the end we can sort of “disagree and commit.”
If something goes wrong, we go back to our minutes, have another discussion about what wasn’t considered, admit our mistakes and make a course correction.
This thorough, discussion-oriented attitude has taken root as Mercari’s decision-making culture.
Ever since the company was listed, we’ve focused on three businesses – Mercari JP, Merpay and Mercari US – and we were able to achieve what we have through the exchange of diverse, clashing opinions. That’s what’s gotten us to where we are now.
Currently, the number of users on the Mercari flea market app has expanded to 19.04 million users per month, and the total distribution amount has expanded to 756.6 billion yen annually.
We started Merpay in November 2017 to provide financial services. It began trading on the Tokyo Stock Exchange (TSE) Mothers in June of 2018.
Globally, the C2C business concept using smartphones has begun to spread in the United States. I’m more and more certain that this was the right move, and that there’s a lot of potential for growth in the global marketplace.
From here on, we’re working to double or triple the number of Mercari users in Japan, while at the same time providing solutions through technology to improve safety and security.
Transparency leads to success in the global marketplace. But we can’t really call Mercari a global product just based on our track record in Japan and the US. We’re going to keep challenging ourselves and expanding.
We set up Souzoh, Inc. in January of 2021 to support the planning, development, and operation of new businesses. And in April we lauched Mercoin, Inc., to plan and develop cryptocurrency and blockchain services.
None of this would have been possible three years ago. But now we know more about financial business licenses and legal compliance, knowledge we’ve cultivated at Mercari, and we have a track record of increasing profitability.
Souzoh closed in 2019, but the people we brought on and the lessons we learned there have built the foundations for new businesses. Now it’s time for us to think about taking on new challenges with a new, improved Souzoh.
Today, Mercari has grown into a large organization of more than 1,700 people.
We have an opportunity now to use the assets we’ve built up to establish new businesses that can have a greater impact on the world.
There seems to be a kind of preconceived notion that the bigger an organization becomes, the more they play it safe and take things slow. I can tell you, that’s not the case for Mercari.
We’ve focused on our three businesses and had a great response, so now we’re ready to expand our peripheral businesses with Mercari at the core.
As a tech company, we are in the expansion phase. That’s the future of Mercari.
Interviewer: Takuma Go
Contributor: Rumi Tanaka
Photographer: Hiromichi Matono
Design: Kirika Kosuzu
Editor: Michiko Kashimoto
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