Things don't always go as planned. In fact, they usually don't. Four years ago, femtech was both a rapidly-growing product category and a nationwide movement vocally championed by politicians, industry, and the media. As the market began to grow, however, Japan's incumbents took note and took action. The femtech social movement began to decouple from the products. Today we talk with Amina Sugimoto about the future of femtech in Japan, the fragile nature of public promises in the face of corporate lobbying, the likely impact of Prime Minister Takaichi on femtech, and how, despite aggressive lobbying by the incumbents, foreign femtech products are starting to enter the Japanese market. There is a lot of important advice for anyone thinking of entering the Japanese market. It's a great conversation, and I think you'll enjoy it. Show Notes What femTech means in Japan Why its hard for men to invest in femtech -- even when they want to The transformation of femtech in Japan Massive social and political support does not always translate to sales How Japanese incumbents (still) stifle innovation The core challenge in introducing new innovation in Japan Prime Minister Takaichi's likely impact on femtech in Japan What other innovators should learn from femtech in Japan WHat's next for femtech in Japan Links from the Founder Everything you ever wanted to know about Fermata Follow Fermata on Twitter @hello_fermata Friend Amina on Facebook The Kegg Crowdfunding Page Leave a comment Transcript Welcome to Disrupting Japan, Straight Talk from Japan's most innovative founders and VCs. I'm Tim Romero, and thanks for joining me. FemTech is, well, it's just different in Japan. FemTech in Japan is part market disruption, part social movement, part technological innovation, and part bureaucratic red tape. It's something that everyone seems to get behind and support, but at the same time, that support is often slow, sometimes very slow, to translate into real action. Well, today we sit down once again with Amina Sugimoto, founder of Fermata. And Amina is absolutely on the forefront of Japanese FemTech, women's health, and the regulatory challenges that these products face in Japan. Now, since we last had the chance to catch up with Amina three years ago, Fermata has had a change of fortunes and a change of strategy. Amina saw the growing social movement that powered FemTech in the early days start to decouple from the technology and take on a life of its own. And so she restructured Fermata, shrinking the team of 35 down to a small core team, and then refocusing and rebuilding. Amina and I talk about why FemTech is having so much trouble crossing the chasm in Japan, what happens when Japanese incumbents decide they don't want you in their market, and what's really going to be at stake for women's health in Japan over the next five years. But you know, Amina tells that story much better than I can. So, let's get right to the interview. Interview Tim: So, we're sitting here with Amina Sugimoto, the founder of Fermata, and one of the most active advocates for FemTech in Japan. So, thanks for sitting down with us and welcome back. Amina: Thank you so much for having me again. I'm super excited for this. Tim: So, we've got a lot to cover because so much has happened in I guess the last three years since you were on the show last. Just to kind of set the stage, like the word FemTech, it means a lot of different things to a lot of different people. So, what is FemTech? Amina: So yeah, it does mean a lot of different things for different people. Initially, the term itself, people started using it around 2017, I think 18-ish. And it used to be a term that being used between investors and entrepreneurs. And at the time, a lot of sort of entrepreneurs working in sort of women's health, they were having a hard time getting investment. So, they came up with a term to communicate with investors. And it literally sort of back then means the latest technology being applied on women's health. So, it was very broad back then. Tim: So originally, it was more of a financing, an investor-focused term, rather than a consumer-focused. Amina: Yes. It really was. Tim: Interesting. Amina: Because back then, FemTech, edotech, I think all these terms started to sort of appear. Back then, and it still is, the majority of people working in finance are men. And it's not like men's fault, but it's just difficult to communicate about the industry. Like this product is for menstruation, this product fertility, rather than saying that the FemTech sounded a bit easier for investors to sort of... Tim: And I see what you mean. It's not really discrimination exactly. It's just investors tend to invest in what they know. Amina: Or what they like, or what... Tim: What they understand, I mean. Amina: Exactly, exactly. So, there was a gender imbalance within the investor world. And so the term then was used to raise money. Tim: But now it's taken on a much, much broader use. Amina: Yes. So interestingly, the term, so just sort of like around the same time as COVID. And I think that's when the people start to get more interested about their own well-being or wellness. So, when Fermata started, it was in 2019, we started to use the term FemTech for consumers. It was during COVID, so we started to events on women's health, and we started to use the term FemTech. And I think that sort of, it was the right timing. So, the term itself in Japan sort of spread really quickly. All these major magazines, newspapers started to pick up. But sadly, compared to what's available in the US or Europe, there are not many tech products available in Japan yet. It's just that the word simply became a lot more popular than the actual industry. Tim: Is that because of regulations around medical technology? Is it just a Japanese consumer's reluctance to try new things? Why do you think it's? Amina: Well, I think there's a lot of things. And one of it is, of course, deregulation, which I can tell you more about later. Another thing would be that we have a pretty good health system. So, for people in Japan, compared to let’s say Americans, we are less interested in purchasing new products, because it's easier and cheaper to go to a doctor. So, the mentality and sort of the industry itself is a lot different. However, there is a trick. The Japanese health system only covers clinical stuff, not prevention. And women's health, most of it is related to prevention. So, we can only get covered by government if we have a breast cancer. But to prevent breast cancer, the only way to prevent it is to go to the checkup provided by the government. But there's no intention. There's no motivation to create something in between. Something that maybe we can track something at home. Tim: So, last time we spoke, Fermata was experimenting with a lot of different business models and business directions. You were working with a lot of imported products. You had some pop-up stores, a couple of physical stores in e-commerce, and doing B2B consulting. And where is Fermata today? Amina: I made a decision in February 2024 to shrink the size of the company to just myself. The market didn't grow as fast as I predicted. So, February 2024 is when Fermata hosted our signature event called FemTechFest. We had over 6,000 people coming and we rented out the entire floor of Roppongi Hills. But then I realized soon enough, the market in Japan when it comes to women's health and FemTech will hit the chasm. So, we managed to just capture those individuals who's early innovators or those who's interested in this kind of product. But we struggled enough to get into the mass market. So, the women's health industry was hitting the chasm. And then I felt that when I hosted the event of over 6,000 people, we can host an event and bring in loads of people, but it doesn't directly link that with our sales. And there's something wrong is happening. Tim: You know, it is. I mean, one of the things you told me last time we spoke really stuck with me about FemTech in Japan. And I think it goes directly to what you're telling me now. Last time you mentioned that FemTech is more than a product category in Japan. It's more of a social movement. It gives people kind of social permission to reexamine gender roles and to reexamine these conversations that were once considered settled about what's appropriate for women to do and things like that. Can you talk a bit about if that's still the case? And is it more that the interest was more on the social dynamic side than the product side? Amina: I think it still is. So, we couldn't get any of the signature tech products out in the market in the last five to six years because of the regulation, because of the market dynamics were spread. And then people had this high expectation and motivation. Yes, we can now freely talk about our own health issues, period, menopause, whatnot. And that did get to a certain level in Japan, there's a TV shows and stuff. So, the environment around it has changed. But yet it has a lot stronger social movement connotation to it. And then not so much of the business industry side. So, when it comes to B2B business, we get a lot of inquiry from companies. Okay, we would like to do something about FemTech. And I'm like, what do you mean by something about FemTech? And for me, I'm like, whenever we speak with the Japanese, especially the big companies, it's not their fault, but they're just very general. And I guess those people who's responsible leading this project, they're often women. And they have something that they want to communicate. They have these passions and maybe the struggle that they have gone through over the time working in the company. But it's usually like more of a social side and the product development. Tim: Yeah,...
