| Entrepreneur plays winning hand
on Japanese Internet Portlander Tim Clark parlays opportunity and instinct into an ace -- he literally wrote the book on Japan's World Wide Web Monday, September 28, 1998 By Steve Woodward of The Oregonian staff If life had gone just a hair differently, he might still be a temp worker with a psychology degree, haunting clubs at night with his rock band The Boxes. Instead, he's an acknowledged guru of the Japanese Internet, working barefoot from the garage of his Hawthorne district home for companies such as Neiman-Marcus Direct and J.C. Penney. Tim Clark looks at it this way: Sometimes in life you turn over an ace of spades -- and you either play it, or you don't. Clark's TKAI,Inc., born of coincidence, obsession and instinct, is what happens when you play the ace. Today, TKAI is known for writing the book on Japanese World Wide Web use -- literally and figuratively. For $2,995 a copy, you can buy the market research document, which contains the most detailed data ever gathered on the 10 million Internet users in the world's second-biggest online market. Moreover, TKAI has worked with more than 40 leading companies as a consultant, researcher and marketer. It produces three monthly email newsletters, two in Japanese, one in English. It has held seminars from Oregon to New York City to Guam. It designs, buys and tracks Internet banner advertising for the likes of Amazon.com and Cyberian Outpost, two of the world's hottest online brands. And TKAI does it all from its international headquarters in a remodeled blue garage behind a cheery yellow house with a white picket fence in Southeast Portland. All because Clark once thought -- mistakenly -- that he could cruise through a college course in Japanese. Ace of spades. Inside the garage, their shoes, parked Japanese-style at the side door, Clark, his Japanese wife and three bilingual employees sit at the nexus of East and West, connecting U.S. businesses with Japanese customers. It's a small, growing and increasingly coveted business: It has one shareholder -- Clark. A half-million dollars in projected 1998 revenue. Profitable since year one, with a current 16 percent profit margin. Zero debt. Three unsolicited offers to invest money in the company and one to merge with another small business -- all rejected. "This is going to sound old-fashioned," said Clark, 6-foot-3 and lanky in khaki shorts and a green T-shirt, "but I'm interested in building the business in an organic way. All these Internet IPOs, they get a lot of money, they blow it, and then they're gone." Like the Japanese culture it values, TKAI is patient. Clark took almost three years to build the staff, which includes his wife, Keiko Onodera, as art director. TKAI chose to develop deep relationships with a few clients rather than shallow relationships with many. "It's a service-intensive business, so it's not scalable," said Clark, who left Japan to earn a master's degree in business administration in 1991. "It's not like software: You make one, you make 5 million." Clark's patience, however, stands in counterpoint to the growing frenzy of interest in the Japanese Internet market. Two leading players, America Online Inc. and Microsoft Network, have identified Japan as their No. 2 global target market, according to a recent report by Hambrecht & Quist. Big Internet portals, such as Yahoo!, have Japanese-language sites. The Internet Mall boasts more than 50 Japanese retailers. And many of Japan's 1,000-plus Internet service providers, such as Global OnLine Japan, have launched programs to connect corporations with the 7 million households that Jupiter Communications projects will be online in 2000. The Internet boom will test Clark, who has come a long way since he turned over his first ace of spades. "I was a typical college student," the 42-year-old Clark said, drifting back to his final semester at Stanford University, where he was about to earn a bachelor's degree in psychology. "I just needed 15 credits to get out the door." And there, in the course catalog, was the first of several aces in Clark's life: a 15 credit-hour class in intensive Japanese. Clark thought it would be a good way to glide toward graduation. It turned out to be academic boot camp, taught by a professor who dressed in black and forced them through relentless daily drills in a language bound by rigid rules. Clark graduated, broke and in debt. But he had become obsessed with Japanese. "I loved the language, I loved the idea of going over there," he said. "I had this instinct that there was definitely a big opportunity there." After bouncing among temp jobs in Seattle and California's Silicon Valley, writing original rock songs and making demo tapes, Clark left for Japan in 1984. Within hours of his arrival, he found himself listening to an elderly drunk on a long train ride to a friend's home in Tochigi Prefecture north of Tokyo. His heart fell when he realized he didn't understand a word the man was saying. "I thought I had landed in the wrong country," he recalled. Clark, however, was driven by obsession and good luck. A computer programming college gave him a job teaching English conversation, and suddenly he was on track to learn not only Japanese but also computers. Ace of spades. A "mystical experience" By the time he left the school five months later, he could read Japanese newspapers without a dictionary. He launched himself as a free-lance translator, mostly for a small firm called Digitized Information. Beginning at 4:30 every morning, he and the company owner would devour the nation's profusion of daily electronics and telecommunications newspapers. Then they would digest and translate the information for clients, mostly large foreign firms with Japanese operations. Clark kept up the work even while earning an MBA at the University of Hawaii. Then, in 1994, he had what he calls his "mystical experience" with the Internet. On a trip to Japan from Hawaii, an American friend introduced him to an amazing, new experience: surfing the Web. Clark was agog. "My first question was: 'How do you do this in Japanese?' He said, 'You can't.' "That's when the big light bulb went on." Ace of spades. Coding Japanese Then the big break came: Netscape added Japanese language encoding to its Web browser. "It instantly became very easy for Japanese people to set up pages and view them," he said. "The market went like this --" He slapped his hands together and shot one off at a 45-degree angle, like a rocket. Clark and Onodera quietly put the Do-It-Yourself Import Center online one month before the formal July 1, 1995, launch date. A Web-surfing Japanese newspaper reporter found the site and contacted Clark. The first time a Japanese newspaper had interviewed Clark was at Stanford, where he talked about the experience of learning Japanese. Clark's photograph ran with the article on the front page, generating letters -- and even cookies -- from half a dozen Japanese women who wanted to meet him. This time, the article about Clark's and Onodera's new Web business ran on the same day they launched the Web site. Several magazines picked up on the newspaper article. Publicity generated hits on the site; hits generated a base of users; the user base generated Clark's first insights into the minds of Japanese Web users. Even now, www.diyer.com still attracts 500 Japanese visitors a day. Ace of spades. Playing the last card Powell's Books was an early customer. Its technical bookstore had just gone online, and 30 percent of its sales were coming from Japan. TKAI and Powell's built a Japanese home page. It lasted only one year. "We needed more than a Japanese home page," said Kanth Gopalpur, Powell's online marketing manager. "Japanese customers still had to do a search in English." The difficulty lay in Powell's market niche: used books. Powell's couldn't afford to translate its massive inventory of used books into Japanese. At the same time, big online competitors began to undercut Powell's prices on new books. "For an informational Web site, they're good," Gopalpur said of TKAI. "It was a great publicity thing for us." By 1998, TKAI had picked up more expertise in gaining Japanese customers. One current customer is Cyberian Outpost, based in Kent, Conn., through Japanese customers buy more than $300,000 a month in computer software using its Web site (www.outpost.com). "TKAI doubled our monthly Japan sales during the first 30 days of their new '98 marketing plan for Cyberian Outpost," said Robert Rathbun, Cyberian's vice president for marketing. "As far as I'm concerned, their skills and expertise are unmatched." Clark relies on a small corps of bilingual employees. The media manager, Hiroko Brown, and the system engineer, Jun Kamaya, are Japanese. The research assistant, Kevin Schaer, is American. Then there's Onodera, Clark's 34-year-old Tokyo-born wife and art director. A decade ago, Onodera was a corporate designer, creating packaging for food and cosmetic companies. Clark was on assignment for a Japanese music magazine that sent him to the hip Harajuku district of Tokyo to interview Mark Mothersbaugh, the former lead singer of the rock band Devo. Their paths crossed at a Harajuku He never got the interview. She never went back to food packaging. Ace of hearts.
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