Distraught by a business failure and a career setback, Tsuyoshi Domoto walked despondently onto a bridge in Portugal. The waters of the Douro River slowly flowed far below as he contemplated his options. He saw his parents’ faces staring back at him, and finally made a choice.
“‘What the hell are you doing?’” the tech entrepreneur recalled asking himself. “‘Let’s not give up on this thing called life. As long as there is life, there is hope.’”
Domoto opened up about his down-and-out days and about his 2023 "aha" moment on the Luis I Bridge in Porto during a Tokyo Fail Club gathering held at the Shibuya Ward offices of Google, its sponsor.
Disappointments had pushed him to the brink: a coding school he founded that had to shut during the pandemic, and being passed over for a promotion by a venture capital company that employed him.
Domoto was one of three speakers at the late-February event, where dozens of attendees heard candid talks about ventures gone wrong, bankruptcy and depression. The mood was lighthearted and supportive — like a low-key TED Talk — and persistence in the face of adversity was the overall message.
“Failure is not disgrace,” read a slide projected by the organizers.
One speaker came to Japan with dreams of getting rich and retiring early, but quit his job at a large Tokyo IT company after having difficulty with the culture and clashing with his boss. He then experienced periods of unemployment and relationship troubles.
His speech concluded with a sincere appeal for work.
Max Hodges, also a speaker, hit it big with kanji flashcards decades ago. The Texan's follow-up act in 2008 and 2010 — CD-based walking guides to Tokyo's hip neighborhoods — was a flop. He sunk $40,000 into the business and had to pay another $13,500 just to destroy the CDs, which he couldn't even give away.
"I like to share what I’ve learned with other people,” said Hodges, who now runs Japan Rabbit, a company that buys Japanese goods for people overseas.
Japan can be an especially tough place for entrepreneurs. Venture capital funding as a percentage of gross domestic product is about a 10th of what it is in the United States, while startup funding has been falling since 2022.
For the unsuccessful, it can be even harder.
At past meetings of the Tokyo Fail Club and its precursor, one engineer described how he accidentally switched off his company’s website in the Asia-Pacific region, which led to millions of dollars in losses. A former boxer, who now works in the performing arts, said he developed eating and anxiety disorders in an unsuccessful quest for the championship.
“We all have an idea that it's valuable and meaningful to talk about failure, but there are very few opportunities to actually do so,” said club organizer Riley Masunaga.
“When people do talk about failure, they tend to try and sugarcoat things and frame failures as 'the road to success,' rather than being really honest and truthful about their experiences,” Masunaga added. “We try to make this a space where people can talk really honestly, humanly and openly.”
After leaving Portugal, Harvard-educated Domoto put himself through a coding boot camp and came up with a business idea: sales and consulting for akiya — vacant homes in Japan.
He cofounded a startup, but troubles continued. The venture didn't win an investment in a competition and his partner quit.
He then had a falling-out with the web developer, and his site went offline. Hackers stole the database and demanded ransom.
Indomitable Domoto refused to pay and continued the business using his own money, selling his collection of 1996 Pokémon cards to shore up cash flow. He defiantly showed a bank statement from that period to members of the Tokyo Fail Club: ¥7,009 ($47). The company, Akiya Air, remains afloat thanks to an angel investor.
“For Japan to remain relevant in the 21st century, entrepreneurship will have to drive the economy forward, and entrepreneurship doesn’t work without failure,” Domoto said.
“In Japan, unfortunately, we still shun failure. We need to embrace this culture of failure, learn from our mistakes and move on with life. If we can’t do that, Japan will disappear.”
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