Innovating Translation Technology from a Global Perspective: Interview with Suguru Sakanishi, CEO of Yaraku, Inc.

Yaraku, Inc. is supporting multilingual corporate communication with its unique CAT (Computer Assisted Translation) tool that combines machine translation with human expertise. We spoke with CEO Suguru Sakanishi about his entrepreneurial experience in America, his current business and his vision for the future. From a business that began on a drunken impulse to building a diverse global team, there's much to learn from Sakanishi's unique perspective and experiences.

—— Could you please introduce yourself and tell us about your background?

I'm Suguru Sakanishi from Yaraku. After graduating from Waseda University, I moved to  America and simply put it, I started a business in New York and became independent around 2005. I ran that business for about 6 years before returning to Japan and established this company, which is my second venture.

I was born and raised in Fukuoka. My aunt married an American and was working as an artist. I really wanted to go to university in America, but due to various circumstances, I ended up attending university in Japan. After graduating, I moved to America and started a business in New York.

My first job after graduation was selling sake in Silicon Valley. We were selling local sake like Hakkaisan. Later, I was transferred to New York since it had the largest sake market. But I realized sake wasn't quite right for me. It was fun, but career-wise, I had been involved with IT since university, so I wanted to enter the IT industry.

By chance, a startup in New York was recruiting people, and I joined as a founding member. It was a media business—a portal site for Japanese people living in America—and I was handling various aspects by myself. One day, I got drunk on sake and searched for "corporate" online, and an advertisement came up saying I could start a company for just $349. I thought, "I can start a company for just $349?" and in my drunken state, I entered my credit card information and fell asleep.

About two months later, I received a bill from the tax office saying "Congratulations, please pay your taxes," and I realized, "Oh right, I started a company." That's how it all began.

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—— That's quite a trigger. What was your business like at that time??

Rather than raising a lot of capital and doing something flashy, I mainly started with web development and translation services. At that time, there weren't many companies doing quality work locally, so we created international websites for Japanese companies like Itoki and Yamaha.

But selling website development and translation services to Japanese companies wasn't very interesting and led to price competition. So I changed my approach and decided to create Japanese websites and provide promotion services for American companies.

In America, you could find directories of advertising agencies in libraries, including the names of contacts. While sending Christmas cards is part of the culture there, I deliberately brought New Year's cards from Japan, attached a 5-yen coin, and wrote "Five yen to the world" with a message like "ou who received this have now made a connection (go-en) with me." When I sent these DMs, I received a tremendous number of inquiries and secured major clients.

Besides myself, I had three staff members: a Japanese-American, a Jewish woman who loved Japanese people, and someone who had converted to Islam. We worked together until I eventually transferred the company to my partner and returned to Japan.

—— What inspired you to start a translation business?

After returning to Japan and doing research, I found that the translation market was growing. Globalization was advancing, and while English and Japanese speakers initially dominated online, multilingualism was increasing year by year. I saw data showing that Asia accounted for more than half of the online population, which led me to choose the translation business.

However, I struggled after returning to Japan. Everyone else had entered companies normally as new graduates, but I had been in America from university graduation until I was 30, so I had few connections and my university friendships had stagnated. It was after the Lehman shock and the venture capital scene was devastated, but I managed to start by winning a business contest.

Initially, I created a multilingual bulletin board that would convert phrases like "konnichiwa" to "hello." Later, we specialized the multilingual board towards anime and manga, connecting anime fans worldwide in multiple languages, and launched a business plan in 2010 to sell figures and keychains through cross-border e-commerce.

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—— Could you tell us about your current business?

We develop a professional translation software called a CAT tool (Computer Assisted Translation). When people think of machine translation or AI translation, they usually think of Google or DeepL, but companies don't simply copy and paste from these services when communicating information. For example, if you translate a contract using Google Translate and say "Let's agree on this," it could cause major problems if there are any mistranslations. That's why professional translators are needed and are still used.

We provide a solution that uses AI to improve the productivity of high-quality translations that companies need. For instance, if you want to translate a Word document, you drag and drop it, select the language and engine and start. Up to this point, it looks similar to Google, but the difference comes next.

When text is extracted from the document, it's classified according to how closely it matches previous translations. When you click on a section you want to modify, various results from engines like Google, our own engine, Microsoft, Claude, and GPT are displayed on the right, and you can click on the one you think is best. The modified data is accumulated in a phrase collection and used for machine learning. The more you use it, the more it learns, improving quality and further increasing productivity.

Our main clients are automobile manufacturers, semiconductor manufacturers and chemical manufacturers. Recently, we've also seen growth in inbound tourism-related accommodations, retail and restaurants.

—— What principles or values do you consider important?

From when I first started my business in New York, I was accustomed to working with foreigners. I worked with Japanese-Americans, Jewish people, and Islamic Americans using broken English and acquired foreign clients. From that experience, even now more than half of our company is made up of foreigners, with diverse people working together. I value hiring diverse people and creating teams that leverage this diversity.

—— How do you manage to coordinate a global team?

By keeping things simple and being straightforward. Japanese culture of "reading the atmosphere" doesn't translate well, so I tell everyone that if they have something to say, they should say it simply and directly to the person concerned.

—— What challenges do foreigners face when starting a business in Japan?

The main issue is that government information is only available in Japanese. I also have companies in the Netherlands and Belgium, and official information there is in Dutch and French, which is challenging. You might manage to establish a company with effort, but as you try to grow it, regulations regarding employment, taxation, and so on are all in the local language, making it difficult to understand in your own language. You need help from specialists like lawyers, labor consultants, and accountants.

—— Conversely, what are the advantages of starting a business in Japan?

Depending on the nature of the business, I think the competition is less intense compared to America. Also, rent and labor costs are cheaper compared to Europe. Raising funds is easier too.

When I established a company in America and went to a bank asking for a loan, they would only lend me about $1,000 (approximately 150,000 yen). But in Japan, you can borrow millions of yen without collateral. Thanks to the Japan Finance Corporation, I think the business environment is better than in America.

—— What is your vision for the future?

I hope this concept spreads more widely and becomes an infrastructure. Specifically, we want to use generative AI to enable more context-specific translations, and we also plan to release an interpretation function that translates spoken words in online meetings in real-time by around autumn this year.

The technical challenge is handling specialized terminology and internal jargon used by our clients like manufacturers. Standard translation features in services like Google Meet can't adequately handle these, so the key is to use accumulated data to address this specialization.

—— Do you have a message for Blackbox readers, young entrepreneurs, engineers, or those considering starting a business in Japan?

I think you should just give it a try. Especially in terms of finance, Japan might be easier than you'd expect. With resources like the Japan Finance Corporation, I believe the business environment is better than in America. I encourage you to take the challenge.

Editor's Note: Technology That Transcends Language Barriers and the Value of Diversity

Sakanishi's business career, which began with a $349 startup application made on a drunken impulse, teaches us the importance of "just trying." His journey from sake sales to IT and then to translation technology may not have gone according to plan, but the accumulation of these experiences has led to the current success of Yaraku, Inc.

Particularly impressive was Sakanishi's approach to global team management. An environment where more than half of the employees are non-Japanese is rare among Japanese companies. His emphasis on simple and straightforward communication rather than a culture of "reading the atmosphere" represents a universal value that will be increasingly demanded in global business.

Sakanishi's mention of the "ease of fundraising" as an advantage of starting a business in Japan was an unexpected insight. The abundance of public support, including from the Japan Finance Corporation, can be a major attraction for entrepreneurs from overseas.

With real-time translation functionality scheduled for release this autumn, we look forward to seeing how Yaraku, Inc. will continue to expand the possibilities of translation technology alongside the evolution of AI.

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