How a little known Japanese Internet startup is shaking up the global music industry

We will Rock YouSix years after graduating from Imperial College London in 2006, British born Malek Nasser was with a friend in a Tokyo bar discussing Internet startup ideas. Malek had recently sold his first Internet business to Double Click and was looking for his next venture. As the evening sailed on, the conversation turned to which club they would visit later that evening. Malek was familiar with the best music clubs in Osaka where he had been living but knew little of the Tokyo music scene. Then his friend hit upon an idea: “Why don’t you build a system that tells people the best places to go and party?” Not knowing much about the subject but having a passion for clubbing, Malek thought, “I can do this”.

And do it, he did.

The software platform Malek built with the help of his Californian partner, Sach Jobb, now serves the full breadth of Japan’s music events industry. Called iFLYER, the platform is a state-of-the-art content management system, social networking system and marketplace that serves end-users, venues, artists and promoters alike.

What’s more, as the platform was developed in Japan, their activities have largely gone unnoticed by Western competitors. That’s bought them valuable time to develop a platform with the capacity to leapfrog future competition. Six years after launching iFLYER, Malek and Sach are only now taking iFLYER global. Beacon Reports holds expectations their platform will rock the global music industry.

Here’s why….

When Malek launched iFLYER, the platform ran only on mobile devices. It answered the simple question, “What music events were happening now,” which varied based on an individual’s music preference and location.

Three months after launch, Malek met Sach. The two hit it off and became business partners. Together they hung out in the music clubs of Osaka befriending venue owners. They asked them what problems they faced and began developing a platform which minimized venue owner’s “pain”.

Each venue had their own website that needed constant updating. That was a task venues had previously farmed out to third parties, who did so manually. So the first thing Malek and Sach did was to offer homepages that venues could update themselves through a content management system. That solved the chicken and egg problem all internet startups face at launch, in this case, obtaining website traffic while convincing venue owners to input the event information. “This was a weird idea for many Japanese companies in the early 2000s and was definitely not accepted practice in the music event industry,” says Malek. The reason was that nobody before in Japan had developed a software solution focused on the events industry.

Malek and Sach then had a content management system containing event information of venues throughout Japan. They had achieved this simply by talking to venue owners and giving them a good solution, matching technology with the way venues conducted their business. “That was quite unusual. Nobody else was doing it,” says Malek. People in the industry were saying, “You actually understand what we have to do.”

With a minimal viable product providing a basic service of value to venues, Malek and Sach began to expand iFLYER’s business organically. First they created what amounts to a Wikipedia database of performing artists.

But then artists started asking, “Can you change my name? It should be all in caps.” Or they would ask, “Can you change my image?” It was becoming a lot of work, so Malek and Sach decided to build a content management system for artists also. Information about the artists was then crowdsourced by the venue owners themselves, who found the artist’s database invaluable. Soon they had a big database containing all the artists who were playing at venues throughout Japan.

Three separate content management systems were built − one for venues, one for artists and then another for promoters. “It was a collaborative effort,” says Malek. “Everyone added their own content. Every time we learned about something else, we adapted our software solution to fit that problem. Now we’re also servicing the labels.”

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Malek explains how he and Sach developed the platform around the music industry’s actual needs: “Events are complex propositions. Each event consists of one venue, one or two promoters, and maybe 10 artists. Perhaps labels are involved too. Sometimes there are as many as 10 or 20 people contributing to one event. You need to organize who has control over what and when. If something goes wrong, there can be finger-pointing. A lot of money can go into the production of an event, especially if it is big. iFLYER could get blamed, for instance, because ‘tickets sales were slow’. We wanted to avoid that kind of liability, so we gave everyone control over their own assets within the system. Our philosophy was, ‘we’re not going to change anything. You do it. We’ll just hold the information for you.’ That’s why we created a complex permission system.”

Malek and Sach learned that, in the music events business, the venues, artists and promoters are inextricably intertwined. So the pair decided to completely rebuild their software from scratch, effectively combining all the content management systems into one. Under the new consolidated platform, called APEX, when one person logs in, they can now control multiple profiles. “Understanding the complex relationship between the venue, promoter and artist is the DNA of events management,” says Malek. “APEX mirrors that relationship structure precisely. This is what makes it so appealing and instinctually familiar to the industry at the same time.”

Malek and Sach didn’t stop there. They also added a social media component. Under APEX, users can now see who’s managing the other venues. “Instead of just merging the three systems, we made it so users could communicate with each other in a collaborative and visual way,” says Malek.

“We took down the walls to let everyone see what everyone else was doing. APEX is like a social network. If you log into Facebook and you want to communicate with someone in the music industry, it’s difficult. There are billions of people on Facebook. It’s tricky to find the right people to speak to. LinkedIn is also great because it’s for professional people, but is not specific to any one industry. Under APEX, you can login and instantly see what other people are doing right now.”

According to Malek, APEX is now the place where Japan’s music events industry communicates with one another. “Today, you can log into the system, not know anybody in the industry, and find out who’s managing who and communicate with them. You can also create an event without having any previous industry connections at all.”

After launching APEX, the number of users began to take off and Japan’s music industry became aware of iFLYER. Malek and Sach learned that the staff at Ticket Pia, a large publicly listed Japanese online ticket agency, routinely referenced iFLYER’s website to checkout event information. “That was a huge validation of what we had accomplished up until then,” says Malek.

The board of directors at Ticket Pia had been eyeing iFLYER and in mid-2012 bought a small stake in the company. Malek and Sach did not need the money, but the two are hopeful the strategic investment will help iFLYER grow more quickly.

From their perch in Japan, Malek and Sach are currently focused on growing the platform and going global. The current platform manages 2,000 to 3,000 events per month and contains the profiles of some 20,000 artists. They have global competitors, to be sure, but apparently none provides a single integrative service the way iFLYER does.

Reflecting on their journey, says Malek, “If I were going back six years ago, and I said to myself that iFLYER was going to be what it is today, I would be scared to build it because it seems like such a big thing. But because it grew from a minimal viable product, that actually made it possible.

Beacon Reports believes, barring the making of any future strategic errors, Malek and Sach will be rocking the global music industry.

Sach Jobb & Malek NasserMalek Nasser, CEO (right) and Sach Jobb, COO (left) of 77hz Ltd (iFLYER). The British born Malek started and sold his first Japanese Internet business to Double Click before founding iFLYER in 2006. Californian born Sach Jobb joined Malek in the business as COO shortly after its founding. iFLYER has grown to become Japan’s leading website in the music event space.

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