Hey Mickey, You’re So Fine: Meet the Man Who Landed Silicon Valley’s Hottest Funding Deal in Pinterest
There’s no question that every venture capitalist within 100 miles of Silicon Valley wanted to squeeze their khaki-clad selves into what had become tech’s hottest deal of late.
That would be to get a piece of the new round of funding for start-up phenom Pinterest.
But while piles of VCs and other investors tried to work every angle possible to noodge into the action, the iconoclastic CEO and co-founder Ben Silbermann decided to go big and go global by hooking up with a Tokyo-based Internet giant.
Japan’s Rakuten will invest upwards of $50 million in a $100 million round that values the social bookmarking site at $1.5 billion.
Rakuten is one of the largest online commerce companies in the world, with a flagship site Rakuten Ichiba, among others. It was founded in 1997 and had revenue of $4.7 billion in 2011.
Most important in Pinterest’s calculation was apparently the link with its CEO Hiroshi Mikitani, whose nickname is Mickey. One the richest men in Japan, Mikitani is one of the best known entrepreneurs there where he’s been described as “Richard Branson meets Jeff Bezos.”
I briefly chatted with Mikitani last night about why he decided on the Pinterest deal, in a conversation where he focused a bit on Rakuten’s famed “omotenashi” or “empowerment” philosophy. Simply put, the concept is that — unlike an Amazon — Rakuten is a facilitator of commerce, much like its shopping mall metaphor beginnings. The approach is to aid merchants rather than compete with them.
It’s a little eBay, a little Alibaba, some Etsy and even a little Amazon Web Services mixed in. It’s also a place that can move retail globally, which is presumably the attraction to it by Pinterest.
ATD: Why did Pinterest pick you?
Mikitani: We are not a venture capitalist. We got together and talked about our story and our history.
We agreed that we shared a vision of the future of Internet e-commerce.
ATD: Why make an investment?
Mikitani: When we started to talk about being involved in the round of investment, we wanted to invest as much as possible.
We were very impressed by their business model and also the management style.
ATD: What made Pinterest so attractive in comparsion to other similar companies?
Everyone is talking about social commerce and best solution to social commerce, but Pinterest really was the first to use graphics that well to connect with people.
Facebook has used connected ways to reach friends, but Pinterest had a totally different approach to using more graphical ways to connect interests.
Rarely have we seen such a powerful media and we were seeing huge traffic coming from Pinterest [to Rakuten sites]. It was much higher than anyone else.
ATD: What do you bring to the table?
Mikitani: I think there are some things we think we can do with our expertise. Ben and his team have an extremely strong commitment to make their products as attractive as possible.
I did not think we could compete with Pinterest at all.
But we have 40,000 stores in Japan and we can give them access to our customers and do aggregation to engage in everything. And we have sites in many other countries too.
ATD: How are you going to work together?
Mikitani: We are not going to stop them from doing dealings with other e-commerce companies. But we can have more constructive input on how to make their site more effective from e-commerce point of view.
We can drive revenue. We have strong experience in mobile. We can combine their apps with our apps.
This is a long-term arrangement and we have a strong committment and attachment to this business. We truly understand their business and respect their management.