Hiroshi Mikitani at Startup School 2012

TL;DR

Hiroshi Mikitani founded Rakuten in 1997 with $200,000 of his own money, never raised venture capital, and achieved cash flow positivity from the second month by charging merchants six months upfront. He built a “shopcentric” marketplace that facilitates communication between small/medium merchants and consumers, diverging from Amazon/eBay’s model.

Key insights

• Rakuten’s initial capital was $200,000; no VC money was raised before or after founding (friends & family shares were issued only six months before IPO as a favor).
• The company forced cash flow positivity from the second month by requiring merchants to pay a $500/month fee six months upfront.
• Rakuten intentionally did not copy Amazon or eBay; instead it built a platform to help small/medium merchants sell, acting as a liaison rather than a competitor.