Novas Software (recently merged with Springsoft) | Print |

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springsoftSeptember 2008 – Novas Software* is an EDA (electronic design automation) software developer originally based out of San Jose, CA. Novas had been selling its software to the Japanese market through a distributor for a few years before opening a branch office last year. As a result of opening the office, the company has enjoyed growth in sales and closer relationships with their customers. JETRO spoke with Julie McDonald, then senior human resources manager of Novas Software, about establishing the branch office and about working with JETRO.

Opportunities in Japan
It is common for companies in the information communication technology (ICT) field to sell their products in the Japanese market through a distributor until certain factors of the business compel them to establish an office. For Novas Software, the decision to establish a Japan office “was mostly driven by a few large clients that were based there,” said McDonald. “We were servicing them from the United States which required a great deal of traveling, so we decided to hire a dedicated person that would be willing to work directly out of Japan.” For 2007, the EDA Consortium estimated the EDA market in Japan to be US$1,175.7 million in revenue. Novas sought to increase its market share of the EDA business in Japan, which represents about 20% of the global market.

Market Entry
The first step Novas took to open the office was to hire someone to lead it. The company chose an associate, Lynn Lin, from within Novas Software, who had Japanese language ability. “Then we just started going through the process of finding out all the steps needed for opening a branch office,” said McDonald. For McDonald, whole process took about three to four months.

Working with JETRO, she learned about getting a work visa, gained connection to a visa specialist, obtained help finding housing, and was connected with accounting personnel. “It was mostly an education in what the processes were and making all the connections to the appropriate people that would help us,” said McDonald. “JETRO had really good follow up and was very good at clearly articulating what the next steps were going to be.”

McDonald cautioned against avoiding what she called “a cart-before-the-horse type of scenario.” “Lynn had some difficulty obtaining a visa until she had a residence but also couldn’t get a residence before the business was established,” said McDonald. “It was very challenging to line everything up appropriately. Lynn was traveling between the US and Japan on just a travel visa for quite a while until she could actually get her work visa.” To avoid this situation, McDonald advises other companies to establish the business in Japan first, before sending a manager who needs to settle into a residence. “I would have things set up prior to the person going over there,” said McDonald.

McDonald also said she was not prepared for a few smaller matters she encountered. “For example, it was really challenging for Lynn to get a cell phone in Japan. And we also weren’t quite prepared for the amount of ‘good faith’ money that she had to put up for renting an apartment.”

Results and Outlook
McDonald feels the most important thing for Novas Software’s business in Japan has been to have a presence there. “So many things are tied to the relationship with the client. Having a person in Japan that can communicate and be hands on, without having to deal with a time delay when communicating with the United States, I think, has been critical for our success there.” McDonald said having a Japan office has definitely increased sales and strengthened business relationships, both of which Novas plans to continue doing.

* Novas Software has recently merged with EDA firm Springsoft, headquartered in Taiwan.

Related organizations
Japan Electronics and Information Technology Industries Association (JEITA)
World Semiconductor Trade Statistics (WSTS) Japan Office
Semiconductor Equipment Association of Japan (SEAJ)