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From Hungary to Japan: How a Small European Company Found Its Primary Market in Japan

Hungary, nestled in the heart of Europe, is known for its rich history, cultural heritage, and technological innovation. For Scriptide, a Hungarian-owned software development company, one might assume that its natural market would lie within Europe. Yet, its primary focus has become Japan, a country over 9,000 kilometers away. But how did this happen, and why Japan instead of other European countries?

Written by

Ariadne Mavrogenis

Last updated

JAN 01, 2025

Topics

#tech

Length

5 min read

From Hungary to Japan: How a Small European Company Found Its Primary Market in Japan

Why Japan and Not Another European Country?

In addition to Japan, we have worked with clients from Israel, Ireland, the United States, and, of course, Hungary. Initially, we focused on finding more customers within Europe. However, as the global market evolved and our approach to working with Japanese clients matured, we began to see Japan as our primary target market. Today, Japan has firmly established itself as our main market.

A Fateful Beginning

Sometimes, the most extraordinary journeys begin with unexpected events. In 2019, our CEO, Daniel Fazekas, was backpacking through Asia when he had the opportunity to visit Japan. He was captivated by the unique blend of cultural richness and technological innovation. He thought to himself that he must return someday.

Unrelated to his trip, nine months after returning to Budapest, the CEO of a Japanese software development company reached out to him on LinkedIn. The company needed developers to complete a project and required expertise in technologies that our then-nascent team possessed.

Following a few discussions, they offered us a smaller task to test the waters. We gave it our all, and they were pleased with the results. More importantly, we found that our values and approach to work aligned seamlessly, making the collaboration feel natural. Thus began our partnership.

That initial project grew into a long-term relationship, with an increasing number of projects bringing us closer to the Japanese market.

Fast forward four years, and Japan has become our main market. What started as a chance connection has evolved into something much greater, and we can’t wait to see where this journey takes us next.

Economic Factors

Japan’s IT sector faces a unique challenge: a severe shortage of software developers. Unlike the current global trend of developer oversupply, Japan faces a deficit of 350,000 software engineers in 2024—a figure projected to grow to 450,000 by 2030. This shortage is particularly acute in emerging technologies such as React, Next.js, React Native, and Node.js.

This significant gap presents valuable opportunities for external developers to collaborate with Japanese companies.

We explored this topic in greater detail in a previous article.

Meanwhile, the tech industry in other regions, including Europe and North America, has been grappling with a wave of layoffs and hiring freezes. Many venture-backed companies, particularly in tech hubs like Silicon Valley, have been hit hard by high interest rates, which increase the cost of borrowing. Additionally, reduced consumer spending has further squeezed revenue streams, forcing companies to scale back operations.

According to data from Layoffs.fyi, over 300,000 tech employees worldwide lost their jobs in 2023–2024, with major players like Meta, Amazon, Google, and Microsoft announcing significant rounds of cuts. Smaller startups have also faced similar challenges, unable to sustain growth under tighter financial conditions.

As our CEO, Daniel Fazekas, observed: “High interest rates and reduced consumer spending are causing many venture-backed companies to struggle, leading to layoffs and hiring freezes.”

In contrast, Japan’s demand for developers far outweighs supply, creating a unique market for software development companies like ours to thrive. This stark difference in market dynamics has made Japan an increasingly attractive and strategic focus for our business.

Natural Alignment

Our experience in Japan has taught us that the market offers more than just opportunities—it offers the perfect environment for our business to thrive. Through our years of working with Japanese companies, we’ve gained invaluable insights that have allowed us to better serve our partners and contribute meaningfully to their growth.

We’ve developed a strong understanding of the Japanese market and its unique needs. Japanese clients place a high value on precision, reliability, and long-term commitment—all qualities that are central to our approach. Once we established trust with our partners, our collaborations deepened, and our relationships grew stronger. The result? A sustained market presence, a growing client base, and projects that constantly challenge and excite our team.

In addition, Japan’s technical landscape has provided our developers with challenging and intellectually stimulating opportunities. From complex software development to working with cutting-edge technologies, these projects have pushed us to grow professionally while delivering high-quality solutions to our clients. It’s this environment of professional growth combined with our shared values that makes our work with Japanese partners so rewarding.

Challenges of Working in Japan

While Japan offers significant opportunities, working in the market comes with its own set of challenges:

Language Barriers: The language barrier is perhaps the most prominent challenge. While only a small percentage of the population speaks English, most business communication happens in Japanese. This means that to communicate effectively, you often need a deep understanding of the local language and culture. At Scriptide, we've learned to embrace this by investing in Japanese speaking, tech-savvy people and focusing on building cultural knowledge to bridge the gap.
Time Zone Differences: The time zone difference between Japan and Europe can feel like a challenge, especially when time-sensitive issues arise. However, we’ve found a way to turn this into an advantage. With a 7-8 hour difference, our team can often resolve issues overnight, so by the time the Japanese workday begins, solutions are ready and waiting. Of course, this requires flexibility, but it’s a system that has worked well for us.
Slower Decision-Making: The decision-making process in Japan tends to be more thorough and, therefore, slower than in Europe or the U.S. While this can feel like a delay, it often leads to more considered and firm decisions. Once a choice is made, it’s rarely changed, which contributes to the stability and reliability of business relationships.
Higher Entry Barriers: Entering the Japanese market requires a long-term commitment. The process of establishing relationships, understanding local business practices, and navigating regulatory requirements can be time-consuming and resource-intensive.

Cultural Compatibility

Japanese values like reliability, long-term thinking, and precision really resonate with us at Scriptide. We believe in delivering high-quality work, maintaining strong commitments, and collaborating closely—all of which are values we share with our Japanese partners.

What makes working with Japanese clients so fulfilling is the mutual focus on building lasting relationships. This shared approach has allowed us to approach each collaboration with respect, working toward common goals.

We’ve also found that the Japanese emphasis on attention to detail aligns perfectly with our own methodical and precise approach to development. This cultural compatibility helps us communicate more effectively, even when we face challenges like language or time-zone differences.

The Journey Ahead

Looking back, our entry into the Japanese market may have started by chance, but it has grown into a success story fueled by hard work, trust, and a shared vision.

Japan’s demand for software developers, its compatibility with our values, and the opportunities for growth have made it the perfect market for Scriptide. While there are hurdles, we believe the rewards far outweigh the challenges.

For other small European companies considering global expansion, Japan may not seem like an obvious choice at first. But for us, it has proven to be the right one—a decision that continues to shape the future of Scriptide.

Scriptide is a strategic technology partner specializing in the development of custom, complex B2B software solutions. We provide a comprehensive suite of services, including digital transformation, web and mobile development, and the integration of AI and blockchain technologies.

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From Hungary to Japan: How a Small European Company Found Its Primary Market in Japan

#tech

Why Japan and Not Another European Country?

A Fateful Beginning

Economic Factors

Natural Alignment

Challenges of Working in Japan

Cultural Compatibility

The Journey Ahead

Scriptide is a strategic technology partner specializing in the development of custom, complex B2B software solutions. We provide a comprehensive suite of services, including digital transformation, web and mobile development, and the integration of AI and blockchain technologies.

Liked this article? Subscribe for more.

Keep me posted

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