IT Access Co.,Ltd. Case Studies on Japan-Israel SMEs Collaboration 【2020/12/25】

IT Access Co.,Ltd.

---

IT Access was established in April 2000 with capital from Access Co. Ltd. and Innotech Corporation. Access's corporate vision is to realize the world of "connecting all devices to the Internet." Innotech Corporation continues to challenge new business fields beyond the technology trading company's conventional framework. To respond to the arrival of the IoT era, IT Access is under reforming its business structure by providing hardware and service solutions, rather than software, middleware, or commissioned software development. In addition to developing proprietary software and hardware and providing related services, the company is expanding its business as a sales agent for cutting-edge software overseas and thereby creating synergies between the two core businesses.
The company's vision is to be "Making the world a better place through IT." The company has four business divisions:

 1) CS Division: software development services

 2) ADV Division: advanced design and development environment services (including sales agency business of foreign software)

 3) FT Division: cloud-based settlement services

 4) BT Division: cloud services for beauty care.

In the past, the company's main business was the sales agency business for foreign software. However, the fintech business has expanded rapidly, and this business accounts for most of the company's profits in recent years.




In October 2019, IT Access began a business partnership with Israeli company Cognata Ltd. The business collaboration agreement was signed to provide the company's advanced ADAS (Advanced Driver Assistance Systems) and automated driving simulation software and solutions to Japanese automotive companies.
Cognata was established in 2016 and is currently a Series B startup company with $23.5 million in capital. The company's simulation software can automatically generate detailed digital maps of real cities based on data and satellite images. It can create virtual spaces of dynamic layers with pedestrians. They are globally expanding through a partnership with companies such as Microsoft Corporation and Dassault Systemes SE. In June 2018, a developer of automated driving technology, AID, an Audi AG subsidiary, entered into a partnership with the company. They engaged in developing automated driving technologies, which will simulate and conduct extensive testing in cities around the world. Cognata's solution will accelerate the simulation of the entire product lifecycle of automated driving, from training to development to testing.
The Japanese automotive industry is a global leader in commercializing state-of-the-art ADAS capabilities and the large-scale deployment of automated vehicles. Cognata is looking to expand its business by providing its solutions to Japanese automotive companies. It is also a step towards developing its business in Asia, including China and Korea. The company hopes that IT Access' name recognition and experience in this industry will help establish Cognata's brand as a leading company in ADAS/automated driving simulation. On the other hand, Cognata's comprehensive solution for the automotive industry ranges from design, testing to verification. It will help IT Access to develop a product faster and safer in the ADAS/automated driving market.


Before Cognata, IT Access had collaborated with an Israeli company called Visuality Systems Ltd. 10 years ago, as a software sales agent for printers. Since they already had experience working with the Israeli company, they could conclude the contract with Cognata relatively smoothly.
Behind the collaboration with Cognata, IT Access's parent company Innotech played a significant role. The company's design analysis division referred Cognata as they have strengths in simulations for automated driving. The research division of Innotech took the initiative in conducting research and approaching the company for collaboration. However, since the software business was assigned to IT Access within the group, IT Access, in turn, took the lead from the middle of the negotiation process. In the end, the decisive factor for the collaboration was IT Access could imagine concrete ideas of what they offer to their targeted automotive industry through the partnership discussion with Cognata.
The two companies concluded a distributorship agreement. IT Access is positioned as a "solution partner," selling and providing engineering services and support for the software supplied by Cognata. IT Access highly values Cognata's technical capabilities. It expects their engineers to be able to learn the latest technology by interacting with Cognata's engineers. The company also plans to use its sales network to promote Cognata's simulation software to mainly Japanese companies in automated driving business. It also aims to sell its proprietary software and services along with it.
The collaboration with Cognata started at the end of 2019. However, it has lagged behind the initial plan due to the impact of the Covid-19. They struggle to perform aggressive sales under the circumstances. However, the company would like to have Cognata's employees come to Japan from Israel in the future and work together to market the product to the targeted customers. In addition to Cognata's advanced simulation technology, the company expects to accelerate its expansion in Japan as it builds up its sales record in overseas.


IT Access has long been interested in entering the software development business for the automated driving companies. It has been building a network in Japan for its existing business. Through the collaboration with Cognata, IT Access expects to approach the targeted companies with high technology products and to connect them to its own business, making it a highly complementary partner for mutual benefit. Besides, the company hopes to expand sales opportunities by handling high-profile Israeli companies' products.
However, there are still concerns about the future. Cognata has been expanding its partners overseas, including with major global companies. Also, automated driving business is a field that attracts international attention. They believe that a major company may acquire Cognata in the future. Still, IT Access recognizes that it is an uncontrollable factor for them.
Israeli companies tend to be fast and dynamic, so IT Access has to keep up and stay top in business with them. It is crucial to always keep eyes open and be the first to know about the startups' technology. It must carefully examine if there is any affinity or synergy with its own business. Since Israeli companies are very aggressive and high negotiating capability, it is vital to show that they can be a friendly and beneficial partner. The key to successful negotiation is to be flexible throughout the process and apply your experiences of working with American and Israeli companies.


Cognata's automated driving simulation


Interview: Center on Finance and Innovation, Waseda University
Editor: Center for International Economic Collaboration

← Back to the list

---

<Related Website>