This ‘anti-Airbnb’ Japanese startup builds art communities with its hotel business

A room at BnA Art Hotel in Koenji named “Into the Foreign.” Photo credit: Bed &Art.

This article is part of Tech in Asia’s partnership with Disrupting Japan where we publish the revised transcripts from the show’s podcast interviews with Japanese entrepreneurs. This is heavily revised from the original transcripts. For the full interview, go here.

Keigo Fukugaki has started his own hotel brand, Bed & Art, where he tries to merge travel with supporting the local art community. It’s an ambitious project, and as the interview progressed, I went from thinking “This won’t work,” “Nah, this is way too much of a long shot to really work,” to “You know, this is just crazy and quirky enough that it just might work.”

In this age of SaaS, Airbnb, and middleware, it is sometimes refreshing to find a startup that deals with something concrete. Fukugaki tells that story.

What is Bed & Art?

It’s a hotel startup. We’re trying to find a new way to start a hotel brand and not to turn ourselves into a real estate mogul. We’re just four guys with a little bit of cash.

We’re creating rooms with artists, and every time someone stays in those rooms, part of the revenue goes back to the artists. It’s bringing together a lot of unique travelers and local artists together.

We’re actually registered as a hotel. We’re taking over and renovating old buildings, creating a lobby, bar, and hotel rooms. In Tokyo, there are a lot of these office buildings that we’re able to convert into a hotel. And I think that’s new.

We called on our friends to do the renovations. We had some pizzas and beer and asked our friends to come over and paint the walls with us. Of course, it’s under some supervision. It was a great time and we built a community out of that. Everyone had a little part in it.

I think it was a great way to start something.

Are you kind of anti-Airbnb, as the accommodations on the platform get standardized?

That is exactly why we started Bed & Art. We started a pilot project in Ikebukuro, as two of our co-founders used to run a lot of Airbnbs in Tokyo. They were actually Airbnb moguls. They had like 40 Airbnbs in the city, and they were some of the first ones to really start making that into a pseudo business.

They were killing it but I came in and made fun of them. I said, “You guys are actually making this cookie-cutter room with IKEA furniture, and all you’re doing is making money.”

At the time, they were 27-year-old brilliant guys, and that’s why I’m working with them. But I realized that at 27, I think if you can have a higher goal, you can achieve much, much more interesting things. And that’s when I came in and poked around. They agreed. They wanted to do something more interesting.

However, they have pulled back from the Airbnb business. They realized the competition is really high in terms of the volume of listings. So, even if you are doing a great job, the price will come down.

If your hotel only has two rooms, how else do you generate profit?

Our hotel has a bar on the first floor and an art gallery in the basement. We also have a community space on the rooftop. We generate some income through those and events and art gallery exhibits. But we’re definitely looking to scale and that’s one of our biggest hurdles right now. I think we’ve built everything so far as a pilot, tested the concept, and learned about the market.

You ran a crowdfunding campaign. How did it go?

How will you replicate your model overseas?

What’s the future growth of Bed & Art?

You lived in San Francisco for a while. But why leave to come to Japan to build a startup?

What do you find attractive about the Japanese startup ecosystem?

If I gave you a magic wand to change one thing about Japan, what would you change?