Freewill reveals potential for new circular capitalism

Freewill, Inc. is a Japanese ICT company aiming to create a new form of capitalism starting from Japan. The company has utilized technologies such as IT, AI, and blockchain to provide global technical support. Currently, the company is creating unique services to improve society by utilizing their technologies.

One of these technologies is the crowdfunding service called “SPIN.” With blockchain technology, anyone can check the transaction history on the website, including who donated and what the money was used for.

The other technology is “tells market” where ethical products carrying a social impact score are introduced. In addition, it has a unique point system that contributes to reforestation as users shop.

Beyond these services, the company aims to create a new form of capitalism; the “Sustainable eco Society.” It will be a new ecosystem to replace the traditional profit-seeking capitalism. The more you do business through it, the more you can solve social issues and benefit the entire society.

What is the new economic form that Freewill is aiming for? How will that change the world from Japan? Here is what Toshi Asaba, CEO of Freewill, Inc is telling us.

Transparency and traceability are necessary to improve society

SPIN is a crowdfunding service that leverages blockchain to keep track of all money in and out. The implemented transparency allows you to see all the profiles of project owners and recommenders. Why the focus on transparency and traceability?

“It has been reported in the past that large amounts of money collected at large charity events were absorbed by governments and half of the donations to the Red Cross collected for a disaster were used by the organization itself. Due to such stories, more and more people do not want to donate to unreliable places.”

“The problem is that no one could track where the money collected went through and how it was ultimately spent. No one could know if the donation destination is reliable. What was lacking was the technology of transparency and traceability. I thought we should create a mechanism to prevent collectors from lying and verify whether the collected money reached the supposed beneficiaries or not.”

Blockchain can realize transparency and traceability

“Blockchain technology has made possible what was impossible before. First of all, transparency and traceability can be guaranteed. And since the information cannot be tampered with, credibility is improved. For example, kintsugi and lacquer repainted vessels are more valuable. The ones used by celebrities will also increase in value. With blockchain, you can ensure the credibility of its footprint and owner change history.”

“Blockchain is sometimes neglected because it is difficult in Japan, but I thought it would be easier to use blockchain immediately if its use can ensure transparency. After that, I think entertainment and communication are important to make blockchain familiar to everyone.”

Make social impact transparent

Similarly, the E-commerce website “tells market” presents ethical products emphasizing on transparency about their ethicality level.

“When the seller registers an item, they need to fill in its information. The more information they provide, the higher their ‘Ethicality Level.’ For example, how raw materials are procured, what kind of upcycling they do, how they transport goods, and how much carbon offsetting they are tackling. Even if you say that your product is eco-friendly, it would be overwhelmed if you emit a large amount of CO2 during transportation. Therefore, transparency is important as a mechanism to prevent such things.”

All products sold in “tells market” are given a “social impact score.” It is calculated based on users’ ratings backed by a detailed calculation fusing 3 indicators.

“Users of other e-commerce websites may give a lot of high evaluations under the vendor’s direction. If their evaluation is reflected, the final evaluation of the product will not be credible. On our website, ratings made by untrustworthy people have little influence on the ratings. The fuller your profile and the more active you are, the higher your credit score. Ratings made by users with high credit scores will be weighted more in the social impact score.”

New capitalism, “Sustainable eco Society”

Freewill is trying to make a “Sustainable Eco Society” by utilizing its technology. The company aims for a new ecosystem that activates the economy, eliminates profit-seeking, contributes to solving social issues, and lets the entire society prosper.

“It is said that the current capitalism will be overturned around 2050. Until then, capitalism is shareholder-centric and profit-seeking. To pursue profit, it has been practiced to produce in cheap countries and sell in high countries. As a result, the global environment and resources are simply consumed, and various issues on the earth are exacerbated and resources are reaching their limits.”

“What I want to achieve the most at the Sustainable eco Society is to change consumer society’s hedonism. However, we don’t have to force change on consumers. Attempting to change their behaviors will only result in rejection. There is a saying that ‘shopping is voting,’ but that is painful. Instead, it would be better for consumers to contribute to the planet unconsciously.”

How to make consumers contribute to society unconsciously

Asaba has noticed that the point system is well established and remain very popular in Japan. However, in reality, many of the awarded points have expired, which leans in the interests of companies and shareholders.

“The points belong to the point operating company. In other words, the money they can collect is distributed throughout Japan. Consumers believe that if they shop for100 yen, they will get 1 point. In reality, they pay 100 yen for 99 yen items and 1 point of the business’s economic sphere. The economic sphere becomes more and more prosperous as users use the points to shop. In addition, the expired points become profits for the company and shareholders. This is the result of shareholder capitalism. However, if these profits contribute to society rather than companies and shareholders, society will change.”

“That’s why we created a mechanism that automatically turns points into a forest sapling upon expiry. Coins will be issued when you make a purchase or donate on our service, and you can use them as 1 coin for 1 yen when purchasing products, similar to the normal point system. It expires after a certain period, but the expired coin is automatically donated to “more trees,” the organization engaged in forest conservation and environmental activities.”

“In the future, this mechanism can also allow you to choose to donate to selected areas instead of forest saplings. You can become part of the ’relationship population’ of a local town, such as in your hometown, while in Tokyo.”

The term “relationship population” refers to a group of people who are related to a certain region and are more than just vacationers. They can be big fans of a region, or have some close connection to people living there. The bigger a “relationship population” grows, the more activated the local economy becomes.

“There is also a ‘hometown tax donation program’ system in Japan, in which taxpayers who donate to local municipalities can get tax reduction and a thank-you gift. However, the system can’t grow a ‘relationship population.’ That is because many people choose where to donate not because they want to support an area, but because they want attractive gifts that municipalities offer.

Therefore, the option of distributing a portion of the profits you have consumed to your hometown or the area you want to be involved with is necessary to create a circulation system. It will be a great power if approximately 14 million people in Tokyo support each region.”

Turning consumers into “prosumers”

“When we finish creating such an ecosystem, consumers will not just consume but will become ‘prosumers’ who play a role in production at the same time. Instead of them consciously changing their behaviors, I want to aim for ‘they were already prosumers the moment they realize the change.’ Isn’t that easier to accept? I think it’s easier to accept that I’ve already done that kind of activity rather than being told to ‘plant more trees’ or ‘don’t use plastic.'”

Japan has a role in showing a new capitalism

Freewill envisions expanding the Sustainable Eco Society worldwide from next year after conducting demonstration experiments in Japan.

“From a historical and cultural background, I think Japan should appeal for peace and ideals. During the war, Japan made the wrong choice and was beaten into a burnt field, then rebuilt and once became the world’s second-largest economy. No other country has such experience.”

“The philosophy of business owners who have rebuilt Japan from a burnt field has attracted worldwide attention and is being studied by leaders of many countries. Therefore, we can believe that we now have the power to change the world. I think Japan, which is economically blessed and well-conditioned, has a role in showing new capitalism. So, I want to show the Sustainable Eco Society to the world as a new solution.”

Now is a good timing to create Sustainable eco Society

Now that the world is in a difficult situation, such as the COVID-19 and the invasion of Russia, the company thinks it is an opportunity.

“COVID-19 has become a common threat to humankind. As the environment was destroyed, an unknown virus in the forest came to a place close to humans. It was an opportunity for everyone to think about what to do from now on. Everyone in the world should have felt that the wheels that hadn’t turned before started to move. Regarding Russia’s invasion of Ukraine, what you think is right may differ depending on your position, but what everyone questioned was what to do with the energy problem. Everyone wondered what it would be like to continue capitalism as it is.”

“People are motivated to act in times of emergency, and we cannot help but make good use of this timing. It is a perfect timing to create a world that implements sustainable eco society, that I have envisioned since I was 19 years old, now that technology has caught up and things have taken immense turn.”

“What we need now is a five-dimensional idea. Capitalism is three-dimensional. The credit economy has begun and has become four-dimensional. When love is added to it, it becomes five dimensions. It is the love to solve social issues, not monetization. I’m sure it’s because humans move according to their emotions and hearts. I want to believe it. If there is a common principle for all dimensions, I think it is the word ‘love.’ I believe that all the great people who moved the world were moving with such feelings.”

Writer’s thoughts

The new capitalism Freewill envisions is circular capitalism, in which consumers not only consume but also become the creators of society, and the entire society prospers. Some may call it idealistic. However, if we utilize technologies such as AI and blockchain that have evolved sufficiently, we may be able to create an ideal society. Someone in the world needs to do it.

Japan lags behind in digital technology. However, each individual has high technology, therefore, there is a future that can only start from Japan. I am looking forward to the Sustainable eco Society.

Freewill will hold a large-scale event, “MoFF2022,” in Shibuya on September 9th, where it will conduct a demonstration experiment of the Sustainable Eco Society. If you are interested in it and in Japan, why not joining?