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Why Round1’s Japanese-Style Arcades Are a Hit in America
What Kind of Business Thrives in the U.S.?
One of the most common questions I get from Japanese entrepreneurs is: “What kind of business can succeed in the U.S.?” Many ambitious founders come to Silicon Valley with dreams of launching tech startups, yet history shows that very few Japanese entrepreneurs have achieved major success in the American market.
This article is a translated version of the original Japanese text. If you’d like to read it in Japanese, click here.
Japan’s Culinary Boom in the U.S.
While the tech sector poses challenges, Japanese cuisine has been booming in the U.S. Ramen, for example, has become a $20-per-bowl sensation, with Americans lining up for a taste.
Banner to recruit cooks to work in the U.S. (Image Source.)
Sushi remains a staple, and even Japanese udon chains like Marugame Seimen are gaining traction.
The Next Big Japanese Export: Entertainment Centers
Amid these trends, one unexpected Japanese import has taken the U.S. by storm: all-in-one entertainment centers. Round1, a fusion of arcade, bowling, and karaoke, has been a runaway success.
According to their official reports, the company’s U.S. operations have grown to generate over 10 billion yen (approximately $67 million) in annual revenue.
Why Are American Youth Obsessed with Japanese Arcades?
One standout attraction at Round1 is its UFO catchers (claw machines). Stocked with exclusive Japanese anime merchandise and plush toys, these machines tap into the rising popularity of anime culture in the U.S.
The demand has skyrocketed, drawing crowds eager to win authentic Japanese prizes.
Rapid U.S. Expansion: Over 50 Locations Nationwide
Since opening its first U.S. store in 2010 at Puente Hills Mall near Los Angeles, Round1 has expanded aggressively, now boasting over 50 locations across the country.
Unlike many Japanese businesses that limit their reach to urban centers with large Asian populations, Round1 has strategically targeted suburban malls and even less densely populated inland states.
The Secret to Round1’s Success in America
What makes Round1 such a hit in the U.S.? Here are 10 key reasons:
1. Lack of Entertainment Options in Rural Areas
The U.S. is vast, and outside of major cities, entertainment choices are limited. Many young people’s options are restricted to movie theaters, bowling alleys, and shopping malls. Round1 provides a much-needed fun zone.
2. A New Go-To Date Spot
Under-21s can’t drink in bars or enter clubs, and casual gambling like pachinko doesn’t exist. Meanwhile, driving is common, so suburban teens are willing to travel to places like Round1 for a unique date night.
3. Suburban Growth Amid Urban Decline
Post-pandemic, many downtown areas have struggled with crime and business closures, while suburban malls are thriving. Round1 has capitalized on this shift.
4. Skyrocketing Dining Costs
With inflation pushing up restaurant prices and tipping expectations rising to 18-20%, affordable social activities are in high demand.
Round1 provides entertainment without the high dining costs.
5. Nostalgia for Arcades
Arcades disappeared in the U.S. decades ago, but nostalgia for them remains strong.
Round1 reintroduces the experience with a modern twist, attracting both younger crowds and millennials longing for their childhoods.
6. Deep Nightlife Appeal
Many Round1 locations stay open late, often past midnight, giving young people a rare late-night entertainment option outside of bars and clubs.
7. The Rise of Anime Culture
With anime’s mainstream success in the U.S., Japanese arcade games and prizes resonate more than ever. Gamers and anime fans alike flock to Round1 for exclusive merchandise.
8. Strong Social Media Buzz
Many visitors share their wins from UFO catchers or high scores in rhythm games on TikTok and Instagram, providing Round1 with free viral marketing.
9. Multi-Activity Venues Are a Hit
The combination of arcade, bowling, karaoke, and dining in one location maximizes appeal, drawing in families, friend groups, and date-night couples alike.
10. Adaptation to Local Preferences
Round1 has adjusted its offerings to suit U.S. preferences, incorporating features like billiards, darts, and even “Spo-Cha” (a multi-sport activity zone) in select locations.
What This Means for Japanese Businesses Eyeing the U.S.
Round1’s success demonstrates that Japan’s best U.S. exports aren’t necessarily high-tech—they’re often rooted in fun, nostalgia, and culture. The business model of providing accessible, casual entertainment in suburban areas—has proven to be a winning formula.
For Japanese companies considering U.S. expansion, Round1 offers a valuable lesson: understanding American lifestyles, filling entertainment gaps, and strategically choosing locations can be more powerful than simply chasing tech trends.
As we look to the future, what other Japanese business models could take America by storm?
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