The Japanese startup ecosystem has been on a 10-year bull run. Startup investors who previously overlooked Japan should take this into consideration because the ecosystem is robust, offering plentiful opportunities for investment and healthy returns.
However, it is also true that little information on Japanese startups is available in English. This report is intended to shed light on macro stats, exciting trends, unique insights, and promising startups emerging from Japan. This is a joint report published by INITIAL, a leading startup database provider in Japan, and Globis Capital Partners, a leading venture capital fund in Japan with an extensive background dating back to 1996—and managing over JPY 180 billion (USD 1.3 billion) in assets. With such a rich history and active involvement in Japan, Globis Capital Partners brings an insider's perspective to this report, offering a comprehensive overview and the latest developments within its startup ecosystem.
Highlight
- Investments in startups in Japan has grown 10x in the last decade, reaching JPY 850 billion (approximately USD 6 billion) in 2023, and is expected to grow even more.
- The growth is fueled by larger Japanese VC funds, corporate trends towards open innovation, and the government's Five-Year Plan, which aims to create 100 unicorns.
- Startups are becoming mainstream, with an increasing number of serial entrepreneurs and top talents from academia and corporations entering the startup field.
- The emergence of Japanese unicorns is altering the startup valuation landscape, highlighted by Mercari's IPO at JPY 676 billion (approximately USD 4.8 billion).
- Investment themes are diverse, from B2B SaaS to consumer apps to deep tech, in a less crowded market compared to the US and China.
- Growth stage startups are attracting significant funding, offering opportunities for global investors.
- Despite the global downturn in technology stocks, the Japanese startup ecosystem is demonstrating strong resilience in 2023, with investment, IPO, and M&A activities surpassing the levels of 2019-2020.
The report is for
- Overseas venture capitalists and limited partners aiming to gain a comprehensive understanding of the Japanese startup ecosystem.
- Entrepreneurs and startup-related stakeholders who are considering an expansion into Japan.
- Domestic entrepreneurs, VCs, LPs, and other startup stakeholders who intend to provide a comprehensive overview of the Japanese startup ecosystem to international stakeholders.