Japan has a reputation as one of the most high-tech nations on earth, but its startup scene has never quite lived up to this reputation, with much of the tech industry under the control of massive, often family-owned, mega-corporations such as Sony and Mitsubishi, whose roots stretch back before the dawn of modern technology. However, it still boasts a more robust startup scene than most and today it got its first unicorn, in the form of marketplace startup Mercari, which raised USD75m. Here are the key figures to know for the Japanese startup ecosystem:
> 2015 saw USD539.6m raised across 34 deals
> 2016 so far has seen USD110m raised across 8 deals.
> That 2016 figure does not include the USD62.5m raised for two new VC funds, from Mitusi Fudosan and IMJ.
> By the same date in 2015, Japanese firms had taken USD89m over 5 deals. This means 2016 has seen a 23.6% increase in value of funding and a 60% increase in number of deals.
Any discussion of Japanese startups has to start with, as of today, its first and only unicorn, Mercari. The firm offers a peer-to-peer marketplace platform and claims to oversee around USD88m in transactions per month. Mercari raised USD75m earlier today, at a valuation of USD1bn. It’s the second e-commerce startup from outside the US to achieve Unicorn status this week, hot on the heels of UAE-based Souq.com, a sing of the sector’s continuing appeal to investors. While Japan has plenty of companies worth over USD1bn on public markets, Mercari is the first private tech company to hit that value and is a sign, along with the launch of a couple of new Japanese venture funds earlier this year from Mitsui Fudosan and IMJ, that Japan may be moving to a more Silicon Valley-style private startup model.
Business cards are all well and good, but as the top drawer of many an office the world over could tell, they’re a format that could benefit from digitisation. Sansan is trying to do just this and its system combines machine learning and crowdsourcing to digitise scanned business cards and upload them onto a shared database, which can be then tapped by multiple users for promising business leads. It scored USD16.9m in Series C financing in January to grow its services.
3. The Bridge
Another sure sign of the seriousness of Japan’s startup ecosystem is the undisclosed round of funding picked up by startup-focused news site The Bridge. The Bridge provides comprehensive coverage for startup activity in Japan and originally launched back in 2010 under the name Startup Dating, when it operated as a discovery platform connecting entrepreneurs with local technical and engineering talent.
4. Port Medical
At 84, Japan has the highest life expectancy of any country in the world. Part of this may be chalked up to diet and lifestyle, but credit is also due to Japan’s highly developed health and welfare system. Telemedicine platform Port Medical, a spin-off of consultancy firm Port, is a proud part of that tradition and recently picked up USD7.9m for its service, which allows clients to consult doctors online. Japanese people are estimated to visit doctors around 14 times a year, so a service that can eliminate the stress on waiting rooms and cut queues has particular relevance.
The digital age has somewhat displaced the space age as go-to description of our high tech world, but it hasn’t completely disappeared. After all, our connectivity still depends on satellite networks. Now it’s even the domain of startups, such as Tokyo’s Axelspace. It launched as a business back in 2008 and plans to launch its fleet of imaging satellites in 2017. The satellites will be used for collecting data which can be used in areas like forestry, fishing, agriculture and disaster control. Whilst not as powerful as Google Earth’s imaging services, its images will be updated daily, as opposed to every three years and its data will be cheaper. It picked up USD15m in Series A funding in September 2015.
3D printing has enormous potential, but few people can afford to buy and run their own 3D printers. This is where Kabuku comes in. It runs a 3D printing marketplace, called Rinkak which allows designers to post and print their designs via its platform, sell them to consumers, or find clients and commissions. Its printing network stretched over 30 countries and counts Toota among the firms it has worked with. It picked up USD6.9m in Series A funding in November of last year.
7. Monstar Labs
There is an enormous wealth of cheap engineering talent in developing markets around the world and Monstar Labs wants to help clients get to it, with its development outsourcing platform Sekai Labs. The Sekai Lab platform connects clients to engineers in countries like China, Vietnam and Bangladesh to work on apps, games and other software applications. It also proves intermediary translation services for its clients. Its key markets are wealthier nations with more expensive talent, such as Singapore, the US and domestic teams. Monstar Labs took USD3.3m for its services in November 2015.