It should come as no surprise that the startup culture in Japan is booming. The island nation has been on the forefront of many of the past century’s most innovative inventions.
With a bevy of foreign and domestic investors ready to sink capital into promising new firms, Japan is using its access to cutting-edge technology and inventive minds to surge ahead in the startup community. The 10 most successful Japanese startups of 2018 have two things in commons: a solid business plan and state-of-the-art products and services.
Mercari wasn’t always the e-commerce behemoth that it is today. In fact, it started out in 2013 after Shintaro Yamada left his job at Zynga’s Japanese branch to found his own mobile store. With the help of co-founders Ryo Ishizuka and Tommy Tomishima, the company landed a $500,000 investment from Tokyo’s East Ventures.
Eventually, Yamada grew the tiny online thrift store from 500,000 to 40 million users. Mercari’s meteoric rise to the top was realized in 2016 when the company reached a $1 billion valuation. Today, the mobile marketplace sells products in Japan, the U.K., and the U.S. and handles around $100 million in transactions per month.
2. Preferred Networks
After interning at Google, Daisuke Okanohara became convinced that he could start his own firm. He joined with former University of Tokyo classmate Toru Nishikawa to launch a new search engine.
However, as AI technology advanced, they decided to pivot and develop deep learning architectures for tech devices. The move paid off when they began attracting big investors like Toyota, FANUC and NTT, Japan’s biggest telecommunications firm. In late 2017, the company received a massive investment from Mitsui, Hitachi and Mizguo Bank. Preferred Networks is now Japan’s most valuable startup with a valuation of more than $2 billion.
3. Money Forward
Japanese analyst Yosuke Tsuji spent years working for Monex, a Tokyo-based online brokerage firm. Dissatisfied with the company’s traditional business methods, he teamed with Chihiro Asano and Toshio Taki of the Nomura Research Institute to found his own personal financial management startup.
Money Forward has had no trouble finding Japanese investors like Toho Bank and Isetan Mitsukoshi Holdings. The company recently caused a stir in the startup community when they announced that they are expanding into cryptocurrency. The firm plans to launch its own exchange by the end of 2018.
Daisuke Sasaki had been working for Google for four years when he elected to leave his marketing position and found a software accounting startup. With only $500,000 in seed money, Sasaski’s team developed their own personal and business accounting software, as well as their own HR program.
Impressed by the company’s innovative services, Infinity Ventures injected more than $80 million into the nascent startup. The company recently inked a partnership deal with Shiga Bank and Hikari Strategic Accounting and rolled out a new AI feature in their programs that automatically checks for accounting errors.
In 2009, Genki Kanaya was pounding the pavement as a sales manager when he got the idea for a technological solution to Japan’s perennially jammed parking lots. With Akippa, commuters can reserve their parking space in advance, eliminating any uncertainty about getting a spot.
After a modest initial investment from DeNA, a Japanese mobile gaming company, Kanaya began his push to take over Osaka’s parking lots. Akippa now operates in Japan’s largest cities and recently received a $7.3 million influx of cash to expand further.
Kohei Ishida was working at an online games company when he decided to quit and start his own crowdfunding company, Campfire. Campfire quickly became Japan’s answer to Indiegogo and Kickstarter.
Since launching, the company has formed several offshoots focused on crowdfunding for organizations in specific areas like fashion and charity. Campfire even debuted its own conventional loan service to help crowd funders find additional funding. The startup has seen substantial investment from firms like East Ventures and DeNa.
Shinichiro Kai spent years honing his skills as an options trader for the famous British investment bank Barclays. However, he was confident that his stock market know-how could be translated into an online financial service. In 2015, he left the safety net of a regular paycheck to launch Folio, a Tokyo-based investment service. Folio soon attracted investment from some of Japan’s biggest companies, including Rakuten and Mitsui.
In 2018, Kai inked a deal with Line to integrate Folio into the popular messaging app and secured a $63 million investment from Goldman Sachs.
8. Ascent Robotics
Canadian engineer Fred Almeida was CIO of Japan-based cloud computing firm Pasona Tquila but was more intrigued by the world of AI software. In 2015, he launched Ascent Robotics to develop software for autonomous vehicles.
The company’s software is precisely tooled for the crowded, narrow streets of Japanese cities. 2018 has been a banner year for the burgeoning startup. Sony’s Ken Kutaragi joined the company in March and Ascent raised $9.9 million in their Series A funding round.
Jonathan Epstein was no stranger to the world of technology and finance when he launched Moneytree with Paul Chapman and Mark Makdad in 2012. Epstein had previously helmed PayPal’s Japanese branch and worked for AIG, NASDAQ Japan, and SoftBank. Moneytree’s money management tools soon attracted a wide user base in Japan.
Big-time investors like Mastercard and Mitsubishi came calling, eager to bankroll the company’s growth. Mizuho Bank saw potential in the Moneytree service and integrated it into their banking app. After enjoying success in the Japanese market, the company recently expanded into Australia.
Kaisei Hamamoto and Ken Suzuki first got the idea for SmartNews while watching mobile phone users traveling on the Tokyo subway. They decided that they would make the news as interesting and accessible to commuters as mobile games.
They launched the SmartNews app in 2012. Designed to be simple and easily accessible on weak internet connections, the app soon became one of the most successful news apps in Japan. The company has received more than $85 million from investors and is now available in Japan and the United States.
As Japan persists in its role as a technological world leader, the country’s startup community continues to flourish. Whether they’re giving birth to fin-tech companies or simply offering a modern platform for aggregated news coverage, these Japanese startups are breaking technological barriers in the Land of the Rising Sun and beyond.