SBI Holdings to Bolster Startups in Japan
SBI Holdings, a major financial conglomerate in Japan, has announced its plan to start operating an investment fund by the end of 2023. The focus will be on startups in sectors like Web3, artificial intelligence (AI), and the metaverse. This fund aims to bolster the burgeoning startup ecosystem in Japan.
The fund is expected to reach up to 100 billion yen, with individual investments ranging from several hundred million to a few billion yen. SBI is drawing investment from major and regional banks in Japan, supporting the development of domestic startups.
Collaborative Funding from Major Financial Institutions
Significant financial players, including Sumitomo Mitsui Banking Corporation, Mizuho Bank, Nippon Life Insurance, and Daiwa Securities Group, have already committed over 50 billion yen. This level of venture capital (VC) funding is relatively rare in Japan, and an SBI representative emphasized to Nikkei the importance of having financially robust backers to nurture globally competitive startups.
Japan’s Current Landscape and Goals for Startups
Japan currently faces challenges in cultivating startups. Under Prime Minister Kishida’s administration, the “Startup Development 5-Year Plan” was established in November 2022. It aims to increase startup investment from 800 billion yen (as of 2022) to over 10 trillion yen by 2027. It also aims to establish Japan as Asia’s leading startup hub by creating 100 unicorns and 100,000 new startup companies.
Enhancing the Ecosystem for Web3
The Japanese government recognizes the need for tax reforms pertinent to Web3 companies in its “New Capitalism Grand Design and Implementation Plan 2023 Revised Version.” Corporate taxes for Web3 companies have been partially reformed in the fiscal year 2023, exempting self-issued cryptocurrencies from market value evaluation under certain conditions. Further reforms for third-party held cryptocurrencies are being advocated for in the fiscal year 2024 tax revisions.
Understanding Web3
Web3, often termed as the “next generation of the internet,” is a decentralized network built on blockchain technology, encompassing elements like NFTs and cryptocurrencies. It marks a shift from the one-way information flow of the initial Internet (Web1) and the current centralized Internet (Web2).
Hot Take: SBI’s Investment Fund Fuels Japan’s Startup Ecosystem
SBI Holding’s commitment to invest in startups through a significant venture capital fund indicates a positive step towards fostering innovation and entrepreneurship in Japan. This approach aligns with the government’s goals outlined in the “Startup Development 5-Year Plan,” aiming to elevate Japan as a leading startup hub. By focusing on emerging technologies like Web3 and AI, SBI’s initiative could contribute to shaping a more dynamic and competitive landscape for startups in Japan.
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