Japanese blockchain startup Nayuta raises $1.3M round for “Lightning Network for IoT”

Nayuta’s founder and CEO Kenichi Kurimoto
Image credit: Masaru Ikeda

See the original story in Japanese.

Based in the western Japanese city of Fukuoka, Nayuta has been offering new technologies that combine IoT (Internet of Things) and blockchain. The company announced on Thursday that it has raised 140 million yen (about $1.3 million) in a seed round from Tokyo-based VC firm Jafco (TSE:8595) and a single unnamed individual investor. For the Fukuoka company which had been running on bootstrap mode relying on its two founders’ resources, this is the first financial injection from investors. Using the funds, the company will be focused on developing “the 2nd layer technologies” and related applications.

Named from the Sanskrit word meaning novemdecillion, Nayuta was founded back in March of 2015 by its CEO Kenichi Kurimoto who had been working on development of SoC (System on Chip) and research of software algorithm for LSI (large scale integration) circuits. The company has been dedicated to developing blockchain technologies (especially around public blockchain) for actual use in the real world.

Blockchain is under the spotlight as a scheme for developing decentralized platforms. The concept is surely good but it still has various problems to solve for actual use, such as requiring users to wait 10 minutes on average to confirm a transaction, needing to lower the dealing cost to enable micropayments and the maximum capacity of seven transactions per second, among others. Until these problems are solved, blockchain is unlikely to support massive IoT and social infrastructures.

As one of the solutions, US-based Blockstream and other brockchain startups have succeeded in enabling rapidly-processable end-to-end micropayments services by developing Lightning Network technologies. Leveraging Kurimoto’s background, Nayuta specializes in developing the 2nd Layer technologies for IoT products along with the Lightning Network concept, planning to develop the necessary utility tools for every app in partnership with user companies. The company has unveiled that it is in potential partnership talks with a certain leading company, but Kurimoto says they will leverage the funds and focus more on acquiring additional partners and engineers.

While Nayuta had been operating based out of co-working spaces like Tenjin Color in Fukuoka as well as Finolab in Tokyo, the company will soon set up an independent office space so that their current and future employees can work more comfortably and conveniently. However, the company says it is flexible about where its engineers will work and where to hire developers.

Nayuta recently won the runner-up at the MUFG Digital Accelerator 2nd Batch Demo Day.

Edited by “Tex” Pomeroy

Nayuta won the runner-up at the MUFG Digital Accelerator 2nd Batch Demo Day.
Image credit: Masaru Ikeda