Finance data analytics startup Xenodata Lab. raises $2.2M from Japan megabanks, others

Yojiro Seki, founder and CEO of Xenodata Lab., makes a pitch at MUFG FinTech Accelerator Demo Day.
Image credit: Masaru Ikeda

See the original story in Japanese.

Tokyo-based Xenodata Lab., the Japanese startup developing an AI-powered finance data analytics leveraging Natural Language Processing (NLP), announced today that it has raised 250 million yen (about $2.2 million US) in the latest funding round. This is supposed a series A round. Participating investors are Bank of Tokyo-Mitsubishi UFJ (BTMU), Teikoku Databank (Japan’s leading business credit reporting company), Tokai Tokyo Financial Holdings (TSE:8616), Okasan Securities (TSE:8609), Securities, DBJ Capital, Mizuho Capital, and SMBC Venture Capital. This round follows the startup’s 60 million yen funds from BTMU, Teikoku Databank, Securities, and Mitsubishi UFJ Capital.

Regarding each investor’s intention in this round, Xenodata Lab. explains as follows:

  • BTMU, Teikoku Databank, Securities….Follow-on strategic investment coinciding with business partnership
  • Tokai Tokyo Financial Holdings, Okasan Securities…New strategic investment coinciding with business partnership
  • DBJ Capital, Mizuho Capital, SMBC Venture Capital…Portfolio investment

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Sample Screen of Xeno Flash (dummy content)
Image credit: Xenodata Lab.

Xeno Flash, developed by Xenodata Lab., specializes in listed stocks in Japan and uses XBRL (eXtensible Business Reporting Language) analysis, PDF table analysis, and PDF graph analysis to convert information attached to various financial-related materials into tabular data, which they then apply their own algorithm to in order to extract the most important financial points, and furthermore, through natural language processing, they are able to pull up a background of specific numerical values from an enormous amount of sentence data in the material.

Of the 3,600 listed Japanese stocks, only 500 companies, corresponding to 14% of all stocks, are issuing financial reports which individual investors can refer to when making investment decisions. In other words, since the price fluctuations are so intense, account analysis reports are not issued by most of the small and medium-sized companies invested in by individuals, but if they use Xeno Flash, it would be possible for companies to make them available.

Xenodata Lab offers their analytics to Securities, Okasan Securities, Tokai Tokyo Financial Holdings to help them improve productivity in their operations as well as better serve their customers. Teikoku Databank uses the analytics to help research and development of their company credit database while Xenodata Lab. also uses Teikoku’s data of unlisted companies in Japan to improve the functionality of the Xeno Flash platform.

BTMU hosted MUFG FinTech accelerator (now known as MUFG Digital Accelerator) where Xenodata won the first batch Demo Day last year which led the team to draw a huge attention in the FinTech sector. We’ll expect to see further business collaboration between MUFG group companies and Xenodata Lab.

With the funds this time around, Xenodata Lab. will enhance the coverage of their analytics solutions beyond corporate financial reports while developing the function that enables predicting future performances of listed companies to better serve securities companies and corporate clients.