Nikkei reported on Friday Japanese HRTech startup SmartHR has secured about 12.5 billion yen (about $115 million US) in the latest series D round, which brought their valuation up to 170 billion yen ($1.6 billion US) and let them join the Unicorn Club. According to CB Insights, Japan has now five unicorns including Paidy joining the club earlier this year, and SmartHR will be the 6th unicorn for the country.
Founded back in 2013 as Kufu, SmartHR automates procedures related to social insurance and unemployment insurance. It was developed to free up managers or human resources representatives from tiresome and time-consuming personnel management. According to the figures as far as we could add up the amounts of funding in the past, the company has apparently secured over $185 million US to date.
Tokyo- / Kuala Lumpur-based Secai Marche, the Japanese startup behind a shared food supply chain for the Southeast Asian market under the same name, announced on Tuesday that it has secured 150 million yen (about $1.4 million US) from Beyond Next Ventures and Rakuten Ventures. The company plans to use the funds to strengthen its fresh food fulfillment service, hire new talents, and enhance its marketing effort. Since its launch back in July of 2018, the company has been offering a cold supply chain connecting farmers and food producers with F&B businesses in the Southeast Asian market, especially optimized for the delivery of low-volume and high-mix orders. Supply chains for fresh produce in the region is usually operated by the supplier side, which are optimized for bulk deliveries and therefore difficult to use it for small restaurants which typically ask for small orders or niche needs. The company wants to solve the problem by building a shared supply chain allowing several different food suppliers to use for delivery. The company says more than 100 farmers and food producers in Japan and ASEAN as well as more than 300 restaurants and hotels are using the 20-month-old platform. In view of optimized…
The Secai Marche team Image credit: Secai Marche
Tokyo- / Kuala Lumpur-based Secai Marche, the Japanese startup behind a shared food supply chain for the Southeast Asian market under the same name, announced on Tuesday that it has secured 150 million yen (about $1.4 million US) from Beyond Next Ventures and Rakuten Ventures. The company plans to use the funds to strengthen its fresh food fulfillment service, hire new talents, and enhance its marketing effort.
Since its launch back
in July of 2018, the company has been offering a cold supply chain
connecting farmers and food producers with F&B businesses in the
Southeast Asian market, especially optimized for the delivery of
low-volume and high-mix orders.
Supply chains for fresh produce
in the region is usually operated by the supplier side, which are
optimized for bulk deliveries and therefore difficult to use it for
small restaurants which typically ask for small orders or niche needs.
The company wants to solve the problem by building a shared supply chain
allowing several different food suppliers to use for delivery.
The
company says more than 100 farmers and food producers in Japan and
ASEAN as well as more than 300 restaurants and hotels are using the
20-month-old platform.
Tokyo-based VC firm One Capital announced on Tuesday that it has reached the final close of its first fund at 16 billion yen (about $145 million US), more than three times oversubscribed from its original target 5 billion yen ($45.8 million US). According to Preqin, data resource for the alternative asset industry, the fund is the largest-ever single one managed by an independent firm in Japan. One Capital was established in April last year by Shinji Asada, the former head of Salesforce Ventures Japan, and Wataru Sakakura, former managing director and partner at Boston Consulting Group. Asada and Sasakura serves the firm as CEO and COO, respectively. The firm says 70% of the fund’s amount would be targeted to enterprise software startups that can help realize the Future of Work”. In addition to the investors joining the fund by the time of the first close last year, the firm introducecd medical kit maker Hogi Medical, a medical kit maker, the Organization for Small & Medium Enterprises and Regional Innovation, Japan (SME), En Japan (TSE:4849), Z venture capital (foremerly known as YJ Capital), and gas and power distribution company Saisan as new limited partners. Given that overseas individual and corporate investors…
Image credit: One Capital
Tokyo-based VC firm One Capital announced on Tuesday that it has reached the final close of its first fund at 16 billion yen (about $145 million US), more than three times oversubscribed from its original target 5 billion yen ($45.8 million US). According to Preqin, data resource for the alternative asset industry, the fund is the largest-ever single one managed by an independent firm in Japan.
One Capital was
established in April last year by Shinji Asada, the former head of
Salesforce Ventures Japan, and Wataru Sakakura, former managing director
and partner at Boston Consulting Group. Asada and Sasakura serves the
firm as CEO and COO, respectively. The firm says 70% of the fund’s
amount would be targeted to enterprise software startups that can help
realize the Future of Work”.
In addition to the investors joining the fund by the time of the first close last year, the firm introducecd medical kit maker Hogi Medical, a medical kit maker, the Organization for Small & Medium Enterprises and Regional Innovation, Japan (SME), En Japan (TSE:4849), Z venture capital (foremerly known as YJ Capital), and gas and power distribution company Saisan as new limited partners. Given that overseas individual and corporate investors account for over 40% of the fund’s investors, Asada told Bridge that it indicates overseas investors’ unparalleled expectations for the Japanese market.
Image credit: One Capital
One of One Capital’s symbolic investment policies is to focus on the SaaS vertical. Bessember Venture Partners, a long-established VC firm in the US known for having helped over 120 companies IPO, create an index from the stock prices of NASDAQ-listed SaaS companies and publishes it as EMCLOUD. Inspired by this, One Capital also started sharing an index based on the stock prices of listed SaaS companies in Japan, which clearly shows them growing more steadily than other stocks categorized in Nikkei 225 or Mothers.
Of the $10
billion enterprise software market in Japan (according to IDC Japan’s
“Domestic Enterprise IT Market Forecast”, May 2020), SaaS businesses
account for only 6%, at $5.5 billion (according to Fuji Chimera Research
Institute’s “Software Business New Market 2020 Edition”). Rather than
conventional packaged software, more and more companies prefer to use
SaaS platforms where functions are constantly improved even after
installation, and the Japanese market, with its large growth potential,
is attractive to foreign investors, Asada says.
One Capital has has invested in the following eight companies from the first fund so far:
The
last of these, Oura, is unique in the list because it is a Finnish and
also IoT startup. It can be also seen as a SaaS startup in terms of
offering a dashboard to collect and analyze data from IoT devices.
Furethermore, since it allocates a certain percentage of its first fund
to investing in overseas startups aiming to enter the Japanese market,
which encouraged the firm to join the Series C round of Oura.
The University of Tokyo Edge Capital Partners (UTEC) announced on Monday that it has launched its fifth fund. The firm made the first close of the fund which is eventually expected to secure up to 30 billion yen (about $275 million US). The fund’s investors have not been disclosed but Nikkei says the majority of them are institutional investors including sovereign wealth funds from Southeast Asia. The fund’s ticket size is up to 2.5 billion yen ($22.9 million US) per investment and company. Since its launch back in 2004, UTEC has been running five funds worth 85 billion yen ($780 million US) in the total commitment amount. It has invested in more than 110 companies, 13 of which have IPO-ed and 12 of which have been acquired by other companies. The total market cap of the IPO-ed 13 companies reached 1.5 trillion yen ($13.7 billion US) as of December 2020. The fund can invest in startups at various stages while we may recall recent funding from the fund such as Startbahn (blockchain-based certificate issuing for art) and Kuzen (no-code interactive AI platform). UTEC also announced that it has launched the UTEC Founders Program (UFP), an open-ended support program for startups…
The University of Tokyo Edge Capital Partners (UTEC) announced on Monday that it has launched its fifth fund. The firm made the first close of the fund which is eventually expected to secure up to 30 billion yen (about $275 million US). The fund’s investors have not been disclosed but Nikkei says the majority of them are institutional investors including sovereign wealth funds from Southeast Asia. The fund’s ticket size is up to 2.5 billion yen ($22.9 million US) per investment and company.
Since its launch back in 2004, UTEC has been running five funds worth 85 billion yen ($780 million US) in the total commitment amount. It has invested in more than 110 companies, 13 of which have IPO-ed and 12 of which have been acquired by other companies. The total market cap of the IPO-ed 13 companies reached 1.5 trillion yen ($13.7 billion US) as of December 2020. The fund can invest in startups at various stages while we may recall recent funding from the fund such as Startbahn (blockchain-based certificate issuing for art) and Kuzen (no-code interactive AI platform).
UTEC also announced that it has launched the UTEC Founders Program (UFP), an open-ended support program for startups in the science and technology fields. The program consists of two tracks: the Equity Track, which provides up to 100 million yen in equity investment, and the Grant Track, which provides up to 5 million yen in grant. Equity Track applications are accepted at all times while Grant Track ones will be accepted from June 15 to July 31.
In 2020, startup investment in Brazil reached US$3.5 billion, up 30% from the previous year, while the number of unicorns in 2020 increased by 3 to 14. Meanwhile, that in Japan reached US$4.32 billion, and the number of unicorns increased by Spider alone to 7 during the same period. This indicates that Brazil has produced unicorns at about twice the rate of Japan so far and last year despite having experienced one of the worst pandemic situation in the world. Mitsuru Nakayama, founder and CEO of Brazil Venture Capital (BVC) has been forced to stay inside Japan due to the pandemic but been busy to remotely support startups which are typically located on the other sdide of the planet. Thanks to the efforts of newly joined partners and associates in Brazil and Peru, the firm’s investment activities are keeping going well. BVC announced its second fund with a targeted final size of 1 billion yen in December, and has reached its first close and disclosed the names of their investors and two invested startups. Most of the fund’s investors are angels in Japan as follows (except for those who don’t want to be named): Shintaro Okuno — Managing Partner and…
BVC’s Mitsuru Nakayama Image credit: BVC
In 2020, startup investment in Brazil reached US$3.5 billion, up 30% from the previous year, while the number of unicorns in 2020 increased by 3 to 14. Meanwhile, that in Japan reached US$4.32 billion, and the number of unicorns increased by Spider alone to 7 during the same period. This indicates that Brazil has produced unicorns at about twice the rate of Japan so far and last year despite having experienced one of the worst pandemic situation in the world.
Mitsuru Nakayama, founder and CEO of Brazil Venture Capital (BVC) has been forced to stay inside Japan due to the pandemic but been busy to remotely support startups which are typically located on the other sdide of the planet. Thanks to the efforts of newly joined partners and associates in Brazil and Peru, the firm’s investment activities are keeping going well. BVC announced its second fund with a targeted final size of 1 billion yen in December, and has reached its first close and disclosed the names of their investors and two invested startups.
Most of the fund’s investors are angels in Japan as follows (except for those who don’t want to be named):
Shintaro Okuno — Managing Partner and Head of Tokyo, Bain & Company
Haruo Amano — Executive Vice President, Hennge
Soki Ohmae — Co-Founder and Representative Partner, Drone Fund
Ken Soga — President, SGcapital
Shota Kawaminami — Executive Officer, HENNGE
Tatsuya Matsuoka — President, Japan Medical Support Institute
Nobuaki Takahashi — Founder, Phil Company / PHALs
Second Fund’s portfolio 1: Digital Restaurants sees a spree.
Image credit: Digital Restaurants
In late April, Europe-based Taster announced it has secured 27 million euros. The startup wants to call themselves a digital restaurant brand rather than a ghost restaurant or a cloud kitchen operator because they dare not just providing cooking resources behind third-party brands but trying to build new brands themselves. The sales in Paris of Europe’s leading food delivery operator Deliveroo recently showed a consolidation of Taster brands was ranked in third place following McDonald’s and Burger King.
Pedro Neira Ferrand, a four-time serial entrepreneur from Peru, launched Digital Restaurants. Approved to join renowned entrepreneur support networks like Endeavor and Founders Network, he had been running a Latin America-focused dating app called MiMediaManzana (already shut down) prior to the current startup.
Digital Restaurants has partnered with MCK Hospitality, an operator behind the Japanese-Peruvian restaurant chain Osaka being operated in major Latin American cities, and is now operating several digital restaurant brands like Lucky’s Crispy Chicken, Poke for the People and Black Burger. Currently, the company is only serving Peru but it may be easier for them to expand into other markets in South America where MCK has been running their operations.
Second Fund’s portfolio 2: Mono is an Colombian answer to neobank.
Image credit: Mono
In our previous interview with Nakayama, he said that many local people are experiencing fewer access to financial services in Latin America while financial infrastructure is in place. If any startup can use the infrastructure to provide innovative services which are too cumbersome for conventional banksto provide, it could be a huge market out there. One example is ContaSimples, an investee from BVC’s first fund. The Brazilian startup currently serves 13,000 customers, planning to triple it by the end of the year. In late last year, they secured a US$2.5 million funding led by Brazil’s FinTech-focused VC firm Quartz.
We can guess that Mono is a Colombian answer to ContaSimples. It’s seeing a high growth by issuing credit cards to entrepreneurs and sole proprietors with no credit history but high demand for card payments in their business. All four of Mono’s founders have previously worked at fintech startups, including the two who has been selected in a Y Combinator-qualified startup (tpaga, selected for the YC S17 batch).
A growing number of startups from the fintech industry are joining the unicorn club in Latin America, including local neobanks like Brazil’s Nubank and Argentina’s Uala we well as payments startups like Uruguay’s dLocal and Mexico’s Clip. What is more, many of these unicorns have common in terms of having got SoftBank Vision Fund as an investor. SoftBank tends to invest in the middle or later stage, it is interesting to note that BVC is able to reach out to potential unicorns in the early stage.
BVC has also informally agreed with four Brazilian startups to invest in them from its second fund shortly. The first fund, launched in August 2016, has invested in 12 companies so far, and Nakayama told us that they would see some exits from that portfolio pretty soon. The first fund’s portfolio includes bxblue (automated payroll loans), ContaSimples, ARPAC (drone technology for efficient pesticide spraying).
Dentsu Group (TSE:4324) has recently launched Dentsu Ventures Fund II, the second fund worth 10 billion yen (about $91 million) by its corporate venture capital arm Dentsu Ventures. Combining with the Fund I launched back in April of 2015, they now have 20 billion yen (about $184 million) cash for startup investments. According to the arm’s Managing Partner Kotaro Sasamoto, the second fund will be focused on investing in both Japanese and foreign startups with exploring potential synergy while the first fund was more focused on investing in mid- and later-stage foreign startups planning to enter the Japanese market. From its first fund, Dentsu Ventures had invested in about 40 startups, mainly in the US, and been targeting mid- and later-stage startups in the bioscience and healthcare industries which are less likely to work with Dentsu’s primary business. Their remarkable investees from the first fund include Nextbit (the developer of the Robin cloud-optimized smartphone, acquired by Razer), Cheddar (a video news service for millennials, acquired by Altice USA), and Twist Bioscience (DNA synthesis startup, IPOed). Sasamoto says, From our first fund, more than 30 out of 40 invested startups are from the overseas, with an eye on potential synergy with…
The Dentsu Ventures team Image credit: Dentsu Ventures
Dentsu Group (TSE:4324) has recently launched Dentsu Ventures Fund II, the second fund worth 10 billion yen (about $91 million) by its corporate venture capital arm Dentsu Ventures. Combining with the Fund I launched back in April of 2015, they now have 20 billion yen (about $184 million) cash for startup investments. According to the arm’s Managing Partner Kotaro Sasamoto, the second fund will be focused on investing in both Japanese and foreign startups with exploring potential synergy while the first fund was more focused on investing in mid- and later-stage foreign startups planning to enter the Japanese market.
From its first fund, Dentsu Ventures had invested in about 40 startups, mainly in the US, and been targeting mid- and later-stage startups in the bioscience and healthcare industries which are less likely to work with Dentsu’s primary business. Their remarkable investees from the first fund include Nextbit (the developer of the Robin cloud-optimized smartphone, acquired by Razer), Cheddar (a video news service for millennials, acquired by Altice USA), and Twist Bioscience (DNA synthesis startup, IPOed).
Sasamoto says,
From our first fund, more than 30 out of 40 invested startups are from the overseas, with an eye on potential synergy with Dentsu’s future business domain in 5 to 10 years from now. We had invested in very few Japanese startups such as Alp (developing the Scalebase platform helping subscription businesses maximize revenue) and Kakehashi (SaaS for pharmacists).
From the second fund, we would like to more work with Japanese startups in collaboration with Dentsu Innovation Initiative (DII), especially focused on investing in the areas a little bit closer to our core business such as MarTech, SalesTech, retail, commerce, media, and community. We expect to co-create new business with them.
DII is Dentsu’s R&D arm with the mission of “creating the future businesses that only Dentsu can create”, promoting investment in and business development with promising global startups and technology companies with an aim to create the business infrastructure for the future. It has recently been offering internships with business development in mind. Dentsu Ventures intends to strengthen its investment efforts with an eye to have startups co-create not only with the Dentsu Group and its affiliated companies but also with their clients.
Compared to the first fund, the COVID-19 pandemic has apparently influenced to changing the policy of the second fund because it is no longer possible for investors to hop around foreign destinations for sourcing startups and their due diligence. On the other hand, six years have been passed since the launch of Dentsu Ventures, they are getting better recognized in the startup landscape, which may be partly due to the fact that it is now more likely to be able to lead or co-lead investment deals in the seed stage, both in Japan and overseas.
Masaru Ikeda
The Bridge
