The Umami Meats management team. CEO Mihir Pershad stands in the middle. Image credit: Umami Meats
Singapore-based cultured seafood developer Umami Meats made an official announcement on Thursday that it will expand into the Japanese market. The company is focused on developing cultured fish for endangered species such as eel, grouper, snapper, and tuna, which are in high demand in Japan. It is actively working to build partnerships with Japanese companies and create an ecosystem to generate technology and manufacturing applications for the Japanese market.
Umami Meats, founded in 2020, produces cultured seafood that is nutritious and affordable. The company aims to provide a delicious eating experience by offering cultured seafood that is free of heavy metals, antibiotics, and microplastics and has the same nutritional value as conventional seafood. It has previously signed a licensing agreement with NUProtein in Tokushima, Japan, to license its growth factor production system.
In this particular vertical, US startup Finless Foods, backed by Japanese fish wholesaler Dainichi, IndieBio, Twitch founder Justin Kan, and others, has successfully developed plant-based cultured tuna meat. BlueNalu, another American cultured fish startup backed by Sumitomo Corporation (TSE:8053) and others, formed a business alliance with Food & Life Companies (TSE:3563), the company behind Japanese major sushi restaurant chain Sushiro. Tokyo-based startup IntegriCulture has begun joint research on cultured fish meat with Maruha Nichiro (TSE: 1333), one of Japan’s largest fishery processors.
Updated on 7am, May 17: Added a part of the sentence in red. Okinawa-based EF Polymer, the Indian scientists-led startup developing polymer absorbent technology, announced on Thursday that it has secured 550 million yen (about $4 million US) in a Series A round. Participating investors are Universal Materials Incubator (UMI), Nishimoto Wismettac Holdings, MTG Ventures, Beyond Next Ventures, Lime Time Ventures, and Okinawa Development Finance Corporation. MTG Ventures and Beyond Next Ventures followed their seed investment in the startup. Founded by Indian researchers who attended an accelerator program by at Okinawa Institute of Science and Technology (OIST), EF Polymer has developed super absorbent polymer (SAP). Made from inedible parts of fruits such as orange peels, the polymer is fully organic and biodegradable. When applied to farmland, it is expected to save about 40% of water consumption and 20% of fertilizer dispense, and increase yields by 10-15%. The company has sold about 100 tons of super absorbent polymers to date, mainly to the U.S., India, and Japan, and has successfully upcycled about 1,000 tons of crop residues, since about 10 tons of crop residues are used to produce one ton of the polymer product. The company boasted the product has been…
Image credit: EF Polymer
Updated on 7am, May 17: Added a part of the sentence in red.
Okinawa-based EF Polymer, the Indian scientists-led startup developing polymer absorbent technology, announced on Thursday that it has secured 550 million yen (about $4 million US) in a Series A round. Participating investors are Universal Materials Incubator (UMI), Nishimoto Wismettac Holdings, MTG Ventures, Beyond Next Ventures, Lime Time Ventures, and Okinawa Development Finance Corporation. MTG Ventures and Beyond Next Ventures followed their seed investment in the startup.
Founded by Indian researchers who attended an accelerator program byat Okinawa Institute of Science and Technology (OIST), EF Polymer has developed super absorbent polymer (SAP). Made from inedible parts of fruits such as orange peels, the polymer is fully organic and biodegradable. When applied to farmland, it is expected to save about 40% of water consumption and 20% of fertilizer dispense, and increase yields by 10-15%.
Founders of EF Polumer. From left: CEO Narayan Lal Gurjar, COO Puran Singh Rajput
The company has sold about 100 tons of super absorbent polymers to date, mainly to the U.S., India, and Japan, and has successfully upcycled about 1,000 tons of crop residues, since about 10 tons of crop residues are used to produce one ton of the polymer product. The company boasted the product has been introduced into about 12,000 farm households in five countries.
The company will use the funds to expand its polymer production capacity, strengthen research and development, and prepare to meet global demand. They also aims to establish research and development capabilities for applications in fields beyond agriculture.
EF Polymer is one of the finalist at the Okinawa Startup Program 2019-2020; it also won the Carbon Tech award at the 2019 Climate Launchpad Award Grand Final.
This guest post is authored by Mark Bivens. Mark is a Silicon Valley native and former entrepreneur, having started three companies before “turning to the dark side of VC.” He is a venture capitalist that travels between Paris and Tokyo (aka the RudeVC). He is the Managing Partner of Shizen Capital (formerly known as Tachi.ai Ventures) in Japan. You can read more on his blog at http://rude.vc or follow him @markbivens. The Japanese translation of this article is available here. Over the past 6 months we were forced to bow out of an investment in a startup on which we were particularly keen, and we barely averted a similar situation on a second one, both for the same reason. The hang-up came in the due diligence phase of our investment process. The term due diligence can be misleading for founders. VCs employ the term differently amongst themselves. Some venture capital investors use the term due diligence quite broadly, with the scope of their due diligence efforts encompassing nearly their full transaction process. Due diligence can begin shortly after the startup’s initial pitch meeting, and could include the VC’s entire assessment of the company: market analysis, strategic review, business model assessment,…
This guest post is authored by Mark Bivens. Mark is a Silicon Valley native and former entrepreneur, having started three companies before “turning to the dark side of VC.”
He is a venture capitalist that travels between Paris and Tokyo (aka the RudeVC). He is the Managing Partner of Shizen Capital (formerly known as Tachi.ai Ventures) in Japan. You can read more on his blog at http://rude.vc or follow him @markbivens. The Japanese translation of this article is available here.
Over the past 6 months we were forced to bow out of an investment in a startup on which we were particularly keen, and we barely averted a similar situation on a second one, both for the same reason.
The hang-up came in the due diligence phase of our investment process.
The term due diligence can be misleading for founders. VCs employ the term differently amongst themselves. Some venture capital investors use the term due diligence quite broadly, with the scope of their due diligence efforts encompassing nearly their full transaction process. Due diligence can begin shortly after the startup’s initial pitch meeting, and could include the VC’s entire assessment of the company: market analysis, strategic review, business model assessment, valuation benchmarking, full financial and legal audits, reference calls, and interviews with customers prospects and/or partners.
In contrast, I am old-school. I tend to apply a more conventional Silicon Valley view of due diligence, which is much more narrow in scope, essentially limited to the following principle: to verify that what we’ve been led to believe is indeed actually true. Specifically, in my narrow characterization, due diligence is limited to the client and reference calls as well as any detailed audits when necessary (financial/legal/technical). Everything before that is simply part of my job as a VC.
However, I am not writing this to complain about semantics. Either definition is fine, as is anywhere along the spectrum between my narrow usage and some investors’ broad definition of due diligence.
My objective here, rather, is to shed some transparency on the concept so that founders can avoid being misled, however inadvertently. Opacity on the nature and duration of a VC’s due diligence procedure does a disservice to entrepreneurs. It potentially wastes their precious fundraising time, causes them to miss out on investment from another VC fund, or in the worst case jeopardizes their company’s commercial relationships.
To be crystal clear and sidestep any confusion over the word due diligence, I will refrain from using it here. Instead, I will refer to an important milestone in any VC investment process: the VC term sheet.
The VC term sheet is a blueprint for an investment, a non-binding legal document that forms the basis of more enduring and legally binding documents. It establishes the specific conditions, valuation, and rights pertaining to the VC’s investment in the startup.
The term sheet is important for the startup founder because it represents a genuine intent on the part of the VC to invest. True, the term sheet is a non-binding document that subjects the contemplated transaction to certain conditions. For instance, at Shizen Capital our term sheets are conditional upon the satisfactory outcome of my narrow definition of due diligence (i.e. reference calls), as well as approval from our fund’s investment committee.
I submit that VC best practice should be as follows: only after the term sheet is agreed upon should the VC be allowed to perform reference checks with clients/prospects/partners of the startup. Founders may agree to make an exception to this practice, but I believe that this should come at the founder’s prerogative, and that founders should not feel pressure to do this as the norm.
I have witnessed too many startups in Japan fall into a trap while fundraising of overburdening their clients with reference call requests from potential investors. It is perfectly understandable to me now how this situation arose, and I do not condemn the behavior of my VC peers in Japan. The VCs are simply trying to collect as much information as possible to reassure their decision-making process. Especially in hierarchical VC fund structures, the analyst or junior associate evaluating the startup is afraid to make a career-limiting move by presenting an investment case that lacks airtight certainty.
The conundrum, however, is that in early-stage ventures it is impossible to eliminate all uncertainty.
The result is an inherent misalignment which can bring great harm to the founder. It can extend an investment process from what should take weeks into several months. Worse even, it may raise doubts among the startup’s clients, who subsequent to frequent reference calls, may start to wonder:
Is this startup having a difficult time fundraising?
Is this startup financially stable, or should I consider switching my business to another vendor?
Will being a customer of this startup always be so troublesome and time-consuming?
When a prospective investor requests client calls only to decide subsequently not to invest, the startup founder has squandered a bit of their goodwill with their customers. Multiply this by several VCs, and this becomes a burden on the startup’s commercial relationships.
Founders should not feel obligated to grant reference calls to any candidate VC who requests them.
Postponing reference calls until after the term sheet is signed will separate the VCs who are genuinely interested in investing from those who are merely gathering information or embarking on fishing expeditions.
Tokyo-based Abeja, the Japanese startup offering a variety of AI-based solutions to help companies transform their workflows into digital, announced on Tuesday that its initial listing application on the Tokyo Stock Exchange had been approved. The company will be listed on the TSE Growth Market on June 13 with plans to offer 700,000 shares for public subscription and to sell 187,500 shares in over-allotment options for a total of 550,000 shares. The underwriting will be led by Nomura Securities while Abeja’s ticker code will be 5574. Founded in September of 2012, Abeja provides more than 200 clients with AI-based business solutions such as ABEJA Platform and ABEJA Insight for Retail. In April of 2021, the company formed a capital and business alliance with SOMPO Holdings (TSE: 8630, SOMPO HD) and became an affiliate of the insurance conglomerate. According to its consolidated statement as of August of 2022, the company posted revenue of 1.978 billion yen ($14.6 million) with an ordinary loss of 181.757 million yen ($1.3 million). Their sales is mainly composed of two categories from a revenue stream perspective: Transformational (one-time-fee business model) and Operational (subscription business model). The transformational services account for 83.6% of their total sales. Led…
Image credit: Abeja
Tokyo-based Abeja, the Japanese startup offering a variety of AI-based solutions to help companies transform their workflows into digital, announced on Tuesday that its initial listing application on the Tokyo Stock Exchange had been approved.
The company will be listed on the TSE Growth Market on June 13 with plans to offer 700,000 shares for public subscription and to sell 187,500 shares in over-allotment options for a total of 550,000 shares. The underwriting will be led by Nomura Securities while Abeja’s ticker code will be 5574.
Founded in September of 2012, Abeja provides more than 200 clients with AI-based business solutions such as ABEJA Platform and ABEJA Insight for Retail. In April of 2021, the company formed a capital and business alliance with SOMPO Holdings (TSE: 8630, SOMPO HD) and became an affiliate of the insurance conglomerate.
According to its consolidated statement as of August of 2022, the company posted revenue of 1.978 billion yen ($14.6 million) with an ordinary loss of 181.757 million yen ($1.3 million). Their sales is mainly composed of two categories from a revenue stream perspective: Transformational (one-time-fee business model) and Operational (subscription business model). The transformational services account for 83.6% of their total sales.
Led by founder and CEO Yosuke Okada (17.76%), the company’s main shareholders include SOMPO Light Vortex (17.61%, digital business-focused subsidiary of Sompo HD), SBI (7.22% through two funds), Hulic (4.5%), Inspire Investment (4.47%), Executive Officer and CEO Office’s head Naoki Tonogi (3.69%), co-founder Keisuke Tomimatsu (3.68%), stock options trustee Kotaeru Trust (3.45%), and NTT Docomo (3.39%).
In Japan, COVID-19 has become downgraded to Category 5 so that it will be treated as a normal infectious disease by medical institutions and public organizations from today. Forbes Japan says more than half of Japanese companies said they would not return to their pre-COVID work style while FNN Primeline reports 40% will return to the previous state, which makes me feel interesting since media outlets expressed different perspectives based on the same survey to 11,428 companies conducted by Japanese research company Teikoku Databank. In the startup community, perhaps many of us would view this not going back to the previous state as a positive. Although I love the concept that developing new ideas based on study of the past, however, the changing times are irreversible. For startups being likely to change and evolve due to their “simple” organizational management, adapting quickly to change will give them an advantage. Startups must excel not only in changing themselves, but also in proposing new services to a changing society. It was around the end of 2019 when the damage from COVID-19 began to be reported suddenly. About six months after we first heard it, some of our readers may recall that San…
The Retreat team. Founder and CEO Shunsuke Yamada is on the far right. Image credit: Retreat
In Japan, COVID-19 has become downgraded to Category 5 so that it will be treated as a normal infectious disease by medical institutions and public organizations from today. Forbes Japan says more than half of Japanese companies said they would not return to their pre-COVID work style while FNN Primeline reports 40% will return to the previous state, which makes me feel interesting since media outlets expressed different perspectives based on the same survey to 11,428 companies conducted by Japanese research company Teikoku Databank.
In the startup community, perhaps many of us would view this not going back to the previous state as a positive. Although I love the concept that developing new ideas based on study of the past, however, the changing times are irreversible. For startups being likely to change and evolve due to their “simple” organizational management, adapting quickly to change will give them an advantage. Startups must excel not only in changing themselves, but also in proposing new services to a changing society.
It was around the end of 2019 when the damage from COVID-19 began to be reported suddenly. About six months after we first heard it, some of our readers may recall that San Francisco-based Japanese entrepreneur Shunsuke Yamada announced a service called Remotehour. People loves the tool’s experience which allows users to talk to others anytime through an always-on connection, as opposed to, say, Zoom and other work-from-home platforms where you need o set a pre-defined time to connect. Tokyo-based VC Miraise, one of Remotehour’s investors, arranged office hours for entrepreneurs to consult with using the platform. However, we can no longer reach the Remotehour website. Yes, it pivoted.
What kind of world is out there as the dawn from the pandemic breaks out? In industries where digitization is possible, people has adopted a hybrid form of work-from-home and work in office. Major companies and startups have shut down the space of their headquarters one after another, which in principle were designed to bring all employees to work together, and have shifted to purpose-specific spaces or decentralized offices utilizing co-working spaces. Meanwhile, offsite meetings are coming into the limelight. In Japan, Island and office, a startup founded in 2021, is a remarkable answer.
As you may have guessed by this point, Remotehour has pivoted to a service for offsite meetings. In January 2022, Yamada decided to shut down the previous service and turn the helm completely to Retreat (formerly Telesite). It has been already used by around 20 startups in their series B round stage, mainly in the U.S.
Getting People Ops onboard
Retreat held a meeting in San Diego last year, attended by People Ops representatives from 16 startups. Image credit: Retreat
When a startup with a few dozen employees decides to go offsite, it is up to the People Ops team to arrange it. It would be impractical for startups to hire additional personnel or assign someone exclusively for offsite arrangements. In addition, while individual business travelers can book accommodations and transportation quickly using online travel agencies (OTAs), this is not the case for offsite arrangements involving dozens of people.
Retreat has succeeded in digitalizing this part of the process, including some automation. Since meeting rooms and other facilities are required according to the number of people, the platform curates and proposes hotels with facilities suitable for such purposes. The company also provides detailed service by having staff members accompany the guests offsite, which has been well-received by People Ops representatives.
In a recent interview with Bridge, Yamada says,
Because of the large number of people, mistakes are sometimes made by the hotels. We experienced that one request came from an employee who had declared himself a vegetarian during the sign-up process, but who, during the offsite, had gave it up and asked to be reverted to a regular diet.
The representative was in a state of flux as requests from employees kept coming up. Sometimes they get angry when we are accompanying them, but when we accept their requests and solve their problems, they later thank us very much. This will lead to them asking for us again the next time.
Image credit: Retreat
The more global a startup is, the more distributed its work locations tend to be. It is not uncommon for them to only communicate with each other online and only meet in person during quarterly offsite meetings. Thus, the offsite experience is directly linked to the evaluation of their employee experience, which in turn is directly related to whether or not the startup is able to retain talented people, bring in new employees, and even whether or not it is able to grow.
Despite Retreat’s emphasis on digitalization, it may seem inefficient for the company’s members to accompany clients on offsite visits, but it is not all bad. First of all, the CEOs of these clients are usually present at their offsite meetings, which provides an opportunity for the company to meet and exchange words with the founders and executives of promising startups in the mid stage and beyond. And off course, this is a great opportunity to hear directly from participating employees, which may lead to service improvements or the creation of new businesses.
Retreat’s key to market its service is how they can get People Ops representatives involved. THe company has built the community of these representatives and organized offsite tours for them to participate. The company paid for most of the travel costs to bring in the representatives, but it seems to be paid off because they target a narrow demographic which are location-distributed startups in the mid or later stage.
a16z Scout Fund, Japanese angels participate in this round
Retreat has secured pre-seed round funding from renowned US angel investor Jason Calacanis and Miraise in June of 2020 (undisclosed sum in seed round). The company announced today that it has raised additional funding from Andreeseen Horowitz’s (a16z) Scout Fund as well as Japanese angel investors including Hiro Mizushima and Yuki Ota, which brought the company’s funding sum up to date to US$1.55 million.
Other investors in the latest round include Mitsui Sumitomo Insurance Capital, Egg Forward, CyberAgent Capital, 90s, and UB Ventures in addition to Miraise as a follow-on investor. Retreat is competing in this space with Cvent (NASDAQ: CVT, acquired by Blackstone for US$4.6 billion and expected to go private) and Navan (formerly TripActions, valued at US$9 billion in market cap and has acquired a number of peers in recent years). The company wants to differentiate itself by leveraging its engineering capabilities and further increasing automation.
The man is back. Tokyo-based Finnish entrepreneur and startup ecosystem builder Antti Sonninen, formerly known as the Japanese country manager for Angry Birds developer Rovio Entertainment, handed over his CEO position at Slush Tokyo (formerly Slush Asia) to the younger generation in 2018 (Incidentally, Rovio just agreed to be acquired by Sega Sammy Holdings of Japan). Since then he has been involved in supporting companies and running an international hackathon event called Builders Weekend. Takeoff Tokyo, a two-day pitch event for entrepreneurs aiming for the global market, was just announced to take place in Tennozu, Tokyo, on June 8-9. In addition to Sonninen, the new event will be organized by several like-minded individuals, including Haruka Furukawa, who took over the CEO role of Slush Tokyo from Sonninen (Slush Tokyo was rebranded into BARK but later cancelled during the pandemic). Sonninen first came to Japan in 2007 as an exchange student at the University of Tokyo. In an interview with Bridge, he compared the Japanese startup landscape of about 10 years ago to that of today, saying, it has now become easier to realize the vision he used to want to achieve. In many countries, startups usually expand into beyond their…
Antti Sonninen speaks at the Takeoff Tokyo launch party in Shibuya, Tokyo, on Tuesday. Image credit: Masaru Ikeda
The man is back. Tokyo-based Finnish entrepreneur and startup ecosystem builder Antti Sonninen, formerly known as the Japanese country manager for Angry Birds developer Rovio Entertainment, handed over his CEO position at Slush Tokyo (formerly Slush Asia) to the younger generation in 2018 (Incidentally, Rovio just agreed to be acquired by Sega Sammy Holdings of Japan). Since then he has been involved in supporting companies and running an international hackathon event called Builders Weekend.
Takeoff Tokyo, a two-day pitch event for entrepreneurs aiming for the global market, was just announced to take place in Tennozu, Tokyo, on June 8-9. In addition to Sonninen, the new event will be organized by several like-minded individuals, including Haruka Furukawa, who took over the CEO role of Slush Tokyo from Sonninen (Slush Tokyo was rebranded into BARK but later cancelled during the pandemic).
Sonninen first came to Japan in 2007 as an exchange student at the University of Tokyo. In an interview with Bridge, he compared the Japanese startup landscape of about 10 years ago to that of today, saying, it has now become easier to realize the vision he used to want to achieve.
Antti Sonninen speaks at the Takeoff Tokyo launch party in Shibuya, Tokyo, on Tuesday. Image credit: Masaru Ikeda
In many countries, startups usually expand into beyond their home turf early on in their history, which is just an extension of their everyday business efforts. Of course, the typical mindset of local entrepreneurs differs between countries that heavily depend on foreign demand and those with large domestic demand, but even so, it seems to Sonninen that Japanese startups have less ventured outside the country, which in his eyes is a rare occurrence. However, the situation has been changed, especially in the Web3 startup scene, and there has been a noticeable movement of entrepreneurs and investors from all over the world coming to Japan, as seen at ETHGlobal Tokyo a couple of weeks ago.
Sonninnen says,
During my days at Rovio, I recall how much I was impressed when I saw with my own eyes how one of the world’s best projects was born from the small Nordic country.
He continued.
Now it is much easier to take on the challenge of creating the world’s best business or project from Japan. In 1990s when Japan saw high economic growth, some people may have thought that the Japanese way on business works fine. They typically used to take an interpreter and visit destinations worldwide on business. But more people now think that this way doesn’t work anymore. Now we have a better environment in Japan, which encourages new challenges to take on.
There are many startup conferences in Japan and the rest of the world, but Takeoff Tokyo is particularly interested in helping and encouraging startups trying to go global, not only from Japan. However, the issue at hand for them is to help Japanese startups trying to expand globally. The team will focus on fostering a community which can also discuss issues such as securing the human resources and improving the skills required for the startups looking at global expansion. The June event will be apparently a kick-off to such community activities.
A huge crowd gathered at the Takeoff Tokyo launch party in Shibuya, Tokyo on Tuesday. Image credit: Masaru Ikeda
Our country has imported a variety of knowledge from overseas, and even Slush Asia and Slush Tokyo were localized from Slush in Finland. But Sonninen’s decision to launch his own brand, Takeoff, was based on the idea that he wanted to bring his original to the world instead of importing. The event is eventually expected to be managed on a community-driven basis where each participant can act as one of the organizers.
Slush Asia and Slush Tokyo have produced many entrepreneurs and budding entrepreneurs from the conference’s organizers and volunteers. In fact, we have often covered startups founded by their alumni, and they proudly say, “I am from Slush Asia (or Slush Tokyo)” when introducing themselves, which is less often experienced in other startup conferences, either domestic or international. We look forward to seeing the June event to understand what kind of community Takeoff Tokyo will foster from now on.
The Bridge
Masaru Ikeda
