Overseas VC firms are increasing their investment in Japanese startups. In the first half of 2024 the amount invested by overseas VCs increased by 70% compared to the same time period in 2023 to 22.5 billion yen, accounting for approximately 20% of all VC investment.

This increase is attributed to the Japanese government's initiatives to attract overseas VCs plus a decrease in investment in China due to the US-China trade friction. In particular, large-scale investment deals of 1 billion yen or more increased by 51%, with companies such as Sakanai AI and Xeitomo succeeded in raising large amounts of funding.

Asian VCs are also paying attention to the Japanese market, and the support of government-affiliated funds is also increasing investment appetite. With the abundant funds and know-how of overseas VCs, Japanese startups are expected to expand globally and foster unicorns — an accolade that has proved elusive for Japanese startups when compared to equivalent countries.

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