Note: This article summarizes the contents of an off-the-record session held at IVS in July 2026. The summary was prepared by Takashi Sano of MUIP, who served as the moderator, with the permission of the organizers of IVS and confirmation from the relevant participants.
In July, I attended IVS CORE, an invitation-only conference held in Kyoto. Last year, I participated in a discussion with Timee, CrowdWorks, and dely about how a startup’s growth strategy changes around the time of its IPO. This time, the theme was about going global.
MUFG Innovation Partners itself was founded with a mandate to invest globally, and today the “border” that once separated domestic and international markets is beginning to dissolve on every front, even within Japan.
The session title posed the question: “Have global investors overlooked Japanese startups?” The answer is a clear no. The real question that needs to be brought into sharper focus is at what point, and how, it has changed over time.
This time, the investors who joined IVS CORE were both domestic and international, all with a serious focus on the Japanese market.
Archibald Ciganer (Director and Managing Partner, Artemis Ventures) spent more than a decade at T. Rowe Price Japan, where he served as a fund manager for its Japan equity strategy and as CIO of the investment division, before being invited to join the firm founded by MUFG Bank. He launched the firm’s inaugural fund this year with a target size of JPY 50 billion.
In 2025, Ryutaro (Ryan) Nakata (General Manager and Representative Director of Japan, Alumni Ventures) established the Japan subsidiary of a US VC firm with roughly $1.6 billion in AUM and an active portfolio of about 1,800 companies. Queenie Wong (Managing Director, EQT Early Stage Asia) leads early-stage investing in Asia from Hong Kong for one of the world’s largest private equity firms, with EUR 341 billion(USD389 billion) in AUM.
The session was essentially off the record, so I won't quote individual remarks directly. Instead, I want to summarize, in my own words, what I took away from the discussion — both as an investor and as a member of MUFG Innovation Partners.
When we discussed post-IPO growth strategy last year, I noted that Japan’s startup ecosystem had started shifting to compete credibly for global investor attention. That shift is now beginning to accelerate.
Why Japan, why now
What struck me first was that the lineup of investors on stage itself reflected how much the Japanese market has changed. Global funds that once showed little serious interest in Japan’s private markets, along with new players specializing in growth-stage investing, are now positioning Japan as one of their core battlegrounds.
Their interest in Japan is anything but sentimental.
Japan ranks among the world’s leaders in GDP, R&D spending, and number of researchers, giving it deep reserves of technology and talent. The public sector, too, is deeply committed: Japanese government officials understand startup ecosystems in other countries that many investors are unaware of, and think seriously about how to support the domestic ecosystem.
All of the panelists said they were convinced of Japan’s potential.
What the panelists shared was a view of Japan as a market at an inflection point. Pieces that had long been missing are finally falling into place. I felt that same conviction alongside them. We are standing at the threshold where global investment capital is beginning to turn toward Japan's private markets.
The barriers to scale in a market where it’s easy to start a business
During the session I presented data on startup fundraising in Japan, which reveals a structural “twist” in the market.
While the total value of startup fundraising in Japan is only about 1.5% of that in the U.S., the number of companies that raise funding reaches roughly 20% of the U.S. figure. In other words, Japan is a country where it is relatively easy to start a company and raise capital, a fact we should be proud of. The flip side is that the amount raised per company is extremely small: the capital needed to scale simply isn’t flowing sufficiently to any one company.
This “barrier to scale” is closely tied to the structure of Japan’s public markets.
For years, Japan has produced a large number of “micro-IPOs” — companies that go public with very small market capitalizations. Because companies list too early, they cannot balance post-IPO pressure from investors to generate profit with the need to keep growing, and their momentum stalls.
This vicious cycle is one reason why so few billion-dollar “unicorns” emerge in Japan.
Of course, the domestic ecosystem is not blind to this problem.
The Tokyo Stock Exchange’s recent reforms include requiring, starting in 2030, companies with a market capitalization below JPY 10 billion five years after listing to be delisted, so market capitalization will be scrutinized far more strictly. As a result, companies will likely stay private longer, growing to sufficient scale before going public. What’s essential for that is growth-stage capital and a secondary market function that can take on the risk existing shareholders (early investors) have already borne.
Protecting startups from listing too early and providing patient support as they scale is precisely the market role Japan currently lacks.
The numbers bear this out.
According to the Tokyo Stock Exchange, foreign investors already account for 20% of trading on its Growth Market, while in the private market they account for only a few percent. That is exactly the gap that Japan’s private markets need to fill.
It’s not that interest is lacking, quite the opposite. Many global investors are looking to enter but what remains to be seen is whether Japan can produce companies worth investing in, and the capital base to support them.
Now is the time for Japanese entrepreneurs to dream big
Another thing that struck me through the discussion was the shifting mindset among Japanese entrepreneurs.
Japan has always had excellent talent.
But much of it chose large corporations, because during the long years of deflation, avoiding risk was the rational choice. Now that Japan has emerged from deflation, taking risks is being encouraged, and it is becoming “normal” for top talent to join startups.
Indeed, students at top universities are increasingly choosing startups or entrepreneurship as their first career. Choices that parents once opposed are now being encouraged. As a Japanese myself, I can feel this change firsthand.
With that in mind, there is something I want to say to entrepreneurs, from an investor’s standpoint.
Capital is no longer just money. It also means introductions to customers, helping to build an equity story for an IPO, and connections to a global network.
When investors genuinely walk alongside a company, its growth trajectory can change dramatically. That is exactly why entrepreneurs should look closely, right now, at what kind of investor their long-term shareholders will be, and what they actually bring to the table.
And above all, I want entrepreneurs to dream bigger. Overturn the conventional wisdom of the domestic market. Design a business with the world in view. The capital needed for that growth is now genuinely within reach. As an investor, I want to dream that big dream together with entrepreneurs and chase it with them.
Japan has excellent ideas and excellent entrepreneurs, and the last missing piece — growth capital — is now falling into place. Through this session, I once again became convinced that Japan’s startup ecosystem is entering a stage where it can truly compete with the rest of the world.
