Startups to receive increased aid from Tokyo govt to help growth

Jiji Press

10:00 JST, January 4, 2023

TOKYO (Jiji Press) — The Tokyo metropolitan government is boosting support for startups in an effort to catch up with Western countries and increase the number of firms capable of competing on the world stage.

Specifically, the Tokyo government plans to help companies aiming to grow exponentially through research on and development of innovative technologies, by establishing a major hub for startups, universities and other organizations, as well as by making it easier for such new businesses to participate in public procurement by the metropolitan government.

“Japan’s international competitiveness has continued to decline since the Heisei era [1989-2019],” Tokyo Gov. Yuriko Koike said at an event last November to announce a new strategy for aiding startups. “Let’s work together to resolve social issues with innovation and create game-changers from Tokyo.”

The governor unveiled a goal of increasing the number of “unicorns,” or unlisted companies valued at $1 billion or more, in Tokyo 10-fold in the next five years and sending them out into the world from the Japanese capital.

The envisioned hub, which will be able to house some 1,000 institutions, is slated to open in fiscal 2024.

Since many newly created companies lack capital and marketing capabilities, the new hub will also be home to domestic and overseas venture capitalists who can supply funding, and organizations with business management expertise. The metropolitan government hopes the hub will be a community where tenants support one another.

There have already been cases in which metropolitan government aid has helped businesses to take off.

Innophys Co., created at the Tokyo University of Science, teamed up with the Tokyo government to conduct trials of its Muscle Suit wearable lifting support device at care facilities. The tests found that strains on Muscle Suit users’ lower backs were reduced by up to 45%.

The good test results led to the Tokyo-based company being able to supply the device to the nursing care and welfare department of a metropolitan government-run high school and other facilities in fiscal 2021.

“By partnering with the metropolitan government, we could boost trust in our product and find customers,” a senior Innophys official said.