SBI Holdings to Launch $663M Fund to Propel Web3 and Fintech Startups

SBI Holdings, a prominent Japanese financial company, is preparing to launch a $663 million fund supporting Web3, AI, and other fintech startups.

The fund is slated to invest in 150-200 companies and is anticipated to begin operations by the current year’s end, as Nikkei Shimbun reported.

Japan’s Startup Fund Momentum with Major Backing

The SBI Holdings investment scale is expected to be robust, ranging from hundreds of millions to billions of yen per project. This ambitious fund is anticipated to reach a substantial 100 billion yen, with key contributions already confirmed from prominent financial institutions.

Sumitomo Mitsui Banking Corporation, Mizuho Bank, Nippon Life Insurance, and Daiwa Securities Group have committed to invest more than 50 billion yen into this initiative. This financial injection carries immense significance in a nation where venture capital (VC) funds of this magnitude are relatively scarce.

Japan has faced challenges in nurturing and fostering startup enterprises, a concern that prompted the Kishida administration to outline a “5-year startup development plan” in November 2022. The plan seeks to address the issue of lagging startup rates compared to the United States and Europe and aims to elevate Japan as a startup hub in Asia.

The Kishida administration is actively striving to materialize a concept of “new capitalism.” At the core of this philosophy is the belief that startup companies epitomize this innovative capitalist mindset, as they can convert societal challenges into catalysts for growth, ultimately leading to the establishment of a sustainable economic society.

Japan’s Plan for Promoting Growth in the Startup Ecosystem

The Japanese government has set an ambitious goal of substantially increasing investment in startup companies, aiming to grow it from 800 billion yen in 2022 to an impressive 10 trillion yen (approximately $66 billion) by 2027. This growth is envisioned through collaborative efforts between the public and private sectors.

Additionally, the administration has expressed its commitment to nurturing the development of 100 unicorns and 100,000 startup companies. This strategic initiative aims to position Japan as a thriving global startup hub, solidifying its standing as Asia’s largest startup ecosystem.

Given the evolving landscape for Web3 and AI startups, regulatory challenges, and tax policies are now critical considerations. To address these issues, the Japanese government is revising the tax framework pertaining to Web3 companies, particularly concerning corporate taxes and virtual currencies. The final outline of the proposed tax reform is anticipated to be confirmed around mid-December.