The Launch of a Secondary Fund Supporting Sustainable Growth for Startups in Japan

In a significant development for Japan's startup ecosystem, Bee Alternatives Japan LLC, along with Sumitomo Mitsui Banking Corporation and SMBC Venture Capital Management Co., Ltd., has come together to establish a new secondary fund. This fund aims to bolster the sustainable growth of startups by enhancing liquidity in the unlisted stock market, which has been a growing concern in Japan's venture capital landscape.

The startup market in Japan has seen meteoric growth since the 2010s, driven largely by an increase in equity financing. However, with many investment funds reaching maturity, there has been a pressing need to facilitate secondary transactions in unlisted equities and expand the M&A market. This initiative is aimed at addressing the challenges related to liquidity for unlisted stocks, which in turn provides more options to startups regarding their IPO timelines and funding methods. It is essential for the healthy growth of Japan's startup ecosystem.

In response to these needs, the newly established secondary fund known as the “Japan Boost-Up 1st Investment Limited Liability Partnership” is designed specifically to invest in vehicles created by domestic VC funds that continue to support their invested companies. The fund has already initiated its first investment project and plans to spend the next year seeking external investors with a target fund size that could reach between 10 billion and 15 billion yen.

Fund Details

- Name: Japan Boost-Up 1st Investment Limited Liability Partnership
- Operators: Bee Alternatives Japan LLC, SMBC Venture Capital Management Co., Ltd.
- Total Management Amount: 5 billion yen, with aspirations to raise 10-15 billion yen through external investors
- Establishment Date / Management Period: February 26, 2025 / 10 years
- Investment Target: Investment vehicles established by domestic VC funds

Through the activities of this fund, the founding companies aim to contribute to the revitalization of the Japanese economy by ensuring a robust supply of growth capital and diversifying investment strategies, thereby fostering Japan’s development as a global asset management hub.

For further inquiries regarding this initiative, interested parties can reach out to:

- Contact Person: Otsukuni, Inoguchi, Nishida
- TEL: 03-6823-8293
- Email: [email protected]

The establishment of this secondary fund not only represents a strategic shift for traditional investment practices in Japan but also reflects a stronger commitment to nurturing the country's budding startups. By enhancing liquidity options and fostering a supportive environment for continued investment, Japan takes a poignant step towards building a more resilient and dynamic economic future.

As the Japanese market continues to evolve, this new fund stands as a promising opportunity for both investors and startups, paving the way for innovative growth and sustained economic advancement. The contribution of the secondary fund to the Japanese venture capital ecosystem cannot be overstated, as it will facilitate better access to funds and support for startup projects across various industries.