US-Japan Investment Initiative
Author: cyberradical (Guest Blogger)
I attended the "US-Japan Investment Initiative 'Investment Seminar in Yokohama'" yesterday.
Yasu, the owner of the Sell To Japan, told me about the existence of JETRO (Japan External Trade Organization) some while ago. This was the first time for me to attend the seminar organized by JETRO. It was a really interesting event for me to understand what kind of policies and business plans each related parties are thinking about to promote business relationship between Japan and US.
Firstly, let me quote the agenda of this seminar.
Date/Time : 13:00-17:30, October 6, 2006 (Cocktail 17:30-19:00)
Place : Yokohama SYMPOSIA
Organizers : City of Yokohama, JETRO,
Kanto Bureau of Economy, Trade and Industry, Ministry of Economy, Trade and Industry,
US Embassy in Japan
Sponsers : Kanagawa Prefecture, Kanagawa Trade Promotion Corporation, Yokohama Chamber of Commerce and Industry,
Yokohama Industrial Development Corporation
Agenda :
1. Greeting Remarks 13:00-13:10
1) Message from the Mayor of Yokohama
Toshiharu Nagashima, Policy Planning Director for Life Science & New Business Attraction, Economic and Tourism Affairs Bureau
2) Hiroshi Tsukamoto, President, JETRO
2. Presentation by Japanese and US governments 13:10-13:30
1) Tsunehiro Ogawa, Director-General, Multilateral Trade System Department, Trade Policy Bureau, Ministry of Economy, Trade and Industry (METI)
2) Hans G. Klemm, Minister-Counselor for Economic Affairs, US Embassy
3. Presentation 13:30-13:40
'Business Environment of Yokohama'
Masayo Hoshizaki, Manager, Business Development Division, Economic and Tourism Bureau, City of Yokohama
4. Presentation 13:40-13:45
'Yokohama's Business Environment from the Foreign Company's Perspective'
Mr. Yoji Toi, Managing Director, Federal Mogul KK (Japan)
5. Presentation 13:45-14:30
'Future Automobile Technologies for Environment and Safety'
Mr. Minoru Shinohara, Senior Vice President, Nissan Motor Co., Ltd.
6. Presentation from Participating Companies 14:45-17:30
1) TSUNAMI Network Partners Corporation - Mr. Masatoshi Go
2) SatCon Technology Corporation - Mr. Leo Casey
3) Zyvex Corporation - Dr. Patrick Y. Howard
4) Fortemedia Inc. - Mr. Fumihiko Ishii
5) GESAC, Inc. - Mr. N. Rangarajan
6) BigFix, Inc. - Mr. George Billman
7) Coherix Inc. - Mr. Kim Chia
8) InternetSpeech - Dr. Emdad Khan
9) Endtone, LLC - Mr. Brock Muir
10) MACRONETICS - Dr. Vinh Nguyen
11) Televital Inc. - Mr. Deepak Bangalore
During the these presentations, companies and registrants had opportunities to talk to individual companies to make business networks with them. I had a chance to talk with two companies, and one of them was quite fruitful for each other to build a partnership from now on.
There are the following three points I want to mention about this seminar.
- Government Policy
- Yokohama City as Business Environment
- Venture Capital
1. Government Poilcy
I didn't know this, but this investment seminar is the PR body of the US-Japan Investment Initiative, a forum for discussing various economic issues that lie in the way of investment to each country. The initiative was established between former Japanese Prime Minister Junichiro Koizumi and U.S. President George Bush in 2001. One of the key policies is Mr. Koizumi's commitment to encourage foreign direct investment (FDI) to Japan from the current 2% per GDP to more than 5% by 2010. Foreign investment is believed to be a catalyst for economic growth and innovation in both Japan and the United States, because it creates jobs, transfers technology, revives corporations, and supplies risk-taking capital. It also helps the two countries develop deeper political and social understanding.
You can find out more detailed information with interesting policies in the media note titled "US-Japan Investment Initiative Report 2006" by the US Embassy. Full report (PDF) is also available.
2. Yokohama City as Business Environment
I was surprised that there is a plan to change Yokohama to a Japanese-version of Silicon Valley. Even it will still take time for a while, Nissan Motors already decided to relocate its global headquarters to Yokohama in 2009. There are many other world-class companies who establish a headquarter or a branch office in Yokohama - Rohm, Macnica, Wipro, Tata, Texas Instruments, IBM and others, not to mention many small & medium sized companies. As a citizen in Yokohama, I can certainly say that Yokohama is much better than Tokyo in terms of cost, environment, density of population, internationality and other elements. Typical Japanese tend to gather in one place just to make themselves stressful ;-) As an aggressive investor and international business man (warning: full of exaggeration), I will take a totally opposite strategy. Stay in Yokohama as your home ground both for business and private life. If you agree with me, you're now my neighbor. So why don't we go Kannai or Isezaki-chojamachi for drink party or night clubbing?
Sorry for my wandering from the main subject...
There are many sophisticated business districts here in Yokohama. Population is second to Tokyo (3.6M people). It takes less than 30 minutes to go to Tokyo. Land price and office rent are much cheaper than Tokyo. Outstanding human capital is available such as researchers and engineers graduated from Keio University and Yokohama National University. Five business centers for foreign-affiliated companies exist, and they help to minimize start-up costs and streamline market entry when foreign firms establish a business in Japan.
If you're interested, I recommend you to contact either Business Development Division, Economic and Tourism Bureau, City of Yokohama (ke-yuchi@city.yokohama.jp) or New York Representative Office of the City of Yokohama (info@coyokohama.org).
3. Venture Capital
Through the seminar, I found there are some venture capitals in Yokohama to assist start-ups. The company who had the presentation was TSUNAMI Network Partners (TNP). According to Mr. Go, President of TNP, the company was founded for the establishment of Silicon Valley type of ecosystem through planning and operation of the venture support organization "TSUNAMI".
Mr. Go's presentation told me Japan's many weak points for nurturing start-ups in this country.
IPO normally used to take 33 years (!) until the late 1990s in Japan, compared to the less than 5 years for major successful US companies including Intel, Cisco, Microsoft, Oracle, Dell, Sun Microsystems and others. Growth of enterprises are clearly driven by Equity Finance in US, but most Japanese companies including start-ups still depend on indirect bank loan.
Balance of VC Investments in 2003 is 243 (USD billion) in US, 162 in Europe, but just 9 in Japan (!). Also the amount invested per VC investment is 2,373 (USD thousand) in US, 246 in Europe, but just 82 in Japan. What a big difference!!!
Considering these facts, I can't help becoming the supporter of Venture Capitals in Japan, even if some of them are just money gamblers.
To summarize, through this seminar, I found three big parties who involve in preparing a very important infrastructure for private companies including start-ups in Japan market.
The Japanese government agencies (especially METI , JETRO and US Embassy) are constructing basis through policies and laws to nurture and promote business with US companies. A local city like Yokohama City also provides physical supports (namely, grants, facilities and others) to start-ups. The challenging plan to change Yokohama to be Silicon Valley in Japan looks very interesting and attractive. Lastly, local VCs and Cooperative Banks ('Shinkin Bank' which I don't have a chance to explain in detail this time) are supporting the finance of start-ups with their understanding of importance of local economies and industries.
* This article is licensed under creative commons:
