Japan Investment Corporation (JIC): A Public-Private Venture Fund


Japan is the world's third largest economy. But, compared to the U.S. and China, the two largest, it lags far behind in the number of startups going public with an IPO and boasts only one billion-dollar startup ("unicorn"). The country trails many economies in overall venture-deal volume. In 2020, the Wall Street Journal reported that Tokyo-based SoftBank, a leading tech investor, showed little interest in funding homegrown startups.

In response, the government has sought to direct public money into business with high growth potential while stimulating private investment. To this end, it created a $18 billion government-backed investment fund in September 2018 - the Japan Investment Corp (JIC). The government holds a 95% stake in JIC.

JIC took over the role of the Innovation Network Corporation of Japan (INCJ), a state-backed fund set up to accelerate the growth of domestic companies. But, rather than investing directly in companies as INCJ did, JIC established funds with private equity firms, sovereign wealth funds and institutional investors to invest in companies.


JIC establishes investment funds and supplies capital to business sectors that meet its policy objectives. The Ministry of Economy, Trade and Industry set a target of 20 new unicorns by 2023. By some estimates, Japanese venture investment volume needs to increase five or six fold to fit the relative size of its economy.

In 2020, for example, JIC created a $1.2 billion venture capital fund (JIC Capital Co., Ltd.) that invested nearly $100 million in an initial group of seven companies. See timeline section below for information on other JIC funds. Through these, JIC seeks to increase venture capital from private investors and the supply of private sector risk capital, and contribute to the development of investment professionals.


Japan Investment Corporation (JIC)


JIC makes investments in accordance with Japan's Industrial Competitiveness Enhancement Act. It has established funds with four target investment focus areas:

1. Society 5.0 businesses: Drives the creation of new businesses for Society 5.0, those where uncertain and discontinuous growth is required, and which demand a significant amount of investment capital over a long period of time.

2. Unicorn startups: Invests in potential unicorn startups, supports sustainable growth of companies with a competitive edge in the global economy.

3. Leveraging promising untapped regional technologies: Addresses the need for capital among regional startups such as university spin outs with under-utilized technology and high revenue potential.

4. Promoting business consolidation across industries and organizations: Supports industrial competitiveness through business consolidation aiming to open innovation in the sectors with potential international competitiveness.


September 2018: JIC is created and launches the INCJ, Ltd. fund by splitting Innovation Network Corporation of Japan. INCJ, Ltd. begins investment activities to finance key industries that leverage open innovation across boundaries between companies and industries.

July 2020: JIC launches the Venture Growth Investments Co., Ltd. fund aimed at improving Japan's international competitiveness by promoting innovation that addresses social and industrial issues.

September 2020: JIC establishes the JIC Capital Co., Ltd. fund to finance new Society 5.0 industries, promote business consolidation, enhance international competitiveness and establish next-generation social infrastructure for promoting digital transformation.

January 2021: Japan’s Parliament considers a new $20 billion fund to invest in environmental innovation during the next decade. Approval is expected.


JIC was designed to address criticism of the failed Innovation Network Corporation of Japan, a government fund established in 2009. The INCJ was supposed to finance innovative businesses, but the $18 billion government-backed fund was mainly used to rescue existing struggling hardware companies.

JIC faced internal disputes among its Board members in 2018, which reflected conflicts inherent in public-private venture capital funds. For example, the Ministry of Economy, Trade & Industry (METI) retracted its policy of allowing JIC to aggressively invest in overseas investment vehicles, which were expected to produce high returns. JIC executives viewed the Ministry’s moves as assuming control over its investment decisions, creating a public dispute over the government’s role in the fund.


Hiroshige Seko, Minister of Economy, Trade & Industry


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Global Entrepreneurship Network
United States
Global Entrepreneurship Network
United States