Tokyo's Dynamic Ecosystem for a Startup Company and its Global Impact

By Taj Shorter and Chiyo Kamino Published on Jul. 07, 2023

Tokyo, Japan is an economic powerhouse with its thriving business landscape and global influence. As the capital of Japan, the city boasts a robust economy that drives the country's growth and innovation. With a GDP surpassing many nations, Tokyo is a major financial hub, hosting the headquarters of renowned multinational corporations, leading financial institutions, and a thriving stock exchange. The city's economic status extends beyond finance, embracing technological advancements across various industries. Tokyo's reputation as a technological leader, with breakthroughs in robotics, AI, and biotechnology, has attracted global attention. Moreover, its diverse industries, including automotive, electronics, fashion, and entertainment, contribute to the city's economic strength and foster a dynamic ecosystem that nurtures innovation and entrepreneurship.

The growing interest in Tokyo's startup ecosystem can be attributed to several factors that make it an attractive destination for entrepreneurs and investors. For starters, the Japanese government has implemented initiatives and policies to support startups, such as deregulation and tax incentives, which create a favorable environment for entrepreneurial endeavors. This proactive approach by the government has increased confidence and sparked enthusiasm among local and international entrepreneurs to establish their startups in Tokyo.

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Access to capital also plays a crucial role in the ecosystem's growth. Tokyo offers a thriving venture capital market, with investors actively seeking promising startups from all over. One of the Venture Capital World Summits will be held in Tokyo, Japan in 2023. Additionally, angel investors, venture capitalists, and government-backed funds contribute to the availability of capital, providing startups with the financial resources needed to fuel their growth. The combination of government support and ample funding opportunities makes Tokyo an appealing destination for startups seeking to thrive in a supportive ecosystem.

Highlights of Tokyo’s ecosystem

Tokyo's startup ecosystem has gained significant recognition globally, evidenced by its impressive ranking of 15th in Startup Genome's global ranking and standing as the 5th top startup ecosystem in Asia. This recognition has further been solidified by Tokyo's designation as a Startup Ecosystem Global Hub City. These accolades highlight the city's growing prominence as a hub for entrepreneurship and innovation.

To encourage international participation, Tokyo has introduced a startup visa specifically tailored for foreign startups. This visa program aims to attract and support foreign entrepreneurs by providing them with the necessary resources and support to establish their startups in Tokyo. Such initiatives demonstrate the city's commitment to fostering a diverse and inclusive entrepreneurial community.

Tokyo has also been making strides in organizing events that showcase its startup ecosystem to a global audience. An example of this is the City-Tech Tokyo expo, an international smart city expo that was held recently. This event provides a platform for startups to showcase their innovative solutions and connect with potential investors, partners, and customers. Additionally, the presence of large-scale government projects further reinforces Tokyo's commitment to nurturing its startup ecosystem and creating an environment conducive to innovation and growth.

While Tokyo's startup ecosystem spans various industries, one of its notable focuses is in fintech. The presence of initiatives such as FinCity and the Fintech Association Japan highlights Tokyo's dedication to promoting innovation in the financial technology sector. These initiatives provide support, networking opportunities, and resources for fintech startups, positioning Tokyo as a leading destination for fintech entrepreneurs and investors.

Role of the government and historical impact

The impact of past successful startups on Tokyo's current ecosystem cannot be overstated. These success stories have not only demonstrated the city's potential for innovation but also inspired a new generation of entrepreneurs. The achievements of companies like SoftBank, Rakuten, and LINE have showcased Tokyo's ability to produce globally recognized and influential startups. Their success has attracted attention and investment to the city, creating a ripple effect that has fostered a sense of optimism and a belief in the viability of startups in Tokyo. Moreover, the knowledge, experience, and networks developed by these successful entrepreneurs have contributed to the ecosystem's growth by serving as mentors, investors, and advisors to emerging startups.


The Japanese government has been pivotal in fostering startups and promoting entrepreneurship in Tokyo. The government has implemented various initiatives and policies to support the startup ecosystem, recognizing the importance of startups in driving innovation, economic growth, and job creation. One notable initiative is the "Society 5.0" vision, which aims to integrate cutting-edge technologies into society and foster innovation. The government has also launched startup-specific programs and platforms such as the Japan Innovation Network, JIN, and the Global Entrepreneurship Network, or GEN, Japan, which provide resources, mentoring, and networking opportunities for entrepreneurs.

In addition to initiatives, the Japanese government has implemented policies and incentives to attract and nurture startups. According to the General Incorporated Foundation

EU-Japan Centre for Industrial Cooperation, tax incentives and subsidies are available for R&D activities and reduced tax rates for certain companies. The government has also introduced regulatory reforms to simplify business processes and lower entry barriers for startups. Moreover, public-private partnerships have been formed to create incubators, accelerators, and co-working spaces that provide essential support and resources to startups.

Overall, Tokyo's ranking, global recognition, introduction of startup visas, hosting of international events, and emphasis on key industries like fintech are all crucial factors that contribute to the thriving nature of its startup ecosystem.