Why Japan’s Startups Are Capturing the World’s Imagination

CES is presented every year in early January in Las Vegas, Nevada, USA. Over the years, CES has outgrown its original scope as a trade fair exhibiting electronic devices, becoming a showcase for leading-edge technologies, solutions and services in a wide range of genres and from all over the world. A few years ago, the event dropped its original name, “Consumer Electronics Show,” to become known simply as CES.

The J-Startup Pavilion, Where Japanese Startups Exhibit, Attracts More Interest with Each Passing Year

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Over the last few years, the number of startup companies exhibiting at CES has grown especially large. Attracting particular attention is the J-Startup pavilion, which hosts a cluster of Japanese startup firms within Eureka Park, a hall for startups from around the world. Startups from Japan have been gathering in the J-Startup pavilion since 2019, when 22 companies exhibited there. In 2020 that number rose to 28 and over 50 are expected to exhibit in the pavilion at CES 2021.

J-Startup is turning heads not merely because of the large number of companies participating but for the outstanding quality of the products, solutions and services showcased here. For example, in 2020 World Matcha exhibited Cuzen Matcha, a machine that brews matcha tea with the ease of a coffee maker. Exhibited here for the first time, Cuzen Matcha won a CES 2020 Innovation Awards.

Other products that commanded rapt attention at the previous two exhibitions were Lovot, a robot developed by Groove-X with a design so lovable that it becomes part of the family, and Flying Gondola, an air mobility solution that enables people to hover in the air using an exclusive balance-control technology. Gatebox, a device for summoning AI characters, is not only already commercialized and launched but growing fast in Japan and worldwide, including through partnerships beginning with NTT DOCOMO in Japan and companies overseas.

As the above examples illustrate, startup companies that participate in the J-Startup pavilion tend to be those that can best reach their intended audiences from Japan, such as makers of robots, drones and smart-home solutions. We spoke with Ichiro Sone of the Japan External Trade Organization (JETRO) with general responsibility for startup support. JETRO is a government-related organization in Japan responsible for promoting trade and is the sponsor of the J-Startup pavilion.

Japanese Companies Are Using New Technologies to Create Fresh Solutions

Asked to identify the strengths of Japanese startups, Sone remarked, “Japan is recognized worldwide as a leader in innovation. Many of today’s global corporate giants, such as Sony and Honda, were once startups. In the Japan of former times, companies did all their development and manufacturing in-house. Today there’s been a change in mindset toward an open-innovation model, in which various companies partner with each other.” Japan’s startups, Sone pointed out, have changed to a more outward-looking character, seeking partners overseas as well as in Japan. Sone added that Japanese quality is alive and well: “[Japanese enterprises’] commitment to quality in products and services is as strong as ever.”

“Japan’s declining birth rate and aging demographic profile are continuing to worsen. In 2020 about 28.7% of the population is 65 years of age or over. But while this trend is generally regarded as a disadvantage, other countries’ demographic profiles are going to start aging too. Japan is already grappling with those challenges, so we’re a world leader in that sense… We’re using new technologies to enhance medical care and social services,” Sone noted, remarking that Japan was attracting worldwide attention on this front.

Japan’s declining birthrate and aging population are leading to a decrease in the nation’s working population. This problem is forecast to become global in scale. Making improvements in productivity essential, to make tomorrow’s smaller working population more effective. Fortunately, Sone notes, Japan is richly endowed with startups that can make that productivity happen: “The Japanese government is working through JETRO to reinforce startups as an engine of growth for the next generation. Our hope is that a wide range of Japanese companies will not only make their debut on the world stage but also play a signature role in solving the social problems of Japan and the world.”

Notwithstanding its decreasing birthrate and aging population, Japan is still a nation of over 100 million people. “We’re the world’s third-largest country in terms of GDP, Sone noted. “A big, attractive market.” Sone outlined his reasons why JETRO is working to highlight Japan’s startups before a global audience and persuade the world to invest in them: “If we can once more present to the world innovative technologies that will drive global development, that will be very important, because it will lead to greater prosperity for the Japanese people.”

From “Startups in the Remote Far East” to “Startups that Can Take on the World and Win”

At the upcoming CES 2021, scheduled for January 2021, a sizable cohort of Japanese startups are expected to participate, once again attracting the attention of the world. Many of the solutions and services exhibited will prove vital in the world of COVID-19. For example, WOTA is a system that recycles and filters water, providing a supply of clean, portable water even in locations where clean water facilities are not available.

At one time Japanese companies’ presence was declining on the world stage. The ability of Japanese startups once more to garner such intense interest at events such as CES is due in large part to the backup provided by JETRO. In the J-Startup Program, launched in 2018, JETRO carefully selected 139 game-changing startups capable of winning internationally and provided focused support to nurture their growth.

JETRO also established “Global Acceleration Hub” in 27 cities worldwide characterized by advanced innovation ecosystems. Working space is provided at these hubs, so that Japanese startups can use the hubs as their base for operations overseas. The Global Acceleration Hub also provides business matching and arranging services. By bringing them closer to global markets in this way, JETRO is assisting Japanese startups in overcoming the perceived handicap of being “startups in the remote Far East.”

Unlike previous events, CES 2021 will be conducted online. This change is a hurdle for Japanese startups, most of which exhibit hardware products. Attendees at CES 2021 will be unable to see and touch the actual products in a physical setting, as is necessary to truly understand the products. Moreover, language barriers are especially troublesome when presentations and negotiations are conducted online.

JETRO is providing wide-ranging assistance to enable Japanese startups to overcome these challenges. Sone says JETRO provides comprehensive support for Japanese startups participating in the J-Startup pavilion: “We assist [the startups] in producing promotional videos and developing effective websites, and we offer training in English for business negotiations.”

Because CES 2021 will be presented online, the Consumer Technology Association, which is the event’s sponsor, is expected to provide a matching system to facilitate connecting exhibitors with business prospects and media. Japan’s startups are preparing in earnest so that, when they are matched with potential customers and media outlets through this system, they will be able to use those negotiations and media appearances effectively.

Can a Super-Aging Society Be Transformed into a Super-Smart Society?

With nearly twice as many companies expected to exhibit at CES 2021 as last year, the presence of the J-Startup pavilion will be greater than ever. At 3:00 PM PST/ 6:00PM EST on Wednesday, January 13, 2021, the third day of CES 2021, the pavilion will host a “JAPAN Session,” on the theme “Transforming the Super Aging Society into a Super Smart Society.” This session will feature many startups contributing solutions to the COVID-19 pandemic as well as the special issues confronting the world’s most advanced super-aging society. Representatives of various firms will take the podium, explaining not only the features of their products but also the concepts and visions that inform them.

With devices, solutions and services that only quality-driven Japan can create, Japanese startups that can take on the world are getting ready for CES 2021. Don’t miss this extraordinary event.

Overview of the JAPAN Session

Wednesday, January 13, 2021

3:00 PM to 5:10 PM PST / 6:00 PM to 8:10 PM EST

View the Japan Session right here!

> Opening Remarks

3:00 PM to 3:05 PM PST / 6:00-6:05 PM EST (5 mins)

> Welcome Speech: Japan’s Innovation Policy for a Super-Smart Aging Society

3:05 PM to 3:15 PM PST/ 6:05-6:15 PM EST (10 mins)

> Session 1: Emerging Visions and Potential Unicorns in Japan’s Tech Industry

3:15 PM - 3:35 PM PST/ 6:15-6:35 PM EST (20 mins)

> Session 2: Wearables for a Super-Smart Aging Society: IoT for Independence

3:35 PM - 4:05 PM PST/ 6:35-7:05 PM EST (30 mins)

> Session 3: Robotics for a Super-Smart Aging Society: Life with Bots that Bring Out the Best of Humanity

4:05 PM - 4:35 PM PST/ 7:05-7:35 PM EST (30 mins)

> Session 4: Unlimited Water Supply, “Touchless Touch” Panels, and Telexistence: How Japan Is Arming Itself Against Covid-19

4:35 PM - 5:05 PM PST/ 7:35-8:05 PM EST (30 mins)

> Closing Remarks

5:05 PM-5:10 PM PST/ 8:05-8:10 PM EST (5 mins)

About JETRO

The Japan External Trade Organization (JETRO) is a Japanese government-related organization that assists innovative startups in expanding their businesses into the global market. The organization provides extensive support for business development, including consultation on go-to-market strategies, in order to help small businesses grow and to foster their relationships with their global counterparts. JETRO has organized the CES J-Startup Pavilion (Japan Pavilion) since 2019.