UTAITE & This Week in Japan Fundraising (6/22-29)
Fundraising announcements from 6/22-6/29
As mentioned in the newsletter earlier this week, we've decided to give fundraising news its own column to make things more digestible - and here's the first issue!
We've also started experimenting with company profiles in an attempt to answer a common question we get: what are some interesting companies - especially early-stage startups - coming out of Japan?
Let us know what you think!
Company of the Week: UTAITE
Fundraising Highlights of the Week
UTAITE
Not 3D or 2D, but 2.5D!
This week we’re doing a quick brief on UTAITE:
UTAITE is a Japanese entertainment startup that specializes in developing and operating 2.5-dimensional (2.5D) IP. Notably, the company raised a sizable ¥1.3B JPY (~$8.1M USD) Series A round early this year.
What is 2.5D?
The term "2.5次元" (2.5-dimensional) refers to a unique genre of entertainment originating in Japan that blends 2D and real-world (3D) elements. The term often describes performances and media adaptations of 2D manga, anime, and video games into live-action formats that retain a stylized, animated aesthetic.
An example of this would be a musical spin-off of Attack on Titan (進撃の巨人), a hugely popular manga and anime series.
Utaite creates original 2.5D IP starting with VTubers - Virtual YouTubers - which mixes human personalities with a virtual avatar (like this example on YouTube).
The rabbit hole of this particular subculture runs deep - one way of contextualizing it is as a logical digital extension of Japan’s (in)famous culture around idol groups and unique consumer behavior like “Oshikatsu” and associated implications and complex relationships it on fan identity.
Value judgments aside, this entertainment niche is growing at a brisk pace - reaching $2.3B and growing at an expected 70.6% CAGR.
Possibly nerdy? Absolutely. Expanding rapidly? Most definitely.
And here’s why it’s especially getting attention:
In June 2022, Anycolor, a Japanese company specializing in Virtual YouTuber (VTuber) management, launched its IPO on the TSE Growth Market. The company's initial market capitalization of approximately 44.6 billion yen (about $344 million USD) surged to 144.27 billion yen (about $1.11 billion USD) on its first day of trading, marking a remarkable 270% increase. This was one of the biggest IPOs in 2022 and one of the only startups to hit the benchmark of a billion dollar valuation that year.
There’s also some early signs that this is a media and entertainment trend that reaches across borders, with popular VTubers reaching audiences in the millions in the US and other markets.
So who are the investors?
Globis Capital Partners led the Series A round, while Z Venture Capital led the Seed round. Notable investors include ZOZO founder Maezawa through the Maezawa Fund, JAFCO Group, Mixi, Dimension Capital, XTech Ventures, Sony, Dentsu, and KDDI.
The next big (and ultra weeb-y) cultural export? Something to keep an eye out to see if UTAITE manages to translate domestic success into mainstream success in international markets!
Weekly Fundraising Highlights
Synspective, a Keio University and the Tokyo Institute of Technology startup that uses satellite data to analyze ground deformation, raised a ¥6.9B JPY (~$43M USD) Series C round from Mizuho Capital, Resona Capital, Astart, JAFCO Group, Toyota, Daiwa House, and Nippon Growth Capital.
Sabu, a startup that provides "ORARY", an Instagram management service for dental clinics, raised an undisclosed Series C round from GENOVA.
Tokium, a University of Tsukuba that provides a paperless expense settlement system, raised a ¥1.5B JPY (~$9.3M USD) Series E round from TGVest Capital.
SOXAI, a startup that sells the world's smallest smart ring, raised a ¥8.8M JPY (~$5.4M USD) Series A round from Hakuhodo Investments, NTT Docomo Ventures, SBI Healthcare Fund, TENTIAL, Mizuho Capital, Future Venture Capital, and Mirai Creation Investments.
Gra&Green, a Nagoya University startup that develops R&D-based businesses for the next generation of agriculture and food, raised a ¥650M JPY (~$4M USD) Series C round by SB Players, Mizuho Capital, Resona Bank, Hulic Startup, Mitsubishi UFJ Capital, Kyoto University, Nagoya Small and Medium-sized Enterprise Investment Development Center, Aichi Capital, and Suzumine Investment Works.
Notes from the Team
Thanks for reading and hope to see you around around the sidewalks of Tokyo!
Have a question or any feedback? Let us know!
Jeremy (Investor @ GHOVC) / Kenneth (Product @ Moon Creative Lab)