Mizuho Leasing told GCV its newly formed Future Creation Fund has a horizon of 10 years and will invest in seed and early-stage startups based in Japan.
Mizuho Leasing, part of financial services company Mizuho Financial Group, became the latest Japanese company to form a corporate investment fund. The $23.5m Future Creation Fund (FCF), was announced on Monday and it has already made its first investment, in Japan-based electric vehicle battery developer PowerX.
Nobufusa Takeuchi has since April this year been representative director at FCF and oversees the fund’s activities. Global Corporate Venturing caught up with Mizuho Leasing’s public relations team to hear more about the unit’s plans.
GCV: Mizuho Leasing has already invested in startup companies – such as Japan-based warehouse picking robot developer Rapyuta Robotics last month. Will all such investments now go through the new FCF?
FCF: Investment decisions will be made on a case-by-case basis, taking into account the stage of the company being invested in and the business synergies with our company. Specifically, investment will mainly be made in seed and early-stage companies through FCF while investment from Mizuho Leasing will mainly be made in mid and late-stage companies where business synergies with us can be expected.
GCV: We understand that ML Estate, the real estate subsidiary of Mizuho Leasing, also invested in Japan-based property technology developer CCreb Advisors in December last year; will ML Estate continue to make strategic investments?
FCF: We have deepened our business relationship with CCreb Advisors, which signed a corporate real estate strategy agreement with our ML Estate subsidiary in September 2019. We have therefore invested in the company to further deepen our collaboration and cooperation as a business partner. There is a possibility for ML Estate to make another startup investment in the future in the event of similar circumstances, but this has not yet been decided.
GCV: Can you tell us more about the newly established FCF’s team members? Are they coming from the VC industry? How many years do you envisage the fund being active for?
FCF: The fund will be managed with investment advice from Mizuho Capital, our parent firm Mizuho Financial Group’s corporate venture capital arm. The operation period will be approximately 10 years.
GCV: What stages do you plan to invest in? Is your geographical area limited to Japan or will you be investing overseas as well?
FCF: We plan to invest mainly in seed and early-stage companies in Japan. The focus is on sectors such as real estate and logistics, renewable energy, healthcare, subscription and vendor finance, robotics as well as electronic vehicle and batteries.
GCV: Is Mizuho Leasing likely to acquire any of the companies you invest in?
FCF: If the needs of the portfolio companies and Mizuho Leasing match, we may acquire them, but we foresee initial public offerings as the main exit method.
GCV: Mizuho Capital is a very active fund in the CVC industry – does FCF have plans to work with the Mizuho Capital team?
FCF: We will operate FCF with Mizuho Capital’s investment advice, utilising its wide-ranging knowledge and experience in identifying startup business models and supporting the growth of startup companies.
Mizuho Capital has a network of startups with cutting-edge technology and a diverse range of private equity fund management know-how while Mizuho Leasing has strengths in providing solutions using our extensive knowledge of the flow of goods – that is, a deep understanding of commercial distribution and advanced financial insights.
We believe synergies can be created by mutually complementing our functions so that we can improve the value of the portfolio companies and contribute to the open innovation of our business partners.
Interview originally conducted in Japanese. English translation by Global Corporate Venturing.