VC Investments Part I

Part
01
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Part
01

LP VC Investments in Japanese Companies

Extensive searches across multiple Japanese finance websites, stock analysis websites, trading exchange platforms, and individual company websites found out that only Asset Management One has invested in a venture capital fund, MM Capital Infrastructure Fund I L.P as a limited partner. The other two companies, Nomura Securities and Misui & Co., have never invested as a limited partner in a venture capital fund.

NOMURA SECURITIES

NOMURA INDIA INVESTMENT FUND MOTHER FUND
  • Nomura Securities' profile on CrunchBase identified a single venture fund called the Nomura India Investment Fund Mother Fund. There were no further details on the announcement date and amount raised for the fund.
  • Based on the most recent published corporate shareholdings filed for June 30, 2017, the Nomura India Investment Fund Mother Fund held 22 public stocks with a net worth exceeding Rs. 2,225.5 Cr., which is about $312 million using the current online exchange rates.
  • The fund increased its percentage holding in the following companies: Brigade Enterprises Ltd., Sadbhav Infrastructure Project Ltd., Neuland Laboratories Ltd., Federal Bank Ltd., India Bulls Venture Ltd., and Emami Ltd., while it reduced its holding in Eveready Industries, India Ltd., Repco Home Finance Ltd., and Gujarat Pipavav Port Ltd.
  • Other major stocks are held in Parag Milk Foods Ltd., BSE Ltd., Pennar Engineered Building Systems Ltd., Crompton Greaves Consumer Electricals Ltd., Manpasand Beverages Ltd., Laurus Labs Ltd., YES Bank Ltd., RBL Bank Ltd., Fortis Healthcare Ltd., Gujarat Pipavav Port Ltd., Advanced Enzyme Technologies Ltd., Capital First Ltd., and Thyrocare Technologies Ltd.

OTHER JOINT VENTURES AND INVESTMENT FUNDS

ASSET MANAGEMENT ONE

  • Extensive searches across Asset Management One's company website, investor relations, and press releases reports revealed that the company focuses mainly on asset management and has established hedge funds, real estate, private equity, and infrastructure investment funds. It does not have a venture capital fund; though, below are provided examples of other funds that it manages, specifically for foreign investments.

MM CAPITAL INFRASTRUCTURE FUND I L.P.

OTHER JOINT VENTURES AND INVESTMENT FUNDS

MITSUI

  • Mitsui & Co. focuses on several investments fields and industries. It has two active venture capital arms Mitsui Power Ventures Limited, which invests in the energy sector and Mitsui & Co. Global Investment (USA) Inc., which invests in early-stage venture and late-stage venture.
  • It also established an equal partnership with Israeli VC firm Magenta Venture Partners to invest in early-stage investments in Israeli and Israeli-related tech startups in AI, mobility, AI smart cities, etc. In none of the above venture capital funds is Mitsui & Co. a limited partner.

MITSUI GLOBAL INVESTMENT

MITSUI POWER VENTURES
  • The Mitsui Power Ventures is based in the United Kingdom. It primarily focuses on investments in power generation businesses.
  • Notable investments made via this fund include in 2014 when the company invested in Lanza Tech, a venture company building gas fermentation process technology.
  • Other key projects include the Vincent oil field projects in Australia, Eagle Ford shale oil and gas project in the U.S., the Gulf of Thailand oil and natural gas field project, etc.

MAGENTA VENTURES PARTNERS FUND

RESEARCH METHODOLOGY

Extensive and in-depth searches across various venture capital and equity investment databases did not reveal much information about venture capital funds invested by Nomura Securities, Asset Management One, and Mitsui & Co. as limited partners. The research findings indicate minimal activity in venture capital funds with limited liability partners. Only one example for Asset Management One stated that it invested as a limited partner; however, when we investigated, we found out that it invested through its subsidiary, Mizuho Bank Limited. Most of the information available online focuses on joint venture investments, as opposed to venture capital funds. Searches throughout the websites of these companies, including a thorough examination of their annual reports disclosed minimal activity, specifically regarding venture capital fund.

Our research findings suggest that these companies are not much focused on venture capital funds, and if they invest through venture funds, they do so as equal partners and not limited partners, or run their own venture capital funds for the case of Mitsui. The assumption is evidenced based on the findings across all asset management companies showing more involvement in joint venture activities as opposed to establishing a venture capital fund. The risky nature of venture capital funds investments in startups with uncertain futures is a major hindrance to increased activity in this space.

Our searches were conducted across different business and investments directories, including CrunchBase, a company and startup profiling provider. We retrieved most of the information presented here from each company's website, in particular, the press releases and product and services sections. External sources such as CB Insights, CrunchBase, Nikkei, TechCrunch, and other exchange platforms in Japan did not feature any relevant information as well. The lack of that information on the company websites suggests that they are not actively involved in venture capital funds, which is characterized by the lack of comprehensive information on such funds.

While we could not uncover specific examples for all companies where they have invested in venture capital funds as limited partners, we have presented details about their major venture capital funds, and investments in venture capital funds. Regarding the latter, we found out that Mitsui & Co. made recent investments in an Israel-based venture capital fund as an equal partner, and not a limited partner. The big nature of these businesses with the capacity to run their own venture, equity, or hedge funds could be the reason they have not made many investments in venture capital funds as limited partners.
Sources
Sources