SoftBank Group Corp.'s Vision Fund has invested its $100 billion cash pile in 75 unicorns around the world. Not a single one is from Japan, its own backyard.
That may be because the pickings are slim: While the U.S. has 179 unicorns, China 93 and India 18, Japan has just two, according to CB Insights. How can a country that pioneered the Walkman and android robots fail to produce more valuable startups? The explanation may be somewhat arcane, but helps get to the bottom of a damaging cycle that's left Japan with an uninspiring pool of fledgling innovators.
The listing standards for the small-cap Tokyo Stock Exchange Mothers Index are exceedingly low. To join Nasdaq, its New York counterpart, companies need a minimum of 1.25 million traded shares upon listing. That compares with just 2,000 for Mothers. This short hurdle, among others, means young, cash-hungry firms can tap public markets pretty easily, and sidestep the grinding process of courting investors through multiple rounds of funding.