What's in store for next year!? We asked the experts— trend keywords for the 2023 startup scene!

2022 is almost over. This year, keywords such as "Sales SaaS", "Web3 (especially NFT, Metaverse)" and "Sustainability" were at the forefront. JP Startups also brings you the hottest funding news every week, but what categories will be in the spotlight next year? We asked experts in various fields.

Editor’s comments

* Honorific titles have been omitted, and names are listed in order of the Japanese alphabet

The seeds of new business are born in difficult times

I believe 2023 will be a difficult period as the wave of economic recession centered on the United States will also hit Japan. On the contrary, this is a once-in-a-lifetime opportunity for Japan. This is because the history of business suggests that the seeds of new businesses are born in times of recession and harsh business environments. Both Slack and Uber were launched at the time of the Lehman Shock.

The emergence of tech ventures in Finland directly resulted from a major restructuring at Nokia, which was struggling, with capital participation from Microsoft and many people who left Nokia to start their businesses. In that sense, various existing companies and industries will be hit by changes next year, and as a result, I think an interesting era will quickly start to take shape in Japan. Or rather, I think we have to make 2023 that kind of year.

Focus on “DAO (Decentralized Autonomous Organization) and Depopulation” in 2023

In 2023, the focus will shift to "DAO (Decentralized Autonomous Organization) and Founding". For example, the "Nishikigoi NFT" project in the Yamakoshi region of Niigata Prefecture is an effort to increase the population in depopulated areas by creating a DAO for NFT artworks of Nishikigoi (colored carp), a specialty of the region, as digital resident cards. 2023 will see efforts to solve regional issues with Web3 technologies such as NFT and DAO, such as Yoichi Town in Hokkaido and Izumisano City in Osaka Prefecture, which has adopted NFTs as return gifts for hometown tax payments. Web3 startups and DAO projects challenging such social issues are attracting much attention.​

As the "new normal" life becomes more commonplace, various experimental initiatives to move away from urban areas, such as the "Creating Valley of the Wind" project promoted by Mr. Kazuto Ataka and his team, and innovations rooted in each region will gradually spread. In connection with this, I think startups dealing with multi-site living, workation support, reskilling support, freelance support tools, and remote communication technologies that utilize avatar robots, VR, etc., will generate renewed interest.​

An increase in movements and services that realize "autonomous decentralization"

An increase in movements and services that realize "autonomous decentralization" In 2023, I expect to see an increase in the number of services and movements that embody the "autonomous decentralization" philosophy of Web3 and DAO. In 2022, I was invited to participate in Keidanren's Web3 working group and several other Web3/DAO research groups. On understanding that the autonomous decentralization philosophy of Web3 / DAO is similar to the  mutual aid philosophy that we Japanese are familiar with, I have seen many workplaces where Web3 and DAO are actively talked about as alternatives to existing businesses and administrative deadlocks, irrespective of whether they are large companies or individuals. Although I am fully aware that there are still issues in terms of technology, security, legal aspects, and operational rules, I am still excited knowing that the day is near when we will be able to propose new services and organizations to the world from Japan, where interest in this field is growing.

In addition to Web3, keep an eye on embedded finance and Generative AI

We are entering the crypto ice age in 2022 due to factors such as the FTX case, but since the Kishida administration has included Web 3.0 in its growth strategy, this area should continue to attract attention, including the establishment of rules. Also, with the lifting of the ban on the digitalization of salaries, I believe that the areas of embedded finance and Generative AI will become the starting point of major trends.

Expect rapid growth for decarbonized startups involved in the ecosystem

As a fund that works on ESG themes centered on decarbonization, 2022 will be seen as the year in which various trials and errors were conducted internationally to expand the carbon credit market and in which preparations were steadily made for future growth, especially among overseas players. In particular, we have established a supply system for purchasing carbon credits backed by funds flowing from institutional investors, such as futures trading of carbon credits and satellite-based search technology that measures carbon credits generated by vast forests.

In 2023, I expect a surge in trading these high-quality carbon credits and the rapid growth of decarbonized startups involved in this ecosystem.

Click here for the article on Zeroboard , which is also an investment outlet of Inclusion Japan! ↓

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The three pillars of SaaS for B, industrial DX, and services for Generation Z remain firm

Starting in the middle of 2022, we have been writing weekly articles focusing on fundraising pick-ups. Among all this news, the listing and growth trend for startups in Japan has been SaaS for enterprises, which is expected to have stable earnings. In 2022, services related to sales efficiency especially were on the rise. In addition, I believe that more and more SaaS for on-site efficiency is emerging rapidly in unique industries such as manufacturing and healthcare. The trend of startup founders emerging from various industries will continue.

The biggest trend in 2022 was Web3, but in 2023, businesses such as NFTs and Metaverse will be organized as they develop rules. In addition to Web3, the sharing economy for Generation Z, such as TikTok, will continue to support entrepreneurship, mainly among the younger generation. The number of players is expected to increase, with investors supporting them.

Focus on "global" for business and team, and "M&A" for an exit strategy

Focus on "global" for business and team, and "M&A" for an exit strategy 2022 was the year in which the SoftBank Vision Fund began investing in Japanese companies in earnest, and multiple large-scale procurements from overseas investors also became a hot topic. From JP Startups' interviews, I sensed an increase in the number of startups premised on global expansion. In the Seed round, in particular, the presence of founding members with overseas backgrounds and teams that engage in business development and finance with a view on global expansion stood out. I expect that even middle- and late-stage startups will accelerate their efforts to successfully involve foreign investors. Beyond this trend, it will be interesting to see which startups will strategically create successful patterns in 2023.

Japan's exit strategy has traditionally been said to be overly focused on IPOs; however, in 2023, due in part to the startup policy of the Kishida administration and the impact of market conditions, I expect that exits through M&A will gradually increase.

Since the launch of JP Startups in April 2022, we have interviewed nearly 100 startup executives. This could only be made possible due to the warm kindness of many people, not to mention the executives who appeared as interviewees. We want to thank everyone who cooperated in our interviews and everyone who visited JP Startups. In 2023, JP Startups will continue to support the challenges of Japanese startups through information dissemination as a media outlet, with the help of everyone in the startup ecosystem.