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We are looking for promising startups with whom we can invest in and collaborate!

Toyo Kanetsu Corporate Venture
Investment Partnership (TKCV)

Guide for Equity Investments and Business Alliances

What is TKCV?

  • The Toyo Kanetsu Corporate Venture Investment Partnership (TKCV) is a corporate venture capital fund established by Toyo Kanetsu K.K.(listed on the 1st section of the Tokyo Stock Exchange) in October 2017. And Toyo Kanetsu Corporate Venture Fund Ⅱ(TKCVⅡ) was also established by the company in October 2018.
  • As a general partner (GP), CVC JAPAN, Inc. acts to search, review, invest, and follow-up to investee companies. Toyo Kanetsu K.K., a limited partner (LP), is also partially responsible for these tasks.
    CVC JAPAN’s Corporate Web
  • We vigorously promote open innovation and collaborate with startup companies to aim for the launch of new business that will lead to future prospects.
Calling all Promising Startups in Japan and the United States!
Let’s Join into an Alliance with Toyo Kanetsu Group!
TKCV will actively invest in private equity!
Currently, we are looking for startups that will collaborate with the Toyo Kanetsu Group to develop new products, new services, and new business!
TKCV

The 5 Main Features of the Fund

  • We invest in startups leading to new business

    We will actively invest in start-ups (unlisted companies) that have technologies and business seeds that will lead to new business for the Toyo Kanetsu Group. We also invest in companies outside of Japan, mainly in Singapore, Australia and the United States. We focus on the potential of the alliance and future growth potential rather than the current sales and profits.

  • We invest in areas different from the existing two businesses (Logistics systems and large storage tanks)

    We will boldly invest in start-ups in areas other than the existing logistics systems and large storage tank business of the Toyo Kanetsu Group to build the “next business”, that is to say, the third business for the company. We want to develop new businesses with 5 to 10 billion yen in collaboration with investee companies.

  • We expect collaboration rather than a financial return

    For investment, we do not ask solely for financial return. We also do not ask for IPO (Initial Public Offerings) to an investee company. We hope the investee companies would collaborate with Toyo Kanetsu Group and contribute to new business! We also hope that overseas companies will be granted the right and a contract to sell their products or services to Japanese customers and operate their business model in Japan.

  • We become a long-term stable shareholder as an alliance partner

    The investment amount is between 25 million and 100 million yen per company (average of 50 million yen). Since it is a fund, there is a deadline for funding (No. 1 fund: 5 years and 3 months, No. 2 fund: 7 years and 3 months). However, even after the deadline, if the invested companies is in a good relationship with Toyo Kanetsu, Toyo Kanetsu can continue to hold shares in the invested companies as a stable shareholder.

  • We expect internalization into the group or growth as an independent entity

    As a final EXIT for our investment, we expect (1) a pattern to join the Toyo Kanetsu Group (incorporation as a new business project), or (2) a pattern to grow as a related subsidiary and independent entity. Moreover, it is also an option to grow on a standalone basis such as by IPO.

Purpose of Corporate Venture Capital (CVC)
Establishment for TKK

TKK’s Problems Common Check-in Counter Baggage Claim issues in new business developments

  • Limitation of the in-house
    innovation

    Due to rapid technological innovation, there are limitations in R&D and ideas in-house, with progress also being slow

  • Commoditization of existing
    technologies

    The source of added value of enterprises tends to shift from manufacturing to planning, development, and service

  • Innovator’s dilemma

    Due to having existing products and customers, it is difficult to create destructive innovations

  • Changes in startups’ position

    From the vertical industrial structure (subcontracting structure) to the era of cooperation and collaboration between large enterprises and startups

Increase in the importance of having contacts with startups
with innovative technologies and ideas

  • Collaboration with startups by establishing a CVC to realize open innovation
  • Acquirement of the seeds that will be our next profitable business and launch them as new business developments

Who is the Limited Investor Partner Toyo Kanetsu K.K. (TKK)?

  • Toyo Kanetsu K.K.http://www.toyokanetsu.co.jp/global/

    Established in 1941, TKK has built up a track record as a core business in the logistics solutions business dealing with logistics systems and the machinery and plant business dealing with large-scale tanks. Through TKK’s management vision to provide “Innovative solutions for logistics & energy”, their aim to incorporate innovative and pioneering technologies, boldly address the challenges faced by society, improve the group’s sustainable corporate value, and develop society. In recent years, TKK has been challenging various initiatives, including the establishment of Corporate Venture Capital (CVC) in order to launch new business that will become the third pillar after the two main businesses so as to further advance the Group.

    Logistics Solutions Business

    Sorter SystemsSorter Systems Automatic Case Storage SystemsAutomatic Case Storage Systems BHS（Check-in Counter）BHS（Check-in Counter） BHS（Baggage Claim）BHS（Baggage Claim）

    TKK provides logistics solutions primarily for material handling (moving and transporting goods) at distribution centers, build an optimal distribution system consistently from design to construction in all processes at distribution centers including e-commerce, and boast a high market share. For the airport industry, TKK handles a series of airport baggage handling systems (BHS) that carry passenger baggage from check-in counters to baggage claims, and deliver it to over 80% of Japanese airports.
    For the current situation in Japan, there is a need for innovations through innovative technologies that realize labor saving in spite of drastic changes in the environment surrounding the logistics industry, such as changes in consumer purchasing behavior and a declining labor force. Therefore, TKK aims to provide advanced logistics solutions by aggressively introducing high value-added products from overseas and utilizing the latest technologies such as AI and IoT.

    < Main Customers >
    e-Commerce Airports 3PL (Third Party Logistics) ・Retail/Wholesale/Co-op Postal Manufacturing

    Plant & Machinery Business

    Cryogenic Tanks Pressure Tanks (Spherial Tanks)

    Toyo Kanetsu K.K. (TKK) manufactures large-scale tanks for liquefied natural gas (LNG), liquefied petroleum gas (LPG), crude oil, etc. for plants of major energy companies in Japan and overseas where TKK has approximately 5,700 tanks combined. The Batam factory in Indonesia is used as a manufacturing base for various tank components. In addition, TKK is developing tank maintenance businesses at refineries and oil storage bases in Japan, and contribute to maintaining the safety of storage facility operations by utilizing the technology and know-how accumulated over many years of large-scale tank manufacturing and construction.

    < Main Customers >
    Cryogenic tanks / Low temperature tanks Normal temperature tanks Pressurized tanks (Spherical tanks)

    < Main customers >
    LNG liquefaction bases/receiving bases/power plants Crude oil export bases Oil storage bases Refineries

    Other Businesses

    Industrial Machinery (Toyo Koken K.K.)
     
    Small WinchSmall Winch

    As a pioneer of heavy goods transport equipment, the company mainly manufactures and sells winches and balancers, which are products that contribute to labor and labor saving at construction sites and factories.

    Building Construction
    (Toyo Kanetsu Builtec K.K.)
    Apartment HousingApartment Housing

    The company provides high-quality buildings with consideration for environmental performance, mainly in a variety of small and medium-sized properties such as apartment houses, welfare facilities, and stores. They also conduct steel pipe pile construction and gondola installation.

    Environmental Surveys and Assessments
    (Kankyo Research Co., Ltd.)
    Asbestos InspectionAsbestos Inspection

    The company provides various surveys, measurements and analyzes related to asbestos, sick houses, noise / vibration, and odor. Furthermore, as the needs for environmental surveys become more complex, they are actively working on technological developments such as survey and analysis methods using IoT.

  • Toyo Kanetsu currently holds abundant internal reserves, and in November 2016, set a new business investment frame (M&A and venture investment) of 4 billion yen (36 million USD).
  • Among them, on October 1, 2017, the fund was established. We are working on making new business developments following upon our two business pillars of large storage tanks and logistics systems.

Outline of Toyo Kanetsu Corporate Expected Investment Stories and Exit Strategies Venture Investment Partnership

  • Form and basis

    Voluntary association on civil law (two-part union of Toyo Kanetsu K.K. and TC Consulting)
    CVC JAPAN’s Corporate Web

  • Total fund amount

    No.1 Fund：
    500 million yen (4.5 million USD) (Toyo Kanetsu: 499 million yen, CVC JAPAN: 1 million yen)

    No.2 Fund:
    800 million yen (7.5 million USD)(Toyo Kanetsu: 799 million yen, CVC JAPAN: 1 million yen)

  • Operating period

    No.1 Fund:
    October 1, 2017 to December 31, 2022 (5 years 3 months)

    No.2 Fund:
    October 1, 2018 to December 31, 2025 (7 years 3 months)

Targeted assets for investment
  1. Unlisted promising startups both in Japan and in the United States, mainly California
  2. LP portions of other venture capital investment fund
  3. Our present investment policy is shown here!
Goals and expected achievements
  1. Strive for promoting new business developments by acquiring new technologies and business seeds for the next revenue business.
  2. Not only financial returns as investment funds are required, but also collaboration with startups for new business developments are expected.

Exit Strategy

  • Expected Investment Stories and Exit Strategies

    Investees are acquired and imported by TKK as a division, project, or subsidiary inside the TKK Group
    Rather than allowing startups to grow on independently, when the startup has progressed to a certain stage, we will incorporate the startups inside TKK Group and then expand their business as an internal business development project.
    Investees grow as independent entities outside TKK
    If it is judged that it is better to grow the startups themselves as independent corporation entities or when they wish, TKK will not import them internally and develop invested startups as affiliated companies of which TKK holds a minor share or just invested companies with which TKK have a collaborative relationship.
    Development and production of new services or products are outsourced for the TKK Group
    In investing in companies that possess AI engineers, etc., the startups are responsible for developing services or products that will become new businesses for the TKK Group. This pattern is associated with pattern 1 or 2 above.

  • Two Expected Types of CVC Investment as a Function of New Business Developments

    Substitution of business development inside TKK
    The activity of developments of new business, services or products originally within the TKK Group would be entrusted to investee startups and then the investee startups conduct trial and error (namely PDCA) of launching a new business.
    The type of CVC investment for this purpose is defined as “substitution type” of business developments inside the TKK Group.
    Complementary type for new business development in the TKK Group
    At the time when the TKK Group tries to launch new business, if the group lacks certain functions, technologies, and so on, CVC funds will invest in some startups to aim to acquire these functions and technologies from them. The type of CVC investment for this purpose is defined as “complementary type” of business developments for the TKK Group.

Global Network

– Members –

Singapore

We have a partnership with BA Partners Pte Ltd. (President: Mr. Ichiro Kawada) to find investment opportunities in Singapore and follow up with investee companies.

Australia

Similarly, we have a partnership with Japan Australia Business Creators Pty Ltd. (J-ABC, President: Mr. Haruhiko Kinase) to discover investment opportunities in Australia, mainly Brisbane, and to follow up with investee companies.

Cooperation with UC San Diego / JFIT

In San Diego, California, we have a partnership with UC San Diego’s JFIT (Japan Forum for Innovation and Technology) to find investment opportunities.

Members of the Investment Committee

Chairman（Main investment officer in the key-man clause）

Satoshi Tomita Dr. Tomita’s profile

President and CEO, CVC JAPAN, Inc. CVC JAPAN’s Web

Educational Background
Ph.D. in Media and Governance, Keio University
MA in Economics, Kyoto University
BA in International Policy Management, Keio University
Business Career
Business CareerThrough an American bank, he participated in the launch of independent venture capital. He invested in many startups that led to IPO, and the VC itself also achieved IPO. He was formerly an assistant professor (venture capital theory) at Osaka City University and in charge of investment in VC funds at Sumitomo Trust and Banking.
From 2008, he established his new consulting firm and has been providing his consulting services to more than 180 companies. His areas of expertise are making corporate alliances and new business developments. From 2017 to 2020 he had the position of professor at the Graduate School of Business Administration (MBA course) of Rikkyo University in Tokyo. He is teaching alliance strategy theory, management of technology, and venture capital. He is a research fellow, University of California, San Diego from 2018. As an author, he has published several books about corporate venture capital, new business developments, and alliance strategy.

Members of Investment Committee

  • Keisuke Kodama

    Director & Executive Vice President
    Toyo Kanetsu K.K.

  • Akira Kakihara

    Senior Managing Officer
    Toyo Kanetsu K.K.

  • Shintaro Yoshizawa

    Deputy General Manager
    Toyo Kanetsu K.K.

Contact

The funds managed by CVC JAPAN presently

CVC JAPAN is managing TKCV

Toyo Kanetsu Corporate Venture Investment Partnership (TKCV)
https://test2021.cvcjapan.com/english/fund01/

CVC JAPAN is managing TKCV2

Toyo Kanetsu Corporate Venture Fund II (TKCVII)
https://test2021.cvcjapan.com/english/fund02/

Please feel free to contact us
Contact us

  • Corporate Venture Capital Japan, Inc. (CVC JAPAN)https://test2021.cvcjapan.com/english/

    Satoshi Tomita, President & CEO
    Minami Aoyama Bldg. 7F, 2-11-13 Minami Aoyama Minato-ku,
    Tokyo 107-0062, Japan
    (On Aoyama street in Gaienmae. 5 minutes walk from Gaienmae station or Aoyama 1chome station on the Ginza subway line)

    E-Mail info@cvcjapan.com
    TEL +81-3-6455-5255　FAX +81-3-3470-8538

  • Toyo Kanetsu K.K.http://www.toyokanetsu.co.jp/global/

    Shintaro Yoshizawa, Corporate Planning Department
    11-1, Minamisuna 2chome, Koto-ku, Tokyo 136-8666, Japan
    (5 minute walk from Toyocho station on the Tozai subway line)

    E-Mail tkk-cvip@toyokanetsu.co.jp
    TEL +81-3-5857-3153　FAX +81-3-5857-3171