Is the Lack of "Unicorns" in Japan Good News or Bad News?

The lack of Japanese unicorns has recently been a cause of concern. There is now only one Japanese unicorn--or just a handful, depending on the source--compared to the 117 in the United States, 73 in China, 15 in the United Kingdom, and 11 in India (according to CB Insights). However, is the lack of unicorns in Japan evidence of an anemic startup ecosystem? Or are there other forces at play? 

In a new opinion piece published by the Nippon Institute for Research Advancement (NIRA), Kenji Kushida argues that when taken in a historical perspective, Japan's lack of unicorns demonstrates the very success of a critical institutional shift in Japan's startup ecosystem that improved the situation remarkably since the late 1990s. As such, the current situation should be considered at an evolutionary stage where unicorns can now emerge in Japan if venture capitalists begin to take diverse strategies in investing –especially after the large IPO of Mercari.