Japanese companies aim to go public on Nasdaq as US investors and financiers explore non-Chinese IPO alternatives.
The companies, ranging from software outsourcing companies to translation gadget makers, are attempting to go public at a time when US investors and bankers are seeking alternatives to Chinese IPOs, which have recently dwindled due to geopolitical tensions. Historically, Japanese listings in the US have primarily been by blue-chip firms like Toyota Motor Corp aiming to secure access to global investors through dual listings.
The founder and CEO of Syla Technologies Co, a real estate developer and crowd-funding service which listed on Nasdaq in March, said he found Japanese investors to be more cautious in estimating its value. The shift has benefited the likes of Boustead Securities LLC, a boutique investment bank based in California, which signed its first Japanese client in 2021 and has since added nine more. In the meantime, business with Chinese clients has fallen.
“Advisory firms such as underwriters are now targeting Japanese firms,” said Yutaka Yuguchi, partner and head of Global Capital Market Advisory Group at KPMG in Tokyo, adding that unlike places such as Singapore where startups have long aimed to list on Nasdaq, Japan was still a relative “blue ocean market”.
The figure stood at ¥142.8 billion in 2014. To make sure the momentum lasts, Prime Minister Fumio Kishida unveiled a ¥10 trillion package, vowing to create 100,000 new startups and 100 unicorns by 2027.