‍3one4 Capital's Emergent Japan 2024: Building the Indo-Japan Innovation Corridor‍

India and Japan share a long and fruitful history, one that is deep-rooted in cultural and spiritual exchanges dating back to ancient times. In the post-World War II era, the relationship evolved from cultural to strategic, with Japan being one of the first countries to establish diplomatic ties with independent India. Over the decades, the partnership has grown, driven by shared democratic values and economic interests. 

Collaboration between India and Japan holds immense potential for mutual growth and innovation. India has witnessed unprecedented growth in recent years, emerging as a hotbed of technological innovation and entrepreneurial spirit. With a burgeoning pool of talent and a rapidly digitalising economy, Indian startups are poised to make significant strides on the global stage. Japan, with its sophisticated market, advanced industrial base, deep technological expertise, robust financial institutions, and a culture of precision and quality, offers an ideal platform for Indian startups to access new opportunities. Japan's substantial foreign direct investment in India, amounting to $41.47 billion from 2000 to 2023, underscores its commitment to India's growth story. 

As both nations navigate the challenges of the 21st century, their deepening economic ties and shared vision for a free and open Indo-Pacific region position them as natural partners in shaping a new era of Asian prosperity and global influence. 

Building on strong economic ties, 3one4 Capital hosted Emergent 2024—Japan, our immersive portfolio engagement program that connects a select group of 3one4 portfolio companies with market-leading institutions. Over the course of the four-day program, we conducted 118 meetings with 53 top Japanese corporations, investors, and our LPs. 

The program culminated with a day-long event on June 25th at Mizuho Bank's Tokyo headquarters. The event began with a welcome address by Masato Kaneda of Mizuho, followed by Katsumi Onishi's presentation on Japanese corporate investment trends and Mizuho's support for expansion in India. Pranav Pai delivered an insightful keynote, emphasising the transformative influence of startups and technology on various sectors of the Indian economy and our experiences working with the founders we have backed. Throughout the afternoon, we heard from our founders who are setting new benchmarks for innovation, efficiency, and scalability. The day also included a panel discussion on India-Japan collaboration, emphasising their combined potential in unlocking the Asian economic powerhouse, and concluded with closing remarks by Shingo Nakamura and a vote of thanks by Siddarth Pai.

In summary, here's an overview of day 2 at Emergent 2024 - Japan:

‍

Welcome Address - Masato Kaneda

Operating Officer, Deputy Head of Retail & Business Banking Division, Mizuho

Masato Kaneda highlighted Mizuho's strategic expansion in Asia, particularly its support for startups in India and Southeast Asia. Lauding the meteoric growth of companies like Oyo, Ola, and Grab, he emphasised the power of partnerships, citing SoftBank Vision Fund as a prime example.

His welcome address elaborated on Mizuho's commitment to India, including investing in local ventures, building networks, and fostering collaborations with key figures. With a well-established presence through five operational bases in India, Mizuho is poised to be a key facilitator, unlocking the vast potential of India’s booming market.

‍

Keynote Address - Katsumi Onishi

Senior Manager, Global Strategic  Advisory Department, Mizuho

In his keynote, Katsumi Onishi, Senior Manager at Mizuho Bank's Global Strategic Advisory Department, painted a compelling picture of India as the new frontier for Japanese enterprise.  India, he declared, has eclipsed China as a strategic priority, with a surging market and a GDP projected to surpass Japan's by 2040.

Onishi-san, a titan of international strategy, emphasised Mizuho's unwavering support for Japanese expansion in India. He noted India's rapidly increasing high-income households and stable political environment, making it an attractive investment destination. China's scaled-back presence, he noted, presents an even greater opportunity. Success stories, like Daikin's, exemplify the potential for profitability in India. Onishi-san concluded by reaffirming Mizuho's commitment to facilitating Japanese companies' entry and growth in the Indian market through extensive resources, support, and partnerships.

‍

‍

Keynote Address - Pranav Pai

Founding Partner & CIO at 3one4 Capital

Pranav Pai's keynote celebrated 3one4 Capital's impressive eight-year journey, marked by four unicorns and numerous high-growth companies. The depth and innovation within the Indian market illustrate how companies in the firm’s portfolio are generating substantial value and revenue. With four companies surpassing $100 million in annual revenue and many others reaching significant milestones, the focus is not just on valuations but on fundamental business growth.

3one4 Capital’s investment strategy is comprehensive and multifaceted, spanning five key sectors: consumer internet, enterprise digitisation, fintech, SaaS, and digital health. The firm’s proactive investment strategy and deep market understanding enable it to support startups that are setting new benchmarks for efficiency, scalability, and impact. Through its efforts, 3one4 Capital is not only contributing to the growth of individual companies but also shaping the future of the Indian economy.

With India's vast and young population, burgeoning digital infrastructure, and a rapidly growing middle-income category, the potential for startups is immense. As India continues to evolve into a global economic powerhouse, 3one4 Capital remains at the forefront, driving innovation and value creation in the Indian startup landscape.

‍

Portfolio Showcase

Following the keynote address, our portfolio companies took the stage to share presentations on their operations, growth journeys, and future expansion strategies, offering insights into their businesses.

‍

Dozee

Mudit Dandwate, the co-founder and CEO of Dozee, took the stage to present Dozee’s mission to save a million lives by addressing a critical gap in patient care. Traditional manual monitoring of patient beds, conducted intermittently every four to six hours, often misses early signs of health deterioration. This issue became personal for Mudit when a family member nearly lost their life due to delayed symptom detection. Dozee was founded to promptly catch early signs of health issues and take corrective action.

Dozee employs an AI-based, contactless, remote patient monitoring system using a sensor sheet placed under the mattress. This technology captures heart and respiratory vibrations, converting them into digital biomarkers like heart rate, blood pressure, and respiration. Continuous monitoring alerts healthcare providers to early signs of deterioration, with studies showing it can escalate warnings at least eight hours in advance for 91% of patients, significantly improving outcomes.

Their market penetration has expanded internationally, with operations now in the United States and the Middle East. Dozee's Enhanced Connected Care Programme represents a paradigm shift in healthcare, enabling continuous 24x7 monitoring of patients across various settings, from homes to ambulances and emergency rooms. 

Mudit concluded by sharing that Dozee now monitors over 40,000 beds and impacts a million patients annually, saving around 50 lives daily. The vision is to expand further, automating care settings and continuously innovating to save every potential human life.

‍

Vidyut

Xitij Kothi, co-founder and CEO of Vidyut, introduced the company's pivotal role in India's energy transition through its innovative EV ownership platform with embedded finance. Leveraging their deep experience in the Indian startup ecosystem, Xitij and Gaurav Srivastava (co-founder) aim to address the slow adoption of electric vehicles in India despite its significant auto market. With only a 5% penetration rate, the Indian auto sector is poised for rapid growth, driven by government incentives and the active participation of major OEMs.

Vidyut's platform encompasses the entire EV ecosystem, providing a comprehensive service layer that includes dealers, financiers, and after-sales services. Their unique vehicle data platform and asset underwriting model utilise real-time data from smart batteries, enhancing the accuracy of asset health predictions and improving loan underwriting processes. This integrated approach has led to an 80% loss recovery on delinquent loans, significantly outperforming industry peers.

The company's digital ownership hub offers consumers a seamless experience, from financing to tracking vehicle health, raising service requests, and even reselling their vehicles. Vidyut has established partnerships with top OEMs like Mahindra, Tata Motors, and Maruti Suzuki, as well as leading lenders in the climate tech space. Looking ahead, Vidyut aims to scale its platform globally, supporting the EV transition in other markets by leveraging its advanced technology stack and comprehensive service offerings.

‍

Fasal

Shailendra Tiwari, the CEO and co-founder of Fasal, took the stage to discuss the innovative strides his agritech company is making in transforming agriculture in India and Southeast Asia. Based in Bangalore, Fasal serves over 6,000 farmers and covers more than 80,000 acres of farmland.

Fasal addresses the core challenges faced by farmers, who often rely on intuition rather than science for critical decisions on irrigation, pest control, disease management, and climate risk mitigation. Despite India's vast arable land, farmers' yields lag behind those of smaller nations like the Netherlands due to inefficient practices. Fasal's full-stack platform integrates IoT technology with proprietary crop science algorithms to provide actionable intelligence, helping farmers optimise their operations irrespective of their education, age, or local conditions.

The platform's robust IoT devices withstand extreme weather conditions and operate without power or network connectivity, ensuring reliable data collection. This data, combined with satellite and radar inputs, feeds into agronomic models that predict crop stages, disease risks, and climate challenges, offering farmers precise guidance. This innovation has enabled Fasal to bring over a billion dollars worth of produce to market, enhancing the quality and traceability of exports.

Fasal's impact is substantial, reducing farmers' input costs by 15-30%, increasing yields by the same margin, and ensuring high-quality, export-ready produce. The environmental benefits are significant as well, with 56,000 metric tons of GHG emissions saved, 82 billion litres of water conserved, and a reduction of 1.5 lakh kilograms of pesticide use. Fasal's technology is not only transforming Indian agriculture but is also poised to make a global impact, with plans to expand further into Southeast Asia and beyond.

‍

Exponent Energy

In the rapidly evolving landscape of electric vehicles (EVs), Exponent stands out as a full-stack energy company, dedicated to solving the pressing challenges around EV energy systems. 

Despite the mainstream adoption of EVs over the past 15 years, energy infrastructure remains a bottleneck. Unlike petrol cars with a vast refueling network, EVs suffer from "charging anxiety." Exponent's mission is to eliminate this by creating a fast, reliable, and dense network of charging stations. Their Energy Stack offers a 15-minute full charge using regular LFP cells, with a 3000-cycle warranty, translating to a 3x longer lifespan and 20x faster charging compared to standard LFP cells.

Exponent's technology includes an in-house developed Battery Management System (BMS) with sub-2-milliwatt accuracy, real-time cell monitoring, and a unique charging algorithm that adjusts the charging current based on the cell's condition, minimizing stress and preventing damage. The off-board thermal management system efficiently extracts heat during charging, making the process faster and safer without the high costs associated with traditional on-board systems.

Exponent aims to be the leading energy partner for OEMs, providing both battery technology and a comprehensive charging network. With plans to scale up to 180,000 vehicles across multiple segments in the next three years, including buses with a 15-minute charge capability, Exponent is poised to play a pivotal role in the global shift towards electric mobility. They invite collaboration and partnership opportunities, particularly with Japanese brands entering the Indian market, offering a gateway to a reliable and efficient energy network for EVs, driving the transition to a sustainable future.

‍

Unbox Robotics

Founded in 2019 by Pramod Ghadge, Unbox Robotics emerged from his experience at Flipkart, where he saw the inefficiencies and high costs of existing robotic sorting systems. Unbox Robotics focuses on creating compact, scalable solutions that can be rapidly deployed and adapted to various operational needs.

Specialising in parcel sortation, Unbox Robotics addresses a critical process in supply chain networks handling close to a trillion parcels annually. Unlike traditional, capital-intensive systems requiring significant installation time and infrastructure changes, Unbox’s agile, space-efficient solutions use swarm intelligence and machine learning to enhance speed, efficiency, and scalability. Their systems can be installed in days and scaled to meet seasonal demands like Black Friday or New Year sales.

Unbox Robotics' technology includes a backend system integrating with customers' Warehouse Management Systems (WMS) and a robot control system managing the fleet. Inspired by ant colonies, the robots use sophisticated algorithms to optimise operations. 

Successfully deployed across India, Europe, and the US, with clients like Flipkart, ExpressBees, DHL, and Inditex, Unbox Robotics has demonstrated significant productivity gains. The company’s modular systems also support flexible business models, including robotics-as-a-service, allowing customers to pay based on the number of robots used.

‍

Ripplr

Abhishek presented Ripplr’s mission to build India's largest tech-driven distribution platform for FMCG products. With the FMCG market poised to reach $300 billion, urbanisation and rising per capita income are driving increased demand. By 2028, India’s per capita income is expected to cross $4,000, marking a substantial rise in retail spending, similar to trends observed in China and Japan.

The Indian retail market, dominated by small mom-and-pop stores, is fragmented and inefficient, relying on 350,000 small, family-owned distributors. This fragmentation leads to delays and lack of real-time data on sales and inventory.

Ripplr is a game changer with a tech-enabled platform that integrates order, warehouse, delivery, credit, and collection management. This ensures orders are delivered within a day or two, enhancing efficiency. The platform is integrated with the top 20 FMCG brands, enabling seamless transactions without middlemen.

Ripplr's use of technology extends to geo-tagging retail stores, enabling precise delivery routes and ensuring new personnel can easily locate stores. The platform also leverages data to predict trends, advise retailers on inventory management, and optimise stock levels. This data-driven approach has led to significant improvements in order fulfilment rates and overall operational efficiency.

The company has grown to handle 250,000 orders per month and manage 8,000 SKUs. With plans to become a $1.5 billion business within six years and turn profitable next year, Ripplr positions itself as the "Amazon of offline." It provides a crucial gateway for international FMCG brands entering the Indian market, offering an efficient solution to navigate the complexities of India's retail landscape.

‍

Scimplify

Sachin Santosh took to the stage to present Scimplify, a science-first, full-stack platform for B2B manufacturing of specialty chemicals, focusing on segments like pharmaceuticals, agrochemicals, personal care, and industrial chemicals.

India has over 10,000 underutilised small to mid-size factories with specific chemistry expertise. Scimplifi integrates these factories into its platform, using in-house R&D to develop key chemical technologies that comply with international standards, such as Japan's PMDA regulations. By combining proprietary technologies with existing manufacturing capacities, Scimplifi offers a seamless, cost-effective solution for specialty chemicals production. Their platform ensures end-to-end visibility and quality control. They have onboarded 150 factories and served over 150 customers across 10 countries.

With the global specialty chemicals market valued at over a trillion dollars and the China Plus One strategy gaining traction, India's robust R&D capabilities and underutilised factories position it well for growth. Scimplify simplifies the operationalisation of manufacturing units, reducing setup time to less than a month.

With a remarkable 4x quarter-on-quarter revenue growth, Scimplifi remains committed to R&D, profitability, and ESG compliance. They look forward to new partnerships, especially in Japan, a market ripe for collaboration.

‍

Fermbox

Fermbox Bio, founded in 2022 by an experienced biotech entrepreneur Subramani Ramachandrappa, is a Synbio (synthetic biology) company with the primary focus on sustainable production of animal-free alternatives to products such as lipids, colours, flavours, proteins, and green chemistry products. They cater to sectors including nutraceuticals, cosmeceuticals, and food.

The company specialises in mitigating supply chain risks by delivering sustainable and ethical Synbio solutions. Their 'lab-to-launch' approach accelerates the introduction of next-gen Synbio products, enhancing scalability and cost-efficiency.

Fermbox Bio engages in extensive global collaborations aimed at product development, scaling up operations, and bringing innovations to the market. They provide tailored solutions to address unique challenges within various industries. Fermbox Bio addresses two key challenges facing the Synbio industry: product-only companies cannot rely on Contract Manufacturing Organizations (CMOs) because it is not cost-effective, and CMOs struggle to offer one-size-fits-all solutions for bio-manufacturing.

With its strong team, deep expertise in bio-manufacturing, and key industry partnerships, Fermbox Bio has the potential to become a leading player in the precision fermentation market.

‍

Panel Discussion | Beyond Borders: India & Japan - Unlocking the Asian Economic Powerhouse

The panel brought together influential leaders including Tatsuya Terazawa (Chairman and CEO of the Institute of Energy Economics Japan), Yasuhisa Nakao (Managing Executive Officer, COO, Business Innovation Office and Executive Management of Economic Security Affairs, Sojitz), and Susumu Furukawa (Senior Manager of Innovative Startups Coordination Department, Ex-Head of Bangalore, India Corporate Banking Division, Mizuho). Moderated by Mohandas Pai (Chairman at 3one4 Capital), the discussion highlighted the significant strides and potential of this bilateral partnership.

Terazawa-san has been instrumental in fostering the India-Japan Digital Partnership, a pioneering initiative that led to the creation of the Indo-Japan Digital Fund. His vision and dedication were crucial in drafting the partnership framework signed by both governments, significantly boosting bilateral digital cooperation. Nakao-san, representing Sojitz Corporation, has been a long-term supporter of innovation between India and Japan. India is a significant market for Sojitz, given its rapid economic growth and vast potential. The company has established a strong foothold in the country with multiple offices across major cities. Sojitz has been actively involved in India's infrastructure development. A notable example is its participation in the Mumbai-Ahmedabad High-Speed Rail project.

Furukawa-san, with his extensive experience in Bangalore, has facilitated numerous engagements between Japanese and Indian businesses. The panel discussion underscored the strategic importance of the India-Japan partnership in the 21st century. Japan, with its advanced industrial capabilities, and India, with its vast market and rich talent pool, complement each other perfectly. The collaboration aims to leverage Japan's technological prowess and India's burgeoning market to drive economic growth and innovation.

Sojitz Corporation's strategic shift towards consumer-focused and digital ventures in India reflects the market's youthful and dynamic demographic. This aligns perfectly with the growing demand for digital solutions.

Mizuho Bank's focus on leveraging technology and digital platforms to provide financing for Indian SMEs and retailers highlights the financial muscle Japan can bring to the table. Building trust and fostering relationships between businesses from both nations is seen as crucial to unlocking the full potential of this partnership.

The closing message emphasised the need for deeper collaboration between Japanese and Indian companies. By leveraging each other's strengths, a powerful economic alliance can be forged in Asia, shaping the digital future of the region. The discussion served as a springboard for exploring the transformative potential of this India-Japan partnership and the exciting opportunities that lie ahead.

‍

Closing Keynote - Shingo Nakamura

Senior Managing Director & Head of Japanese Business, India, Mizuho

Shingo Nakamura delivered a compelling closing address that underscored the growing interest and potential in the Indo-Japanese business landscape. 

Reflecting on his career, Nakamura-san highlighted his extensive experience with China, having worked there from 2001 to 2022. In 2023, he shifted his focus to India, recognising its burgeoning role in the global economy, especially given the current geopolitical climate and supply chain realignments. His time in India has provided him with unique insights into the comparative growth trajectories of China and India.

The discussion noted that while China has traditionally driven Asia's economic growth, it has recently faced challenges, creating an opportunity for India to emerge as the next major growth area. Moreover, the development paths of China and India are markedly different. Two decades ago, China lacked infrastructure and global economic integration, which it has since developed extensively. In contrast, modern India already boasts numerous well-established companies and a vibrant startup ecosystem, attracting global talent and investment.

Japanese companies in India often focus on domestic demand before expanding exports, contrasting with China's export-driven model. This underscores the importance of Japanese firms finding reliable local partners in India to navigate the complex market. Nakamura reaffirmed Mizuho's commitment to supporting Japanese businesses in India, offering assistance in finding local partners and navigating the market. 

‍

‍

Vote of Thanks - Siddarth Pai

Founding Partner & CFO at 3one4 Capital

Siddarth Pai, in his vote of thanks, invoked the profound concept of Inyo to express gratitude. Inyo, a universal symbol of duality and harmony, symbolises the universe as a circle containing two coexisting yet distinct colors. The metaphor elegantly captures the essence of Emergent Japan 2024's collaborative spirit.

The first facet of Inyo symbolises the attendees: partners, Japanese businesses, and well-wishers. These individuals are the equity and driving force behind the innovation, while our founders, dedicated and far-traveled, are our greatest assets. In Japan, business relationships are built on trust, which, once established, leads to enduring and valued partnerships. Mizuho Bank and Sojitz Corporation stand as exemplars of this steadfast trust and partnership.

The Emergent Program serves as a cornerstone initiative within our broader strategy. It provides our founders with curated access to leading institutions, investors, and markets. Emergent Japan 2024 marks not an end, but a beginning. It lays the foundation for future collaborations that will undoubtedly redefine the landscape of Indo-Japanese business relations and technological innovation.

‍

‍

DISCLAIMER

_{The views expressed herein are those of the author as of the publication date and are subject to change without notice. Neither the author nor any of the entities under the 3one4 Capital Group have any obligation to update the content. This publications are for informational and educational purposes only and should not be construed as providing any advisory service (including financial, regulatory, or legal). It does not constitute an offer to sell or a solicitation to buy any securities or related financial instruments in any jurisdiction. Readers should perform their own due diligence and consult with relevant advisors before taking any decisions. Any reliance on the information herein is at the reader's own risk, and 3one4 Capital Group assumes no liability for any such reliance.Certain information is based on third-party sources believed to be reliable, but neither the author nor 3one4 Capital Group guarantees its accuracy, recency or completeness. There has been no independent verification of such information or the assumptions on which such information is based, unless expressly mentioned otherwise. References to specific companies, securities, or investment strategies are not endorsements. Unauthorized reproduction, distribution, or use of this document, in whole or in part, is prohibited without prior written consent from the author and/or the 3one4 Capital Group.}