Key Facts
• On July 30, STARTUP DB released the 2025 First Half Domestic Startup Investment Trends Report.
• Total startup funding in the first half of 2025 reached 381 billion yen, a 26.2% YoY decrease.
• Equity financing accounted for 328.4 billion yen, down 17.4% YoY.
• The number of funded startups was 1,209, a 24.7% YoY decrease.
• Non-equity funding methods, such as debt financing and subsidies, saw increased adoption.
• IPOs remained sluggish with only 21 cases, reflecting macroeconomic uncertainties and stricter listing standards.
• M&A activity surged, with 92 acquisitions recorded in the first half of 2025.
• Startups increasingly view M&A as a primary exit strategy, with some acquiring other startups for growth.
• Funding trends show a decline in deals under 100 million yen but growth in 500 million to 2 billion yen deals.
Summary
The 2025 first half report by STARTUP DB highlights a slight decline in Japan’s startup funding, totaling 381 billion yen, down 26.2% YoY. Equity financing dropped to 328.4 billion yen, while non-equity methods gained traction. IPOs remained weak with 21 cases, influenced by economic uncertainties and stricter listing standards. However, M&A activity thrived, with 92 acquisitions, as startups increasingly adopt M&A as a key exit strategy. Funding trends indicate a shift towards larger deal sizes, reflecting a maturing ecosystem.
