Japan’s €5B bet on Europe’s deep and climate tech boom: ‘This isn’t capital tourism’

Japanese investors are fast becoming one of Europe’s most strategic sources of impact capital.

Since 2019, Japan-linked funds have participated in more than €30 billion worth of deals involving European startups and scaleups, according to a new report from NordicNinja and Dealroom.

Deep tech and climate tech firms took the lion’s share of that funding – €11.3 billion and €8.6 billion, respectively. Since the start of 2024 alone, deep tech startups have attracted €3.2 billion, while climate tech has secured €1.9 billion – matching the amount Japanese-linked funds have put into European AI during the same period.

“Japanese investors are turning their eyes to Europe with growing intensity each year – especially across deep tech, AI, and climate tech,” said Tomosaku Sohara, co-founder and managing partner at NordicNinja.

Early-stage momentum

While Japanese investors once focused mainly on mega-rounds (often led by SoftBank), capital is now increasingly flowing into early-stage deals. In 2024, Japan-linked investors took part in a record 140 early and breakout-stage rounds across Europe.

Standout examples include Tozero’s €11m seed round in circular battery recycling (backed by NordicNinja), Danish EV charging startup Monta’s €80m Series B (led by byFounders), and HIVED’s €38m Series B for green logistics (supported by Yamato Holdings, Marunouchi Innovation Partners, and NordicNinja).

Growth capital and key markets

Japanese VC investment – whether deployed directly or through Japan-backed funds – has featured in roughly 6% of all European VC deals since 2019.The UK has been the top destination, drawing €14.9 billion since 2019, followed by Germany (€4.8 billion), and France (€3.4 billion). The Nordics raised €3.6 billion combined.

Notable later-stage rounds include Gridserve’s €120m growth equity raise in July led by Mitsubishi, and a €150m late-stage investment in 1Komma5 led by 2150, a London-based VC with Japanese backing.

Active acquirers

Japanese corporations are also stepping up as acquirers and R&D partners in Europe.

In 2023, they completed a record 15 acquisitions of VC-backed startups – from Asahi Kasei’s $1.3 billion purchase of biotech firm Calliditas to Mitsubishi’s acquisition of grid hardware company Scibreak.

Another eight deals are expected to close by the end of 2025, according to Dealroom.

“This isn’t capital tourism,” said Sohara. “Japan has a long tradition of building enduring partnerships rather than one-off transactions.”