Launched “Germination Fund”, a Fund with Unlimited Duration Specialized in Seed Investments

Leave a Nest Capital Co., Ltd. (Head Office: Shinjuku-ku, Tokyo; Representative Directors: Mr. Masahiro Ikegami, Dr. Shuichiro Takahashi; hereinafter “Leave a Nest Capital”) has launched the “Germination Fund I Investment Limited Partnership” (hereinafter referred to as “Germination Fund I”), that will start operation on January 2023 with an “unlimited duration” and will specialize in seed investment in domestic venture companies founded by entrepreneurs who are trying to solve deep issues. Leave a Nest Capital will manage the fund as a general partner, while the parent company Leave a Nest Co., Ltd. (Head Office: Shinjuku-ku, Tokyo; Founder & Group CEO Dr. Yukihiro Maru; hereinafter referred to as “Leave a Nest”) and members of both companies will participate as limited partners.

In this fund, all members will contribute to the growth of the venture not as supporters but as proactive participants and will initiate new projects involving large companies as well as small and medium-sized enterprises, thereby realizing a new type of fund whose ultimate purpose is not simply to profit from the sale of shares.

Background on the Fund Genesis

Leave a Nest was founded 21 years ago, on 15 December 2001, holding a “lecture on advanced science” to children in Kumon classes (private preparatory schools in Japan), which became the origin of our Science Workshops. Then, on 14 June 2002, 15 undergraduate and graduate students in science and engineering became co-founders of the company and raised a capital of 3.6 million yen at their own expense, leading to the establishment of Leave a Nest heralding the mission of “Advancing Science and Technology for Global Happiness”. Since then, all members of Leave a Nest have been working as “Science Bridge Communicators®️” to bridge knowledge and technology from different fields and continuously start their own projects to contribute to the world.

In 2014, as a part of the “Frontier Development Project” to create new businesses in the world, Leave a Nest launched TECH PLANTER, a program to discover and nurture deep tech ventures that take on the challenge of solving global issues through the power of R&D and manufacturing, and has discovered as many as 3,000 entrepreneurs in Japan and abroad. Furthermore, the members of Leave a Nest are taking the leadership to encourage the founders to accelerate the social implementation of science and technology and change the world.

In January 2020, Leave a Nest Capital was established as a wholly-owned subsidiary of Leave a Nest to provide direct investments for venture companies through its investment development activities, as well as services to accompany ventures in setting up their corporate operational structures through its business environment activities, with the ultimate goal of build together with Leave a Nest a system to promote entrepreneurship activities, whether or not they are investee.

However, not all of the issues associated with ventures have been resolved. In the seed period following the establishment, it is difficult to raise funds from VCs or obtain bank loans, so angel investors often end up taking high risks and investing their own money, most of which comes from single individuals. In addition, existing funds generally have a duration of ten years, and some ventures that require many years of R&D may face extreme difficulty in raising funds due to this time frame. In other words, there is hardly any organization or VC firm in Japan that can continue backing ventures from the seed stage to social implementation over a long period.

In this context, Leave a Nest Capital together with Leave a Nest launched “Germination Fund I” in January 2023, a new type of fund with an “unlimited duration” whose ultimate purpose is not just to profit from the sale of shares. This fund will create an impact through the social implementation of science and technology by helping to build the management infrastructure of ventures, together with Leave a Nest’s Science Bridge Communicators, who will use their strength to proactively launch new projects.

As Leave a Nest celebrates its 20th anniversary, it will once again create a cycle of investment in which its members and those in Leave a Nest Capital will contribute with funds to directly nurture the next generation of ventures, just as the founding members did when, still students, invested their own funds to establish Leave a Nest.

Features of the fund

“Germination Fund I” was created after a thorough investigation on what challenges Leave a Nest together with Leave a Nest Capital should take on after reaching its 20th anniversary, and what challenges cannot be faced by no other than Leave a Nest.

The features of this fund are as follows.

(1) The limited partners are Science Bridge Communicators® (“SBCs”).

SBCs at Leave a Nest are members who bridge knowledge between researchers and different fields while launching projects on their own. In this fund, most of the limited partners are SBCs. We believe that the growth of the backed ventures will be further promoted by the participation of SBCs, who are committed to both the growth of the Leave a Nest Group and the investee companies by contributing their own funds, working hard, and launching projects involving the backed ventures with large and small companies that hold the key to their growth.

In addition, this fund specializes in promoting the germination of seeds by making small investments in seed-stage Japanese ventures, which have been established by entrepreneurs who are striving to solve deep issues. Although the size of the fund is not large, we believe that the fact that limited partners are all SBCs enables a loose risk-taking small-scale management approach.

(2) The duration of the fund is indefinite.

We have set the duration of this fund to “unlimited”. By setting an unlimited duration, we hope that the managers and researchers of the ventures in which we invest will be able to devote their maximum resources, both physically and mentally, to R&D and social implementation without being swayed by IPOs, M&As, and other exit deadlines, while having Leave a Nest as a partner through the duration of their endeavors.

However, this does not mean that we do not expect any achievement over a long period. Leave a Nest will promote the research and development of portfolio companies by utilizing its knowledge-based platform, while Leave a Nest Capital will help the portfolio companies build their management foundations, thereby paving the way for backed ventures’ expeditious social implementation of science and technology.

Through the management of this fund, we will further accelerate the growth of Leave a Nest Capital and the Leave a Nest Group together with the social implementation of science and technology by the backed companies, thereby realizing the mission of advancing science and technology for global happiness.

Outline of the Fund

Fund Name:	Germination Fund I Investment Limited Partnership (commonly known as “Germination Fund I”)
Fund Amount:	130 million yen
Investment per Company:	5 million yen
General Partners:	Leave a Nest Capital Co., Ltd.
Limited Partners:	Leave a Nest Co., Ltd., directors, and employees of Leave a Nest Co., Ltd. and Leave a Nest Capital Co., Ltd. who meet certain conditions (34 persons in total)
Establishment:	1 December 2022
Duration:	Unlimited

For inquiries

Leave a Nest Capital Co., Ltd.　Attn. to Daniele Casale

Leave a Nest Co., Ltd.　Corporate Planning Office　Attn. to Takeda, Matsubara

Tel: 03-5227-4198　E-mail: contact_us@lnest.capital