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2. Promotion of Business Innovation and Start-Ups Among SMEs

(2.1) Promotion of Start-Ups

In order to promote start-ups, the State shall endeavor to increase national interest in and understanding of the significance and necessity of start-ups, as well as to take necessary measures such as the provision of information and enhancement of training concerning start-ups and of the smooth fund supply needed for start-ups.

  • Support based on "the Temporary Law concerning Measures for the Promotion of the Creative Business Activities of Small and Medium Enterprises"

In order to support SMEs that plan to enter new business fields through start-ups, research and development, and commercialization, the State shall take steps to provide subsidies, low-interest loans, and special tax reductions for SMEs that conduct business in accordance with a "business plan for research and development, etc.," which has been approved by the prefectural governor under the Temporary Law concerning Measures for the Promotion of the Creative Business Activities of Small and Medium Enterprises.

* "Creative Business Activity" means to make a new product /service through a business start-up or R&D (research & development) or commercialization.

  • Support based on “the Law for Facilitating the Creation of New Business”
  • Support for technological development based on the Japanese-Style SBIR (Small Business Innovation Research) system

In order to activate SMEs with technology development capability and to support business activities with originality, relevant ministries and agencies collaborate to grant subsidies and spend outsourcing expenses centering on SMEs, for development of new technologies that lead to the creation of new businesses, and take special measures such as expansion of the scope covered by the credit guarantee system to consistently support the commercialization of new businesses.

  • Support by financing and taxation
  • New start-up financing system

In order to facilitate and diversify financing for the founder, if the business plan is appropriate, the National Finance Life Corporation can make a loan without collateral or any guarantor.

  • Venture capital investment system

In order to promote investment to venture business, SMRJ (Organization for Small & Medium Enterprises and Regional Innovation, Japan) will invest into limited partnership for venture capital investment.

  • “Keep it up! SME Fund”

In order to coordinate support in aspects of funding or marketing, for new business of SMEs having an outstanding idea or skill, SMRJ and companies collectively build the “Keep it up! SME Fund” and offer comprehensive support.

  • Angel taxation

As individual investors (angels) get profit or loss through selling and transferring corporate stock of venture businesses, they can use exceptional tax treatment in order to support the founder.

  • Support start-up

In order to support a founder or SME who is finding it difficult to embark on a new business although having an outstanding skill or business idea, SMRJ offers funding and consult support toward the practical application of the business plan.

  • Fostering of founders and entrepreneurship

In order to foster entrepreneurship, the “National Forum for Founding and Venture Business” is held and educational activities implemented through symposiums for public discussion and through the mass media. In addition, fostering of founders is implemented through seminars for founders to gain basic knowledge on founding, schools to get practical skills for founding, the Venture Plaza, which matches venture companies to link investors or partners and the Venture Fair, to develop sales outlets.

  • Utilization of retirees in companies

JCCI(Japan Chamber of Commerce and Industry) and SMRJ seek retirees to advise on business strategy, which tends to be lacking in SME/venture companies, supports Matching retirees with suitable SMEs through data base of retirees, and post related information on a website (J-Net21 managed by SMRJ).

  • Support for creative technical development by SMEs

In order to promote R&D and enhanced products or facilitate to embark new business areas, the State provides a grant for part of the costs of raw materials and equipment for SME’s R&D to develop new products/technology.

(2.2) Promotion of Business Innovation

"Business Innovation" means to seek substantive managerial improvements through the development and manufacture of new products, the development and provision of new services, the introduction of new methods of production and sales, the introduction of new methods of providing services, and implementation of other new business activities.

  • Support for business innovation of SMEs under “the Law on Supporting Business Innovation of Small and Medium Enterprises”

In order to support SMEs in carrying out business innovation, the State takes measures such as providing low-interest loans and special tax reductions to SMEs that conduct business innovation, including development or manufacture of new products, in accordance with a "business innovation plan," which is approved by the central government or the prefectural governor, under "the Law on Supporting Business Innovation of Small and Medium Enterprises". From 2004fy, measure to reduce patent-related fees for R&D-type SMEs, was added.

  • Matching & fostering human resources for Business Innovation

Business innovation lectures and basic skill development seminars are held. The enlargement of business networks and opportunities is implemented through the introduction of new products developed by business innovation-focused companies, at Business Fairs.


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