Proposals to Solve Gender Diversity Challenges
in Japan’s Startup Ecosystem
July, 2022
FSA Open Policy Lab: Diversity, Equity & Inclusion in the Financial Sector

This report summarizes gender diversity challenges in Japan’s startup ecosystem based on 19
individual interviews ,(*1) discussion at a workshop ,(*2) data analysis and literature review conductedby the Open Policy Lab. (*3)
Three main findings in this report are as follows: Firstly, Japan needs to overcome the persistent gender inequality in the management of listedcompanies. While numerous measures have been in force, female leaders of the newly listedcompanies account for only 2% (See Page 5).
 Secondly, gender diversity in the startup ecosystem is a critical agenda from economic
perspectives. Lacking in gender diversity, male-dominant companies may suffer from a varietyof losses, including the impact on profitability.

Executive Summary Third, all stakeholders in the startup ecosystem should act now to change the status quo.
Investment in startups has been on the rise. If current practices remain unchanged, existing
distortions would likely be maintained or even strengthened. Please refer to Page 16 and beyondfor proposals.
We hope that this report will contribute to making Japan’s startup ecosystem a better place foreveryone.

*1: During the period from October 2021 to January 2022, we interviewed a total of 19 professionals, including female
entrepreneurs/capitalists who raised or aimed to raise funds, and those who provide support for such entrepreneurs.
*2: On March 24, 2022, the FSA Open Policy Lab and MASHING UP held a joint workshop to discuss gender-related challenges

surrounding female entrepreneurs in Japan A total of 53 participants, including entrepreneurs, capitalists, government officials
and university student, engaged in a dialogue on what is needed for a change(https://www.mashingup.jp/2022/04/253045_workshop.html [Available in Japanese]).
*3 :The FSA’s Open Policy Lab is a framework for voluntary submission of policy proposals by employees.
(https://www.fsa.go.jp/en/about/openpolicylab.html)

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Diagnosis

Structural and complex challenges
behind tragic circumstances
surrounding female entrepreneurs in
Japan

P5

Statistics presents a daunting reality
Female leaders make up only a small portion of founders and CEOs thatraise funds from VCs or experience IPOs.

P6-

Structural challenges exist across the globe
The challenges include the male dominance in VCs and entrepreneurs’
networks as well as gender biases in business evaluation.

We deepened insights into the state of play around female
entrepreneurs in Japan through individual interviews andliterature review. We also shed a light on unnoticed figuresfrom publicly available data to showcase the daunting reality
around them.

P13-

Economic perspectives are critical for change
Improving gender diversity has both social and economic benefits.

We discovered that:• Female leaders account for only 2% of the heads of newlisted companies. Females are also under-represented in
the fundraising stage from VCs.

P14-

Female entrepreneurs have the potential to unlock the futureFemale entrepreneurs are full of possibilities, such as:• Behind this lie complex structural problems, which lead to•encouraging diversity in organizations; and,various economic losses. Economic perspectives should•

discovering new business opportunities and solving social issues, which aplay a critical part in solving gender diversity challenges.

male-dominant society tends to overlook.
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A gender gap exists among Japanese entrepreneurs
IPO

The ratios of female entrepreneurs (34.2%) and female CEOs (14.2%) are low. Even worse, a larger gender gap exists whenfirms scale up with external funding: the ratios of companies with female founders/CEOs that received funding from VCs orexperienced IPOs have plummeted to 1-2%.

Fundraising

2%

Company registration/Incorporation

14.2%

Staring a business

34.2%

2%

Females CEOs that experienced IPOs
（2021）*5

Funding raised by female founders/CEOs in top 50
fund raising companies（2019）*3

Female CEOs
Female entrepreneurs

1%（2021）*2（2017）*1

VC firms represented by female capitalists（2021）*4(Note) The populations of the data sets vary.
(*1) Basic Survey on Employment Structure, Ministry of Internal Affairs and Communications in 2017. Entrepreneurs are those who have changed jobs or obtained a new job in the past year and are now "self-employed."(*2) Data base of Tokyo Shoko Research on business owners of approx. 4 million companies (including non-listed companies) in 2021 (https://www.tsr-net.co.jp/news/analysis/20211102_04.html).
(*3) STARTUPPDB's data on the top 50 companies ranked by fundraising in 2019 (https://startup-db.com/magazine/category/research/funding-ranking-2019full).
(*4) Calculated based on a survey of 123 VC members of the Japan Venture Capital Association to determine whether female representatives are included (accessed in November 2021).
(*5) Calculated based on 127 companies which completed IPO in 2021 (accessed in November 2021).

FSA Open Policy Lab

5Why the gender gap exists: from gender biases to access to communities
Female entrepreneurs face various challenges from early stages to IPO, such as access to communities and difficulty inobtaining support for their less-scalable business ideas.

Insufficient support from accelerator
programs
 Too few female speakers present at pitch events
 Not enough female mentors support female

IPO

Limited access to communities
 There is an insufficient number of communities offemale CEOs for supporting each other.
 Females do not have access to information

entrepreneurs

circulated in male-dominant circles.

 One-size-fits-all support is inefficient, where female
entrepreneurs have diverse attitudes toward scale

Gender biases by capitalist

Starting a business VCs do not understand gender-related businesses
 Female CEOs tend to receive pessimistic questions,Less “scalable” business ideas
 VCs hesitate to invest in female
entrepreneurs, who tend to select lessscalable and B2C businesses, while malecounterparts tend to choose more scalable
and B2B businesses.

Lack of confidence Females tend to speak with lessconfidence Female founders lack confidence in their

which male counterparts do not.
 Fulfilling childcare responsibilities is perceived as arisk in business expansion.
 Criteria for investment decisions are unclear, likely
to be affected by reputation.

ability to raise funds and scale theirbusinesses

Source: Interviews of 19 professionals, including female entrepreneurs/capitalists raised or aimed to raise funds, and those who provide support for such entrepreneurs, between October 2021 and January 2022.

FSA Open Policy Lab

6Why female entrepreneurs feel uncomfortable

It took me years to say I would beinterested in IPO. Though I was confident
in my business, I could not think of IPO as
an option for me..

VC continued to ask me whether I would
be interested in the same business in 10
years. Unlike male entrepreneurs, manyfemales were often asked such similar
questions.

A traditional path for business expansion
from fundraising, scaling to IPO or M&A isoften the case for male entrepreneurs.
Female entrepreneurs may seek?

different paths.

Female entrepreneurs do not haveaccess to must-have information forCEOs. “Boys' club” is the place wheresuch information is shared.

Investment criteria are unclear.

?

Experience and reputation seem to bequite important, which are difficult tomeasure.

In our interviews, female entrepreneurs expressed discomfort with the male-oriented rule of thegame, gender biases in business evaluation, and male dominance in communities.
(Source) Our interviews.

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Lack of post-IPO gender diversity across the globe

Male

＜1%

99%

CEO at IPO

Female

4%

5%

5%

6%

7%

10%

13%

14%

96%

95%

95%

94%

93%

90%

87%

86%

Unicorns

Fin Tech

Russell 3000

STOXX 600

Fortune 500

Health Tech

Health Care

US Startups(Source) Holon IQ(2022) “The 2022 Global State of Women's Leadership”
Russell 3000 seeks to be a benchmark of the entire U.S stock market; STOXX600 is a stock index of European stocks.

FSA Open Policy Lab

8Why female CEOs found fundraising challenging
Female CEOs’ lack of access to capital is a global phenomenon.

Raising money is catastrophically challenging for female
founders
 The space of development tool is led predominately by white men. It

Why aren't female founders getting a bigger piece of the pie?
 Despite the recent increase in female capitalists, female VCs are justtakes a tremendous amount of energy and time for other people toas inclined to favor male founders as their male peers because female

generate interest in fundraising.

VCs also maintain patriarchal biases.

 There is a persistent perception that females are less aggressive in theprocess of advancing a funding round, both as founders and as VCs.

 VCs’ enduring focus on presentations and pitch decks negatively
impact underrepresented founders, who are typically inexperienced.

 This means that females are more risk averse, slower to move forwardin the process, and less demanding.

(Source) Tech Crunch “Raising money is catastrophically challenging for female founders”(Source) Tech Crunch “Why aren’t female founders getting a bigger piece of the pie? Theories abound”

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9Unconscious gender biases may affect evaluation
Unconscious biases in the evaluation process exist: for instance, projects run by male are likely to obtain a higher evaluation

A lower evaluation when pitched by females
 When the same content is presented in both male and female voices,pitches with male voice are more likely to be favored.
 A male narrator is judged to be more “persuasive” and “factual.”

A lower funding due to gender-biased questions
 Analysis of 189 pitches at TechCrunch Disrupt NYC in 2010-2016
 Judges tended to ask prevention-related questions to females andpromotion-related questions to males.
Promotion-related question: How do you plan to acquire
customers?
Prevention-related questions: What is your customer retention
like? Are you operating at break even?
 Entrepreneurs tended to respond to the questions as they were asked.
Entrepreneurs with promotional questions received more funding thanthose with prevention questions, resulting in a gender gap in funding
allocation.
 TechCrunch entrepreneurs in 2010-2016 raised $3.8 million less if asked
prevention questions.

(Source) Brooks, A. W., Huang, L., Kearney, S. W., Murray, F. (2014) Investors prefer entrepreneurial ventures pitched(Source) Kanze, D., Huang, L., Conley, M. A., & Higgins, E. T. (2018). We Ask Men to Win and Women Not to Lose: Closing

by attractive men. Proceedings of the National Academy of Sciences 111(12): 4427–4431.

the Gender Gap in Startup Funding. Academy of Management Journal, 61(2), 586-614.

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Limited access to networking restrains funding opportunities
Networking is critical for successful startups. Female founders have limited access to networking opportunities.

Tight-knit network
 The VC industry is a tight-knit network in

Gender gap in access toadvisors/capital In a survey of over 600 VCs, male

Investors’ reliance on referrals
 Investors are more likely to invest indeal syndication and deal sourcing that

entrepreneurs have more networks thatcompanies referred through "warm leads"

goes beyond just VCs.

provide access to advisors and capital.

than companies led by individuals not intheir social networks.
 Female and colored entrepreneurs havefewer opportunities to connect with theventure capital networks which are
predominantly white and male to secure
investment.
 The social capital of entrepreneurs is
associated with long-term performance ofventure-backed firms.

(Source) Brush, C., Greene, P., Balachandra, L., & Davis, A. (2017). The
Gender Gap in Venture Capital – Progress, Problems and Perspectives.

(Source) Padnos, C. (2018). Gender Differences in Entrepreneurship:(Source) Kapor Center.. Leaky Tech Pipeline – Entrepreneurship & VC．

Venture Capital, 20(2), 115-136.

Voices of Founders and Funders (Illuminate Ventures Report).

(https://leakytechpipeline.com/barrier/entrepreneurship-vc-barriers/)

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Over-representation
by male capitalists

Males’ lack ofinterest in
gender diversity

Unconscious
gender bias

Limited number offemale founders
who scale up theirbusinesses
Gender-biased
evaluation（-）

A negative feedback loop

Limited support/
funding tofemale entrepreneurs

Lower evaluation
to female founders

Obstacles faced with female founders are closelyinterrelated.
For example, (1) Few female entrepreneurs are in
VC networks, which results (2) Females’ limitedaccess to management advice, which results that

Females’limited opportunities
for pitch events

Lack of access
to VC networks

Lack offemale entrepreneursin networks

Lack of accesstofounder networks

Females’insufficient efforts
to scale(3) Female-led businesses are less scalable, which
results (4) Less funding to females, which results(1) ... (cont’d)（Source）Issues are grouped using the causal loop diagram method based on

Females’limited understandingof“rules of the game”

Females’limited accessto management
advicethe content of interviews and literature review conducted by the Lab.

FSA Open Policy Lab

12Enhancing gender diversity is critical from economic perspectives
Literature shows that enhancing gender diversity has economic as well as social benefits, such as higher performance in businesses with female
than those with male alone.

Female founders outperform Companies with a female founderLong-term win

Female capitalists matter Startups founded/co-founded by female

 VC firms that increase female partners byperformed 63% better than investments

perform better in the long run, generating

10% increase their returns by 1.5% annually,

with all-male founding teams.

10% more in cumulative revenue over 5

resulting in an exit that is 9.7% more

years: $730K compared with $632K.

profitable on average Startups founded/co-founded by female
earn 78 cents on every $1 invested, whereas
male-founded startups earn only 31 cents.

(Source) BCG “Why Women-Owned Startups Are a Better Bet”
(Source) First Round “10 lessons” http://10years.firstround.com/

https://www.bcg.com/publications/2018/why-women-owned-startups-(Source) Gompers, P.A., & Kovvali, S. (2018, July-August). The Other

are-better-bet

Diversity Dividend. Harvard Business Review.

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Potential female founders can unlock [Views expressed at individual interviews]
An increase in female entrepreneurs will create new business opportunities, discover solutions to social challenges and enhance diversity inorganizations.

New business opportunities
for VCs A target return could be maintained while

Seeking solutions to social issues

Diversity in organizations

 Males tend to focus on making money as Female leaders have the potential to create

increasing investments in female

their primary objective, whereas manyan organization with diversity, which fits

entrepreneurs, which resulted to connect

females want to solve their own difficulties.

future trends. They could create anwith female entrepreneurs who haveunique business insights.
 “Gender lens investments” (*) have great
potential. Male capitalists never understandFemtech.

 While female founders have diverse
backgrounds, they tend to pay more
attention to social issues.

organization that would work efficiently,
understand the limits of logic, and scale up
with an understanding of social
significance.
 Female leaders are likely to seek, notmasculine, but servant leadership. Female
tend to be better at leading a team ofpeople with different age and thoughts.

* Gender lens investments include investments in women-owned or
women-led companies; investments in companies that promote
workplace equity (in staffing, management, executive boards andsupply chains); and investments in companies that provide products
and services that significantly improve the lives of women and girls(GIIN).

 Female entrepreneurs used to be adapted
to the male society. But now they want tobe a new role model who cares both workand family.

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Solutions to complex challenges

What should be done for addressing structural challenges
Communities surrounding
female founders
Direct support to female founders

Influence to ecosystems as a whole

What is needed for change is the action of the
majority (i.e., stakeholders surrounding female
founders), not that of a minority (i.e., female
founders). Major stakeholders are shown at right.

Like-mindedsenior founders
Educational
institutions

Supportorganizations

Government

The following pages summarize “who should dowhat,” based on discussions at the workshop. Pleaserefer to page 34 for the high-level overview.
FemaleFounders

Investment in startups is on the rise. If current
practices remain unchanged, the existing distortion
would likely be maintained or even strengthened. All

VC firms

ImpactInvestors

Researchers &Think tanks(General Partners)

stakeholders in the startup ecosystem should act
now to change the status quo.

Individual
Capitalists
In VC firms

LimitedPartners
(LPs)

Media

Financial support to female founders

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Seven key perspectives for enhancing
gender diversity

1

Eliminate gender imbalance and gender biases of supporters

2

Promote entrepreneurship education

3

Create a community for female founders & provide access to
networks

4

Diversify options for exit and assessment perspectives

5

Accelerate support programs to female founders

6

Strengthen government leadership

7

Raise awarenessWe identified seven perspectives for enhancing gender
diversity based on our interviews, workshop and literature
review.

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1
Eliminate gender imbalance and gender biases of supporters
VC Firms

LPs

Capitalists

Support Organizations

 The workshop received a number of comments on gender imbalance and unconscious biases in those
who support entrepreneurs. Literature shows that females tend to be asked preventive questions,which we have also confirmed at individual interviews.
 Possible solutions include: Introducing guidelines for gender balance, such as on gender ratios about speakers and judges at pitch events;
 Improving the gender imbalance of venture capitals (e.g., recruitment, retention and promotion); Improving the gender imbalance of LPs to diversify perspectives in due diligence; Eliminating unconscious gender bias in the selection of invested firms (see next page for unconscious bias); and,
 Strengthening support (e.g., mentoring, sponsoring and coaching) from senior capitalists to female capitalists.

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1
Eliminate gender imbalance and gender biases of supporters
VC Firms

LPs

Capitalists

Support Organizations

Anri Samata

Kathy Matsui

General Partner, ANRI

General Partner, MPower Partners

To promote diversity and inclusion in the start-up industry, ANRI

Our DEI Event Policy states that we can be speakers at events only

has set an investment policy to increase the ratio of investments in

if at least 10% of speakers have minority backgrounds (e.g., women,

companies with a female founder to 20%. Now many talented

LGBTQ+, foreigners, people with disabilities). Although awareness inentrepreneurs have chosen us. Our institutional investors also

diversity has increased in the past few years, more proactive

support this initiative. We will spread this initiative to encourage theinitiatives are needed. Government policies should incorporate theindustry as a whole to fulfill our responsibilities to society.

perspectives of women, who account for half of the population.

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1
Eliminate gender imbalance and gender biase of supporters
VC Firms

LPs

Humans may misjudge

Capitalists

Support Organizations

Gender biases should be eliminated Regions A and B on the right are Unstructured interviews allows room for gender biases. Interviewers findin the same color but are seendifficulty in making fair comparisons between candidates when they

otherwise due to illusion.

are free to ask any questions. Such biases include the halo effect (i.e., a If everything around is removed,

A and B would be seen in thesame color.
 We should recognize that thedecisions we consider right are
subject to various influences.

good initial impression affects the overall perception of a person) andconfirmation bias (i.e., people prefer evidence to support existing beliefs
and ignore evidence opposing them).
 These biases can be eliminated by structuring interviews:
 Questions should be predetermined: interviewees receive thesame questions in the same order;
 Interviewers should score candidates immediately after eachinterview; we should recognize that brains are not a complete
decision-making machine (See page 75 of the literature below).

(Source) Thomson, G. and Macpherson, F. (July 2017), "Adelson's checker-shadow illusion" in F. Macpherson (ed.),(Source) Women and Public Policy Program Harvard Kennedy School (2019), “Advancing Gender Equality in

The Illusions Index. Retrieved from https://www.illusionsindex.org/ir/checkershadow.

Venture Capital

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1
Eliminate gender imbalance and gender bias of supporters
VC Firms

LPs

Capitalists

Support Organizations

Miki Yoshida

Masaru Nagura

Senior Portfolio Manager, Genesia Ventures

General Manager, CIC Tokyo

Each person faces different obstacles when trying to balance their

In order to increase the number of female entrepreneurs, it iswork and life events such as childcare and caregiving for elder

important to create a supportive environment for entrepreneurs

family members. The level of support that they can receive fromand an atmosphere that allows them to overcome various biases.

the local community, relatives and other family members varies

Without a strong sense of urgency on the part of those who

and in most cases, it's uncontrollable. Given the circumstances, I

support startups regarding the current state of diversity, including

believe that companies should be more flexible in providing thegender, it will not be possible to create an ecosystem that will

support their employees with different backgrounds need to

produce successful startups in the global market. With this in mind,

successfully balance their work and life events. To that effect,

CIC Tokyo is working to increase the percentage of women andGenesia Ventures is currently creating a variety of employee

non-Japanese speakers to 50% of the total number of speakers at

support options so that each member can demonstrate his/her fullits events. Ideally, I believe that the diversity of startup CEOs andpotential regardless of their circumstance.

speakers should reflect the balance in Japan.

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2
Promote entrepreneurship education
Support Organizations

 Females tend to consider entrepreneurship unrelated to themselves unless they
are surrounded by entrepreneurs. At the workshop, many pointed out thesignificance of entrepreneurship education, including education from elementary
school and to professionals in STEM fields.
 Educational institutions started to implement entrepreneurship education, which
received increasing attention. In addition to strengthening implementation, it isalso critical to measure the effects of education on startups and continue toimprove in the PDCA (Plan-Do-Check-Act) cycle .

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2
Promote entrepreneurship education
Support Organizations

Takaaki Umada
Director, University of Tokyo Found X

Over the past decade, numerous researchers have investigatedskills.(*) Moreover, guest lectures aimed at presenting role models

entrepreneurship education and produced insightful findings.

may be counter-productive, where students tend to become less

Whereas it is a good sign that Japanese people started to pay

interested in entrepreneurship .(**)

attention to entrepreneurship education, I am a bit concerned that

I hope that entrepreneurship education will become more effective

those research findings are ignored, and the education is still basedon intuition and experience.

and prevalent by adjusting it depending on the humandevelopment. Furthermore, research of entrepreneurship education

For example, literature shows that non-practical approaches such as

is as important as education itself to enhance the effectiveness of

edutainment and guest lectures are not effective in acquiring hard

education in the long-term view.

（*）Innovation Growth Lab “What‘s next in Entrepreneurship Education? Charting the course for effective policies and necessary research”(**) Matsui et al. "Effects of Entrepreneurial Education Programs Centered on Guest Lectures by Entrepreneurs."

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3
Create a community for female founders & provide access to networks
Capitalists

Senior Founders

Support Organizations

 Access to networks of entrepreneurs and VCs has a direct link to information access necessary for
financing and management. Communities that support launching a business and scaling are also critical.
 Creating communities and providing access to networks and information are "easier said than done.“ Whatmatters is not to create female’s clubs but to integrate females into existing communities. Like-mindedsenior founders, male or female, can play a major role in providing access to existing communities.
Moreover, it is also important to provide individual support (e.g., mentoring, sponsoring, coaching) tofemale founders.
 Some pointed out the importance of having access to large companies, engineers, lawyers, accountants
and SMEs, which accelerator programs can contribute to.
 Balancing work and life can be a challenge for female founders. A solution is that multiple people are in
charge of the same jobs. In terms of finding a co-founders, having diverse networks is also beneficial.
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3Create a community for female founders & provide access to networks
Capitalists

Senior Founders

Support Organizations

Motoko Imada

Tomoko Minagawa

CEO, INFOBAHN Group

Founder, Femtech Community Japan

Female CEOs overwhelmingly lack information necessary forrunning a company. There exists a methodology for starting a

Female entrepreneurs have difficulty in accessing information andbusiness, which CEOs should know. The reality is, however, that

networks, far from existing communities for entrepreneurs and VCs.

such information is shared only in male-centric communities. The

Increasing contact points with senior entrepreneurs and investors,

same is true for investors. Joining the communities requires

they can obtain access to lively information and experiences thatwomen to act like an honorary male, which many women are notcannot be obtained from books as well as to accelerator programs

comfortable with. On the other hand, information is scarce andand investors. Creating an ecosystem and community is essential

solutions are difficult to find in women-only communities. In

to improve the awareness and knowledge of each entrepreneur

conclusion, existing communities need to be transformed into

and increase opportunities for business growth.

inclusive ones that go beyond gender.

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4
Diversify options for exit and assessment perspectives
Impact Investors

 Many pointed out that existing arrangements for exit, capital markets andevaluation process should be changed because female entrepreneurs tend to
focus on solving social issues rather than scaling.
 Existing arrangements are being reviewed around the world. The concept of impact
investing has emerged. Moreover, “zebra companies,” as an antithesis to unicorns(i.e., unlisted ventures with a valuation > $1 billion within 10 years), focus onsustainable prosperity, while pursuing both social and economic benefits.

 Such moves, albeit unconventional at this moment, are important in unleashing thepotential of female entrepreneurs. Specifically, we hope for further consideration on
exit options other than IPOs as well as support measures to simultaneously achievescaling and addressing social challenges.

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4
Diversify options for exit and assessment perspectives
Impact Investors

Yuji Suyama

Chunmei Huang

Co-Founder & CEO, Zebras and Company

Managing Director, Shinsei Corporate Investment

The government and existing investors seek scaling (i.e., rapid

growth in a short period) with an emphasis on efficiency.
Nevertheless, we should reflect on whether it is also the highest
priority for each entrepreneur as well. Four female entrepreneurs in
the United States shared the idea of a “zebra company” and theneed for finance and supporters for it, which are recognizedglobally.
To support female entrepreneurs, it is necessary to diversify theperspectives of finance and evaluation, including how to recoup
investment and exit.

With its declining birth rate and aging population, Japan is goingahead of other developed countries in dealing with various social
challenges. Businesses responding to these issues by leveraging
unique business models and IT technologies are expected to realize
a positive correlation between business growth and the resolutionof social issues. We believe that a business that solves deeply
rooted social issues requires a variety of unconventional ways ofthinking, and the perspective of “women” entrepreneurs could be
one of them. The diversification of business evaluation andinvestment criteria, along with the expansion of impact investing,would likely help women entrepreneurs gain renewed recognition in
Japan, a country that is at the forefront of social challenges.
FSA Open Policy Lab27

5
Accelerate support programs for female founders
Support Organizations

 Female entrepreneurs are diverse in their goals. For example, some focus on scaling or addressing
social issues, while others pursue both or do not aim for growth. For this reason, entrepreneur
programs require more precise and tailored definitions of female entrepreneurs.
 We should be also knowledgeable about unconscious messages that supporters would deliver(e.g., if a brochure includes pictures of handmade goods or bread, it could be a message that thisstartup will start a small business leveraging the skills of housewives.) It is also important to provide support based on business expansion phases, from the brainstorming one in the very beginning to a later one where support should prevent founders fromaiming small.

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5
Accelerate support programs to female founders
Support Organizations

Mariko Yazawa

Asuka Murayama

Founder & CEO, Yazawa Venture

Deputy Director, Economic and Social Policy Office, METI

Diversity is becoming more important in innovation. Nonetheless,female entrepreneurs tend to be underestimated in startup areas
where the majority are male. Female entrepreneurs should seek
not only to overcome social challenges but also to have a large
impact on the world by scaling. Investors should contribute inmany ways including funding. Expanding support programs willlead to innovation by standing close to women's unique difficulty ingetting support for starting a business.

Goals should be as many as the number of women starting abusiness. Up until now, however, female founders have to adjust
their business plans to one-size-fits all support packages.
Digital transformation allows founders to have access to needed

support, wherever they are. "My Cheerleaders for Starting Business“of the Ministry of Economy, Trade and Industry will encourage
female entrepreneurs to connect with support institutions andexpand the options available.

（note）Titles is as of comment creation

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6Strengthen government leadership
Government

 The government should raise awareness to encourage the startup community to takethe lead in changing behavior. Specifically, the government should: develop data (i.e., gender gap in business startups, percentage of female capitalists in VCs,
gender gap in financing), given the lack of sufficient data to grasp the current situation;
 issue guidelines on gender balance at events, including numerical targets, and allow
government officials to speak only at the events that comply with these guidelines;
 add gender-related requirements for public investments and loans; establish a fund for female entrepreneurs to encourage co-investment by private sectors; and,
 reduce the burden of making an application for a nursery school by individual business owners.

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6Strengthen government leadership
Government

Mari Kogiso

Cases Studies

W20 Japan delegate/ Co-CEO SDG Impact Japan

Over the long term, an ecosystem plays an essential role in UK: The Treasury established the Investing in Women Code in 2019.
Seventy-nine institutions, including Lloyd's and Natwest Bank, signed

assisting women in starting businesses. However, changing existing

the code as of February 2021. The code aims to facilitate the actions ofsystems is not easy, where government leadership should besignatory institutions and produce the necessary data to understandstrengthened. In Europe and the U.S., the governments started tothe challenges faced by women entrepreneurs.

make loans and equity investments conditional on companies' United States: Implemented the Women-Owned Small Businessgender balance and gender perspectives, while implementing

Federal Contracting Program, which spent 5% of federal government

financial programs for women entrepreneurs by public

contracts on small businesses run by women.

organizations. At W20, each G20 member proposed to establish a

 Stock Exchanges; NASDAQ, London Stock Exchange, and Hong Kong

policy framework for women entrepreneurs, particularly in fields

Exchange set a minimum threshold for listed companies to appointsuch as finance and digital, which is said to play a major role infemale executives.

promoting gender equality.

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7
Raise awarenessMedia

Researchers/ Think tanks

 The first step is to recognize the problems. Gender diversity issues in the startup ecosystem
are under-recognized compared to those in the listed companies (e.g., low percentages offemale directors and managers).
 The media can play an critical role in raising awareness through reporting. Outlets should

include various role models, including failing cases, to drive a positive momentum forentrepreneurship. In addition, media companies specialized in startups could develop a listof support measures available to women seeking to start up a business.
 The role of research institutions and think tanks should not be overlooked. As research inJapan is limited, most literature referred to in this deliverable is from overseas. We lookforward to further analysis on gender issues in the startup ecosystem, the importance ofentrepreneurship, and the significance of solving gender challenges.

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7
Raise awarenessMedia

Yuko Endo

Yuri Okina

Editor in chief, MASHINGUP

Chairperson, Japan Research InstituteThe shortage of female leaders in Japanese politics and businesshas been broadly known to everyone. What prevents this frombeing overcome is the fact that gender challenges spread like a
spider web in Japanese society. There is not enough awareness or
discussion about specific issues, such as women entrepreneurs.
The workshop made me realize the low level of awareness among
the general public. Media can change the understanding in thegeneral public.

Researchers/ Think tanks

The gender gap in the startup ecosystem is not widely recognized.
However, there are many successful female entrepreneurs. From
what I heard from them, there are many advantages for women tofulfill their dreams and continue to work with a high degree of

freedom. More media coverage on such successful stories tointroduce their businesses, ideas, and ways of living, will be usefulfor many others. As many women are interested in social issues, it
is important for the Japanese society to support startups fromeducation and networking perspectives.

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A to-do list to solve structural challenges
Raise awareness in structural challenges

Structure interview process for investment selection and recruitment

Feature various role models (including failure cases)

Provide support for the retention of female capitalists

Collect information on gender

Media

Disseminate useful information on available support measures

Increase the number of female decision-makers

VC firms

Conduct analysis on gender issues in the startup
world, the importance of entrepreneurship, andthe significance of solving gender issues

Researchers &Think tanks

Limited Partners

Improve the gender balanceIntegrate DEI perspectives into investment strategy

Construct statistics for monitoring purposes
Provide support for Balancing Life Events with Female
Entrepreneurs

Female entrepreneurs

Introduce guidelines on gender balance for event
speakers
Add gender-related requirements for government-

Government

Provide support for accessing existing networks
to female capitalists and founders

Capitalists
in VC firms

Provide individual support to female capitalists
and entrepreneurs (e.g., mentoring, sponsoring,coaching)

funded loans and investments
Establish a government fund for female entrepreneurs
to enhance co-investment by private sectors
Provide entrepreneurship education at universities
Provide entrepreneurship education to junior andExplore options for exit other than IPO for

ImpactInvestors

Educational
Institutions

senior high school students

Provide individual support for female entrepreneurs (e.g.,

Like-mindedsenior founders

mentoring, sponsoring, coaching)(Source）Prepared by the laboratory, based on the comments received on the draft proposal at the workshop. The draft was
prepared based on the interviews we conducted and the report(Women and Public Policy Program Harvard Kennedy School(2019), “Advancing Gender Equality in Venture Capital”).

Provide support to founders aiming both solving social
issues and scaling

Examine the effects of education methods
Assist entrepreneurs in obtaining access to communities

entrepreneurs who focus on solving social issues

Supporting
Organizations

Introduce guidelines for gender balance for event speakers
and judges
Help establish diverse communities (including forentrepreneurs, large enterprises, engineers, professionals,
SME managers)
Design tailored support programs based on individual needs

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Ideal startup journey
Our hope is to realize a future in which:Support from VCs- everyone starts what they want to do based on their interests; and,- listed companies in Japan become organizations full of diversity and continue

A senior entrepreneur introduced us to a VC that understands
our dual focus on scaling and solving social issues. The

to create innovative businesses.

entrepreneur continues to advised us on how to achieve both
impact maximization and high profitability several times, andTailored support by accelerators

my business is almost getting on track!

After working for 10 years, I came up with an idea that could be

IPO

commercialized, so my friend and I started a business
together.
I want to place importance on solving social issues, but I also
want to scale, I would be happy with various options available.

Funding

People with different backgrounds, regardless of gender,
participate in pitch events, which gives me courage!

Company registration

A new start post-IPO

Starting a business
Students

Support from communities
I received an award at a pitch event, but there are many

Entrepreneurship education fromelementary school to university

things I don't know about as to how to run a company. I
participated and received a lot of advice from senior
entrepreneurs in founders’ communities. Though there wereStarting a business seems exciting. I want to try starting amany times I was about to quit because it didn't work out well,business by myself once I gain some job experience.

other entrepreneurs in similar situations and I encouraged

Our company is listed in a new market segment for firms
aiming to balance impact and profit seeking. The number of
employees has increased considerably, and I have to work
harder! I recently become a mother as well. Now it's easier for
entrepreneurs to let children get into nursery school and getgovernment support for baby-sitting. Above all, I canovercome with the help of my friends.

each other, so I was able to push forward. I changed mybusiness model several times, and my business is almost
getting on track!

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Special Thanks

Satoshi Ikeda
Chief Sustainable Finance Officer, FSA（Advisor to the Lab）

The stagnation of startup creation has long been perceived as a chronic malaise for Japan. The mostrecent attempt to provide a solution to this problem has come from the Keidanren's "Startup BreakthroughVision," March this year. It has set out the goal of "increasing the number of startups by 10 times =approximately 100,000 companies" and "increasing the number of unicorn companies by 10 times =approximately 100 companies.
I am not necessarily aware, however, there have been a plenty of proposals that have directly addressed
the issue of gender diversity as a contributing potential factor to this chronic disease. From this perspective I
really hope that this project will mark a milestone in deliberately moving away from one-sided efforts that
may have been constrained by unconscious gender bias."
Looking back, it is so unfortunate that "Oshin (*)," the best hit Asadora (Japanese TV broadcaster NHK’smorning drama program), which attained the highest viewer rate in record of 62.9%, has left in mostpeople’s mind a stereotyped narrative of the story where a woman continues to endure hardship in her life.
In reality, the drama depicts Oshin, its main character, as a woman who strives to find an opportunity
through repeatedly changing jobs and starting her own business, eventually becomes a entrepreneur of asupermarket chain and struggles to run it till the end of her life. Perhaps a certain type of gender bias in themind of the people is at work in distorting the interpretation of the story. As a typical scene of the drama,
people tend to more remember 7-year-old Oshin in poverty, played by Ayako Kobayashi than matured andFSA Open Policy Lab:
Diversity, Equity & Inclusion in the Financial Sector
Members
Aiko Kozaki (Sustainable Finance Office, Lab Leader)
Taiki Fukasu (Sustainable Finance Office)Megumi Fukuoka (Sustainable Finance Office)affluent Oshin in the middle to old-age, played by Nobuko Otowa. In this sense, it seems to me that we must

Minari Higa (Sustainable Finance Office)break free of the bias and revisit the story of Oshin from the contemporary perspective of women

Takuma Tanaka (Strategy Development Division)

entrepreneurship.

Sonoko Tominaga (Strategy Development Division)(*)Oshin is one of the most famous Japanese serialized morning television dramas, which originally aired on NHK from 4 April(note) as of June 30, 2022.

1983 to 31 March 1984.

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Special Thanks
We would like to extend our sincere gratitude to the 53 participants in the workshop co-organized byfor providing valuable inputs.

Katsuya Hirokawa Exeuctive Director, General Foundation SFC Forum

Rui Nagamori Co-Founder&CEO, Leaflow/ Board Member, Startup Lady

Atsuko Horie CEO, Sourire

Masaru Nagura General Manager, CIC Japan

Chunmei Huang Managing Director, Shinsei Corporate Investment

Hodaka Nakanishi Professor, Advanced Comprehensive Research Organization, Teikyo University

Tomoe Inada CEO, mog

Ai Ohtsu CEO, Compass

Takashi Kanda Auditor, Mercury

Ayako Otsubo Deputy Director, Economic and Society Policy Office, METI

Yukari Kawai CEO, Enbirth

Machi Takahashi President & CEO, Stroly

Kovari-Krecsmary B. Szilvia CMO, Paidy

Sayaka Takatsuka Senior Director, Shinsei Corporate Investment

Mari Kogiso W20 Japan delegate/ Co-CEO SDG Impact Japan

Tomoko Tanaka Assistant Director, Economic and Social Policy Office, METI

Naomi Koshi Partner, Miura & Partnerts, / CEO, OnBoard

Kana Tomita Program Manager, University of Tokyo FoundX

Miwa Koyasu CEO, Will Lab/ Co-Chair, W20

Takaaki Umada Director, University of Tokyo FoundX

Mariko Magnan CEO, TPO

Haruka Yagi Deputy Director, METI

Kathy Matsui General Partner, MPower Partners

Meyumi Yamda Board Director & Co-Founder, Istyle

Tomoko Minagawa Founder, Femtech Community Japan

Naoko Yamanaka CEO, meetalk

Tak Miyata Founder & General Partner, Scrum Ventures

Mariko Yazawa Yazawa, Founder & CEO, Yazawa Venture

Kumiko Morie Associate, Energy Environment Investment
Asuka Murayama Deputy Director, Economic and Social Policy Office, METI(And Other 23, in alphabetical order, title as of the time)

We would also like to express our gratitude for various advice in compiling this report:
Toshikazu Hayashi Nippon Life Global Investors Europe Plc, Chief Director
Akihisa Yahata Senior Manager, Research Consulting Division, the Japan Research Institute

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