New Surging Trends in Japan's Entertainment Sector

Incubate Fund

MASAHIKO HONMAFounder and General Partner, Incubate Fund

Incubate Fund

Incubate Fund is one of the largest seed stage investment firm in the area of mobile, gaming, and internet media industry in Japan.

We always create the business from scratch together with founders, and support them for their success

US$ 200M under management

“FIRST ROUND AND LEAD POSITION”

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Toru Akaura (Tokyo)

Masahiko Honma (Singapore)

Keisuke Wada(Tokyo)

Yusuke Murata(Tokyo)

Leading internet companies invest in our funds

They are looking for new business opportunities and asking us to find out good startups

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Selected gaming investment

【M&A: SEGA&GREE in 2012】

We has been leading mobile gaming investments in Japan since 2007 Gumi and Aiming went public last Dec. and this March, respectively, and they are valued over

US$500M in Japan’s stock exchange We had many great M&A exits of our gaming companies to big players like SEGA, GREE,

and others

【 IPO: Dec 2014】 【 IPO: March 2015】

【 IPO: Planned in May 2017】

• Mobile Video• VR/AR• eSports

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Mobile Video

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3minute Inc.

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• 3Minute specializes in the production and management of next influencers, particularly female Youtubers.

• Recruits popular models and celebrities and assists them in making and promoting video contents on Youtube.

• Produce original and commissioned based videos, focussing on fashion, makeup and health care.

• Line Corporation invested an undisclosed amount in February 2015. After the investment, Line publishes content from 3Minute’s YouTube artists on the messaging app

Open8

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• Started as a a women-targeted video ad network for smartphone users called Video Tap.

• Raised US$7M from IncubteFund, Jafco, TBS, iStyle, and excite Japan.

• Specially focused on women aged from 25 – 34, reaching 40 million users on monthly basis. They leverage on existing user bases from iStyle and Excite Japan.

• Constantly exploring partnerships with other online media sites, such as launch a native video ad scheme on @Cosme and Women Excite.

C Channel

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• C Channel is an online video-based media targeting women aged 20 to 34, focusing on offering lifestyle-related information ranging from hairstyling, food, to travel tips.

• Content are delivered via Facebook, Twitter, Instagram, YouTube, China’s Tudou and other popular online video sites.

• Video plays was reported to surpass 100 million per month due to the launch of a ‘how-to’ clip series featuring women’s favorite topics such as how to make up, style hair or cook.

• Recently partnered with Ookbee, a Thai startup providing e-publication and user generated content in Southeast Asia

Game changing factors on mobile video

–New contents distribution channels (Instagram, FB)

–SEO–TV vs Magazine vs Mobile Media

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VR/AR

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• Game creation for VR/R devices

• Location Based VR/AR• B2B solutions

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Bandai Namco

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• In April 2016, Bandai Namco opened a virtual reality experience area called “VR Zone: Project i Can” in Tokyo Plaza.

• The 5,870 square-foot VR Zone will act as a virtual reality research facility where Bandai Namco can gain feedback from users to pursue further possibilities in virtual reality.

• Some of the main games will challenge users to perform simple tasks while their VR surroundings induce fear in them.

• 'VR Zone: Project I Can' hints at the future direction of Japanese arcades

– “Skii Rodeo” – A downhill skiing experience set on a snowy cliff.

– “Escape Ward Omega” – A “were we really attacked?” horror experience where you enter a giant, ruined hospital ward together with everyone.

– “Argyle Shift” – A cinematic experience where together with a girl, you enter the cockpit of a giant robot and battle.

“Fear of Heights Show” – An extreme test of courage where you rescue a cat left behind on a thin plank 200 meters above the ground.

Universal Studios Japan

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• As part of “Universal Cool Japan” event in 2016, Universal Studios Japan has transformed the Space Fantasy spinning indoor coaster into a VR experience starring Japanese fashion model and singer Kyary Pamyu Pamyu.

• The ride will be the world’s first “XR” Ride which synchronize the frantic speed and the sense of gravity of a theme park ride with astonishing advances in virtual reality that transport visitors to brand new super real world through sight and sound, stimulating the six senses.

• Visitors will be able to take part in incredible experiences such as encountering giant objects or taking sudden 200-metre drops that spread 360 degrees around them

Recruit Technologies

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• Recruit Holdings Co. Ltd is a classified advertisement, publication and human resources company in Japan. In October 2012, Recruit Technologies was established to develop IT and Internet marketing technologies for the Group.

• In March 2016, Recruit Technologies hosted a VR focussed event called “Mirai (Future) Amusement Park” for 2 purpose.1. To find various potential use cases of VR;

and2. To get connected with the engineers.

• There are numerous different VR attractions at the event, in ‘Tokyo Skyline’, people can experience the reality of roller coaster through VR while being suspended on a swing. This allows visitors to experience VR beyond visual senses through simulation of the ‘float and fall’ feeling, as well as other sensations associated with thrill of such activities in real life.

“Zamami Rocket Jump” – Visitors are hoisted above ground to simulate tall jumps using jetpacks

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Game changing factors on VR/AR

–New devise platforms–Existing software assets and

development environments(Unity, Unreal Engine, 3DCG)

–VR fund (Colopl, GREE, Gumi)

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eSports

Surging Trends in Japan

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DetonatioN Gaming

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• DetonatioN Gaming started off as a Counter Strike focussed team, after gaining sponsorship from Gigabyte, they added LoL, World of Tanks, StarCraft II, Super Smash Brothers, Battlefield 4.

• With a shot to compete at the International Wild Card tournament, the LoL team, also known as DetonatioN Focusme, converted to became full-time, salaried players in February of 2015, and moved into a gaming house in Chiba Prefecture, Japan.

• Gaining small successes overseas, DetonatioN Focusme attracted Japanese corporate attention to eSports. For example, Kadokawa announced eSports initiatives, ranging from massive Puzzle and Dragons tournaments to the establishment of an “eSports major” at the Tokyo School of Anime.

• To further promote the eSports scene in Japan, Nobuyuki Umezaki, manager of DetonatioN, recently established eSports consulting company Sun-Gence where he assists organizations in their approach to the industry and introduces them to talent.