TOKYO -- Nikon is the latest company to look to startups as a way to cultivate new business fields.
Over the next three fiscal years, the Tokyo-based company intends to invest as much as 30 billion yen ($280 million) in medical-related startups and turn what is now a business with virtually zero sales into one with sales of 130 billion yen and operating profit of 4 billion yen in fiscal 2016.
The majority of Nikon's profits now are generated with digital cameras. But considering that the market has hit its ceiling, the company faces an urgent need to develop new revenue streams.
Nikon has earmarked 50 billion yen for in-house research and development in new fields of business over three years, with a focus on the medical field. But by also investing in ventures, it seeks to accelerate the development of new products. This will be Nikon's first full-fledged foray into such investments.
As investment targets, Nikon will select startups with excellent technologies and strong development capabilities. The idea is to leverage its own strengths in optics and semiconductor manufacturing equipment to develop new products for the medical field.
One plan is to develop equipment to manufacture glass and plastic slides for biological samples. These products can be used in a wide range of applications, from blood tests to regenerative medicine R&D.
Other Japanese companies are also counting on venture businesses to kick-start their advances into new fields.
For example, Omron set up an investment subsidiary in July that will plow some 3 billion yen into startups over the next three years. Omron's idea is to leverage its factory-automation control technologies in the fields of agriculture and medicine. One possible product is a machine for filling test tubes with liquids.
Asahi Kasei began a five-year program in fiscal 2011 to invest some 6 billion yen in startups. It acquired in 2011 a venture that makes ultraviolet LEDs and plans to use those lights to commercialize sterilizers for food-processing companies and medical facilities in 2015.