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Southwestern Japanese city tapping tech strengths

FUKUOKA -- Nikkei and Vienna-based Pioneers will host Pioneers Asia, a startup event in Tokyo in March. Industry, the government and academia in Japan are working to foster startups as a driver of economic growth.

     Asian startups are getting off the ground in growing numbers, attracting increasing attention in the West. This series highlights the growth of startups in Asia and their future prospects.

Favorable climate

Japan's southwestern island of Kyushu is a hotbed of research on OLED materials. These organic materials enable the development of ultrathin, flexible displays. Kyulux, a venture company set up in Fukuoka in March 2015, is looking for ways to create brighter, cheaper materials for use in mobile devices and cars.

     In a clean room at Kyushu University, next door to Kyulux, the startup's employees work with university researchers. The key technology was developed by Chihaya Adachi, a professor at Kyushu University, which holds the patent. The prefectural and city governments assist the work by offering facilities. The goal is to create a hub for OLED technology in Fukuoka.

     Kyushu University's wealth of scientific and medical expertise is a valuable resource in the drive to develop new regional industries. "We intend to foster entrepreneurs and ensure that research results are used to the advantage of society," said Masato Wakayama, the university's executive vice president in charge of research and industry-academia-government cooperation. QB Capital is a venture capital provider set up last spring by Kyushu Technology Licensing Organization, an affiliate of the university, and local businesses companies, including Nishi-Nippon City Bank. QB Capital will soon begin full scale investments, drawing from a 3.1 billion yen ($25.7 million) fund created last September.

     In a building overlooking Ohhori Park in central Fukuoka, Unixon Systems develops software enabling fast file transfers. The software allows data-heavy content, such as video, to be transmitted quickly. Sales have risen sharply over the past several years, thanks to the product's popularity with broadcasters.

     Unixon's software is also used in health care and scientific research. Yorihiro Ueno, the company's executive director and chief financial officer, said the domestic market for the software will "expand more than tenfold to about 100 billion yen in a few years." He expects the overseas market for the product to be 10 times larger than that.

     Fukuoka, which is looking to nurture new industries in information technology, new materials and services, was designated by the central government as a national strategic zone for startups in 2014. Since then, the city has eased restrictions on the height of buildings downtown in hopes of bringing new development. It has also relaxed residency requirements to encourage people from overseas to set up shop in the city.

     In the autumn of 2014, municipal authorities created Startup Cafe, a place where would-be entrepreneurs can get advice from lawyers, accountants and other business experts. There have been more than a thousand consultations so far, more than 40 of which have led to the launch of new businesses.

     Marine Biotechnology in Munakata, Fukuoka Prefecture, is working on containers that would allow fish caught in Kyushu to be shipped live to Tokyo and overseas. The container uses a technology developed by Kenji Kugino, a professor at the University of Nagasaki. The container holds seawater with a high concentration of carbon dioxide, effectively putting the fish to sleep. They wake up at their destination, none the worse for wear. The company hopes to commercialize its container by the end of the year. "A new market will be created and the fishery business will have a greater potential," said Kugino.


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