Silicon Valley’s giant venture capital firm Andreessen Horowitz is preparing to open its first office in Asia in Japan. This move shows that Japan is becoming an increasingly important investment center. While tensions between the US and China over the high-tech sector are driving American investors away from China, Japan is emerging as a new center of attraction.

Reasons for Turning to Japan

Andreessen Horowitz, which also supports cryptocurrency projects, aims to support startup investments by establishing strong ties with companies in Japan. According to information received from three sources, the company’s senior executives and investor relations officers have repeatedly explained the plan for a Japan office to its limited partners, but a final decision has not yet been made. Opening an office in Japan aims to both increase cooperation with existing investors and pave the way for future fundraising activities in Tokyo.

U.S. venture capital firms, once deeply involved with China, have begun to pull out of China due to U.S.-China tensions in high-tech areas such as artificial intelligence and semiconductors. This has led to a decline in investment in Chinese startups and a shying away from Chinese investors. But Japan stands out as a low-risk source of funding for American investors, thanks to the cash reserves accumulated by large Japanese companies in a low-interest-rate environment.

The Company's Investments in Japan

The $7.2 billion fund launched by Andreessen Horowitz in April includes NTT Group, Tokio Marine & Nichido Fire Insurance and major Japanese trading companies among its investors. The amount of funds raised from Japanese companies is reported to be in the hundreds of millions of dollars, which corresponds to about 5% of the total fund.

Although Japan has been lagging behind in the development of startups in the past, it is now seen as an emerging source of funding as an alternative to China. With rising interest rates, American institutional investors are limiting their funding for venture capital, while Japan stands out as a new hope. Andreessen Horowitz’s interest in Japan signals that the company may make investments in Japan in the future.

The move is seen as part of Andreessen Horowitz’s international expansion strategy. The company established its first overseas office in London in 2023 and has now chosen Japan to establish itself in the Asian market.