6 “The relationship between Israel and Japan has grown substantially, marked by increased collaboration in innovation, technology, and healthcare,” adds Masato Tanaka, partner at TMI Associates and Tokyo-based Vice Chairman of Israel Japan Chamber of Commerce and Friendship Society (IJCC). “Entrepreneurs from both nations are leveraging complementary strengths, with Israeli startups driving rapid innovation and Japanese companies providing robust infrastructure and market access.” Hesitation Easing into Renewed Hope and Optimism Since the October 7th attack on Israel and the subsequent war, there has been an obvious economic impact. “Companies have shown deep concern due to the security situation in Israel, particularly after two Iranian attacks. The outcome is a decrease in the number of investments compared to previous years”, points out Gilad Majerowicz, Chairman of the IJCC, as well as partner and co-head of Herzog’s Asia practice. “The atmosphere is less proactive compared to 3-4 years ago. Back then, many Japanese investors were visiting and actively engaging with Israel,” agrees Akira Ehira, partner at the fullservice Japanese law firm, Mori Hamada & Matsumoto (MH&M). “Since 2022, the global startup ecosystem has also seen a significant slowdown, and this has also impacted investment flows from Japan to Israel.” It was a different story over a year ago. In May 2023, Woven Capital, Toyota’s growth fund, participated in the initial closing of Series C funding for Foretellix, an Israeli company that provides safety-driven verification and validation solutions for Automated Driving Systems and Advanced Driver Assistance Systems. In May 2023, Asahi Kasei decided to invest in Castor Technologies Ltd., an Israeli startup developing industrial 3D printing software. In June 2023, Iino Lines decided to invest in a fund managed by the Israeli maritime VC firm, theDOCK. Resilience in Israel’s DNA Nevertheless, even against the backdrop of war and challenging market conditions globally, resilience is in Israel’s economic and cultural DNA. In the 12 months since Oct. 7, Israeli tech firms raised some USD9 billion - third behind Silicon Valley and New York, according to the Israel Innovation
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