Naoyoshi Yoneyama, SBI Holdings’ European Managing Director

As we have previously reported, Japanese financial services conglomerate SBI Holdings has chosen Berlin for its recently opened European headquarter. European Managing Director Naoyoshi Yoneyama spoke last week at an AsiaBerlin webinar about his career as a diplomat, the rationale for the Berlin decision, and the EUR 200m fund focused on “Industry 4.0” he is going to lead.

After graduating from university, I entered the diplomatic service, which allowed me to get involved with a number of interesting projects. For example, I was responsible for aid to developing countries. In particular, in the European context, this included financial aid to Balkan countries such as Kosovo and North Macedonia, to refurbish educational institutions or provide medical equipment to the to local hospitals.

For a long time, I have been personally engaged in the bilateral relationship between Germany and Japan, developing even stronger economic ties between our countries. Through my activities in the public sector, I also realized that there are a couple of weak points, because not all policymakers have a good sense of business strategy, which can be quite important when rebuilding a country.

So when I moved from the public to the private sector, I could learn how entrepreneurs think and how they operate their companies. I joined SBI Group, the large Japanese financial conglomerate that was originally part of SoftBank, but then spun out in 2005. SBI has been very successful in Asia, and last year we expanded into the European market. We already had a couple of direct investments into Berlin-based startups, such as solarisBank, and in order to support these companies, as well as to to develop a stronger footprint for SBI Group in Europe, I came to lead our new office in Berlin, the new startup hub in Europe.

Here, we partner with local firm Redstone to establish a EUR 200m fund called the “Future Industry Ventures Fund”. While SBI has been historically very active in the financial industry, this fund is focused on “Industry 4.0”. As we expand in Europe, and especially Germany, we have considered the similarities between Japan and Germany. As a result, we will focus more on common industries, such as manufacturing and automobiles, where Germany is very strong as well.

From a decision-making perspective, SBI is quite unique among Japanese companies. We put great value on individual entrepreneurship by each employee. At the moment, we have roughly 8,000 employees, and each employee is responsible for her own type of individual entrepreneurship. That is how we have come to be known as a company builder in the financial industry. I am just one of the entrepreneurs in this Group, and as such I could propose this idea to create our fund specifically focused on “Industry 4.0”. So SBI does not strictly follow a top-down approach, we also work bottom-up, and our strong corporate culture supports this way of operating.

We will invest in sectors where we can expect major industry transformations, for example towards a more sustainable, secure and decentralized type of business. Industry 4.0 covers quite a wide range of segments, of course, like Internet-of-Things (IoT), Artificial Intelligence (AI), blockchain technology, the circular economy and smart cities, just to name a few. We do not specifically focus on one segment, but we always have a keen interest in companies that transform the existing way of doing business. And typically, we are an early stage investor.

From my own experience, having served in Germany for roughly four years as a diplomat, I see Germany as having a fairly decentralized structure. Why did we choose Berlin for our European headquarter? If you look a Europe’s financial industry, probably some people would say “Why did you not go to Frankfurt?”. I do not believe that would have been the right decision for us, because first of all, innovation is happening right here in Berlin. The second thing is that of course, the policy making takes place in the capital. And since we also diversify beyond the financial industry, Berlin seems the right choice.

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