Tokio Marine Launches CVC Fund to Back Early-Stage Startups

Tokio Marine, a Tokyo-based insurance company, announced Tuesday the launch of its $42 million corporate venture capital (CVC) fund, Tokio Marine Future Fund, to invest in early-stage startups worldwide.

Source: TechCrunch | Published on April 21, 2022

The Palo Alto-based CVC fund will invest between $500,000 and $3 million in seed and Series A rounds in industries such as insurtech, fintech, mobility, healthcare, cybersecurity, artificial intelligence, automation, and climate technology.

“There are often cases where Tokio Marine sees very promising companies or product ideas that are too early to support Tokio Marine as a customer,” Yoshi Yoshida, who leads the CVC fund at Tokio Marine, told TechCrunch. “We don’t tie investments to an immediate strategic opportunity but want to help accelerate development either as an advisor or capacity provider with the hope that there is eventually an opportunity to partner strategically or become a customer as they progress.”

To drive the CVC's investment strategy and process, the fund has partnered with World Innovation Lab (WiL), a Silicon Valley and Japan-based venture capital firm with approximately $1.5 billion in assets under management. "WiL will serve as the CVC fund manager, led by Steve Pretre, who manages WiL's investments in the fintech and insurtech sectors," Yoshida explained.

WiL partner Steve Pretre stated that WiL will provide back-office administration for the fund as well as leverage its portfolio support capabilities for marketing, Japan market entry, and broad expertise.

"From the start, I will be actively sourcing and driving investments with the fund, while also advising and partnering with the Tokio Marine team as they develop their own network and deal flow," Pretre said.

Tokio Marine claims that the new venture investment fund will expand on the company's current commitment to supporting its startup Innovation labs in Silicon Valley, New York, London, Singapore, So Paulo, Taipei, and Tokyo.

"The Silicon Valley Innovation Lab collaborates directly with the CVC team to drive post-investment business development activities between portfolio companies and Tokio Marine companies," Pretre explained.

To date, the fund has made several early-stage investments, including Carefull, a financial caregiving app that monitors and protects aging parents' daily finances; Nirvana Insurance, a platform that provides commercial insurance for fleets and transportation from the ground up; Titaniam, a data protection platform that provides encryption-in-use to ensure that even if attackers gain access, they cannot leave with valuable data; and TrustLayer, an AI-powered risk management platform.

Tokio Marine, the CVC fund's sole limited partner, is currently allocating $42 million to the initial fund. Tokio Marine plans to invest more in the next fund once it has been deployed, according to the company. Tokio Marine is a long-standing LP in the WiL growth fund, according to Pretre, so the firm approached WiL to partner on its CVC fund.

“The fund is structured as a single LP fund with WiL as the managing GP,” Pretre said. “With this structure, we have the ability to move quickly on financially driven investment decisions using a professionally managed VC approach while also leveraging the strategic value from Tokio Marine’s global operations both during and post-investment process.”

“The global investment opportunity for early-stage innovative startups in the United States and emerging markets is immense,” said Yoshida in a statement. “Tokio Marine’s global presence gives us the ability to help accelerate the growth of startups tackling new opportunities… We are excited to help empower a new generation of entrepreneurs.”