RIEB Discussion Paper Series No.2025-05

Title

The Determinants of the Growth of Japanese Start-ups: A Resource-based View Analysis

Abstract

The objective of this article is to determine and analyse the factors behind the growth of Japanese startups. The framework of reference is derived from the Resource Based View of the firm (Penrose 2009) and the quantitative analysis relies on data from a survey carried out in 2022 with 753 Japanese startups. The article assesses internal (entrepreneur, workforce, innovation) and external (finance, knowledge access and location) resources under uncertainty. Econometric findings suggest that larger but younger firms with a domestic market orientation, and experienced entrepreneurs drive growth, while intellectual property ownership and equity financing for fixed capital investment positively impact economic success. Market-product mismatches and weak supplier quality hinder growth, and Tokyo's location benefits ICT start-ups but not others. Employment growth, though weakly linked to sales growth is strongly influenced by business confidence and access to skilled labour and investors. These findings provide strategic insights to inform policies to foster start-up success in Japan.

Keywords

Internal resource; External resource; Uncertainty

JEL Classification

M13, O32, G32, R58

Inquiries

Nobuaki HAMAGUCHI
Research Institute for Economics and Business Administration,
Kobe University
Rokkodai-cho, Nada-ku, Kobe
657-8501 Japan
Phone: +81-78-803-7036
FAX: +81-78-803-7059
and
Research Institute of Economy, Trade and Industry

João Carlos FERRAZ
Institute of Economics, Federal University of Rio de Janeiro