For my first blog, I have chosen Money Forward (Ticker: 3994), although it is not a newly IPOed company which are already discovered and supported by the institutional investors.  Money Forward, as a SaaS based accounting and other back office management  provider, symbolizes what Japan sorely needs –digitization of Government and private corporations.

In its 1/2/21 article, the Economist called Japanese government as an “e-government failure”.  It also noted that, in a survey of 30 counties in the OECD, Japan raked last in terms of providing digital services: only 7.3% of citizen requested anything from the government online in 2018 vs. Iceland’s 80% and behind countries such as Slovakia and Mexico. These are indeed sad and painful (to a Japanese) statistics, especially since Japan has some of the world’s best digital infrastructure, including top notch mobile networks. It appears that the progress toward digitization is minimal even though Mr. Suga, the now outgoing- prime minister, made digitization of government as one of his policy priorities in 2020.

Japanese citizens are fully aware that productivity improvement through “process digitization” is the best way to offset labor force shrinkage in the rapidly aging society.  Therefore, I believe that digitization initiatives of payment systems at private entities should garner people’s supports.  As such, Japan’s Digitization is one of the highly profitable investment themes and it has a LONG runway (a low hanging fruit), since it is coming from a low base.