The recent Tokyo International Conference on African Development (TICAD) brought together business leaders, investors, and government officials from across Africa and Japan and reaffirmed the Asian powerhouse’s ambition to strengthen its commercial relationships with the continent.
Particularly in the aftermath of this conference, conversations about deepening Africa–Japan investment ties are accelerating. Yet, despite the optimism expressed about Africa’s potential at forums such as TICAD, actual Japanese investment flows into African startups remain limited. Japan’s engagement with the continent represented less than 1% of its total foreign direct investment last year.
When it comes to increasing investment flows, it’s often tempting for African startups to put the onus on Japanese investors — expecting them to recognise the huge growth potential the continent’s markets offer.
As a policy strategist, management consultant, ecosystem builder, investor, and entrepreneur, I’ve had evolving perspectives on how to best crack the code for startups to attract risk capital. But it is really through my years building an African technology venture and now working closely with Japanese investors, that I have developed the conviction that it is African entrepreneurs’ responsibility to meaningfully articulate how they can add value and offer strong returns.
Shifting the Mindset
In my experience, African founders often misread what Japanese investors are looking for. They often lean on narratives about patience, purpose, and potential, when what investors really want is performance.
Indeed, one of the most persistent myths in African investment circles is that Japanese investors offer “patient capital” and are willing to wait years for returns because they value long-term relationships. It sounds comforting, but it’s wrong.
Investors don’t want to be patient. In today’s financial climate, they don’t have to be. They can earn yields of 4% on US Treasuries or an average of 10% annually tracking the S&P 500, with none of the perceived risks that come with frontier markets. If African founders tell them to “think long term,” they’re already losing the argument.
Performance over Potential
The only convincing case for investing in Africa is execution. Investors must see credible teams, disciplined operations, and data-driven evidence that a business can grow profitably and at pace.
In short, founders must prove that they have the ability to turn potential into performance. The startups that can demonstrate real operational discipline and market traction, will be the ones that attract Japan’s attention.
Another issue is that when African startups pitch to Japanese investors, they often start with the macro story: the youngest population in the world, rapid urbanization, and vast untapped demand. Those are important facts, but they don’t necessarily justify an investment decision.
What moves Japanese investors is not the theoretical potential of the African continent but commercial clarity. They want to see where the value lies and how collaboration can generate measurable returns. In other words: stop pitching Africa as a story and start pitching real businesses offering real value.
Governance as Growth
Furthermore, Japanese investors, and indeed all investors, are meticulous. They evaluate processes as much as potential. They want to know not only what you do but how you do it: how you manage risk, monitor performance, and maintain transparency.
African founders often underestimate how much governance and reporting standards matter. Robust financial systems, internal controls, and board oversight aren’t bureaucratic hurdles, they’re essential to building credibility and giving investors the tools they need to make a decision.
Founders should aim to be “investment ready” long before investors arrive. Having clear financial documentation, regulatory compliance, and measurable KPIs signals seriousness and makes it easier for an investor to justify writing a cheque for your startup.
Data and Investor Confidence
Data is also essential. Japanese investors are increasingly curious about Africa, but many still operate with limited information. While new tools such as AI are increasingly empowering investors to benefit from insights derived from alternative data sources, they tend to lack the local networks and context to evaluate risk accurately. This can create a trust gap that slows decision-making or inhibits investment.
Founders can close that gap by using data as a storytelling tool. Share real performance metrics backed up by robust data: customer acquisition costs, retention rates, operating margins, and unit economics to quantify progress and investment potential. The more tangible and data-driven the narrative, the easier it is for an investor sitting in Tokyo to visualize the opportunity and to act on it.
Building Trust
Getting to grips with Japanese corporate culture is also important to building trust with Japanese investors. Relationship-building remains central to Japanese business. Partnerships are rarely sealed after a single meeting. Investors will often observe progress over months or even years, watching for consistent delivery.
That doesn’t mean waiting passively. Founders should treat each interaction as a milestone. Over time, credibility compounds, and once Japanese investors commit, their engagement tends to be deep and enduring.
Winning at Home
With all that said, before seeking international funding, founders should first earn the confidence of those closest to their markets. In any entrepreneurial ecosystem, local peers and investors are often the hardest to convince. After all, they know the sector’s realities, the competitive landscape, and the operational hurdles better than anyone else. Their local knowledge and experience means they are often best placed to sense which start-ups are primed for success and which are likely doomed to failure.
Before even thinking about how to attract international investors, winning over those already operating in your market is essential. Foreign venture capital firms are aware that their peers nearest to the ground have the sharpest understanding of what works in that market. If local investors and entrepreneurs don’t believe in your business, it sends a troubling signal to those farther away. A Japanese investor observing from Tokyo will rightly ask: if those who know the environment best aren’t convinced, why should I be?
From Goodwill to Growth
In the current global environment, money is not desperate for opportunity. Investors have options. They will not choose Africa out of sentiment or moral obligation. They will choose it if the opportunity is commercially advantageous and is likely to offer high returns.
African founders must therefore evolve their pitch: focusing not on moral appeal but market logic. The future of Africa–Japan investment will not be built on goodwill alone. It will be built by founders who can execute fast, scale intelligently, and deliver returns that compete globally — and by investors who recognise that the continent’s best startups are offering very real results.
Bernard Laurendeau is the founder of Enkopa Lab Japan, a Tokyo-based advisory firm for Japanese corporations and investors entering African markets. His career spans roles as CEO and Co-Founder of Arifpay, Ethiopia’s first licensed payment system operator; Senior Advisor to the Ethiopian Jobs Creation Commission; Regional Director for Africa for a Silicon Valley big data analytics venture; and Vice President at BNP Paribas. He draws on 15 years of global experience in corporate strategy, digital transformation, and financial services.