"Shipping × CVC"—The Value of Niche. Expanding the Next Generation of the Shipping Industry Together with Startups at MOL PLUS

Takuya Sakamoto
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Representative of MOL PLUS

Graduated from Kyoto University’s Faculty of Agriculture in 2012. Joined Mitsui O.S.K. Lines (MOL) in 2012 to engage in overseas business. Managed overseas clients in the steel raw material shipping division. Later, was seconded to MOL's Singapore subsidiary, MOL Cape, in 2017, where he was responsible for chartering operations, managing fleet deployment and allocations for 100 car carrier vessels in the automotive division.
In 2020, he proposed and successfully implemented the idea of establishing a "CVC for the shipping industry" within MOL's internal venture system. MOL PLUS, a CVC subsidiary, was established in April 2021, and Sakamoto assumed the position of representative.

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Providing Business Opportunities in "Shipping" to Startups

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Could you tell us about the investment areas, structure, and organization of MOL PLUS, the CVC of Mitsui O.S.K. Lines?

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MOL PLUS was established in April 2021 as a CVC subsidiary of Mitsui O.S.K. Lines with the mission of "Adding new value to the shipping industry and society."

We have set up a ¥4 billion investment budget for the period from 2021 to 2024. We invest not only in domestic companies but also in international ones, operating from three locations: Tokyo (5 people), London (2 people), and Singapore (2 people).

The startups we target for investment are mainly in the early to mid-stages, from Series A onwards. As of August 2023, we have made investments in 11 companies, including WOTA (water circulation), Regional Fish (high-speed fish farming), MetroWeather (wind measurement), Kyoto Fusion Engineering (nuclear fusion), AMOGY (US-based ammonia power generation), and Atomis (porous coordination polymers), among others.

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The main areas and themes we are focusing on for investment are:

1. Upgrading the shipping/logistics industry (digitalization, automation, reducing environmental impact)
2. New business fields (renewable energy, decarbonization, marine business, real estate, etc.)

These two major categories.

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What are the points of connection and value provided by MOL PLUS to startups?

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The biggest feature of MOL PLUS is that we are a CVC aimed at creating new businesses within the shipping industry.

Starting from the shipping industry, we look at adjacent, intermediate, and even further new areas to generate new value. We consider what ideas, technologies, and worldviews startups have that could create value and make investments based on that perspective.

Therefore, the greatest value we can provide to startups is enabling them to leverage the unique resources of the Mitsui O.S.K. Lines Group. Specifically, these include:

• Global shipping hubs
• Approximately 800 large vessels
• A shipping network spanning 40 countries
• Expertise in logistics and trade
• Assets in port and land transportation

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Additionally, we believe a significant value we offer to startups is the opportunity to access the massive and often unknown market of the global shipping industry.

While it may not be widely known, the global shipping market is valued at around USD 500 billion, and the volume of maritime transportation was growing steadily before the pandemic. Japan is the third-largest maritime power in the world, with 99.6% of its trade being carried by sea. The shipping industry globally is actively seeking ways to evolve and innovate, and for startups, participating in this sector represents a major business opportunity.

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While the shipping industry may not be familiar to many and is often seen as closed off from the outside world, by being involved with us, startups can access the shipping and related sectors widely and deeply.

Through our investments, startups that enter the maritime and ocean sectors deeply will create transformative seeds with new technologies, digital skills, and business ideas. We, in turn, will use Mitsui O.S.K. Lines' management resources to fully support the societal implementation of these transformations. Through such activities, we aim to create new industries in collaboration with startups and corporations.

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Since MOL PLUS is a separate entity carved out from Mitsui O.S.K. Lines, we are able to make investment decisions at a different speed compared to the parent company. After investment, we do not require detailed reports, and we are not chasing short-term capital returns. Our structure is designed for long-term collaboration with startups to create and nurture new businesses. We are constantly considering how to build a structure within Mitsui O.S.K. Lines that can consistently engage with startups and respond flexibly over the long term.

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- I understand that MOL PLUS was established after Mr. Sakamoto applied for the company's internal venture program. Could you tell us about the background leading to its establishment?

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MOL (Mitsui O.S.K. Lines) has supported people's lives and met societal needs by transporting a wide range of products such as energy resources and automobiles through the shipping industry. Along the way, it has also contributed to a significant amount of CO2 emissions. With the growing global awareness of environmental issues, MOL has faced major business challenges, such as balancing "transportation with reduced environmental impact" and creating "businesses that do not rely on transportation" as part of its commitment to ESG (Environmental, Social, and Governance) management.

At the same time, as a company that has long supported and maintained the shipping infrastructure, MOL's decision-making process, evaluation system, and internal culture are somewhat conservative. It's difficult to generate ideas for change or create new businesses from routine operations.

The launch of the first round of the internal venture program, "MOL Incubation Bridge," in 2020 was, I believe, a management initiative to break through this situation.

At the time of the internal recruitment, I had been with the company for eight years. While I found great satisfaction in working on socially meaningful projects, my desire to challenge myself with new values and to drive transformation grew as I accumulated various experiences. At that point, I learned about the internal venture program and immediately raised my hand.

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Why did Mr. Sakamoto propose "CVC" as a new business idea?

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In the early stages of preparing the proposal, I tried to think of ideas for new businesses. While I could come up with practical ideas related to business improvement from my experience, I struggled to come up with an idea that would be meaningful for MOL and that could be monetized into a "winning business."

When I was feeling stuck on my own, a friend who is an entrepreneur advised me:

“Creating new businesses is the work of startups and entrepreneurs. For a large company like MOL, instead of focusing on creating businesses on its own, shouldn’t it take on the role of supporting startups and fostering business growth?”

That advice made me realize something.

As I continued to research, I learned about the business model of Corporate Venture Capital (CVC), where large corporations engage in supporting startups. At that time, about 100 companies in Japan were implementing CVC, but there were no examples of CVC being applied in the shipping industry.

I further reached out to venture capitalists, CVC professionals, and entrepreneurs, gathering opinions from the shipping industry as well. Through discussions with nearly 100 people, I began to understand the uniqueness of CVC for companies in the shipping industry and its potential impact. I came to believe that this idea not only aligned with what I "wanted to do," but also had "significance for MOL" and "a strong chance of success as a business." This led me to propose it through the internal venture program.

To successfully work alongside and become a trusted partner for startups, it would not work if I were merely "bringing things back inside the company." I needed to have a certain degree of decision-making authority, so I proposed this. As a result, I became the leader and was directly involved in the management. After about a year of preparation, MOL PLUS was established.

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Being a Minority Allows Me to Provide Value to Others

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- Mr. Sakamoto, could you tell us about your childhood?

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I was born in Suita City, Osaka Prefecture, attended high school in Nara, and went on to Kyoto University, so my living area until university was the Kansai region. I moved to Tokyo only after becoming a working adult.

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Since I was young, I remember being a child who chose things that others didn’t.

For example, when collecting professional baseball chip cards became popular among my friends in elementary school, the most popular team in Suita City was, of course, the Hanshin Tigers. Many of my friends wanted cards of Hanshin players, but I thought to myself, “It might be difficult if I go with the crowd,” so I decided to become a fan of the Yakult Swallows, a team that, although strong with many top players, was the least popular among my friends. I started collecting Yakult player cards. As a result, it was easy to trade cards since my collection didn’t overlap with that of my friends, and I was able to collect good cards without spending much money. By generously giving away the Hanshin cards that everyone wanted, I experienced the joy of making my friends happy.

Though I was a child, I may not have fully realized it, but collecting the baseball chip cards was an experience where “choosing something that others didn’t” led to success.

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Later, at Kyoto University, I enrolled in the Faculty of Agriculture, a science-focused department, but I chose to major in Food Environment Economics, the only humanities-based department in the faculty. While this was simply because my interests aligned with that field, it was also quite rare to have a department that could be described as both "scientific and humanities-based" or "neither strictly scientific nor humanities-based," and I found the positioning of this field quite attractive because it was an area not often chosen by others.

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- Could you tell us why you chose Mitsui O.S.K. Lines (MOL) as your first job after graduation?

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During university, I belonged to a seminar focused on international agricultural economics and had the opportunity to conduct fieldwork in Southeast Asia, including Vietnam and Indonesia. That was an incredibly stimulating and enjoyable experience. When I started thinking about my career, I made "the ability to engage in overseas business" my top priority, and began researching companies. While I was aware of the interesting work available in general trading companies and food manufacturers with overseas operations, I became intrigued by the shipping industry, which supports the infrastructure of island nation Japan while enabling global business. Unlike general trading companies and manufacturers that hire hundreds of new graduates, the shipping industry at the time hired only 20-30 people. The image of being a part of a small elite group, handling global business, was a deciding factor for me, as I tend to choose things that "don’t overlap with others."

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- Have there been any experiences in your career that led you to corporate venturing through CVC?

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There have been many encounters and events that led me to where I am today, but one of the key experiences was my assignment to Singapore in 2015. Through my work and life in Singapore, I rediscovered the "interest in leveraging the relative value of making different choices" and deepened my self-awareness that "I am someone who has little psychological resistance to becoming a minority or niche player."

One time, I joined a Chinese business community where I was the only Japanese participant. Since there were no opportunities to learn about the Japanese shipping industry firsthand, I was asked many enthusiastic questions by the other participants, and I felt grateful for the experience. During my time in Singapore, I encountered many similar situations, and it made me realize that in societies where different nationalities, races, and thoughts coexist, there is a culture of mutual respect, where individuals bring out their strengths and learn from each other.

In Japan, even if I hold a minority opinion, I tend to agree with the majority opinion to avoid communication costs and to "read the air" (understand the unspoken group dynamics). However, there are countless CVC funds worldwide, and shipping industry professionals are scattered across the globe, yet it is extremely rare to find someone who is both knowledgeable about the shipping industry and supports startups. That's why I believe CVC in the shipping sector can offer valuable support. The strength of MOL PLUS as a CVC lies in this "minority" and "niche" position.

The idea for "Shipping Industry CVC" that I proposed and now lead was influenced to some extent by the insights and convictions I gained during my time in Singapore.

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- Finally, what qualities do you think a CVC capitalist should have, and what are your personal goals?

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A CVC capitalist should be a "professional who fully utilizes the business capabilities of a company." At the same time, when supporting the growth of startups, one cannot simply think like a large corporation.

While it is necessary to "fully utilize the business capabilities" of the corporation, one must not operate solely based on corporate logic. I believe that someone who can overcome this somewhat contradictory situation and provide value from a startup perspective will thrive as a CVC capitalist.

My personal goal is to significantly increase the momentum for taking on new challenges within Mitsui O.S.K. Lines (MOL) through the activities and results of MOL PLUS.

I love the shipping industry and believe it is an incredibly honorable profession that supports the global economy through logistics. Therefore, I am challenging myself to create the next generation of the shipping industry through investments in and support for startups. To achieve this, I want to help increase the number of people who are willing to take on new challenges, not only within MOL PLUS but also throughout the organization.

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