Hitachi to establish its fourth CVC Fund, reaches USD 1bn in AUM

Hitachi has announced the establishment of the fourth fund of the corporate venture capital (CVC) fund "HV Fund" with a purpose to identify startups with the potential to create or disrupt large attractive markets, anticipate the next technological and social turning points, and generate future growth opportunities.

The fourth fund will have a size of 400 million USD, which is the largest CVC fund managed by Hitachi to date. The fund will make strategic investments in startups with cutting-edge, digital technologies such as data centers, distributed energy systems, future of work and industrial AI, as well as startups in new frontiers including bio, quantum, nuclear fusion, life science, space and adjacent technologies. With the establishment of the fourth fund, Hitachi's investment in CVC will reach 1 billion USD (AUM), a world-class investment scale which will further accelerate open innovation and contribute to the innovation ecosystem of startups globally.

Under the leadership of Toshiaki Tokunaga, who will be appointed as Representative Executive Officer, President & CEO in April, Hitachi aims to realize "True One Hitachi" with digital at its core and accelerate sustainable growth of Social Innovation Business. In the next Mid-term Management Plan, which is currently being formulated, Hitachi will enhance not only existing businesses but also efforts to explore new technologies and capture future growth opportunities.

The establishment of the fourth fund is intended to add on and further expand Hitachi’s investment in innovative startups to identify the next technology turning points and business model changes that will lead to business creation. In order to promote business creation under the new Mid-term Management Plan, this corporate venturing initiative will collaborate with “Strategic SIB Business Unit”, which will be launched in April to mobilize company-wide resources and accelerate innovation.

Hitachi established Hitachi Ventures ("HV") in June 2019, and now managed 3 CVC funds. HV now has a startup portfolio of 38 companies, including newly born Unicorns that meet the criteria of "more than 1 billion USD in valuation" and "within 10 years of establishment". In addition, about half of this portfolio have already begun collaborating with Hitachi’s business units and group companies and are making progress. These startups include:

• Makersite, the leader in product lifecycle intelligence software, which uses AI and data analysis to accelerate and enhance sustainable product and supply chain decision-making;
• Captura, which offers advanced engineered carbon dioxide removal technology; and
• Archetype AI, whose Physical AI foundation model, Newton, enables developers to rapidly build solutions with their real-world sensor data.

These collaborations are contributing to accelerated implementation of cutting-edge technologies and business models.

By leveraging these achievements under a world-class CVC investment scale, combined with the development of cutting-edge technologies through own R&D, Hitachi will anticipate the latest transitions in technology and society, linking them to business creation, thus achieving sustainable growth.

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