Microfund aids Tohoku revival

JIJI

A microfunding scheme managed by Tokyo-based Music Securities Inc. is supporting the reconstruction of businesses disrupted by the March 2011 Great East Japan Earthquake and tsunami that slammed the Tohoku region.

The funding scheme has so far been used for 39 projects, drawing nearly ¥900 million from 25,000 people. Individual investors select options to contribute via an online catalog of small reconstruction projects, including those planned by farmers and fish processing firms.

The minimum contribution is ¥10,000 and a handling fee of ¥500 per unit is also charged. Half of the contribution is treated as an investment that offers returns and the other half as a donation.

Investors are supposed to receive such returns in the form of dividends, products or invitations to on-site study tours on the projects in which they have invested. Although the final returns may fall short of the amounts invested, the grassroots scheme appears to meet the need of investors seeking close relations with business owners.

“The system also helps raise business owners’ motivation by making them more determined to fulfill promises to investors,” Music Securities President Masami Komatsu said.

Komatsu, 37, initially launched the microfunding system to support musicians. While hoping to become a professional musician himself, he had worked part time at an investment firm.

A turning point came in 2007, when he began to assist local businesses, including sake makers, through the funding scheme. “I discovered that musicians and sake makers are the same in their zeal for production,” Komatsu said.