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When it comes to cracking the code for self-driving cars, startups have an edge on big businesses, says computer scientist Katsuya Uenoyama.

That may sound like bravado coming from the co-founder of a venture with just 30 employees working out of a small office in Tokyo, but Toyota Motor Corp. apparently agrees. The automaker last week made a $9.1 million (about ¥1 billion) investment in the initial public offering of Uenoyama’s firm, PKSHA Technology Inc., which is developing software that could one day help cars learn to hold a conversation with drivers.

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