Tokyo’s latest startup boom kicked off in 2014 in response to the acceleration of digital technology, as well as coordinated efforts by the Tokyo Government, Cabinet Office, and Ministry of Economy, Trade and Industry to nurture local startups.

Changes in policy have helped Tokyo’s ecosystem to flourish. The Kishida Cabinet named 2022 the "first year of startup creation," and various regulations are also being streamlined to promote startup formation and growth. These include changes to allow autonomous driving, shortening the time from approval of listing to IPO to approximately 21 days, and deregulation around crowdfunding. The Tokyo Metropolitan Government announced its Startup Collaboration Strategy in February 2022.

Universities and support organizations are also supporting local startups. The J-Startup project aims to help Japanese startups reach global markets, and the University of Tokyo is set to establish a ￥60 billion ($500 million) fund for startups spun out from universities. The result of all these efforts is that the number of people who are looking to find a career in a startup is increasing, according to a 2021 report from Amateras Startup Review.

Much of the momentum in the Tokyo ecosystem is the result of the entrance of overseas crossover investors. For example, software company SmartHR raised ￥15.6 billion ($129 million) from a total of eight companies, including Light Street Capital and Sequoia Capital Global Equities. News app SmartNews raised a $230 million Series F in September 2021. Successful entrepreneurs are also beginning to act as angel investors and advisors to younger generations.