Japanese 🍺 startup drinks to $615k seed funding

Best Beer Japan, a startup that helps craft breweries through its IT and logistics services, has raised 70 million yen (US$615,000) in a seed round led by PE&HR, an early-stage VC firm in the country. Headline Asia and NBC Angel Fund also participated in the round, as well as Taihei Kobayashi, CEO of listed creative studio firm Sun Inc.

The new round brings Best Beer Japan’s total funding to over US$1 million.

Best Beer Japan CEO Peter Rothenberg holds one of the company’s sharing kegs or “rentaru” / Photo credit: Best Beer Japan

Founded in 2017 by former Tech in Asia Japan correspondent Peter Rothenberg, Best Beer Japan offers a management software platform for breweries. It has also created Japan’s first keg sharing service, which the company says reduces carbon emissions and cuts the logistics costs of beer transportation by half.

The company says that as breweries in the country sell to restaurants directly, they lack a consolidated distribution system. This creates an inefficient process for both breweries and restaurants. Best Beer Japan has started pre-registration for its B2B craft beer platform to make it easier for restaurants to find and pay for beer.

“This is a legacy industry. Until now breweries did not have any real IT tools to help with operations. But with the pandemic, adoption of new technologies has been rapid,” explains Rothenberg, who also serves as the company’s CEO.

According to him, breweries manage their back office mainly with paper and Microsoft Excel, which takes up to 14 minutes to process one order. There are also strict hygiene and alcohol tax laws that require a large amount of forms to be filled out.

“I don’t think anyone became a brewer to do alcohol tax. Our mission is to help breweries focus on making beer, not pushing papers,” the CEO adds.

Best Beer Japan will use the fresh funds to hire engineers, sales, and customer success members. “We are still a young company. If you join now you can get paid in cash, stock, and beer,” quips Rothenberg.

The startup also plans to invest in creating a B2B beer marketplace, bringing breweries to a single portal that restaurants can order from.

See also: Singapore company turns bread to beer to cut Southeast Asia’s food waste

The company is looking to tap into the craft beer market, which is growing over 10% per year in Japan. The market is set to reach over US$1 billion in 2026 with alcohol tax law changes on the horizon.

While the number of breweries in the country has doubled from 250 in 2015 to 500 last year, craft beer accounts for only 1% to 2% of Japan’s beer market.

Other investors in the seed round include: