Entrepreneurs and entrepreneurship played a critical role in transforming Japan’s telecommunications sector. Between the mid-1990s and mid-2000s, in a sector long dominated by a stable set of large actors with well-established patterns of interaction, entrepreneurs introduced new technologies, new business models, and new norms of interaction. The subsequent transformation of Japan’s telecommunications sector was dramatic, providing consumers with not only fast and sophisticated services but also low prices and an entire new ecosystem of mobile content—a considerable departure from Japan’s long track record of being known as producer- rather than consumer-oriented, with consumers enjoying high-end services and products, but at high prices. Yet, these transformative entrepreneurs were not acting in a vacuum. Regulatory shifts in telecommunications were critical in providing opportunities for entrepreneurs, while simultaneously protecting them from large incumbent firms. These regulatory shifts were driven by the political dynamics of the 1990s as Japan struggled through its post-bubble economic malaise and political changes.

How do new industries emerge? The aim of this paper is to provide an answer to this question by focusing on the knowledge dimension of this process. We first argue that there is a sectoral bias of research which has equalized new industry emergence with only a selection of new industries, especially the software and biotechnology industry. In this paper, we focus on the service robot industry. We analyze its institutional properties, its knowledge properties, and the role of collaborations. We find that the emergence of service robot industry is, contrary to biotechnology and software, triggered by established technical leaders, and less by new firms. Using Japanese patent data, we also show that the service robot industry, while being a new industry, possesses cumulative characteristics. As the emergence of this industry matches to the characteristics of Japan’s institutional and knowledge regime we essentially argue that the popular association of certain institutional paths with a lack of innovativeness is erroneous. We conclude that industry emergence in intrapreneurial regimes seems to be distinctive from entrepreneurial regimes.

There is a large literature on innovation and the importance of a node and a network as
important to creating an environment for such innovation. Most of the analysis of this
system has been in high technology industries, and in the products and technologies that
it creates. However, there is no reason why we can’t analyze innovation in less leading
edge industries and products, and in the development or organizational structures rather
than products. This paper tries to illustrate the potential of this type of innovation
institutions by looking at structures for business relationships as the innovation, and
consciously chooses two very low technology industries (Japanese trading company
relationships in textiles and steel) to illustrate the potential usefulness of innovation
system concepts in less conventional venues.

Venture capital investment has become globalized in the business landscape. Scholars
have reported an increasing globalization trend in the VC industry, as measured by VC
investment across national borders (Wright et al., 2005). Aylward (1998) found that Asian
countries/economies (e.g., Singapore, Hong Kong, and India) largely sourced their venture funds internationally. Baygan (2000) demonstrated that European countries experienced increases of cross-border VC flow. Aizenman & Kendall (2008) found that the number/volume of VC deals with international participation has increased in recent years. Finally, according to the Deloitte Touche Tohmatsu 2009 Global Venture Capital Survey, 52% of VCs already invest outside their home countries (Deloitte, 2009). Researchers also examine mechanisms behind this globalization trend: Guler & Guillen (2010) analyze the influence of recipient countries’ institutions on U.S. VC firms’ international investment decision. Aizenman & Kendall analyze the determinants of global VC flow using the gravity model framework. My two studies, both of which examine determinants and patterns of VC investment globalization, are positioned in this stream of research.