Jiji Press TOKYO (Jiji Press) — Crowdfunding is increasingly recognized as an effective way to help companies rebuild their businesses from damage inflicted by the devastating earthquake and tsunami of March 2011.
Crowdfunding is the practice of raising small amounts of money to finance product development, events and other ventures via the internet from a large number of people willing to offer support.
While smaller companies damaged by a natural disaster often find it difficult to get loans from banks, crowdfunding enables them to raise needed funds for business plans with backing from many people.
The 2011 catastrophe, which hit the northeastern Japan region of Tohoku, caused not only huge human and property damage but also harmful rumors, as it led to the nuclear accident at Tokyo Electric Power Company Holdings, Inc.’s disaster-stricken Fukushima No. 1 power plant.
Iwaki Takahashi, a manufacturer of high-grade cedar chopsticks in Iwaki, Fukushima Prefecture, has produced pillows of chips processed from products of inferior quality. The company raised more funds than expected through crowdfunding after a large number of people applauded its plan to help disaster victims sleep soundly.
“We were able to develop the pillow thanks to help from lots of people,” Masayuki Takahashi, president of the company, said. “The product became widely known via the internet.”
The Fukushima prefectural government opened a dedicated website in February last year to facilitate crowdfunding for the reconstruction of disaster-hit areas and revitalization of local businesses. The site has contributed to an increase in “fans of our prefecture,” an official involved in the project said, adding, “We’ll continue providing assistance.”
The Miyagi prefectural government has also set up a website, to support agricultural corporations and companies developing items that use local agricultural produce. The site is “effective for promoting both local revitalization and disaster reconstruction,” an official said.
But the number of such successful examples is still limited and many disaster-affected companies remain unaware of the practice of crowdfunding.
From fiscal 2018, which starts in April, therefore, the central government plans to reinforce programs to spread the practice among companies in disaster areas. The programs include seminars for companies and other organizations in the three hardest-hit prefectures of Iwate, Miyagi and Fukushima and support for the opening of websites for crowdfunding by local businesses.
Victims of massive floods that hit the northern part of Kyushu, the most southwestern of Japan’s main islands, in July 2017, raised funds via the internet from a large number of people to produce candle holders and sculptures from driftwood.