Tokyo-based Beyond Next Ventures’ latest startup fund is 56% bigger than its predecessor, thanks to growing interest from the country’s traditionally risk-averse pension funds.

Of the ¥25.7 billion ($160 million) the company raised for bets on cutting-edge tech and research startups, 20% came from trustees handling annuities and other long-term investments, according to the company. It’s one of the first signs that a trickle of money from the aging economy’s $$3.3 trillion’ worth of pension assets is going into the startup ecosystem.

A steady flow will likely continue to make its way into startups from pension funds in the years ahead, said Yuma Saito, president of Deloitte Tohmatsu Venture Support. Interest is especially high in the long-term potential of scientific and engineering advances developed in the country’s universities, he said.

“It all comes down to whether you can rake in returns,” he said. “Japan has a backlog of good technology. And with backing from the government, deep tech is in favor.”

One catalyst is Prime Minister Fumio Kishida’s promise to find a way to channel money from the Government Pension Investment Fund — until recently the world’s biggest pool of retirement savings — into startups. While GPIF is barred from placing direct bets into equities, even small and indirect sums from the institution would be a boon to the startup ecosystem, alongside government subsidies into areas such as data centers, high-tech materials and quantum computing.

More sources of funding would help the country’s on-again-off-again quest to monetize pioneering research. Japan has been a laggard in linking university research to commercial endeavors. Proceeds from licenses and patents held by Japanese universities are a tiny fraction of what’s earned at U.S. institutions, with research at Stanford University underpinning Silicon Valley innovations at companies ranging from Alphabet’s Google to Cisco Systems.

Part of a government-backed push to create a similar cycle in Japan, Beyond Next is investing in areas such as health care, agriculture, artificial intelligence, semiconductors, space-related tech and quantum computing. Its funds have channeled into startups money from government-backed organizations as well as MUFG Bank and Dai-ichi Life Holdings.

Beyond Next, founded a decade ago, has backed some of Japan’s more promising startups in fields such as neuroscience and biotech. It plans to help startups expand in India, with an India-only fund a possibility in the future, according to Chief Executive Officer Tsuyoshi Ito.

Japan remains far behind the U.S. and China in venture money invested and university clout. But Kishida’s goal to see ¥10 trillion invested in the sector by 2027 to create 100,000 startups is a sign of progress, the 47-year-old Ito said.

“These shifts don’t happen overnight,” he said. “One by one, things are changing.”

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