Sakana AI Wins the Internal Affairs Minister's Prize at the Japan Startup Award

Sakana AI received the Minister of Internal Affairs and Communications Award at the Japan Startup Award 2026 ceremony, held at the Prime Minister's Office in Tokyo on September 25. The prize goes to a startup in the information and communications field, and Sakana AI said that at the ceremony it personally presented Prime Minister Sanae Takaichi and relevant cabinet ministers with a case of cutting-edge AI being used in command and control systems for defense. According to the Ministry of Economy, Trade and Industry, the prime minister and ministers handed certificates to the winners and then toured each company's booth to hear about their products and services.

Competition was stiff this year. According to METI, this 10th edition of the award was jointly solicited by seven ministries — Economy, Trade and Industry; Agriculture, Forestry and Fisheries; Education; Health, Labour and Welfare; Land, Infrastructure, Transport and Tourism; Internal Affairs and Communications; and Defense — and drew 317 entries from across the country. A judging committee chaired by Professor Michi Fukushima of Tohoku University's Graduate School selected 10 companies. The grand prize, the Prime Minister's Award, went to robot intelligence company Mujin, and the Minister of Defense Award went to Oceanic Constellations, which networks many unmanned surface vessels to monitor the ocean continuously.

The committee gave three reasons for the award. Sakana AI established cheap, low-power AI development methods inspired by natural evolution and collective intelligence; it developed an architecture that achieves high-performance inference under limited computing resources; and it is using domestically made AI to tackle social problems such as security and labor shortages. METAL has reported on Sakana AI appointing Jürgen Schmidhuber as chief scientific advisor.

What Sakana AI stressed at the Prime Minister's Office was combination, not size. The company said it explained to the prime minister that, amid an overheated race to build giant models and a shortage of computing resources, its approach of combining several small, efficient models could be an effective solution that does not depend on massive infrastructure. It added that it is laying the groundwork for Japan's AI sovereignty by applying AI developed in Japan to critical areas.

The defense work is spelled out in the winners' booklet. According to page 11 of METI's award booklet, which METAL reviewed, Sakana AI began contract research for the Defense Innovation Science and Technology Institute under the Acquisition, Technology and Logistics Agency in March 2026. The research uses AI agent technology with small vision-language models (SVLM) that run fast on edge devices such as drones, and integrates and analyzes vast data across land, sea and air to advance command and control systems. The booklet says the work speeds up and automates information integration, leading to effective resource allocation.

Its technical record was listed as well. Evolutionary model merging, which combines multiple models through evolution to create new foundation models, and the AI Scientist, which handles everything from research ideas to experiments, paper writing and review, were cited as its signature technologies. The booklet states that the AI Scientist's results were published in Nature in March 2026. Sakana AI was founded in 2023 by former Google researchers Llion Jones and David Ha together with former diplomat Ren Ito, and METI described it as a unicorn that passed a $1 billion valuation about a year after founding, the fastest in Japan.

The company's direction comes through in its founder's words. In an interview METI republished to mark the award, co-founder Ren Ito said: "We will absolutely not follow the United States in how we build. And we have to build things that can be used." He explained that simply making models bigger turns the contest into a battle of money alone, one no country outside the U.S. can win. He also defined Sakana AI as "a company for making Japan's banks, manufacturers and defense industry stronger with AI."

Ito's background overlaps with that direction. According to the booklet, he joined the Ministry of Foreign Affairs in 2001, then served at the World Bank in Washington from 2011, as an executive officer at Mercari from 2015 and as COO of the UK's Stability AI from 2022. Sakana AI signed a comprehensive partnership with a megabank as its first customer, and Spain's largest financial group, Banco Santander, is among those that took part in its capital increase. According to the interview, half of its engineers are Japanese and half come from abroad.

Seen through a tech lawyer's eye, the weight of this award lies not in the certificate but in what was briefed at the Prime Minister's Office. A private AI startup explained a defense command and control case in front of the prime minister, and contract research for a government institute appeared in a public booklet. If small models running on drones tie together land, sea and air data to help allocate resources, the next questions are who bears responsibility for those judgments and by what standards model validation and records are kept. The AI sovereignty Sakana AI invokes goes beyond building technology at home; it leads to a demand that the rules for how that technology is used be set as well.