Neoteny adds philosophy to incubating Internet startups.

For 33-year-old Ito, the attention was nothing new. A few years earlier he had been hailed as "Mr. Dot-Com," a title stolen by Softbank president Masayoshi Son. But while Son has concentrated on building an Internet zaibatsu, Ito has devoted his time to missionary work of sorts, promoting the cause of the Internet among Japanese businesses, bureaucrats, and politicians. He even started writing a column for this magazine.

Neoteny, which raised ¥2 billion within a month of being founded -- that has to be a record -- plans to incubate about 90 Internet startups from now until 2003, nurturing them to go public in two or three years. The company claims to take an innovative approach to incubating: "At Neoteny," says its literature, "we are developing a new approach called 'venture community economics,' which reflects the current shift from an era where 'money attracts people' to an era where 'people attract money.'" Its board of advisors includes such digerati as Derrick DeKerkhovr, director of the McLuhan Program; Jane Metcalf, the cofounder of Wired; and Pierre Omidyar, the chairman and founder of eBay.

So far, four companies are under its wing: Wagg Technologies, engaged in the inspection of computer peripherals; Car Generation, a driving school site; and GiftyGifty, an e-commerce outfit focusing on gifts. The fourth venture, Linuxprobe, is Ito's brainchild. Serving as a Web portal and Linux compatibility tester, the outfit embodies Ito's belief that Linux is a future model for the nonprofit organization, where users of an Internet-based service produce software and coordinate members without a capitalist governance model. Linux has taken off in the US, but it's starting to slip in Japan. The main reason is that since it's not a commercial OS, there is no official support for it. Linuxprobe has received backing from IBM Japan and Oracle Japan.

To accommodate its new companies, Neoteny has located to a large office space in Minato-ku, where the startups pay generously low rents and share office facilities like computers and conference rooms.