The Nippon Foundation draws the funds needed to support its many projects from the proceeds of Japanese motorboat racing. Motorboat racing in Japan is a philanthropy-oriented industry, having been established in 1951 specifically to aid a maritime shipping industry that had been devastated in World War II. Since its origins, the foundation's operational fields have expanded widely, to include areas such as support for basic human needs, aid to volunteer groups in Japan, and human resourced development around the world.

Under this unique system, known in Japanese as kyotei, the majority of the funds taken in are returned to bettors as winnings. However, a small percentage is earmarked for philanthropic purposes. This money is managed by the foundation, which then selects projects that show great promise of affecting fundamental change. Though the percentage that passes through the foundation is small, the amount that is generated through this unique system is remarkable, averaging more than 35 billion yen per year since the turn of the century.