SoftBank Is Taking Over Tech

Proshare

Friday, October 12, 2018   10.46AM / By AngelList

 

In 1981, Masayoshi Son founded SoftBank Group, and by the peak of the dot-com bubble, his net worth was surging by billions a week. He’d become one of the earliest investors in Yahoo, bet $20 million on Alibaba, and invested in about 800 other startups at the time. Today, he’s still Japan’s richest man.


But when the bubble burst, SoftBank’s stock went tumbling, and Son lost an estimated $70 billion in the fallout. He’s built his company back up—most recently considering another deep investment in WeWork—but his business moves have been unconventional from the beginning.


In 2006 SoftBank paid more than $15 billion to acquire Vodafone’s struggling cellphone division. Few supported the move, but the company later struck a deal with Apple for exclusive rights to sell the iPhone in Japan, turning its image around.


In 2012, SoftBank invested $20 billion in Sprint for a 70% stake in the company, but after years of debate, collapsed negotiations, and FCC review, Son’s vision for a merger with T-Mobile is still not final.


Other similar stories exist, but today, SoftBank has become a force in tech investing.


Announced two years ago, its $100 billion Vision Fund is among the largest tech investment funds in history. It already owns stakes in Uber, WeWork, and more.

Whether Son is able to sustain the future he sees in front of him—raising $100 billion every few years to continue to invest heavily in frontier technologies like IoT, robotics, and AI—it's impossible to ignore SoftBank's sprint through Silicon Valley, targeting industry-leading startups and often investing $100 million or more.


Of the deals it has struck in 2018 alone, more than half of the $8.5 billion+ it paid out has gone to U.S.-based companies.


Here's a look at a few of the biggest...


1. Uber

SoftBank became Uber’s largest shareholder this year after an $1.25 billion investment in the ride-share company. In August, SoftBank also invested nearly $400 million in car-sharing company Getaround.


2. DoorDash

DoorDash joined the unicorn club in March after raising its $535 million Series D, led by SoftBank.


3. Compass

The online real estate platform raised $400 million in September from SoftBank. The deal followed a $100 million investment from Fidelity about a month before, taking Compass to a valuation exceeding $2 billion.


4. Opendoor

The four-year-old real estate company raised $400 million from SoftBank in September in exchange for a minority equity stake in the company.


...but the real standout story would be WeWork, if the deal closes.


Reports began circulating Tuesday that SoftBank and WeWork are in discussion for a new round of funding, with potential deal prices wavering between $10 billion and $20 billion. If the deal closes, the investment would follow $4.4 billion in equity funding from SoftBank last year and another $1 billion in follow-on capital from the Japanese lender this August.

 

 

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