Japan's SoftBank Says It Could Invest as Much As $880 Billion in Tech (recode.net)

SoftBank could commit as much as $880 billion to tech investments in the coming years, a gargantuan, unprecedented amount of cash that would amount to a seismic shift in tech-sector finance. From a report: "The Vision Fund was just the first step, 10 trillion yen ($88 billion) is simply not enough," CEO Masayoshi Son said in an interview with The Nikkei Asian Review that was published late Thursday. "We will briskly expand the scale. Vision Funds 2, 3 and 4 will be established every two to three years." Son's comment confirms a Recode report that his Vision Fund -- which is sinking $100 billion into the technology sector worldwide -- was only the first in a series of investments that he plans to make in young companies. "We are creating a mechanism to increase our funding ability from 10 trillion yen to 20 trillion yen to 100 trillion yen," Son told the outlet. That comes out to about $880 billion. Companies that SoftBank either completely owns or has major or minor stakes in include Vodafone Japan, Yahoo! Japan, India's Snapdeal, India's Ola, Sprint Corporation, and India's Flipkart. The company is expected to become a major stake holder in Uber as soon as next week.

Comments

Idea to pitch

[sinij]

I have a startup that is working on creating Virtual Reality, AI-driven vending machine that sells virtual tentacle rape. Monetization will be in selling disposable pouches. Can I have 10mil seed fund?

Re:Idea to pitch

[thrillseeker]

I find your ideas intriguing and wish to subscribe to your newsletter.

Re:Idea to pitch

[Altrag]

If you stopped after the word "machine," you probably could get a 10mil seed fund from somebody.

Hell that actually sounds like it might be an interesting idea if VR ever takes off. Imagine being able to browse Amazon, seeing the items rendered in 3D and maybe even being able to manipulate them?

Re:Idea to pitch

[sinij]

Perfect. First customer.

Re:Idea to pitch

[sinij]

It is designed for anal probing, so yes.

Link Amps?

[sqorbit]

Will Link Amps be a real thing now?

Wealth inequality much?

[rsilvergun]

maybe they're just blowing smoke, but should one bank of a country that's been in recession have just shy of $1 trillion to throw around? It makes me wonder if the reason Japan's stuck in recession is that all the money's at the top.

Re:Wealth inequality much?

[XanC]

To what bank are you referring?

Re:Wealth inequality much?

[swb]

They're not a bank.

But the reason they probably have that much money to invest isn't necessarily inequality, but that they are individually profitable in an economy that has seen little growth and therefore have nothing to invest it in domestically that provides any return on investment.

So they pile up cash, and now they want to invest it, mostly overseas would be my guess, in growth sectors (which always seems to mean technology anymore).

I don't quite get the big PR announcement about it, though. I would think that announcing this kind of move would just drive up the asset prices of whoever they want to invest in. You would think the smarter idea would have been to have invested over time to avoid big price increases.

Re:Wealth inequality much?

[NotQuiteReal]

Google translate yields -

"There are no salarymen, only window tribe and social withdrawal."

Re:Wealth inequality much?

[Paradise Pete]

but should one bank of a country that's been in recession have just shy of $1 trillion to throw around?

I know it! I called them up the other day to ask where their ATMs were and they said they didn't have any! Maybe they should fix that tech first before investing in other stuff. Sheesh, what's wrong with these people??

Re:Wealth inequality much?

[angel'o'sphere]

To what recession are you referring?

Re:Wealth inequality much?

[DavenH]

1) SoftBank isn't a bank, it's a VC firm. 2) They don't have $1 trillion. They have 1 trillion YEN . That's like $50. Yen make pesos look expensive.

Read the figures again -- they've already invested 10T yen in just one of their funds.

Re:Wealth inequality much?

[radarskiy]

They make no claim about having all of that money in a pile right now. As the sum of investments over time, they pay for new investments from the returns on earlier investments.

Not surprising

[hcs_$reboot]

SoftBank (and 2 other big carriers) hold (almost) a mobile phone monopoly in Japan where a smartphone subscription costs ~$60 monthly and that's not even including local phone calls (35 cents / minute). Softbank had a very aggressive marketing from the start, offering appealing solutions which eventually happen to be costly and/or on contracts that are difficult to terminate (a month window to close the contract or you're in for another 2 years). They were even criticized for deceptive ads a few years ago.

"a seismic shift in tech-sector finance"

[K. S. Kyosuke]

As opposed to the previous "tech-sector finance" that has been for decades fueling Japan's technological progress?

Mistake in translation?

[AnthonywC]

Even if it was in Japanese Yen which is ~ 7 billion, as their TOTAL asset is ~ $220 million USD, they'd have an extremely difficult time to raise even a billion. http://financials.morningstar....

Re:Mistake in translation?

[XanC]

From the fine summary:

"We are creating a mechanism to increase our funding ability from 10 trillion yen to 20 trillion yen to 100 trillion yen," Son told the outlet. That comes out to about $880 billion.

Re:Mistake in translation?

[Altrag]

That report is in x million, not x thousand. Their total assets is 24 trillion yen, or ~217 billion USD. Comparing the year-over-years, it looks like their assets are increasing 40-50bn/yr on average. That doesn't really give a clear idea of income vs costs, but 880bn spread over multiple injections doesn't seem too far out of reality as long as they can keep running at that level.

Bubbles are essential to the "globalized" economy

[Pinky's Brain]

Bubbles implode.

Bubbles in the US economy repatriate money which the US trade deficit exports, when the bubble collapses the money stays in the US and the foreign countries can spend a while longer shipping goods to the US. If they invested all their US paper in near-guaranteed income assets like non leveraged real estate or secure but low yielding companies, the US would be in serious trouble (it would snowball and transfer ownership of the US economy abroad).

Bubbles are necessary for the status quo.

Thank you Trump

[jwhyche]

Come on. You know you want to say it. "Thank You Trump!"

Re:Thank you Trump

[jwhyche]

My trolling skills have seriously deteriorated in the last 20 years. I will hand in my troll card now.