Japanese conglomerate SoftBank has launched its second technology-focussed investment corpus, SoftBank Vision Fund II, with an outlay of $108 Bn. The fund claimed to have received commitments from technology majors such as Apple and Microsoft.
Other investors in the fund include National Investment Corporation of National Bank of Kazakhstan, Standard Chartered Bank, and some undisclosed investors from Taiwan. Further, SoftBank will be investing $38 Bn in the fund along with other committed investors including Foxconn, MUFG, SMFG and Mizuho, the Japanese conglomerate said in a statement.
A SoftBank statement added, “The objective of the fund is to facilitate the continued acceleration of the AI revolution through investment in market-leading, tech-enabled growth companies.”
Earlier at SoftBank Group’s 39th annual general meeting of shareholders, CEO Masayoshi Son had noted that artificial intelligence is going to be the biggest revolution in human history and said, “We envision SoftBank Group to lead the AI revolution similar to how a conductor leads an orchestra.”
He had then also mentioned SoftBank’s investments such as Guardant, OYO, Uber, and ByteDance which have emerged as AI innovation leaders.
Further, SoftBank Group’s earnings before interest and taxes (EBITDA) were reported to have crossed over $18.5 Bn (2 Tn JPY) in FY18. Son had attributed this growth to its tech-centric investment corpus SoftBank Vision Fund I.
Masayoshi Son had then projected that the firm’s portfolio could potentially grow 33-times to reach a $1.8 Tn (200 Tn JPY) valuation in the next two decades.
Yesterday, media reports have said that Goldman Sachs Group Inc will also be investing in the SoftBank’s second vision fund but the group did not get a mention in the SoftBank’s statement.
SoftBank Vision Fund In India
SoftBank Vision Fund was set up in 2017 with a total corpus of $100Bn. Most of this vision fund was raised from Saudi Arabia and Abu Dhabi. Overall, the company has invested around $10 Bn so far in Indian startups.
SoftBank has witnessed an 80% year-on-year growth in its operating income for FY 2019. The Son-led company attributed this growth to an unrealised gain of about $12.5 Bn from its investments in ride-hailing company Uber, Indian hospitality company OYO and other portfolio companies. Overall, its investments in Flipkart and OYO paid off with a gain of $2.7 Bn, split between realized and unrealised gains.
SoftBank’s other key investments in India include Ola, OYO, Hike, Paytm, FirstCry, Grofers, Delhivery, Automation Anywhere, and Paytm Mall. Earlier this month, SoftBank was said to be in talks to launch an initial public offering of its $100 Bn SoftBank Vision Fund.
SoftBank Vision Fund was recently reported to be looking to hire a dozen executives in its India operations team over the next few months. “while the operating team will focus on helping our portfolio companies grow globally, they will also be actively investing. The investing and operating teams will work very closely,” the managing partner of SoftBank Investment Advisers, Munish Varma had reportedly said earlier.
During his visit to India in April 2018, CEO Son had reiterated his commitment to invest further in the Indian landscape. Sharing his vision for SoftBank’s portfolio, he said, “Making local companies go global while global to go local’.