SUMMARY
Misra will still keep his role with SoftBank’s Fund 1 of $100 Bn, while for Fund 2, he will be giving up reins and transitioning to the vice-chairman position
The move comes at a time when SoftBank is already under pressure as the valuation of its funds depletes with the tense political and fiscal situations across the world
Misra was not only overseeing the Vision Funds, but was practically the right hand of Masayoshi Son, and the CEO of SoftBank Investment Advisers
SoftBank Investment Advisers’ CEO and the right hand of Masayoshi Son, Rajeev Misra is stepping down from his role in the company to launch his own venture fund.
According to reports, Misra will retain the CEO position with the group’s Vision Fund 1 but relinquish other roles. As for Fund 2, he will be giving up reins and transitioning to the vice-chairman position overlooking the investments. To allow the company time to find a suitable candidate and provide Misra some time to transition, Son will be taking charge of his roles.
According to a Bloomberg report, Misra had held talks with Son in Tokyo and specified his plans to pursue entrepreneurship. The report adds that Misra has already secured more than $6 Bn for his venture fund.
He may also be taking some of SoftBank’s employees with him including SB Management’s Akshay Naheta and SoftBank managing partners Yanni Pipilis and Munish Varma. While none of these plans are final and full-proof, deliberations are ongoing for the fund’s size and timing.
According to an internal memo, Son has confirmed that Misra will move from his current role as the CEO of SoftBank Global Advisers, the manager for SVF2, to become vice-chairman. Inc42 couldn’t independently verify the memo.
Rajeev Misra’s Era With SoftBank
SoftBank is one of the Indian startup ecosystem’s top investors and the Masayoshi Son-led venture capital firm backs companies in telecommunications, internet services, AI, smart robotics, IoT and cleantech sectors. Misra has been pivotal to the Group’s success who joined the VC/PE firm in 2014.
Misra comes from a banking background and had a relationship with Son even before he joined SoftBank. When he joined the fund, Misra was pivotal in building the $100 Mn fund and bringing LPs in the form of Saudi Arabia’s Public Investment Fund, Apple Inc., the government of Abu Dhabi and others. Besides, he also changed the course of Silicon Valley’s startup ecosystem, asking Son’s Vision Fund 1 to make large bets in startups such as Uber, WeWork and Slack.
He was Fund 1’s poster boy, SoftBank Investment Advisers’ CEO and the manager for SVF2.
His shining era at SoftBank- leading Vision Fund 1 and building Fund 2 – was also marred with controversies. Misra had reportedly been instrumental in a smear campaign against his former colleagues (who were later ousted from SoftBank), to gain single-handed prominence in the company.
SoftBank had, at that time, stated that it would be looking into the accusations and inferences made by WSJ, but nothing has been materialised to date.
Board Changes In Turbulent Time
It is to be noted that this is not the first rejig involving Misra. In November 2020, Misra (alongside three other colleagues) had given up his board seat for newer independent directors at SoftBank.
Yet, the current change is a major one as it comes at a time when SoftBank is carefully treading the path of writing cheques. The company’s stock has dropped by almost 40% in the last year and its debt to asset value has risen to almost 22%.
The Japanese company has an expected write-down of assets worth $30 Bn and the reasons – rising interest rates, the Russia-Ukraine war, heavy inflation across the world and the plummeting value of its investments in China.
As for India, until 2021, the VC firm was quite bullish on the country’s startup ecosystem, pumping over $3 Bn last year. Then in December 2021, Misra had said that the investment giant would invest another $10 Bn in the Indian startup ecosystem, especially in B2B SaaS, fintech and edtech – an idea reiterated by Son.
As the current market scenario or the ‘funding winter’ wreaks havoc on late stage investors’ portfolios, who takes control of SoftBank’s advisories now, is going to be an interesting watch.
