SoftBank to create new technology investment fund
The current fund will probably run dry in the next two years
SoftBank chairman and CEO Masayoshi Son revealed yesterday he intends to create a new technology investment fund.
The Vision Fund is what SoftBank is currently using to invest in artificial intelligence and the internet of things. The second fund could be rolled out in the next two to three years and is expected to invest in emerging AI and IoT companies too, according to Nikkei.
"The Vision Fund was just the first step, 10 trillion yen ($88 billion) is simply not enough," Son told the publication. "We will briskly expand the scale. Vision Funds 2, 3 and 4 will be established every two to three years."
The Vision Fund is believed to have already invested 3 trillion yen ($26 billion) and Son believes that it "will probably run dry in about two years".
"We are creating a mechanism to increase our funding ability from 10 trillion yen to 20 trillion yen to 100 trillion yen," he said. He also added that the funds "will probably have invested in at least 1,000 companies within 10 years".
The Vision Funds target unicorns and has managed to lure major partners such as the government of Saudi Arabia and companies like Apple. Son did not identify new investors but could be working out a secret plan.
Son's strategy is called the 'herd' as SoftBank is building a loose network of companies that evolve rather than just expanding.
The fund has made many acquisitions, including ARM in the UK which it bought for 24 billion. It has hired more than 1,000 new staff members worldwide since SoftBank took it over, with a large proportion of these being UK-based employees.
Furthermore, the fund is looking to invest in Uber which Arianna Huffington, an Uber board member, said may be finalised this week, although that does not look like it has happened. The deal will be a direct investment in the company at the last private valuation round, and also a secondary transaction that would involve buying out existing shareholders.
SoftBank also invested $4.4 billion in WeWork, which offers shared workspaces for entrepreneurs, startups, small businesses and freelancers. The investment will allow the company to connect more people in its global community and to expand the company's presence around the world.
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