Business

Vision Fund 101: Inside SoftBank’s $93B Vehicle

The SoftBank Vision Fund has been making headline after headline since plans for the massive vehicle were announced last October, mostly due to its sheer size: The fund held its first close on $93 billion in May and could total up to $100 billion when all is said and done.

 

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Vision Fund

With an unprecedented amount of money to burn, we expect SoftBank to become one of the most active tech investors in the world over the next several years. The Japanese telecom giant and its founder, Masayoshi Son (below, right), have potential to shake up the entire VC space: With that much money, it can invest game-changing amounts in almost any company or industry. The fund is the largest VC or PE vehicle in history, dwarfing even the largest buyout funds, which sit in the $20 billion to $25 billion range.

Below, we’ve put together everything we know about the SoftBank Vision Fund. We’ll update this page with developments and new investments.

General information

Reports initially described the Vision Fund as a VC vehicle, but it’s officially classified as private equity.

SoftBank Vision Fund held its first close on $93 billion in May.

Its final close is expected before the end of 2017, and it may total $100 billion.

The fund’s investment period is five years from its final closing.

Its fund period is a minimum of 12 years from its final closing.

There are potential conflicts of interests with some limited partners' investments in ridehailing companies (Saudi Arabia's sovereign wealth fund has invested in Uber and SoftBank has invested in Didi Chuxing, for instance), so the Vision Fund won't participate in deals for such startups, per Axios.

Focus of the fund

The fund will make investments that require at least $100 million in capital.

SoftBank said the fund “was created as a result of [SoftBank’s] strongly held beliefs that the next stage of the Information Revolution is underway, and building the businesses that will make this possible will require unprecedented long-term investment.”

The vehicle will focus on global tech companies, and SoftBank expects funds to be used across a wide range of industries: IoT, AI, robotics, mobile applications & computing, communications infrastucture & telecoms, computational biology & other data-driven business models, cloud technologies & software, consumer internet businesses, and financial technology.

In a December visit with US President Donald Trump, SoftBank CEO Masayoshi Son vowed that half the money (about $50 billion) would go to US companies and bring 50,000 jobs to the country.

At the annual SoftBank conference in July, Son outlined the strategy of the fund. A highlight from Bloomberg reporter Pavel Alpeyev's coverage of the event: “In the span of two and a half hours, Son painted a picture of the future where satellite networks cover every inch of the Earth and a trillion devices connected to the internet disgorge data into the cloud where it is analyzed by artificial intelligence.”

Leadership

Masayoshi Son: SoftBank founder, chairman & CEO

Rajeev Misra (right): Head of SoftBank Vision Fund

Michael Ronen: Founding partner

Colin Fan: Managing director

Jeffrey Housenbold: Senior investing member

Shu Nyatta: Investor for SoftBank Investment Advisers; helps invest money for the fund

Backers of the fund

SoftBank: $28 billion

Saudi Arabia’s sovereign wealth fund: around $45 billion

Abu Dhabi’s national wealth fund: around $15 billion

Apple: $1 billion

Qualcomm

Foxconn Technology

Sharp (owned by Foxconn)

Larry Ellison’s family office

SoftBank Vision Fund investments

The investments in this section have come directly from the Vision Fund.

July

Plenty: Led a $200 million funding for the indoor farming startup

Brain Corp: Led a $114 million Series C for the AI robotics company

March

ARM: Reports emerged that the Vision Fund is taking a 25% stake in ARM, the semiconductor company Softbank bought for $32 billion in 2016.

Other SoftBank investments

The investments below are a selection of those that have been made by SoftBank itself since the beginning of the year. Some are expected to eventually be offered to the Vision Fund.

July

Grab: Co-led a round that could total $2.5 billion in the Southeast Asian ridehailing company

Nauto: Co-led a $159 million Series B for the maker of camera-equipped devices for vehicles

June 

Cybereason: Invested $100 million in the cybersecurity firm

Boston Dynamics: Agreed to acquire the robotics company from Alphabet

May

Nvidia: Took a $4 billion stake in the graphics chipmaker

Paytm: Invested $1.4 billion in the digital payments provider

Improbable: Led a $502 million Series B in the company, which allows users to build virtual and simulated worlds

Guardant Health: Led a $360 million funding for the biotech, which is developing a blood test meant to monitor cancer treatment

March

WeWork: Invested $300 million in the coworking space provider. The initial funds came from SoftBank; the round is set to total up to $3 billion, with the remainder from the Vision Fund

OneWeb: Invested $1.7 billion in OneWeb and its fellow satellite company Intelsat to support their merger (reports later emerged that SoftBank is letting the merger fall through)

February

SoFi: Participated in a $500 million funding for the online finance startup

Ola: Participated in a $330 million round for the ridehailing company

For even more on SoftBank and in-depth analysis of the Vision Fund, check out our previous coverage.

Article by Dana Olsen, PitchBook