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This smells like walking into bankruptcy. SoftBank was missing some billions for its own new fund and the solution is create debt to fund the fund. Since it's
by tumetab1 7y ago
This smells like walking into bankruptcy.
SoftBank was missing some billions for its own new fund and the solution is create debt to fund the fund. Since it's illegal for themselves to invest in their own... they workaround it through it's own employees.
If a workaround/scheme is required to obtain enough capital for the fund... that means that either there isn't enough capital in the world or that the owners of such capital don't believe in the fund.
The important question is why it's better to resort to this scheme than to not have enough capital for the fund?
- bsaul 7y agoOP says SoftBank contributes for 38b to their own 100b fund directly, so i don’t think your explanation is correct... Plus they apparently did the same thing in their first fund a few years ago.
- tumetab1 7y agoCorrect, thanks for that note. It seems that SoftBank wants to fund directly 38b$ and indirectly 20b$ through employees. In the first fund SoftBank contribution seems to have been 28B$ in a total of 93$B. It seems that SoftBank is having a hard time getting the Saudi Arabia to invest again in the new fund. In the first one they put 45B$.
- jacquesc 7y agoDo you think they're still trying to get more Saudi money after the Jamal Khashoggi government sponsored murder? VCs need to be smart about their LPs. Idealistic startup founders / employees (the one's VCs tend to invest in) don't want to take blood money for their company.
- JumpCrisscross 7y ago> Do you think they're still trying to get more Saudi money after the Jamal Khashoggi government sponsored murder? Yes. There has been zero backlash against SoftBank or Saudi-backed VCs from companies or consumers.