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How does Softbank still keep standing? They keep losing on the vast majority investment they've made, and yet they haven't come up against any financial issues?

How does Softbank still keep standing? They keep losing on the vast majority investment they've made, and yet they haven't come up against any financial issues? I feel like Softbank going bankrupt is going to be the Black Swan that affects Silicon Valley the most.

alephnerd 3y ago
They got a couple wins recently with the ARM IPO, Coupang IPO, and ByteDance (aka TikTok). WeWork (and Uber) has been a massive hole, but SoftBank is diversified enough that they can withstand it. They have historically been one of the biggest movers in Chinese and Indian Growth VC, and have a significant presence in American Growth VC too. They made oodles of money off Slack and DoorDash for example, and their 2010s investment phase was thanks to them being flush with profits from Alibaba and Tencent. At the end of the day, compared to most other Growth Funds, they tend to hire some solid investors who know how to find capable operators. Though, lapses of judgement do happen a la Neumann, but that's like saying anyone who invested in Pivotal or Joyent is dumb. This is VC. It's not guaranteed returns. There's a reason why it's called VENTURE capital.
- Havoc 3y ago
  Also did well of NVIDIA for a while. Exited around crypto boom if memory serves
  - alephnerd 3y ago
    Yep! That was just one of several successes!
tpmx 3y ago
Saudi oil money.
- alephnerd 3y ago
  The Saudis pulled out. Vision Fund 2 (aka SoftBank today) is primarily Softbank's own money [0] [0] - https://pitchbook.com/news/articles/softbank-earnings-vision-fund-2-fundraising https://pitchbook.com/news/articles/softbank-earnings-vision...
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  - tpmx 3y ago
    Do you also base that on something more reliable than that vague article?
    - sharadov 3y ago
      Abu Dhabi and Saudi pulled out https://www.reuters.com/article/us-softbank-group-results-vision-fund/softbanks-vision-fund-2-stalls-as-key-backers-opt-out-idUSKBN2061SU https://www.reuters.com/article/us-softbank-group-results-vi...
      - tpmx 3y ago
        Thanks.
paxys 3y ago
Alibaba, ARM, Bytedance, Coupang, Oyo, Xiaomi, Didi, Slack, Doordash...Softbank has plenty of hits to make up for its losses. That's how the VC industry works.
faeriechangling 3y ago
They aren't afraid of risk and they've been around long enough that they appear to be at least an averagely competent investment firm which just takes way more risk than most would consider reasonable. Softbank was also founded in pretty much the perfect time in history for a firm like themselves to succeed, a highly speculative low interest rate environment. Their hits have more than made up for their misses.

alephnerd 3y ago

They got a couple wins recently with the ARM IPO, Coupang IPO, and ByteDance (aka TikTok). WeWork (and Uber) has been a massive hole, but SoftBank is diversified enough that they can withstand it. They have historically been one of the biggest movers in Chinese and Indian Growth VC, and have a significant presence in American Growth VC too. They made oodles of money off Slack and DoorDash for example, and their 2010s investment phase was thanks to them being flush with profits from Alibaba and Tencent. At the end of the day, compared to most other Growth Funds, they tend to hire some solid investors who know how to find capable operators. Though, lapses of judgement do happen a la Neumann, but that's like saying anyone who invested in Pivotal or Joyent is dumb. This is VC. It's not guaranteed returns. There's a reason why it's called VENTURE capital.

Havoc 3y ago
Also did well of NVIDIA for a while. Exited around crypto boom if memory serves
- alephnerd 3y ago
  Yep! That was just one of several successes!

tpmx 3y ago

Saudi oil money.

alephnerd 3y ago
The Saudis pulled out. Vision Fund 2 (aka SoftBank today) is primarily Softbank's own money [0] [0] - https://pitchbook.com/news/articles/softbank-earnings-vision-fund-2-fundraising https://pitchbook.com/news/articles/softbank-earnings-vision...
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- deleted 3y ago
  [deleted]
- tpmx 3y ago
  Do you also base that on something more reliable than that vague article?
  - sharadov 3y ago
    Abu Dhabi and Saudi pulled out https://www.reuters.com/article/us-softbank-group-results-vision-fund/softbanks-vision-fund-2-stalls-as-key-backers-opt-out-idUSKBN2061SU https://www.reuters.com/article/us-softbank-group-results-vi...
    - tpmx 3y ago
      Thanks.

paxys 3y ago

Alibaba, ARM, Bytedance, Coupang, Oyo, Xiaomi, Didi, Slack, Doordash...Softbank has plenty of hits to make up for its losses. That's how the VC industry works.

faeriechangling 3y ago

They aren't afraid of risk and they've been around long enough that they appear to be at least an averagely competent investment firm which just takes way more risk than most would consider reasonable. Softbank was also founded in pretty much the perfect time in history for a firm like themselves to succeed, a highly speculative low interest rate environment. Their hits have more than made up for their misses.