SoftBank’s Woes Are Not a Victory for Rival VCs
Masayoshi Son’s missteps have led investors to look more closely at old-fashioned things like sales and profits.
Illustration: George Wylesol for Bloomberg Businessweek
Venture capitalists may have breathed a sigh of relief in February when the activists came calling for SoftBank Group Corp. founder Masayoshi Son. The Japanese company’s $100 billion Vision Fund upended technology investing when it began making outsize bets on startups in 2017. Being the biggest venture fund in history meant its portfolio companies didn’t have to worry about profit anytime soon, while making it harder for rival investors to get in.
Paul Singer may have put an end to all that. Elliott Management Corp., the billionaire’s activist vehicle, has built a stake of almost $3 billion in SoftBank and is demanding that Son refocus attention on its existing business. The Vision Fund accounts for just 10% of SoftBank’s overall managed assets, runs the argument, yet consumes 100% of investor attention.