The Troubled Saga of Masa Son's $100 Billion Fund
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- čas přidán 7. 07. 2020
- SoftBank CEO Masayoshi Son’s Vision Fund has been impossible to ignore since its inception, pumping billions upon billions of dollars into tech companies like WeWork and Uber. Now, a string of high-profile losses and the coronavirus pandemic have put the fund deeply in the red. Bloomberg journalists Pavel Alpeyev, Sarah McBride and Tim Culpan break down the controversial investment strategies that have led to this critical moment for Son’s unprecedented fund.
Video by Vicky Feng and Alan Jeffries
#SoftBank #Epics #Business
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Is Masa Son's $100B fund losing its vision? Let us know what you think in the comments.
Time will tell
Incompetent investing on a scale never before seen in human history. Just my opinion...
Bloomberg QuickTake Originals no
Yes
Just 10 of my $1 Per Second Paintings Would help Softbank.
He was gonna be broke in 2000 but 1 company alibaba worked and made him all this cash. He's not really gonna change. He is just waiting to hit one more.
He’s doing doing all kinds of things in Japan, just not internationally.
He’s doing Uncut Gems but somewhat more responsibly :P
He sounds like one of those Las Vegas casino gamblers who won big one time and then kept on gambling just waiting for the next big one.
@MysticJimmy7 You may be right but there's a way of doing this, in the vc game, they say it's better to have 1 company that achieves 1000x growth than 10 companies that achieve 10x growth but the problem with how they're approaching it is everything is big bets, eventually you can deplete your resources and capital with that approach, you still need to use common sense, if I could see WeWork wasn't going to work when I was a teenager they definitely should've seen that because they have decades of experience per person.
So he fluked it ... not much of an investor if you ask me
Invest 10 billion in 10 companies.
Then pray that 1 goes to 100 Billion and you get your money back.
You actually described how a venture fund works
and if you loose the 10 billion does not matter because it's someone else money
Pnoy Pnay you looking at it all wrong. They produce oil. If they put oil in Tesla, then Saudi Arabia would be all over it. The core value didn’t mesh well their production of liquid gold
if you made 100 billion in that scenario you would only break even.
@@wertytrewqa he is implying 1 Billion in each of the 10 companies lol
Too much funding can definitely kill a company.
You mean irresponsibility
Wework
@@saosaqii5807 Right, also funding but I guess it goes hand in hand. They're strategy is clearly to overfund new companies to try and accelerate growth rates at a unrealistic pace which won't always work if the market needs to time adjust to new changes, you can be too ahead of the market, you can be so committed to the point where you don't know when to quit.
I'm 21 now, I was 19 I think when I said WeWork wasn't going to work in terms of what they were claiming to be and what they actually were, when softbank or the vision fund invested in them I knew it was a mistake because they overvalued company that rents out office spaces which I said is almost more like a real estate company than a technology company which they were trying to sell them as and I had little to no real business experience and could see this. That's saying something about how they're investing their capital.
@@arai6147 A lot of people profited in it though so I don't understand this comment.
oh oh what's that? INVESTMENT EXPERT ALERT UUUUUUIIIIII UUIIIIII INVESTMENT EXPERT ALERT
He will bounce back then Bloomberg will put a new video praising him
Grabs and Uber's stocks will hit record high once the pandemic is over.
Seems softbank share price raised by 133% and is at 20 year high.
Exactly not every investment is going to make it big right away who knows a vaccine might come out and all of a sudden boom he’s a genius ride sharing goes through the roof what a “investing marvel”-Bloomberg
Exactly. Bloomberg’s future quote, “So, Masa when your business wasn’t doing well everyone was criticizing you, how did you manage to keep your focus?”
Maybe, but now everyone knows he's actually incompetent and got lucky. We know he's incompetent because WeWork's business model was fundamentally flawed and very clear to everyone with even a modicum of business understanding.
"...He had no business plan, but his eyes was very strong."
and was backed by the ccp
@@rofafofo7057 ccp? got proof?
@@danielsadikoski671 not vision, just charismatic
He was referring to vision instead but the language barrier got in the way I think
@@karmanyasharma8593 Exactly
"The size of U.S. transportation and education fund combined" Lets choose the two things we spend the least on to try to make the viewer think this is a lot of money. Tech busts all the time.
US sucks :'
100 billion dollars is no joke, it is a lot of money
lol, US total Education spending is around $1.2 Trillion.
@@saltymonke3682 and what's US total Military spending ?
@@Also_sprach_Zarathustra. Did he stutter? What does that have to do with the amount?
I think it's safe to say SoftBank does not have an investment strategy. It's more of an impulsive decision by Son Masayoshi. He believed in ride hailing apps hence the huge exposure. He believed in WeWork because of the founder Adam Neumann. If he really had an investment strategy, he would've opted for diversification across multiple industries (chips, AI, robotics, fintech, biotech, enterprise SaaS).
But still, I do admire him for his ambition, grit and his capability to raise the world's largest fund.
He certainly has some analysts who provide nitty-gritty details... but yeah making wrong assumptions in modelling can be catastrophic..
SoftBank is basically throwing as much at the wall and hoping something sticks
Everything about Softbank is just insane to me. The bubble they created has somehow not burst...yet
B Babbich students and people who write for a living use it
@B Babbich I used to pay them for a few months back when I still have to translate documents for the company. Premium check if my language is appropriate for business use, which helped me a lot.
That's how Japan works
Its going to work
@Pnoy Pnay ??? Are you seriously trying to flame someone in a youtube comment because they used Grammarly?
I have strong eyes, how do I get Masa Son to invest.
😂😂💪😂
You should open your own vision fund.
I’m thinking the same thing lol
have an company that have an disruptive company.
Tell him you don't have a business plan.
There’s no secret formulas of fast growth. Discipline and consistency will always rule over time.
@Raymond Spicer you're clearly missing the point and lack the understanding of a business
I guess you didn't get the *"Fake it till you make it"* memo. 🤣
LoL
bet
He basically took money for granted, lost all the importance of value investing. I mean when you have $100 billion in your account you wouldn't really care if hundreds of million would go here and there. Whereas a man with a small account would care where his money is spent.
This is such a wrong assumption. He actually values his money to the penny. You would actually say the strategies that brought him up aren't working in todays technology and economic fields.
Easy to say when the outcome is known.
not really.. japan had issue when you had large amount of money.. let face it... he is destiny to fail...
Salomon Dushimirimana
If you think putting money in cash burning “businesses” is “investing” then maybe this aint for you
value investing? what? Since when is Masa a value investor? He has always been a growth investor, not value. He seem to be confusing him with buffet.
1billion dollar per 1minute
I also want that, I am ready to extend the meeting forever
Hell, I'll be happy with a hello, my name is..... and meeting over. I'm not greedy 😆😆
Uber and Alibaba will pay off but WeWork was a waste of cash
Chase Steele Think about it. Real estate in every major urban center around the world. Most minor centers, too.
@@Inquiring Most of them were rented so they are always losing instead of possibly be earning and the ones that could compensate and add a great value, the ones on the middle of the biggest cities are not We Work property too what makes them volatile of the rent prices that just keep growing on major cities
matheus henriquendo I was unaware that they were rented, thanks.
Uber is losing money, if it could make profit at the end of 2019 that was the year they were the most present, what makes you think that they will reach it in the future?? so you think that self driving cars is going to be their point tipping point??
Sell alibaba and reinvest
"his eyes were very strong" the quote of the decade ladies and gentlemen
I think it was for the interview. No one will give bunch of money just by looking at their eyes.
I think he was trying to say the Neumann had a very clear vision of what the company could achieve but had a very poor business plan
“His eyes was very strong”*
This reminds of Casino Royale, when the African leader gives his money to Le Chiffre to invest.
A couple more We work, them our 007 is gonna have a show down with San
Bhoomtawath Plinsut a Saudi Assasin (Mr. Brown) will walk in and shoot Masa while saying “Money isn't as valuable to our family as knowing who to trust”
The same thing that was going through my mind buddy
Basically he got lucky on a stock bet and somehow convinced himself and everyone else that he was a genius investor. WeWork and arm saw him for what he was and rinsed him.
Yeah, pretty much XD
ARM is their future milk cow!
@ I know the news arm is the only thing that is profitable for them and if they put it out for an ipo they will make big gains, no smart phone in existence works withiut arm.
Nope. I mean he was successful early with Alibaba, but he did go on to build the biggest company in Japan, and one of the biggest in the world. He's bet on Alibaba might be the topping of his _"reputation pizza"_ , but his other investments (through SoftBank, not the vision fund) are the base, that have been sound enough to solidify his confidence in his investments.
"My hairline is not going backwards; I am going forward" In Japan he is rather known as a nice uncle who owns a big mobile company and a big baseball club. It took me this video in English to know what SoftBank is really doing...
Alot of investment experts in these comments. I wonder how many billions they've made lmfao.
Right! they need to go back to their 9-5 job office job And hope the government don’t take their retirement funds and bail out these financial institutions again.
So true lol
I got 1 trillion dollar , just the Zimbabwean one!
@@Alan-sk3tc Get over yourself
User Name I’m over myself
He got lucky with Alibaba. Luck won’t favor him every time.
True, he got too cocky off a Chinese company investment that arguably didn’t even have organic growth.
He got lucky with iPhone too. I guess he was "lucky" with Apple also. By the way, he made a digital pocket translator when he was still in university and made millions of dollars from it too. I guess he was "lucky" then too. I guess his company being the biggest mobile carrier in Japan is being "lucky" too.
He has also profited billions from india. Tech startup like Flipkart which they sold to Walmart snd made 800% profit and aslo ola, Paytm, oyo. Definitely he has good sense which companies will grew in future.
@@DanielK1213th totally agree with you, he is an investor of course it takes luck. And if you watched the video it says that the vision fund was making money just before the covid crisis. Which btw every aspect in the world economy is most probably negatively affected
@@DanielK1213th hahaha... excellent points. Some people don't get it. There the negative types that would criticize Elon Musk with Tesla.
I would pay to listen to the meeting between that Saudi prince and Masa. $1 billion a minute closing deal. How?? What words were spoken? lol
It's said that Saudi princes happily let you take their possessions if you happen to like them. I bet Son might have got the money in first five minutes and must have been admiring the Prince's eyes for the next 40.
MS: "I need money homes"
MBS: "ok"
He said the same after the dot com bubble...
this is like buying 100 billion dollar lottery tickets from all places in the world and just hoping that even 10 pays he is all clear
Well this aged like milk
...Maybe he's a Robinhood investor with all that lack of research he did.
@the troll he's also lost more than me. And if we have the same starting point, my portfolio would have crushed his.
It also doesn't make him less wrong, which makes me more right.
@@greatmaddyave are you worth more than 30.6B? yeah keep dreaming son.
I am pretty sure he has done his homework to put those money in. He has enough money to hire a professional team to do it for him million times over.
It’s not a loss until you realise the loss. If they haven’t sold anything they haven’t lost mate.
This is not how it works mate.
@@heroicnoodle6107 It pretty much is though.
Problem with apple if with blemish people wont buy they want big nice apple.
Yeah If I buy Apple at 150 and it goes down to 140. You haven’t lost anything.
If the company goes bust you loose 100% of your investment lol
Not his money. Too bad for the investors.
You shouldn't feel pity for the drunk gambler who bet his life savings in the casino with bad results.
Am I the only one who is hearing Oyo as oil 🙄🙄😐
HAHAHAHAHAHAHA
I think if I'd have lost Saudi Arabia that much money, I would be looking over my shoulder quite a lot.
I don’t think it’s his fault a pandemic hit
He could have invested all the money invested in WeWork on other smaller startups and make better returns. WeWork is really just a bad idea, it's nice that he admitted that, becuz everyone else just knows that it's a mistake.
Everyone else knows now.
The thing about investment in start ups is that it’s generally hard to determine whether or not it’s gonna be a big hit. Let’s not forget that wework back then was a hot sell amongst investors and media, who hyped the company up to the moon.
@@yanzx01 Thank you for the feedback
@@kunalmandhare3144 Thank you for the feedback
Easy access to money and credit, plans of high growth that lack detail, charismatic leader who talks in half sentences... I've seen this movie before. Like a carousel of broken dreams spinning on credit and hope, sign of the times.
There's never been a greater example of 'fumbling the bag' than WeWork. Can't wait for the movie
WeWork and it's subs are probably one of the best & one of the most laughable scheme for fleecing potential. It's like a business scam.
Try Theranos
Sometimes, mo money, mo problems. It’s hard to still be efficient when you’ve got so much capital to deploy and so many 👀 on you.
Swiggy, one97, Flipkart and oyo will be his next Alibaba
he most definitely needs some timeless lessons from the Oracle of Omaha . investing in potentially great companies @ fair prices .u do not just cut the check just cos u have a large cash pile of sovereign wealth funds .
Thing is though he can take a spread on their money and still get hella rich even with bad performance, he's just playing with other people's money. Seems like this dudes strategy is to invest in as many disruptive companies as possible knowing most will fail but hoping that he might land the next amazon/facebook/alphabet in the process.
He cuts the checks because "strong eyes"
Different approach , Warren invest in established business , Softbank on POTENTIAL profitable business .
@@asdfgoogle and miss out on an powerhouse like Alibaba?
it's simple: it's not his money, he's already a billionaire. The whole thing could be a money laundering scheme as well. He might be getting paid for helping to launder without anyone knowing. And say he gets lucky, one of his multi-billion dollar investment will turn into the next Alibaba, granting him a 10,000x return.
Japanese history has quite a lot of those with concentrated power who going all in and went too far
It has nothing to do with Japan! Wealthy men/companies are so rich that they do not know what to do with the money. smaller bussineses are not profitable enough for them to care, but they still need to invest in order to stay relevant in the future. So when such investors/companies find someone with a vision/idea they tend provide the funds, else the money will just rot or be diverted to non-sense like a trip to mars or golden toilet papers or drugs
@@ulrichleukam1068 trip to mars is nonsense to you?
@@Ray2311us isn't it?
I think their is a factor not being looked at here when considering things... MONEY PRINTER GOES BRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRR
Anyone who did their due diligence on Son would've stayed the hell away. He got lucky with Alibaba but otherwise is a terrible investor.
based on what? A frankly stupid statement
@@aliakram5241 Have you read his statements on why he invested in We Work? He has placed too much reliance in charismatic founders and doesn't do his homework. And then there's how much money he lost during the dot-com bubble. Out of multi-billionaire investors, he really has a pretty poor record.
@Andres Leon he did do well on that one. credit where it's due
@@IanMcD204did u see softbanks latest quarter. Hes a very smart man who knows what he's doing. A poor investor yet manages to run one of the most successful investment companies in the world. Come on m8
Is it wrong to love the story of a failure? Chernobyl, Laker Air, fracking, Softbank. Ericsson...
I think it's too early to say SoftBank was a failure. Who knows? They might come back with a smaller Vision Fund 2 but with much better investment strategy given of their previous mistakes.
Not sure what makes you say Ericsson is a failure?
Sir, You have a comprehension problem.
Sure, if it makes you feel better about yourself.
In which world are your living? Fracking and Ericsson are failures? seriously?
this is why VC are scary to me. They just give companies so much money that companies stop thinking how to keep running lean and mean to make that money last. Additionally, VC tend to push businesses to return that investment and more ASAP instead of being patient and following a reasonable strategy that can just be boosted with some financial help
Well at least he had a diversified portfolio
so he is a washing machine from Japan and they used his age and education in the US to start the cleaning process.
Imagine if Masayoshi coordinates his investments with Private Equity firms. This way, companies he invested on would have management rotation and have their inefficiency and bad habits curtailed by said firms who are incentivized to do so for high returns.
There are many specialized PE firms that he can use for his diverse array of companies.
He is not an innovator; He is an investor.
That's why he lose and win some game. He is just in a bad current; let him go as he feels.
The problem of an undiversified investment, concentration risk can be diversified away using low cost index fund instead.
Masayoshi was a fool for giving Neumann a nearly $1 billion dollar golden parachute.
I think without such investments world would have never witnessed such gr8 startups and Company's...... I appreciate atleast that part.
Venture capital is important but the way he does it seems more destructive to me. For example he gave one company 10x (or so) what they asked, then demanded they'd grow faster ignoring profitability in the mean time and then it failed
Ride-hailing might be a situation where a market-share strategy makes sense. If customers are basically happy, they are going to use only one ride-sharing app. The upshot, however, is that the ride-hailing companies are taking tremendous loss-leaders in order to gain market share. It's a very risky approach. The Vision Fund seems to bet that it can use market-share loss leaders to dominate markets. It's either win big (and perhaps become an unfair monopolist) or lose big.
Great story, was wondering what happened with the Wework investment and it’s impact on Softbank.
The fact that Bloomberg put 2 ads within this video 😃😌
A keen billionaire’s visions are sharper than samurai, u may think he lost a lot but he’ll come back with big hit.
Let’s imagine that on that fated meeting with his highness all he spoke was about Alibaba. All other 99 busts were never brought up , as if they were swept under the rug.
Now imagine he going back to the well, only at this time, he has no trump up his sleeve. No calling card, no recent success history. So he will have to make do with what is left on the stash fund, assuming the Saudis won’t be calling in the “ loan “.
This ain’t some savvy business analyst who did his homework. He wrote the checks on “charisma “. Even Warren Buffet does look at the numbers, the old miser loves his dividends, and he is damn well to be sure the money invested brings returns.
As for this vision thing, investing on a glorified office sublet headed by a lunatic, or an outsourced taxicab company without licenses , granted operating rights by the way of bribing public officials?. There ain’t no vision. It’s just being foolhardy.
Easy money makes up for a lot of Midas out there. You put your money out there to earn , you damn as hell to have your bean counters at the board, or bring along the dudes that break knees.
Otherwise you are just an well endowed folk with a thieving silver tongue.
Yes, thanks. They briefed me already. Also on the exchange.
This is problem with current and newer startups. They're burning money without any precaution because they know if they're big enough bigger fish will bought them.
They're putting too much emphasize in growth than protitability
But all these tech companies never make money and live on speculation .
The point is not to make money but rather have a return of investment: i.e imagine investing $100bil in AI, you might never recover your money but this AI could sythesize a cure against cancer down the line. The speculation is you do not know if you would achieve such thing, but someone need to start somewhere. This way we got Internet, Cars, 5G, satellites, space stations...they never knew they could achieve it but tried. They same goes for medecine....some Pharma companies are investing Billions into creating drugs and vaccine for desease you don't even know exist.
Yaya and then flushing all the money like water..ok next
Mohammad Bin Salman (The Saudi Crown Prince): It's only $45 billion. No big deal. Next ...
"US educated", that explains a lot
My investment strategy is now to short whatever Softbank own/buy 🤣
All for one. One for all 😂
WeFail
It's crazy how much influence Softbank has
At 1:38 the size and shape of the bucket changes when it switches camera angle
Masa's probably being rushed by his investors, and doesn't have the commanding personality of Warren Buffett, who's refused to buy even while maintaining a historic cash pile
Masa error was not getting ride of We Work while it could if We Work went on its IPO SoftBank would make a hell lot of money but maintaining it's position and even offering to buy We Work CEO shares seemed like they trusted We Work way more than it should if I was a investor i wouldn't be mad at SoftBank for entering into We Work i would be mad for them not selling it's position before the whole scandal
The Vision Fund was making money, only because of private equity valuations.
but they are a Venture fund, no?
Best of luck to Son, he is a visionary & he is the kind of person that can make a change.
1:49 Looks like Jin Yang and Erlich Bachman..😂
At 1:46, Erlich Blochman & Jin Yang Duo...
How do their losses in the 2020 pandemic compare to the losses of other funds?
@Mohamed Hassan Yea I figured that, it just annoyed me how they talked about the losses without comparing them, because if everyone goes up going up isn't impressive, if everyone goes down going down isn't that bad. Anyways, it seems like the whole purpose of this fund is to just try and invest in every 'revolutionary' company and hope that he can find the next apple, amazon, FB, etc. that will offset the huge number of failures. Only slightly logical way the fund makes sense, if he thinks all these companies will do well, he's an idiot.
@@matth23e2 This fund is being ran like a VC but on a larger scale, some blunders like WeWork should've been seen a mile away but in the long run they may very well come out ahead because in the VC world it's about finding the 1 that producers 1000x growth vs 10 that produce 10x growth so even with these losses, all it takes is that one company and he'll be praised
And now Softbank share hits 20 year high
I thought this was a joke. It's not, and as of today SoftBank's market cap is $124B and rising. 💰💰💰
L🔐 I swear I’ll never understand the stock market 😂
Softbank goes hardbank!
@@chandrashekard.7543 fomo. It's a melt up before a biiiiiig crash.
45B for Saudi is like the change we keep in our car
That's why they had to steal from their own princes.
@1:30 anybody else notice was up with the ice bucket?
Softbank should had bought cruise, airlines , tesla , amazon after covid crash 🤣😂😅
With that kind of money it must surely be easy to write out blank cheques. Making business decisions on gut or someone's eyes might have it's advantages but likely comes with disadvantages that can only lead to getting your fingers burnt.
It's been a long time since the last time I saw a Yahoo! logo.
his work ethic is insane
If a guy is smart enough to get 100 billions , he's smart enough to recover this easily..these video bloggers are just like vultures hanging for news
There is no luck to a billion. 99% of people won't even get lucky to make a million, he did 100 billion.
Enron, Theranos, etc ring any bells?
Still a better use of money than pouring it into securities. Look at how some of those startups change our world for good.
Great Masayishi ,too courageous & wisest man !
“No risk it, no biscuit.”
He’s trying to do what the Medici family did in the Renaissance.
Atleast the Medici was enriching the arts and promoting the renaissance. Visibly made Italy a pretty country. This guy is just straight up giving money away hoping to land the new Facebook/Amazon.
@@iankim5582 his strategy could work but needs a much longer time scale. A 10 year fund won't do.
The winners they picked need time to consolidate and for those new markets to mature more.
Not really...
@@iankim5582 so he's hoping to recreate what he did with alibaba.
Josue, I guess that you have never opened a history book.
0:48 WHY is no ones top comment about this hilarious toe that replaced a regular thumb?
That robot pizza company needs to be revived, it's the need of the hour. A machine made pizza will benefit hoteliers in covid-19 era.
Any kind of automation in food is critical in this Covid-19 era.
@@angelaanaconda55 indeed
Well done 👏
It's called Vision Fund and it did not invest in Tesla? What a shameful lack of vision.
Tesla ain't your everyday start up 💀
To make money all he has to do is short everything he's invested in.
Son's biggest Nightmare was WeWork
I thought those super rich investors could predict the future much better than common people. Apparently they just relied on patterns and signs
Year 2020 is hard for everybody, not just SoftBank.
Wework is the worst startup idea ever and that they raised money by cheating Son to believe in that stupid idea.
Wework founder said It's a technology company. What kind of Technology is that? It's just a space arrangement and space management .. nothing's more than that.
@@lindafukuyu5767 True. Many business before Wework failed in India decade ago using this model.
Wework is core ideo is not bad but it got over value to the moon
5:38 "Crazier than the craziest guy in the room"
We'd love to invite you to our podcast as a guest ❤️
I think Masayoshi needs to invest in smaller startup like what he did to alibaba during the early stage
the things is that Masayoshi Son and Soft bank were always on the top 10 list of corporates likely to go bankrupt since the 90s.
yet he and softbank still stands tall.
Well, I am pretty sure a lot of investments are not doing so well during Covid-19 pandemic but I am sure Vision Fund is able to ride this out, who knows, they might emerge stronger after Covid-19 and there might be a new video talking about its successes in the near future.
lets see they still just need one big successful company to give returns on whole of vision fund.. wait till 10 years ..!
AWESOME
Maybe his decision-making skills is why he is there and we are here.
Upward spiral of success after dodging the downward spiral consciously ( not letting reality bluff you out of the gold ). It's the magic of discipline, athletes do this all the time, as they ignore criticism while being booed in order to rise back to the top.
Consciously is a key word here.
Disclaimer: This video is just a view machine from a company who thinks its employees know better than a guy who convinced the crown prince to invest 45B in 45m.
To be crazier than the craziest guy in the room is a pretty daunting task. 😁😁😁
0:41 funny intonation