{"id":58672,"date":"2023-09-20T15:37:49","date_gmt":"2023-09-20T07:37:49","guid":{"rendered":"http:\/\/wordpress-my-161844363.ap-southeast-1.elb.amazonaws.com\/articles\/?p=58672"},"modified":"2023-09-21T19:01:47","modified_gmt":"2023-09-21T11:01:47","slug":"softbank-lessons-mistakes","status":"publish","type":"post","link":"https:\/\/www.imoney.my\/articles\/softbank-lessons-mistakes","title":{"rendered":"What You Can Learn From SoftBank\u2019s Recent Struggles"},"content":{"rendered":"

SoftBank, a Japanese telecommunications conglomerate, has been making the news recently, but for all the wrong reasons. Their financial struggles are well documented and reported, such as earlier this year when NikkeiAsia reported that <\/span>SoftBank suffered a massive $5.9bn<\/span><\/a> loss in the three months of September to December 2022.<\/span><\/p>\n

Which is why in this article, we\u2019re going to have a look at lessons you can learn from SoftBank\u2019s mistakes.<\/span><\/p>\n

<\/span>SoftBank\u2019s investment failures<\/b><\/span><\/h2>\n

SoftBank is a Japanese telecommunications conglomerate that is well known for the SoftBank Vision Fund, a venture capital fund founded in 2017.<\/span><\/p>\n

At its inception, the SoftBank Vision Fund managed to raise $100 billion, with investors such as Saudi Arabia\u2019s sovereign wealth fund, Public Investment Fund (PIF), Apple, and Mubadala Investment Company – which made the Vision Fund into the world\u2019s biggest technology-focused investment fund.<\/span><\/p>\n

However, it didn\u2019t take long for it all to go wrong for Vision Fund.<\/span><\/p>\n

In 2020 the first signs of trouble cropped up as multiple SoftBank funded startups started laying off staff as a cost-cutting measure. This included <\/span>Oyo<\/span><\/a>, <\/span>Getaround<\/span><\/a>, and <\/span>Zume<\/span><\/a>.<\/span><\/p>\n

Although laying off staff is not necessarily always a sign of troubles plaguing the office, these companies also faced other issues to compound the problems leading to the layoffs. For example, <\/span>Oyo\u2019s business model<\/span><\/a> had been a point of contention among experts, and <\/span>Zume was facing production issues<\/span><\/a> that crippled their day-to-day operations.<\/span><\/p>\n

Since then, it has been all downhill for Vision Fund, with them posting a record $27.4 billion loss for the fiscal year ending March 2022, and another $32 billion for the fiscal year ending in March 2023.<\/span><\/p>\n

<\/span>How did this happen?<\/b><\/span><\/h2>\n

In order to understand how SoftBank got where they are right now, it\u2019s important to look back at how they got their start.<\/span><\/p>\n

Back in 2000, Masayoshi Son, the founder of SoftBank went on a trip to China and met with 20 Internet entrepreneurs to discuss possible investments. Out of these possible partners, he decided to only invest in one: Alibaba.<\/span><\/p>\n

Son invested $20 million for a 34% stake in Alibaba, which turned into one of the biggest companies in the world. Although Son did sell off his stake in Alibaba a few years back, SoftBank still owns more than a $100 billion worth of Alibaba shares. It was considered one of the <\/span>best venture capital bets<\/span><\/a> of all time.<\/span><\/p>\n

And since then, Son and SoftBank have been trying to replicate that success by funding various startups. However, the fund has not yet had the fortune of finding its next unicorn.<\/span><\/p>\n

The following are some examples of what SoftBank has ventured into:\u00a0<\/span><\/b><\/p>\n