Category: SoftBank Group

June 9, 2019 Off

What happens if there’s no Vision Fund II?

By Jill T Frey

While I’d like to recommend panicking as a general response to the world, a smaller or fully neutered Vision Fund II won’t crash everything in the sphere of giant private companies.

Recent headlines describe a world that might never see a Vision Fund II. The Wall Street Journal reported over the weekend, for example, that “SoftBank Faces Challenges Raising Latest $100 Billion Fund.” The Washington Post this morning noted that SoftBank’sMasa Finds Not Everyone Shares His Vision.” And so on.

What matters for tech shops, startups and unicorns alike is that instead of their being an eventual Brady Bunch of Vision Funds, vision-ing around the world like buzzy, cash-laden drones, the franchise might halt after its first installment.

The $100 billion-ish vehicle has caused disturbances of all sorts in the fabric of the private capital markets, deploying cash with hurricane speed. Checks into … Read the rest

June 3, 2019 Off

Key Vision Fund investors are reportedly lukewarm on a second fund

By Jill T Frey

SoftBank shook up the venture capital world with its unprecedented $100 billion Vision Fund, and the speculation continues around its follow-up.

The fund hasn’t quite closed $100 billion — it is mighty close… — but that hasn’t stopped reports of a sequel from surfacing for the last 18 months. SoftBank has mown through its allocation at speed, dealmaking increased to a record speed in Q1 despite controversy while its hiring has intensified, but the latest chatter suggests that a number of the fund’s key backers are lukewarm at the prospect of a return act.

The Wall Street Journal this weekend reported that Saudi Arabia’s Public Investment Fund (PIF), which anchored the Vision Fund with a $45 billion investment (but also provides the controversy), and the Canada Pension Plan Investment Board are among those that “plan to make limited or no contributions” to the follow-up vehicle.

Sources told the … Read the rest

May 31, 2019 Off

Slack narrows losses, displays healthy revenue growth

By Jill T Frey

Workplace messaging powerhouse Slack filed an amended S-1 with the U.S. Securities and Exchange Commission on Friday weeks ahead of a direct listing expected June 20.

In the document, Slack included an updated look at its path to profitability, posting first-quarter revenues of $134.8 million on losses of $31.8 million. Slack’s Q1 revenues represent a 67% increase from the same period last year when the company lost $24.8 million on $80.9 million in revenue.

For the fiscal year ending January 31, 2019, the company reported losses of $138.9 million on revenue of $400.6 million. That’s compared to a loss of $140.1 million on revenue of $220.5 million the year prior.

Slack is in the process of completing the final steps necessary for its direct listing on The New York Stock Exchange, where it will trade under the ticker symbol “WORK.” A direct listing is an alternative approach to the stock … Read the rest

May 30, 2019 Off

EV Growth closes $200M fund to cover Southeast Asia’s Series B funding gap

By Jill T Frey

East Ventures has long been known as one of Indonesia’s longest-serving and most active seed-stage investors, but now it has officially moved up the food chain after it announced a final close of its growth fund at $200 million.

Called EV Growth, the fund is a joint venture between East Ventures, SMDV — the VC arm of Indonesian conglomerate Sinar Mas — and YJ Capital, which is associated with Yahoo Japan. The fund was first announced last year with a target of $150 million, but this final close has already surpassed that thanks to contributions from LPs that include SoftBank Group, Pavilion CapitaI and Indies Capital.

EV Growth is already active, with 40% of the fund deployed to date, according to East Ventures’ founding partner Willson Cuaca, who serves as partner for the new fund alongside Roderick Purwana from SMDV and  YJ Capital’s Shinichiro Hori.

“We thought ‘There’s a gap … Read the rest

May 29, 2019 Off

China’s used car marketplace Uxin to raise $230M via convertible notes

By Jill T Frey

Uxin, a Chinese second-hand car dealer with Leonardo DiCaprio as its latest brand ambassador, is tipped to get a bag of new funding less than a year after it raised $225 million from its public offering on the Nasdaq.

The company announced on Wednesday that it’s selling $230 million worth of convertible notes to 58.com — China’s answer to Craigslist, Warburg Pincus, TPG and other investors. The fresh proceeds will go towards strengthening its cross-regional car transactions, a new area of focus for the firm.

The notes, due in June, convert to Uxin’s Class A ordinary shares at a price of $1.03 per share or $3.09 per ADS. Upon closing the deal, each of 58.com, Warburg Pincus and TPG will obtain the right to nominate one board director to Uxin.

Uxin was trading at $2.46 at the end of Tuesday, a 74 percent decline from its recent peak in … Read the rest

May 26, 2019 Off

The savage genius of SoftBank funding competitors

By Jill T Frey

Venture capitalists aren’t supposed to make their portfolio companies battle to the death. There’s a long-standing but unofficial rule that investors shouldn’t fund multiple competitors in the same space. Conflicts of interest could arise, information about one startup’s strategy could be improperly shared with the other, and the companies could become suspicious of advice provided by their investors. That leads to problems down the line for VCs, as founders may avoid them if they fear the firm might fund their rival down the line.

SoftBank shatters that norm with its juggernaut $100 billion Vision Fund plus its Innovation Fund. The investor hasn’t been shy about funding multiple sides of the same fight.

The problem is that SoftBank’s power distorts the market dynamics. Startups might take exploitative deals from the firm under the threat that they’ll be outspent whoever is willing to take the term sheet. That can hurt employees, especially … Read the rest

May 18, 2019 Off

Immigrant founders, smartphone growth, SEO tactics, SoftBank’s financials, and AR tech

By Jill T Frey

How an immigration crackdown is hurting UK startups

Our European correspondent Natasha Lomas spent the past few weeks investigating what’s been happening to immigrant founders and tech talent in the UK, who have been receiving more scrutiny from the Home Office in recent months. Natasha zooms in on Metail, a virtual fitting room startup, and its tribulations with the immigration authorities and the damage those action are having on the broader ecosystem:

The January 31 decision letter, which TechCrunch has reviewed, shows how the Home Office is fast-tracking anti-immigrant outcomes. In a short paragraph, the Home Office says it considered and dismissed an alternative outcome — of downgrading, not revoking, the license and issuing an “action plan” to rectify issues identified during the audit. Instead, it said an immediate end to the license was appropriate due to the “seriousness” of the non-compliance with “sponsor duties”.

The decision focused

Read the rest
May 17, 2019 Off

At this point, SoftBank Group is really just its Vision Fund

By Jill T Frey

Last week, SoftBank Group Corp. — Masayoshi Son’s holding company for his rapidly expanding collection of businesses — reported its fiscal year financials. There were some major headlines that came out of the news, including that the company’s Vision Fund appears to be doing quite well and that SoftBank intends to increase its stake in Yahoo Japan.

Now that the dust has settled a bit, I wanted to dive into all 80 pages of the full financial results to see what else we can learn about the conglomerate’s strategy and future.

The Vision Fund is just dominating the financials

We talk incessantly about the Vision Fund here at TechCrunch, mostly because the fund seems to be investing in every startup that generates revenue and walks up and down Sand Hill looking for capital. During the last fiscal year ending March 31st, the fund added 36 new investments and reached … Read the rest

May 8, 2019 Off

Slack to live-stream pitch to shareholders on Monday ahead of direct listing

By Jill T Frey

Slack, the ubiquitous workplace messaging tool, will make its pitch to prospective shareholders on Monday at an invite-only event in New York City, the company confirmed in a blog post on Wednesday. Slack stock is expected to begin trading on the New York Stock Exchange as soon as next month.

Slack, which is pursuing a direct listing, will live stream Monday’s Investor Day on its website.

An alternative to an initial public offering, direct listings allow businesses to forgo issuing new shares and instead sell directly to the market existing shares held by insiders, employees and investors. Slack, like Spotify, has been able to bypass the traditional roadshow process expected of an IPO-ready business, as well as some of the exorbitant Wall Street fees.

Spotify, if you remember, similarly live streamed an event that is typically for investors eyes only. If Slack’s event is anything like the music streaming giant’s, … Read the rest

April 25, 2019 Off

Internet connectivity projects unite as Alphabet spinout Loon grabs $125M from SoftBank’s HAPSMobile

By Jill T Frey

Two futuristic projects are coming together to help increase global internet access after Loon, the Google spinout that uses a collection of floating balloons to bring connectivity to remote areas, announced it has raised money from a SoftBank initiative.

HAPSMobile, a SoftBank project that is also focused on increasing global connectivity, is investing $125 million into Loon, according to an announcement from SoftBank made this morning. The agreement includes an option for Loon to make a reciprocal $125 million investment in HAPSMobile and it includes co-operation plans, details of which are below.

HAPSMobile is a one-year-old joint venture between SoftBank and U.S. company AeroVironment . The company has developed a solar-powered drone that’s designed to deliver 5G connectivity in the same way Facebook has tried in the past. The social network canceled its Aquila drone last year, although it is reported to have teamed up with Airbus for new trials … Read the rest