Softbank Group wants to change the future by supporting tech entrepreneurs who take risks: Masayoshi Son


Softbank Group, which has recorded a 43% compound internal rate of return (IRR) over the past 20 years because it took a long-term view of entrepreneurial risk-taking, is now more interested in “changing. the future ”by betting big on risk. by taking on tech entrepreneurs who are building new business models, President Masayoshi Son said at the 2021 Infinity Forum on Friday.

“I don’t care if the interest rates change a few percentages or the exchange rate changes a few percentages. If you increase the compound IRR by 43% each year, that (interest rate, change) is just a minor mistake, ”he said.

Son’s remarks come against the backdrop of recent volatile Softbank Vision Fund earnings. It announced a loss of $ 10 billion in the second quarter of fiscal 2021-22 (second quarter of fiscal 2021-2022) following the Chinese government’s crackdown on tech companies after reporting a profit of $ 6.9 billion in the first quarter of fiscal 22, down 39% from reported profits in the corresponding quarter a year ago.

On the other hand, the $ 100 billion Softbank Vision Fund posted a record profit of $ 36.99 billion for the fiscal year ended March 2020, after record losses of $ 18 billion the previous year.

The general theme of Son was that the band “don’t try to make money; we are trying to change the future, taking risks with entrepreneurs, “he said.” There are so many great entrepreneurs with new technological business models. But I would like to support them by providing the venture capital … maybe we are crazy enough to believe their vision. Sometimes we lose money, but sometimes we get great feedback. Overall, our returns are more important than the loss … ”Son said.

“I would love that,” Son said, when asked if he would like to be known as the “Rothschild of the digital world”. Rothschild was known to have financed the industrial revolution. Son said he would like to be known as one of the financiers of the tech and digital ecosystem, which has a long-term view in supporting entrepreneurs with venture capital.

In India, Softbank was one of the early backers of many tech companies such as Paytm, Ola, Oyo, and Snapdeal.

Paytm’s parent One97 Communications went public in November at ??2150 per share, but its price collapsed in its early stages and is trading well below the issue price at ??1645 each of the IPO price. Despite this, Softbank is making a profit because it invested in Paytm very early on when the fintech business was valued at less than $ 2 billion and then $ 7 billion.

Its other portfolio companies, Snapdeal, Oyo and Ola, have all filed for public listing.

Over the past year he has invested in SaaS companies such as Mindtickle and Whatfix and other consumer technology investments including Cars24, Swiggy and Flipkart.

Softbank invested $ 3 billion in India this year, which Son said was funding 10% of all Indian unicorns this year.

Money is no longer a constraint for young entrepreneurs, Son insisted. “Today young people are lucky. When I was young there was no venture capitalist.. Humble house, if you have an idea and a lot of passion to bring your friends and partners .. .and create a business model and a plan and then have a little start … If you can prove a few things, and if you can explain a little better to some investors – the money comes. “It’s more of a constraint. It’s just your dream, your passion, your intelligence, your focus, that’s all it takes,” he concluded.

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