- SoftBank's market value dropped by about $10 billion this week after The Wall Street Journal reported that the company has been making massive, risky tech investments.
- The Japanese conglomerate has invested millions in some of Silicon Valley's biggest tech companies, including Uber, WeWork, Slack, and DoorDash.
- SoftBank's founder and CEO, Masayoshi Son, is the third-richest person in Japan, with a $20.6 billion personal fortune.
- He owns $45 million worth of real estate in Tokyo as well as a $117.5 million estate in Silicon Valley.
- Visit Business Insider's homepage for more stories.
SoftBank lost about $10 billion from its market value this week after The Wall Street Journal reported that the Japanese conglomerate has been making huge, risky investments in tech stocks.
SoftBank's founder and CEO is Masayoshi Son, who's worth an estimated $20.6 billion, per Bloomberg's Billionaires Index. That makes him the third-richest person in Japan after Uniqlo founder Tadashi Yanai and Keyence founder Takemitsu Takizaki.
Through SoftBank and his first $100 billion Vision Fund, Son has invested millions in some of Silicon Valley's biggest tech companies, including Uber, Slack, Amazon, Tesla, and Netflix. Softbank was the biggest investor in WeWork, losing more than $4.7 billion after the coworking company's failed IPO.
Here's a look at Son's life, career, investments, and real-estate portfolio.
Masayoshi Son is the billionaire founder and CEO of Japanese holding company SoftBank, which has invested millions in some of Silicon Valley's biggest tech companies, including WeWork, Uber, Slack, and DoorDash.
SoftBank owns stakes in more than 1,000 companies, including Tesla, Amazon, Netflix, Alibaba.
In 2018, the company reported revenue of $82.7 billion.
SoftBank has been suffering in recent months, however, due to the failed IPO and subsequent plummeting valuation of WeWork, as well as the coronavirus pandemic.
In April, SoftBank said its Vision Fund would suffer a $17 billion annual operating loss.
Son is worth an estimated $20.6 billion, according to the Bloomberg Billionaires Index.
That makes him the third-richest person in Japan after Uniqlo founder Tadashi Yanai, who's worth $31.8 billion, and Keyence founder Takemitsu Takizaki, who's worth $23.9 billion.
Most of Son's wealth comes from his 27% stake in Softbank, which makes him the largest shareholder, per Bloomberg.
Son was born in 1957 to Korean immigrants on the Japanese island of Kyushu.
The 63-year-old CEO was one of four brothers, and his father worked at restaurants, farms, and fisheries.
In 1972, when he was 16, Son met one of his idols: McDonald's Japan founder Den Fujita, who encouraged him to go study in the United States.
Son took his advice and moved to San Francisco the next year to continue high school.
Son went on to study computer science and economics at the University of California at Berkeley.
Before he was 21 years old, Son sold his first company, a multilingual translator bought by Sharp for about $1 million.
In the 1980s, Son founded SoftBank, a company that today pours billions of dollars of capital into tech startups, including through its $100 billion Vision Fund.
Through its Vision Fund, SoftBank has invested in major tech companies like Uber, WeWork, food-delivery startup DoorDash, and Indian e-commerce retailer Flipkart.
Son's investment strategies are considered unconventional in Silicon Valley.
The size of Son's $100 billion Vision Fund and its investment strategies have shocked Silicon Valley investors, per Bloomberg.
"The standard VC playbook involves making small, speculative investments in early-stage startups and adding funds in follow-on rounds as those startups grow," Sarah McBride, Selina Wing, and Peter Elstrom wrote for Bloomberg. "SoftBank's strategy has been to put enormous sums — its smallest deals are $100 million or so, its biggest are in the billions — into the most successful tech startups in a given category."
In early 2019, Fast Company's Katrina Booker called Son "the most powerful person in Silicon Valley" for his ambitious vision — and financial means — to transform industries from real estate to food to transportation through his investments in artificial intelligence and machine learning.
Like the rest of Silicon Valley, Son has been reckoning with the presence of Saudi Arabia in the US tech world.
"Saudi Arabia's presence in Silicon Valley is greater than it's ever been," Alexei Oreskovic wrote for Business Insider in 2019.
The SoftBank CEO has direct ties to Saudi Arabia, which has been embroiled in human rights scandals and blamed for the killing of journalist Jamal Khashoggi.
Saudi Arabia's Public Investment Fund is the SoftBank Vision Fund's largest backer, having contributed $45 billion of the fund's $100 billion bankroll.
The SoftBank CEO is known for paying his executives handsomely — and he's far from the highest-paid person at the company.
Six of SoftBanks' top executives made $83 million combined (9.1 billion yen) in compensation in 2018, while Son's salary rose to about $2.1 million (229 million yen), according to Bloomberg.
"The range of executive salaries in Japan has gone up, but compensation in the billions of yen is still unheard of beyond a handful of global companies," Noriko Watanabe, a partner at Heidrick & Struggles, an executive search company, told Bloomberg last year.
In 2019, the head of SoftBank's Vision Fund made $15 million in 2019 — despite the Vision Fund losing billions of dollars — while its COO made more than $19 million, per Reuters. Son himself made just under $2 million.
Son owns millions of dollars worth of property in Tokyo, where SoftBank is headquartered.
The SoftBank CEO owns about $45 million worth of residential property in Tokyo, according to Bloomberg. And in 2013, he spent $326 million on Tokyo's landmark Tiffany Building in the Ginza luxury shopping district.
He also owns a $117.5 million Silicon Valley estate that comes with a 9,000-square-foot house, a 1,117-square-foot pool house, a detached library, a swimming pool, a tennis court, and formal gardens.
Son bought the Woodside, California, property in 2012 from private equity investor Tully Friedman, according to Forbes.
Son is married and has two children, but he keeps his family life private.
The CEO married Masami Ohno, the daughter of a prominent Japanese doctor, while they were both students at UC Berkeley, The Seoul Times reported. The couple reportedly has two daughters together, but little information about the family can be found online.
Son's younger brother, Taizo Son, is also a billionaire.
Taizo Son is an entrepreneur who has founded companies including GungHo Online Entertainment and Movida Japan. He's worth an estimated $1.2 billion, according to Forbes.
The SoftBank CEO reportedly has personal relationships with billionaire CEOs and entrepreneurs such as Bill Gates, Larry Ellison, Rupert Murdoch, and Tadashi Yanai.
Son has visited Ellison's Silicon Valley home, where he met Steve Jobs.
Yanai sat on SoftBank's board of directors until he stepped down in December 2019.
Son reportedly once had a close relationship with Adam Neumann, the cofounder and former CEO of WeWork, in which SoftBank was once the biggest investor.
Neumann told Business Insider in a 2019 interview that he and his wife, Rebekah, call Son "Yoda," in reference to the "Star Wars" character.
"He is Yoda," Neumann said. "He has the Force with him."
But WeWork's valuation has plummeted since September 2019 amid its failed IPO attempt in September 2019. Son reportedly "lost faith" in Neumann and wanted him demoted, the Financial Times reported September 22. A couple of days later, Neumann stepped down as CEO.
SoftBank took control of WeWork in a deal that gave Neumann almost $1.7 billion and required him to step down as chairman of the board.
In May, Son said on an earnings call that he felt "foolish" for investing $18.5 billion into WeWork.
In May 2019, SoftBank announced the creation of a second $100 billion Vision Fund, after having already spent more than half of the first one.
"Various investors from around the world are telling us they definitely want to participate in Vision Fund 2. We will set it up soon," Son said at the beginning of May, according to The Wall Street Journal.
The Journal later reported that Son has been having trouble raising money for this new fund, a claim SoftBank disputed.
"While we don't comment on fundraising, much of The Wall Street Journal's reporting on investor sentiment is misleading and even inaccurate," a SoftBank spokesperson told Business Insider in an email in June.
In July 2019, the company announced commitments of $108 billion to its second Vision Fund.
SoftBank confirmed that Apple, Foxconn, and others will invest in the fund, as well as Microsoft for the first time, Business Insider's Shona Gosh reported.
Although Saudi Arabia's Public Investment Fund was the largest backer of the first Vision Fund, having contributed $45 billion of the fund's $100 billion bankroll, Saudi Arabia is missing from the list of backers for the new fund.
But SoftBank has suffered since WeWork's downfall and amid the coronavirus pandemic.
In April, SoftBank said its Vision Fund would suffer a $17 billion annual operating loss.
SoftBank-backed companies including Oyo, Uber, Zume, and WeWork have laid off more than 8,000 people since January in total. In a Forbes interview also in April, Son said he predicts that 15 of the companies that the Vision Fund has backed will go bankrupt.
In early September, SoftBank's market value took a roughly $10 billion hit after The Wall Street Journal reported that it had been making massive, risky investments in tech stocks.
In June, as protests over racial injustice and the death of George Floyd swept the globe, SoftBank announced the launch of a $100 million fund to invest in entrepreneurs of color.
The fund will be overseen by SoftBank's chief operating officer, Marcelo Claure and two black tech leaders: TaskRabbit CEO Stacy Brown-Philpot and Pindrop cofounder Paul Judge.
"When it comes to diversity, SoftBank absolutely has to do better as an employer, investor, and partner. But we can't just talk — we have to put money behind it, set plans, and hold ourselves accountable," Claure wrote in an email to employees. "This fund will only invest in companies led by founders and entrepreneurs of color."
The announcement came on the ninth day of protests over the death of George Floyd, a black man who was killed by a white police officer, which started in Minneapolis and spread to all 50 states and countries including England, France, Germany, New Zealand, and the Philippines.
Despite his company's recent losses, Son has remained optimistic.
On an earnings call in May, Son talked about how the coronavirus has created a valley — the "Valley of Coronavirus" as he called it — that some companies will fall into, but other "unicorn" companies will be able to fly out of and succeed, as Business Insider's Bryan Pietsch reported.
"Things will probably get worse," Son said in the call, per The New York Times. "But we will keep working hard to survive."
In August, after three quarters of devastating losses, SoftBank finally reported a profit again and proceeded to make investments in Amazon, Tesla, Alphabet, and Netflix.
Axel Springer, Insider Inc.’s parent company, is an investor in Uber.
Disclosure: Mathias Döpfner, CEO of Business Insider’s parent company, Axel Springer, is a Netflix board member.
Source: Read Full Article