SoftBank forms Vision Fund 2 with AI-focus, draws Apple, Microsoft

The fund has thus far grown to $108 billion in commitments, and could grow bigger as the company is in talks with other participants

Harichandan Arakali
Published: Jul 26, 2019 06:28:21 PM IST
Updated: Jul 26, 2019 06:55:32 PM IST

g_119167_masayoshison_bg_280x210.jpgImage: Alessandro Di Ciommo/NurPhoto via Getty Images

SoftBank Group Corp. is raising a second vision fund two years after the first one, to invest in tech ventures worldwide. This time, their focus is on artificial intelligence (AI), and likely participants include Apple and Microsoft, said the Japanese internet and telecom company in a statement on July 26. Apple was an investor in the first fund as well.

SoftBank Vision Fund 2, the new private investment fund, has thus far garnered commitments that total to about $108 billion, including $38 billion that SoftBank itself plans to invest. “The objective of the Fund is to facilitate the continued acceleration of the AI revolution through investment in market-leading, tech-enabled growth companies,” SoftBank said in its statement.

Billionaire chairman Masayoshi Son raised his first vision fund in 2017, totalling $97 billion. SoftBank emerged as one of the biggest investors in startups in India, where it funded companies including ecommerce giant Flipkart; Paytm, India’s largest mobile wallet provider; Ola, the country’s largest cab-hailing service; and Oyo, India’s largest hotel booking service provider.

SoftBank had invested $2.5 billion in Flipkart from its first vision fund in 2017, and when the company sold its stake to Walmart, the stake was valued at about $4 billion. This exit was also the first from among the first vision fund’s investments. SoftBank remains an investor in the other Indian companies and continues to scout for opportunities in India.

Among the companies that have executed memorandums of understanding to participate in the second vision fund are Apple, Foxconn Technology Group, Microsoft Corporation, Mizuho Bank, Ltd., Sumitomo Mitsui Banking Corporation, MUFG Bank, Ltd., The Dai-ichi Life Insurance Company Limited, Sumitomo Mitsui Trust Bank, Limited, SMBC Nikko Securities Inc., Daiwa Securities Group Inc., National Investment Corporation of National Bank of Kazakhstan, Standard Chartered Bank, and major participants from Taiwan, SoftBank said in its statement.

Discussions are ongoing with additional participants and the total anticipated capital contribution to the Fund is expected to increase, the Japanese company said.

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