Japan-headquartered telecommunications and internet group SoftBank launched its second Vision Fund today, disclosing it has signed memoranda of understanding (MOUs) for funding that will take its size to $108bn.
SoftBank launched its first Vision Fund in 2017 with a $100bn target and has confirmed $98.6bn of debt and equity financing for the vehicle, with much of the capital coming from limited partners consisting of Middle Eastern sovereign wealth funds and corporate partners.
SoftBank plans to contribute $38bn of the capital for the new fund, up from about $33bn for the original Vision Fund.
Consumer electronics producer Apple and manufacturing services firm Foxconn each provided $1bn for the first fund and have signed MOUs to invest in this one, but fellow corporates Qualcomm and Sharp do not appear to be returning. Investment bank Goldman Sachs, touted as a backer in media reports this week, was not included either.
Software provider Microsoft, insurance firm Dai-ichi Life, financial services firms Mizuho Bank, Sumitomo Mitsui Banking Corporation, Mitsubishi UFJ Financial Group, Sumitomo Mitsui Trust Bank and Standard Chartered are also among the LPs.
The list was completed by brokerage group Daiwa Securities, the state-owned National Investment Corporation of National Bank of Kazakhstan and unnamed “major participants” from Taiwan.
Saudi Arabia’s Public Investment Fund and the emirate of Abu Dhabi’s Mubadala Investment Company, which jointly chipped in $60bn for the first Vision Fund, were not named as LPs, though SoftBank said it is still talking to prospective additional backers, and that the size of the fund could increase.
Both investors are reportedly among those prospective LPs, multiple sources have told Axios, and are said to be leaning towards contributions similar to those they made for the first vehicle.
The move will ensure Vision Fund maintains its considerable influence on the late-stage investment space, particularly in the artificial intelligence and online services sectors on which it concentrates. It typically provides nine and 10-figure sums in large rounds in a bid to become the largest investor in a company.
The vehicle’s notable exits include e-commerce marketplace Flipkart, where it made $1.5bn in profit in a year, and ride hailing platform Uber, which floated in May 2019, in the largest initial public offering for five years.
Some of Vision Fund’s other largest investments include fellow on-demand ride provider Grab, workspace provider The We Company, satellite technology producer OneWeb, autonomous driving technology developer Cruise Automation and online automotive marketplace Chehaoduo.
SoftBank Investment Advisers, which manages the Vision Funds, has not disclosed any changes to its strategy now the second one has closed, but it has been increasing its presence in areas such as China and India in recent months, and may well look to invest more heavily in emerging markets.
