Internet and telecommunications group SoftBank will commit $40bn to its second Vision Fund and has already secured limited partners, the Wall Street Journal reported yesterday, citing people familiar with the matter.
Vision Fund raised $98.6bn for its inaugural vehicle, with Japan-headquartered SoftBank committing $33bn in cash and existing equity stakes, alongside financing from various corporates and Middle Eastern sovereign wealth funds.
The company’s board of directors are reportedly meeting today to confirm the commitment. Financial services firm Standard Chartered and investment bank Goldman Sachs have already committed undisclosed amounts to the fund.
The WSJ additionally named Apple, the consumer electronics manufacturer that contributed $1bn to the first Vision Fund, and the government of Kazakhstan as likely participants in a second Vision Fund.
Software provider Microsoft is meanwhile also in talks over a contribution but wants to insert a provision that will involve Vision Fund urging portfolio companies to switch to Microsoft’s Azure cloud hosting platform, away from competitors such as Amazon Web Services.
Vision Fund has invested at a rapid-fire rate since its launch, particularly in mobile app-based service providers and artificial intelligence-focused technology developers, and had committed $70bn as of March this year according to SoftBank CEO Masayoshi Son.
The vehicle’s larger investments include ride hailing services Uber and Grab, workspace provider The We Company, automotive e-commerce marketplace Chehaoduo and e-commerce firm Flipkart, ans it subsequently scored a large exit when the latter was acquired by Walmart.
Saudi Arabia’s Public Investment Fund supplied $45bn for the first fund while Abu Dhabi’s Mubadala provided $15bn. However, reports in the past year indicate some of the LPs for the first Vision Fund have been dissatisfied with some of its practices, including the absorption of past investments made by SoftBank itself.
Vision Fund has also reportedly considered asking some of its more prominent LPs to waive rights to annual repayments on the debt portion of their commitments. Reports last month suggested it was in talks with lenders including Goldman Sachs to raise more debt financing.
