The VC arm of Japanese tech giant SoftBank is trying to raise $100bn for a second Vision Fund but is finding it hard to get investors, reports The Wall Street Journal. However, the firm denies it
Raising money is not easy – whether you’re an entrepreneur trying to fund your startup or a VC firm attempting to help other startups. But with conglomerates like SoftBank, which has been responsible for investing billions into tech startups, many head honchos have seen success. And while the firm said it will aim to raise a $100bn fund, it’s facing difficulty to attract investors as reported by The Wall Street Journal.
In a bid to raise a second Vision Fund, the Japanese VC behemoth faced “a chilly reception” from investors when it pitched its idea. The issues that said to be concerning would-be backers included the lack of transparency and the decision-making process about where the money is actually invested.
This isn’t the first time they expressed their discontent. In February 2019, key investors expressed their unhappiness and disappointment with where the firm was going. Some of its main investors like Saudi Arabia’s Public Investment Fund and Abu Dhabi’s Mubadala Investment Co., have been responsible for almost two-thirds of the Vision Fund’s pledged capital until now and if they continue to be unsatisfied then it will indeed become more difficult for SoftBank to raise money.
Having launched the Vision Fund in 2016, CEO Masayoshi Son said the firm has already invested circa $70bn across the globe. Having invested in companies like Uber, WeWork, ARM Holdings and Flipkart among others, SoftBank must ensure it raises money to stay ahead of the curve.
Commenting on the report by TheWall Street Journal, a SoftBank spokesperson told Business Insider: "While we don't comment on fundraising, much of the Wall Street Journal's reporting on investor sentiment is misleading and even inaccurate.”
While it looks challenging for SoftBank, time will tell whether Son will be able to convince investors to bag more money and just how “inaccurate” the story is.