SoftBank’s Vision Fund Arm Posts Record $32B Loss

SoftBank’s Vision Fund unit — known for its investment in startups including Uber, WeWork and DoorDash — suffered losses of $32 billion for its recent fiscal year as startups continue to see their valuations slashed.

The loss is a significant increase from the more than $19 billion loss the unit suffered last year.

The overall loss of investments in the Vision Fund unit totaled $39 billion for the fiscal year ended March 31, compared to $25 billion the previous fiscal year.

The losses from the unit — which included SoftBank’s Vision Fund 1, Vision Fund 2 and its LatAm Funds that focus on Latin America — led the SoftBank Group as a whole to record a net loss of $7.2 billion.

Pulling back

A year ago, the declining private market led SoftBank founder Masayoshi Son to tell investors there will be stricter investing criteria moving forward and a more defensive posture.

This year, the Japan-based investment giant said it will play both offense and defense as it sees significant opportunities in the rise of generative AI.

While SoftBank may see some potential for investment, it has substantially cut back the cash it has deployed. In Q1 of fiscal year 2021, the segment made $15.6 billion in investments, but in the most recent quarter it only deployed $400 million in capital.

In fact, in the last three quarters it has only invested $1 billion total.

The Vision Fund unit has been battered in the past year as tech stocks in the public market sank, bringing down the valuation of many startups in the private market. In addition, geopolitical tensions, a banking crisis and crypto’s ups and downs have led to more uncertainty and roiling the private sector.

The FTX collapse alone led to SoftBank writing down its entire $97 million investment in the crypto exchange.

The total fair value of the Vision Fund portfolios was $138 billion as of March 31, according to SoftBank.

Illustration: Dom Guzman

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