SoftBank thinks tech investors should be grateful for its deal spree

Rajeev Misra, head of the SoftBank Vision Fund.

The venture capital community has been fretting about the impact SoftBank Group Corp.’s giant tech fund has on deal prices. The Japanese company says be grateful.

“It’s good for investors if valuations go up as they can exit at those prices,” said Rajeev Misra, head of the Vision Fund, citing deals with Didi Chuxing, Uber Technologies Inc. and WeWork Cos. where early investors exited by selling stakes to SoftBank.

The industry is upset that SoftBank is muscling in on deals and has voiced concerns that it’s ladling out more money than startups need or can absorb, pushing valuations too high.

The Vision Fund spent 2017 funding some of the world’s largest startups, including leading a $9 billion investment in Uber and a $4.4 billion stake in WeWork. This year the fund revealed plans to invest 460 million euros ($560 million) in Auto1 Group GmbH, valuing the German used-car sales portal at about 2.9 billion euros.

The Vision Fund, which is targeting $100 billion in committed capital, is also looking for more deals in Europe. Misra said he hopes the fund’s wide range of investments, from dog-walking apps to fintech startups, can work together.

“There can definitely be joint ventures in the portfolio, such as Auto1 selling used cars to Uber drivers, and an insurance company like Lemonade selling insurance to Uber drivers,” he said in an interview at the Mobile World Congress in Barcelona.

The hope for joint ventures encompass the Vision Fund’s numerous ride-sharing investments, including Ola in India and Grab in Southeast Asia, with research and development eventually being shared between the companies.

The desire for companies to work together may only go so far. SoftBank is keen for Uber to withdraw from certain Asian markets, according to people familiar with the matter. An Uber retreat would save money for both startups, and would improve the U.S. company’s profitability ahead of a planned initial public offering in 2019. Uber has already begun talks with Grab and Ola about potential deals, Bloomberg has previously reported.

While the Vision Fund has invested heavily in the U.S., India and Asia, Europe remains something of a blank spot. Aside from the Auto1 deal, last year SoftBank led a $502 million investment in a London-based virtual reality startup called Improbable Worlds.

“Our desire would be to see more deals in Europe,” Misra said.

Bloomberg

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.