SoftBank bets $30bn of its own capital on Vision Fund II

Vision Fund II launched in 2019 and failed to secure third-party commitments on the back of the underwhelming performance of its 2017-vintage predecessor.

SoftBank continues to pour billions into its second Vision Fund in lieu of third-party capital.

The Japanese tech conglomerate had committed $30 billion to Vision Fund II as of Tuesday, up from $10 billion at the end of December, according to an earnings statement Wednesday. Fund II launched in 2019 and failed to secure third-party commitments after the underwhelming performance of its 2017-vintage predecessor.

SoftBank’s Vision funds appear to be back on track. Collectively, the unit posted a ¥6.36 trillion ($58.5 billion; €48.2 billion) net gain for the fiscal year ending March 31, compared to a ¥1.84 trillion loss the prior fiscal year. The IPO of South Korean e-commerce business Coupang in March bolstered Fund I’s performance.

“Money-wise we have quite enough cash in hand…therefore right now, we’d like to continue investing using our own cash,” chief executive Masayoshi Son said on a Wednesday earnings call.

“We don’t have to beg for participation, but it doesn’t necessarily mean that we don’t ask any other third-party participation,” he said.

LPs in Vision Fund I include Apple, Abu Dhabi’s Mubadala Investment Company and Saudi Arabia’s Public Investment Fund, according to PEI data.

Fund I held 81 investments worth $120.7 billion as of end-March and has delivered a 30 percent net equity internal rate of return to LPs since inception. Vision Fund II has already completed 65 investments, with an additional 30 approved by its investment committee that are yet to close.

“We’ll be able to expect distributions from Vision Fund I and II by portfolios going public and so on, so at this moment I think we will be able to continue the current status,” Son said. “In the future, we may consider inviting third-party money, but we don’t know yet at this moment.”

This article first appeared in affiliate publication Private Equity International