Venture Capital: Softbank’s Vision Fund Posts $21.68B Quarterly Loss Amidst Tech Wreck

August 8, 2022 | Latest News, News, Venture Capital

The June quarter loss is the second-largest ever for the Vision Fund, and a record loss for Softbank.

The meltdown in technology stocks following hardening interest rates has taken a massive toll from SoftBank (TYO: 9984) and its Softbank Vision Fund, one of the most prolific and high stakes investors in the sector. The Vision Fund’s $21.68 billion loss for the June quarter pushed the bank into a corporate loss of $23.38 billion. (CNBC)

Softbank attributed the losses to falls in the share prices of portfolio companies caused by “the global downward trend in share prices due to growing concerns over economic recession driven by inflation and rising interest rates.” Also at play were declines in valuations of private companies held in the company’s portfolio. It wrote down the value of unlisted assets across its two Vision Funds by 1.14 trillion yen.

On a conference call, Masayoshi Son, the chairman and founder of SoftBank admitted that the Vision Funds had to reduce operational cost and be more selective in new investments.

In a briefing after the release of the results, Son regretted that the company had invested in more startups than it should have during a period marked by valuation bubbles.

“The world is in great confusion,” he said.

Son had said in May that the company would go into “defense” mode and be more “conservative” with the pace of its investments.

Meanwhile, the FT reported last week that SoftBank had this year carried out the sale of about one-third of its Alibaba stake through prepaid forward contracts to raise as much as $22 billion.

Related Story: In Japan, Panasonic Corp And SBI Investment Form Corporate Venture Fund

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