SoftBank expects at least $108b for second Vision Fund
SoftBank Group is set to establish its second Vision Fund focused on artificial intelligence (AI) with about $108 billion in initial commitments.
It highlights ongoing confidence in the Japanese conglomerate's aggressive global technology strategy, which saw the first Vision Fund close at $98.6 billion in December last year. Vision Fund claimed to have achieved a net equity IRR of 45% as of March.
SoftBank will contribute $38 billion to the second iteration of the fund, according to a release. This compares to a $25 billion GP commitment to Fund I. An additional $70 billion is expected to be raised from the likes of Apple, Foxconn Technology, Microsoft, Mizuho Bank, Sumitomo Mitsui Banking, Sumitomo Mitsui Trust Bank, and Standard Chartered Bank, all of which signed tentative LP agreements.
They will be joined by MUFG Bank, Dai-ichi Life Insurance Company, SMBC Nikko Securities, Daiwa Securities, and the National Bank of Kazakhstan. Separately, Microsoft, Goldman Sachs and the sovereign wealth fund of Saudi Arabia are in talks regarding contributions that would take the fund beyond the $108 billion mark, according to Nikkei. SoftBank confirmed it does expect the fund size to further increase.
The Vision Fund program has invested more than 80 start-ups to date, taking a mix of minority and control positions with an emphasis on businesses that focus strongly on incorporating AI. Portfolio companies include a logistics division of China's Alibaba Group, Indonesia's Tokopedia, and India's Paytm. The fund has been notably active in the mobility sector, having committed more than $10 billion across three of the leading ride-sharing apps Uber, Grab, and Didi Chuxing.
No timelines or allocation plans have been specified for Vision Fund II, but it is expected to maintain the sector-agnostic approach of its predecessor. To date, this has included a preference for transportation, healthcare, real estate, financial services, enterprise services, consumer, and advanced tech categories such as robotics, computational biology, and the internet-of-things. The Vision Fund portfolio was said to have an equity value of JPY3.2 trillion ($29.4 billion) as of March.
SoftBank is also active in technology investment via its VC unit SoftBank Ventures Asia, which achieved a first close last month of about $270 million for its latest global early-stage fund.
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