SoftBank plots $108bn Vision Fund successor

The Japanese tech giant has received memorandums of understanding from the likes of Microsoft, Apple and Dai-ichi Life Insurance Company.

SoftBank Group is planning to launch a $108 billion successor to its Vision Fund.

The Japanese tech giant has received memorandums of understanding from institutions such as Apple, Microsoft and Dai-ichi Life Insurance Company, according to a Softbank statement.

Investors will also include Mizuho Bank, Sumitomo Mitsui Banking Corporation and Daiwa Securities Group, as well as the National Investment Corporation of National Bank of Kazakhstan, Standard Chartered Bank and “major participants” from Taiwan.

SoftBank intends to commit $38 billion to the fund. Goldman Sachs has been tapped to raise the vehicle, which is expected to close by March, Bloomberg reported in June.

“The objective of the fund is to facilitate the continued acceleration of the AI revolution through investment in market-leading, tech-enabled growth companies,” the statement noted.

Saudi Arabia’s Public Investment Fund, which was not named among the investors, is in talks with SoftBank, according to the UAE’s The National. In March, chief executive Masayoshi Son noted the “good relationship between the PIF and the fund’s management” adding it was too early to say whether they would commit to Fund 2.

“When it comes to [the] next fund… with what kind of term we go in to raise money, it’s still too early to discuss. There are terms to be discussed, conditions to be discussed… that’s how I see the situation.”

The $97 billion first Vision Fund has raised concerns among industry professionals around competition for deals resulting in higher-priced assets, as it snaps up the hottest next-gen innovation companies from China to Silicon Valley. More than half of the capital had been invested across 49 investments globally as of 31 December.

Its portfolio includes messaging app Slack, ride-hailing giant Uber and shared workspace provider WeWork.

Vision Fund generated a 45 percent net equity internal rate of return and a 29 percent net blended IRR as of March, according to SoftBank’s latest earnings.

Fund 2 follows this month’s launch of SoftBank Ventures Asia Corp, a 317 billion won ($268 million; €240 million) South Korean-domiciled early stage vehicle. Investors include Korea’s National Pension Service and SoftBank Korea Corp.

– Carmela Mendoza contributed to this report.