SoftBank’s Vision Fund has $100 billion to invest in tech companies

    

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If the current state of startups proves anything, it’s that the possibilities are endless for entrepreneurs, no matter where you are in your career. Take for example SoftBank Group Corp, which is headquartered in Tokyo. Its SoftBank Vision Fund seems to be investing in everything in sight. Since 2008, they’ve poured hundreds of millions of dollars into tech companies like Uber, Wag, Compass, Brightstar, and Getaround to name a few with many more to come.

This is exciting news for the type of companies that SoftBank is targeting and it’s exciting news for business leaders seeking investors with a vision of their own.

The future is bright for innovators and disruptors

SoftBank Vision Fund is arguably one of the most high-profile investment engines in business right now. Since 2016, it has become the biggest tech fund in history, with billions of dollars and 82 companies in its global portfolio.

SoftBank founder and CEO Masayoshi (Masa) Son is far from new to venture capitalism. The leader of the Japanese telecom giant has been betting on tech since the early days of the internet, which helped him become one of the world’s wealthiest individuals.

The sheer magnitude of SoftBank’s investments has certainly grabbed worldwide attention. But it’s their method of doing business that really sets them apart. Namely, how and in whom they invest.

Typically, the SoftBank Vision Fund pours money into disruptors in the tech sphere, including high-profile ventures like Slack, DoorDash, and WeWork. Others are less well-known, but one thing is clear: These are not baby startups.

Different from other funds, SoftBank’s Vision Fund is investing in more mature companies.

Son thinks bigger and more long-term with his investments. The minimum SoftBank investment is around $100 million, in exchange for a larger stake in the company (between 20% – 40% ownership). Straying from the two to three year exit timeline of a typical funding venture, SoftBank has made it clear they are looking for companies with longevity. They want to see companies maximize returns over 10-15 years.

How to Become a CEO that Appeals to Investors Like SoftBank

While their checks have created billions in profit, it's argued that SoftBank isn't the reason for these companies’ success. Many, if not most of them were massively successful before. SoftBank is simply picking successful companies and betting on them over the long run.

CNBC says Son meets with every founder of every Vision Fund investment in person before a deal is signed. One of those founders, Mohit Aron, funder and CEO of Cohesity, says he thinks Son is looking for “a leader of a company with very big ambitions.”

Remember, they’re not looking for fast turnarounds (exits) in two or three years. This is a longer play and that means they will need a CEO with the skills to operate a company for longer than "luck" will last.

Five ways to get noticed by an investor

The culture of innovation and limitless possibilities that many CEOs are drawn to seems to be exactly what the SoftBank VisionFund is tapping into. Jeff Housenbold, one of the fund’s 10 managing partners says “... that’s part of the power of partnering with SoftBank, our ability to take you globally and allow you to become a bigger company overnight than you might have with other sources of capital.”

While there are certainly no guarantees to securing investment money like SoftBank’s, there are certain steps you can take now to start growing your company faster to put you in a more attractive position.

1. Communicate your company vision effectively

Do you have a clear vision for a groundbreaking new technology? Have an idea that taps a previously undiscovered market that shows real innovation? Or perhaps you’re already running a successful company and seeking investors to jumpstart your growth.

Unfortunately, you’re not alone. These days, it’s not enough to have a great idea. To be noticed, and pick up traction with consumers or investors, you need the skills to effectively and persuasively communicate your business idea.

To communicate your company vision effectively, you’ll need a solid background in all aspects of business, including:

It also helps to have real-world experience to learn from as you continue to grow your idea.

Being able to speak the language of business and having proven experience in research and developing solutions for modern business problems is one way to cut through the noise and get on the radar of investment firms like SoftBank.

2. Get your MBA

Learning the skills required to start and grow a viable organization is an important component of the curriculum at top business schools.

While an MBA is not a requirement for an executive role, the skills you gain at a top MBA program like UC Berkeley will provide you the preparation needed to lead your company to the top. The academics, top-notch professors, networking opportunities, and more, make your MBA a lifetime investment in your company’s success. It’s no surprise among the top 100 CEOs in the Fortune 500, 29 have MBAs; six of the top 10 CEOs have an MBA.

Berkeley Haas offers dual MBA, Masters of Engineering degree program that helps you stay on the bleeding edge of technology and entrepreneurship.

3. Specialize in intrapreneurship

Investing in mature companies means that Son and SoftBank see a long-term path for those organizations. The key ingredient to a company's ability to remain relevant and withstand a business world growing more competitive every day is innovation.

That’s why many large organizations place a high value on intrapreneurs, people who take on the role of an entrepreneur inside an already established company. Intrapreneurs promote innovative product development and marketing— from seed to market — to differentiate their business in the marketplace.

During your MBA program, you can add a special emphasis to the hard skills required to succeed in intrapreneurship--design thinking, and global economics--as well as learning the necessary soft skills like leadership, critical thinking, and applied innovation.

4. Build your network

For budding intrapreneurs and entrepreneurs, an MBA program at UC Berkeley is a great place to meet potential co-founders, investors, employees, and clients.

MBA students have the chance to get to know classmates, professors, alumni, and to make connections in the business world through:

For intrapreneurs, networking is particularly important. Innovating inside an organization can be rife with bureaucratic red tape. Obstacles are abundant, it can be difficult to acquire funding to launch new ideas, and disruptions as you push new ideas through are common However, with a solid network you have more options for creating partnerships and agreements to help finance individual projects and smooth the process. Maybe the project you find financing for is the one that gets noticed by the next big investor.

5. Apply your learnings and start your company

Odds are, you’ve heard of the app Shazam. Maybe you don’t know its story, though.

The co-founders, Chris Barton and Philip Inglebrecht, both UC Berkeley MBA graduates, developed the idea for Shazaam after taking a Strategic Innovation course, taught by Costa Markides, at the Haas School of Business.

Before entering Haas, Barton had already conceptualized the idea of a radio-monitoring technology, but lacked the skills to identify the need in the marketplace and the most strategic way to bring his idea to market.

After broadening his perspective thanks to Professor Markides, and strengthening his skills to communicate his company idea Barton was able to adjust the way he thought about his product, and bring it to market as Shazam. Though Shazam was not funded by SoftBank, the lesson is still relevant, as it was acquired by Apple in 2018 for a whopping $400 million.

By applying the learnings he acquired from his MBA program, Barton was able to successfully launch a business, innovate to current market needs, and receive a payout at the end for his remarkable work.

Are you ready to push your idea through to the next level? Get started at Berkeley Haas to learn the skills, make the connections, and execute on ideas that work.

 

 

 

About The Author

Rahul is Director of Admissions for the Berkeley MBA Programs for Working Professionals. He hopes these blog posts provide you with useful insights into the Berkeley MBA experience and questions you may have about the MBA in general.