The SoftBank Vision Fund is most certainly back in the black, according to the Japanese telecom giant during its Monday earnings call.
After missteps last year such as WeWork, SoftBank said its 83 Vision Fund 1 investments are now valued at $1.4 billion more than their cost.
And while Vision Fund 2 struggled last year to raise outside funding, SoftBank emphasized that the smaller second fund has had a substantial gain, in part after a single IPO. Riding on the back of Ke Holdings, a Chinese online property platform that listed in the U.S. in August, Vision Fund 2 was valued at $7.6 billion compared to a cost of $2.6 billion.
That’s significant: The second Vision Fund is held up only by SoftBank’s own capital. And should new investors want to put their capital into the fund and its new strategy as it seeks more modest bets, CEO Masayoshi Son said the fund is always open to outside investors.
A clear comparison of the Vision Fund to its past operations though is somewhat more difficult than before, as the firm decided to forego disclosures related to operating profits or losses earlier this year.
But SoftBank’s financials reveal a surprisingly quick comeback for the company: It posted a profit of over $6 billion in the quarter ending in September as markets rose, after a stunning loss in 2019. Firm-wide attempts to bring its share value back in line with those of its assets, including the sale of part of its hefty stake in Chinese e-commerce giant Alibaba, have played a big role.
Not every bet has worked out, however. The company also recorded an investment loss of about $1.3 billion from “investment in listed stock” and other derivatives in the six months ending September.
Also of note: As activist investor Elliott Management has pressured the company to bolster corporate governance with a higher proportion of outside directors, four internal directors resigned from the board. Those names are SoftBank COO Marcelo Claure, Chief Strategy Officer Katsunori Sago, and Vision Fund CEO Rajeev Misra. The head of Saudi Arabia’s Public Investment Fund, Yasir O. AI-Rumayyan, also stepped down.