Softbank to invest $9bn in pivot to AI

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Softbank chief executive Masayoshi Son has set his sights on AI investments.
Softbank chief executive Masayoshi Son has set his sights on AI investments.

Japanese tech company Softbank is to invest almost $9bn in artificial intelligence, as it pivots away from its traditional venture capital model of investing.

Softbank became known globally for its flagship Vision Fund, investing in pie in the sky companies which occasionally translated to a massive win.

Most famously, the company invested a staggering total of $18.5bn into Wework, which has since filed for bankruptcy.

Now, that seems to be changing, as it moves towards a more streamlined focus on semiconductors and artificial intelligence.

Softbank has more than doubled its commitments towards AI over the last year since its CEO Masayoshi Son said the company was preparing to go on the “counteroffensive”.

“We will, in principle, be keeping the same kind of trend in terms of the pace of investment activities,” Softbank’s chief financial officer Yoshimitsu Goto told the Financial Times. “From now on, we want to step up investments in AI companies.”

“The reason we’ve been keeping our balance sheet at a very safe level is because we would like to be prepared,” he added, “and we would like to be flexible if there is anything that we would like to move on.”

Earlier this month, it was revealed that the Vision Fund had quietly sold off or written down billions in its publicly-listed holdings.

Despite cutting its teeth on American companies, the fund has shrunk its US-listed portfolio by almost $29bn, dropping stakes in firms like Doordash.

Meanwhile, Softbank led an investment of over $1bn into British self-driving car start-up Wayve in Europe’s largest artificial intelligence deal to date.

Last year, CEO Son said he expected artificial general intelligence to become 10 times more powerful that all of humanity by the end of the decade.

“Take advantage of it or be left behind,” he said.

Softbank is beginning to face intense competition in the AI space, as tech behemoths like Google and Microsoft move to either create their own artificial intelligence services, or buy stakes in companies like Openai.