SoftBank Vision Fund Reports a Heavy Loss in Q3

SoftBank Group, a leading Japanese multinational conglomerate, took a major hit in the third quarter of 2021 amid a sharp decline in the valuation of companies like Coupang. SoftBank recently published its results for Q3 2021 and posted substantial losses in its Vision Fund unit.

The Group reported a net loss of 397 billion yen ($3.5 billion) between July and September. SoftBank’s decent performance in other units was dragged down by heavy losses in its Vision Fund unit. The latest performance by SoftBank’s Vision Fund is the worst ever in its history.

During the recent quarter, the value of Digi Global and Coupang dropped heavily. Didi Global lost nearly 50% of its value while the stock of Coupang decreased by approximately 40% between July and September 2021.

“Naturally, the focus of investors and capital providers is completely different. Investors pay close attention to the daily movements of indicators that affect the stock prices of these industries, such as interest rates, exchange rates, and employment statistics, as well as the monetary policies of the authorities, and make decisions based on these indicators,” Masayoshi Son, CEO of SoftBank, commented.

“However, for capital providers who are looking to shape the future over a 10- to 30-year span, these indicators are not necessarily important. As a capital provider, all I see is how technology is going to create a paradigm shift. In the formative years of the Internet, most Internet companies did not generate profits,” Son added.

Investments from SoftBank

SoftBank Vision Fund made several investments this year to expand its portfolio with the addition of companies working on innovative technical solutions. Earlier this year, fintech startup Revolut raised $800 million in a funding round led by SoftBank Vision Fund and Tiger Global Management. The Japanese multinational conglomerate also invested in the Digital Currency Group (DCG) recently.

The latest drop in the valuations of technology companies across Asia is hurting the overall financial numbers of SoftBank.

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