SoftBank Vision Fund Posts $17.7 Billion Loss on WeWork, Uber (bloomberg.com) 29
SoftBank Group said its Vision Fund business lost 1.9 trillion yen ($17.7 billion) last fiscal year after writing down the value of investments, including WeWork and Uber. From a report: The company posted an overall operating loss of 1.36 trillion yen in the 12 months ended March and a net loss of 961.6 billion yen, according to a statement on Monday. The Tokyo-based conglomerate released figures in two preliminary earnings statements last month. The losses are the worst ever in the company's 39-year history. SoftBank founder Masayoshi Son's $100 billion Vision Fund went from the group's main contributor to profit a year ago to its biggest drag on earnings. Uber's disappointing public debut last May was followed by the implosion of WeWork in September and its subsequent rescue by SoftBank. Now Son is struggling with the impact of the coronavirus on the portfolio of startups weighted heavily toward the sharing economy. 50 of the Vision Fund's 88 portfolio companies had a cut in valuation in the 12 months to March 31, 2020, said Son, adding that 15 could soon file for bankruptcy.
Fooled by randomness (Score:5, Interesting)
Re:Fooled by randomness (Score:5, Interesting)
Son got lucky early and people misattributed that to investing prowess.
This. So much this. A lot of people we consider "successful" don't have any special gift or talent, they simply had the luck of having the right idea at the right time. At best, they were smart enough to buy in/sell out when it was most beneficial. Most of the ones that move on and try to replicate their success fail because they bought in that they have a magic touch or special insight that simply isn't there.
Re: (Score:2)
A large part of success is based on luck.
However the smart successful person, takes full advantage of the times they are lucky. Lets say you picked a Penny Stock and it shot up 500% in one day. Consider yourself lucky cash it in, and put it back into stable stocks, perhaps put a fraction (Perhaps your original investment) back into the high risk penny stocks again.
However there are so many factors to success.
What family you have been born into, who else do you know for contacts, that right job came into
Re: (Score:2)
Most of the ones that move on and try to replicate their success fail because they bought in that they have a magic touch or special insight that simply isn't there.
I doubt most of them fail in replicating success, but only because now they have a massive advantage which comes from their newfound fortune and reputation. Once you are worth $50 million and are known to have been a successful investor / entrepreneur / etc. you will have a much easier time with your next venture. You will have an easier job raising funds for a new VC investment if you are an investor, an easier time getting customers and investors if you are an entrepreneur, and an easier time marketing yo
Which idea was that? The translator? Video games? (Score:4, Interesting)
> the luck of having the right idea
I have good ideas all the Dan time. I bet you do to.
I'm not quite a billionaire. I bet you're not either.
When Son came to the US at rhe age of 16, three weeks later he completed high school by testing out of all of the classes. At 19, he created an electronic translator, making the product well enough and managing the business well enough to make a couple million dollars - at the age of 19. Was that his "got lucky with a good idea"?
Next up, he bought used arcade games from Japan and set them up in California in places where people would want to play Japanese games. Apparently he chose the right games, offering the right prices, and put them in the right locations (working well with the management of those locations) because he made a million and half doing that. Was that his got lucky with a good idea.
Next, he graduated college. Yeah he'd already made a few million in multiple different businesses before he graduated - dude just keeps getting "lucky", right?
That's when he "got lucky" AGAIN. He spent a year and half coming up with 40 different unique business ideas and 25 different ways to score each idea. He scored each idea on the 25 measurements and looked over the total scores to figure out which idea was best overall. Maybe THAT was his lucky idea, spending a year and half carefully analysing all of his 40 other ideas?
Maybe his lucky idea was to stand up in front of the new company's two employees and declare "in five years we're going to be the largest software PC distributor in the world". Certainly nobody else ever had the idea to sell software, right? That was just a lucky idea. Maybe "being number one" was his lucky idea, maybe nobody else ever thought of trying to be the biggest?
Or maybe ...
Success in business depends on a few different factors.
Maybe having a really good product helps.
Maybe who you choose to work with is important. Maybe of you lay with dogs, you wake up with fleas, so it's important to avoid having a scummy or lazy business partner.
Maybe being sloppy, not having the right things in stock and leaving customers waiting doesn't work so well. Maybe execution matters - doing things right as well as doing the right thing.
Maybe Son keeps "getting lucky" over and over again because he does things right, after spending the time to figure out tye right thing to do (remember the 18 months spent scoring different business ideas before launching one).
What does that mean to you? Is it good news or bad news? Both. It's good news because the recipe doesn't care who is cooking. Follow a cake recipe, you'll get a cake. And that means you CAN follow the recipe, do the things that successful people do, and be as successful as you want to be (recognizing that more success requires more work). It's bad news if you were happy making excuses for not doing anything, saying "whhaaa I'm just not lucky. Nothing I can do about it". Knowing that there is a pattern, that there are specific things successful people do and you CAN do the same things, you no longer have that "eh I'm just not lucky like the millions of successful people are" excuse. Now you either do it, or know in your heart that you CHOSE not to be successful.
.
Re: (Score:3)
Son got lucky early and people misattributed that to investing prowess.
It is more than just that. The skills needed for an early-stage "zero-to-one" VC are completely different from a 3rd or 4th round VC investing in mature unicorns. The expertise needed for managing IPOs and investing in public markets are yet another set of skills.
For early-stage investing, success is mostly in judging the viability of the idea and the capability of the founding team. With later stage investing, the idea has already been validated, so the skill is in judging the organization and understan
Re: (Score:1)
Randomness is all you need (Score:2)
Most of what people think is "investing prowess" is actually just randomness [marketwatch.com]. Any time you have a bunch of different entities pick stuff at random, some will get lucky [wsj.com] - that's just how probability works. It's only in i
Good (Score:5, Insightful)
We need an economy that doesn't keep backing shitpiles like Uber.
Re: (Score:2)
They have brand recognition. You can step off a plane almost anywhere in the world and Uber will work.
Flew up to Montreal for a quick work trip, needed to get to my hotel. First, was having issues with my cellphone connecting to a Canadian network. Finally got it to work about 15-20 minutes later and got an Uber. When I tried to pay, it kept rejecting my credit card on file. When I got back home a day later, tried paying online and it still failed. I stopped trying to pay after that (since they clearly didn't want my money) and haven't used my Uber account since. The driver was pretty nice though.
Re: (Score:1)
Well there you have it! Cancel Uber everyone, it didn't work for that guy that one time!
Re: uber's worth something (Score:2)
You can get off a plane anywhere in the world and climb into a taxi, or the shuttle van. You'll be downtown long before the guy riding the uber has even connected to the local phone network, let alone hailed a ride.
Re: (Score:2)
Yeah, they "rescued" WeWork then lost money on the deal.
Imagine that!
Re: (Score:2)
The problem is the economy is centered around get rich quick.
If these businesses kept an emergency funds that will last them say 1 qtr closed down, paying workers to stay on board, and keep the loan payments. Then these businesses wouldn't be so hard hit.
The real issue, is these companies are laying off people. When they start up business again, not all of these people will come back, and those who do, may no longer be as motivated anymore as the company they worked for burned them badly.
The companies th
Japan in tailspin (Score:2, Interesting)
Hope they can recover but man they need to figure out something ASAP. Most of their companies have halted innovation for the past 10 to 15 years. Look how far behind Toyota is compared to Ford and Tesla. They zeroâ(TM)d on autonomous vehicles, zeroed on electric. Leadership in display technology shifted to South Korea. Leadership semiconductor manufacturing technology has shifted to Taiwan and South Korea. Gaming software tech is firmly led by the US. Gaming hardware may be shifting from Japan to the U
Re: (Score:3)
Toyota leads the world in hybrid cars.
Re: (Score:2, Funny)
OK, the Pony Express leads in equestrian-based delivery services. Useful in 2020?
Re: (Score:2)
The world doesn't have sufficient facilities to plug in pure electric vehicles. Even America doesn't have sufficient facilities.
To charge at home, you basically need to own a home with a garage. Over a third of of American households rent. Not all owned homes have full garages condos tend toward parking garages and carports. And a quarter of American garages are too cluttered to park a vehicle in there.
In California, we're JUST getting to the point of setting appropriate rules for chargers. Ya, we've have b
Re: (Score:2)
And a quarter of American garages are too cluttered to park a vehicle in there.
I'll bet that only a quarter of American garages can only fit a vehicle in them; the rest of it is garbage you couldn't give away at a garage sale. Some areas are requiring car charging stations in new garage construction; my dad lives out in the boonies in NorCal and built a garage, and was required to install a charging station, despite the fact that he will probably never own an electric car.
Re: (Score:2)
While my gut reaction was ‘troll’, from a business perspective their focus on hybrids has made them very successful for 10-15 years. I don’t see much suggesting the strategy will continue to have as high efficacy though as battery costs drop though; the value the engine provides drops quickly.
Re: (Score:2)
I imagine it's easier to take the generator out of an electric car and replace it with more batteries, than it is to take the engine out of a non-electric car.
Re: (Score:2)
While my gut reaction was ‘troll’, from a business perspective their focus on hybrids has made them very successful for 10-15 years. I don’t see much suggesting the strategy will continue to have as high efficacy though as battery costs drop though; the value the engine provides drops quickly.
Those Toyota hybrids completely solve "range anxiety". I suspect they'll be around for a while yet.
Re: (Score:1)
Leader of the pack (Score:2)