孙正义和他的软银帝国 | 马云背后的男人

I believe many of you have heard of this story In year 2000 when Jack Ma and Alibaba urgently needed financing there was a Japanese tycoon handed out olive branch in just 5 minutes with a quick swish of hand here you go Jack Ma $20 million This not only rescued Alibaba it has also achieved the most successful venture capital investment in history which has since grown 3,000 times this tycoon is Masayoshi Son

Investing in Alibaba is just one of his many famous scenes in life His life is incredibly remarkable He has been the richest man in Japan for many years and once even was the richest man in the world for one day But what I found most incredible is his aggressive radical investment philosophy His Vision Fund of more than $100 billion It can almost be said that it’s a tech unicorn that has swept the world Everywhere he went

he unleashed a torrent of capital bloodshed Today we’re going to talk about the man behind Jack Ma Masayoshi Son’s company is called SoftBank I think most of you would’ve heard his name but if I ask you what’s their specific business then you’d probably have to guess This question is indeed quite difficult to answer simply as they are quite complex and unique However I can assure you once you finished watching this video you’d be enlightened

Masayoshi Son is of Korean descendant He was born in Japan in 1957 he studied hard since he was small his grades was outstanding But Son has one very different characteristics from the Japanese and Korean children and that is he was very brazen How to say well you'll understand after you've listened to his story When he was 16 he read a book by Japan’s McDonald CEO about doing business and he was greatly dazed by the content

He found that doing business is something interesting So when he was 16 he aspired to be an entrepreneur Alright up to this point, he was still a normal, ambitious young man who is getting ready to work hard But then it gets crazy Masayoshi Son was like, no I have to meet Den Fujita So he found the phone number of Den Fujita’s assistant and called him day and night asking to meet Den Fujita Please Can you imagine

a 16 year old out of nowhere calling how can people take him seriously So despite calling for over 70 times it was no use At the time, the phone calls he made were long distance phone call, it was expensive So he flew to Tokyo and told the assistant, look I flew all the way here please let me talk to Den Fujita for awhile or at least arrange a place for me

to look at him for 3 minutes from afar Looking at his sincerity Den Fujita met with Masayoshi Son and talked for 15 minutes and guided him to two very important direction The chain of suspicion and the explosion of technology No no Den Fujita actually gave him two advices One is to visit USA and another is learn about computer These two advices had indeed changed the life of Masayoshi Son I too want to meet Den Fujita

So the 16 year old Masayoshi Son listened to his advice and flew to California look at his ability to act After he finished high school He entered the University of California at Berkeley His brain started to turn again Here’s what he said Is there any way where I could use 5 minutes of free time daily to earn $10,000 a month after all I still have to study

How to only use a small amount of time to make money So he thought of inventing he forced himself to think of one invention everyday In less than a year he had two three hundred ideas one of them is translation machine That's a pretty good idea I don’t know if you’ve seen a machine it was quite popular when I was a kid electronic dictionary When you enter a word it’ll show you the translation

The first translation machine was invited by Masayoshi Son He then sold this machine Sharp at the price of $1.7 million Later he imported Japan game machine to restaurants in US sales were booming and he earned $1.5 million He was only in his early 20s when he met Den Fujita, invented machine and reselling gaming machines In 1980 he already earned $3 million What a fantastic beginning right?

This is why in the beginning we said Masayoshi Son was very brazen All these are from his narration so it’ll be more or less self-glorification However from all these you can see that he is a born entrepreneur After his graduation in 1981 Son took his million dollars went back to Tokyo from California Honestly, the money he made back then is way more than what most people could've ever earned in their lifetime However apart from being brazen

he has one major characteristic and that is his extreme risk appetite or big guts Just don’t ever hope he’ll stop one day For as long as he still has leverage regardless it’s $1 or $10 billion he’d go all in From then on he started forming his own investment philosophy Just continue watching At the age of 24, Son used the money he earned he started to think what’s the next step after careful considerations

he decided to be distributor of software It's basically wholesale a bunch of software then they sell them to retail companies Look isn’t it like a bank for software So let’s call it SoftBank The name SoftBank When you heard it the first time you’d think it’s a bank but the keyword is Soft not bank no relation to bank Of course his later business development

is not so relatable to Soft Just like that in 1981 24 year old Masayoshi Son established SoftBank The software distribution business for the next 10 years we'll just fast forward To put it simply, it was booming He even published a few magazines on computers He opened up a channel and combine with the software distribution business swiftly captured the market Moreover in those few years the market was already developing rapidly SoftBank of course was growing rapidly

SoftBank went public in 1994 Market Cap at $3 Billion This is the first stage for SoftBank For most companies It's already a big deal when they go public But Masayoshi Son is no ordinary man This is only the completion of the original accumulation of his capital With all this leverage He can go to the billion-dollar gambling table Although he is an entrepreneur but personally I think his strength is not in

micro product innovation or company growth He is better at grasping the macroscopic trend of the time then pool his resources to take advantage of the situation So since SoftBank went public in 1994 Masayoshi Son have more money on hand to play bigger game I'm not going to compete with you on the micro level like product innovation, marketing, market competition I compete in the big trend, direction Once he looks to one direction like Internet

then he’ll spend money to buy bunch of companies As for those specific product details he just couldn’t be bothered Here comes the first highlight of his investment In 1995 He had his eye on a fast-growing company and that is Yahoo At that time there were only 15 people working in Yahoo He was very generous and offered $100 million with 30% stake Imagine that large sum of money Yahoo founder Jerry Yang was also confused

he hesitated to accept the investment It's a lot of money, after all but to dilute 30% of the share it’s very intimidating Son was able to see through their hesitation and started to threatened them If you don’t take this $100 million I’ll invest it on your competitor like Excite, Lycos You better think quickly This is forceful buy in If you don’t accept I’m going to invest in your competitor This method has been tried and tested

which later become his customary tactic He finally hold a stake in Yahoo In 2022 Yahoo was listed on NASDAQ His investment fold more than 2.5 times Later over the years under the push of dot com bubble it became a company worth billions of dollars But that is not the most successful aspect of his investment He wanted to play bigger and introduce Yahoo to Japan So in 1996 SoftBank invested $72 million

to set up a joint venture with Yahoo in Japan Yahoo Japan For a long period of time it was Japan’s number one portal and the number one search engine The market value of Yahoo Japan in 2004 reached $50 billion and surpassed Yahoo Global brought SoftBank a return of at least hundreds of times It has become a pillar of SoftBank's business We’re not finished yet, after few years another famous investment of Masayoshi Son began

The one we mentioned at the beginning of the video In 2000 he invested in Alibaba According to his recollection Jack Ma couldn’t produce a proper business plan but he was moved by Jack Ma Moreover he was optimistic about e-commerce So after talking to Jack Ma for about 10 minutes he invested $20 million in Alibaba holding 34.4% of the share After 14 years, this investment became $60 billion when Alibaba was listed That's a 3,000-fold increase

In 2019/2020 when Alibaba’s market worth was at its highest Alibaba made up half of SoftBank Due to these Yahoo and Alibaba investment Masayoshi Son rose to fame for his early, accurate investment His fame was even comparable to Warren Buffett Yahoo and Alibaba are more of a classic example From 1996 to 2000 In these 4 years he invested in 250 tech companies

and companies in other sectors This brought his SoftBank empire which started as a company that sells software and magazine to a conglomerate that hold large scale businesses If you look at the businesses of a company normally you’d divide it by product But if you look at SoftBank their businesses are far and wide This is their financial report in 1999 There are six business segments It involves Software, media, Internet, finance and so on SoftBank Group in 1999

became a holding company Meaning there are bunch of subsidiaries under it And they are all subsidiaries with a variety of businesses Now you can check how many employees working in SoftBank Do you know how many there are?

There are 255 person not 255k or 2.55 million it’s 255 person It’s ridiculous A company worth tens to hundreds of billions of dollars has only 255 employees This is actually because it is a pure holding company Actually including its subsidiaries there are about 60k employees and this doesn’t include the companies he invested in Those 255 employees Probably more than half of them are C grade

I thought it was just an interesting tidbit to share with you In short, Masayoshi Son thinks there’s a future in Internet Spent more than 50 billion yen to buy Yahoo, CNET There’s future in Financial sector another 50billion yen E*Trade Morningstar There’s future in technology buy Kingston That’s the style of Masayoshi Son and SoftBank They’re not going to put in effort to work in all those sectors they just spend money to buy those companies

and believe that they are going in the right direction What’s the result?

He has some less successful investment For example Kingston It’s one of those Deal that buy high sell low But in overall he was determined on the internet sector He was just in time for the dotcom bubble With all his aggressive investments and acquisitions it covered a large number of Internet companies and businesses So at that time All the Internet founders are worth a ridiculous amount of money

but none of them is comparable to Masayoshi Son and SoftBank Before the burst of dotcom bubble, SoftBank was worth $200 billion Masayoshi Son became world richest man for a day The bigger the bubbles grew the worst when it burst The S&P 500 fell more than 40% NASDAQ fell over 70% 99% of SoftBank's market value was wiped off From $200 billion to $2 billion Masayoshi Son's $70 billion net worth

was also wiped out In those few years He was also facing huge controversy and on the verge of bankruptcy Losing $1 billion every year And almost all of his investments are losing money Yahoo shares plunged Alibaba was far from being listed This is the darkest moment Masayoshi Son had ever faced so far You cannot imagine the pressure he had to face everyday He had to turn his attention back on real economy

because he needed a new pillar of his business which could give him more capital help him continue to lay out his grand strategy And he really did get it all right He first targeted the spread of home Internet He entered the broadband business in 2001 and established Yahoo Broadband In 2004, he bought Nippon Telegraph and Telecom which was able to help him through the most difficult period.

After that he was aiming at the popularisation of smartphones and entered the telecommunications business Here's another twist He contacted his idol Steve Jobs At that time Apple hadn’t came up with iPhone but iPod was selling like hot cake So he drew a draft of an iPod that has phone call function to Jobs Hey look, you can create something like this Jobs was shocked because the iPhone was actually already under R&D

So Jobs told Son that we’re already in the midst of creating it Son was like oh great if you guys could really come out with it could you let me sell it for you in Japan Jobs was amused SoftBank was not in mobile network sector you must be joking Son said yes, we just haven’t started it yet but Masayoshi Son started getting into mobile business immediately after returning to Japan and acquire Vodafone Japan

Two years later iPhone was introduced to the world SoftBank became exclusive distributor for iPhone in Japan later SoftBank acquired Sprint, an American telco operator He even managed to convince Trump and completed the merger of Sprint and T-Mobile In fact, this SoftBank Group did not acquire the business of Vodafone Japan.

This is telco company later changed their name to SoftBank Corp SoftBank Corp So if one day someone asks you What’s the main business of SoftBank you’ll have to make sure if they are asking about SoftBank Group or SoftBank Corp All in all Masayoshi Son managed to grasp on this opportunity and started to make profit from 2005 Revenues rebounded year on year In 2014 The seed he planted before finally bears the fruit Alibaba finally went public

Now he could finally stood up and stand firm He wanted to start investing again now that everything seemed stable So in 2016 Masayoshi Son was aiming at a new direction Chip The company he was aiming for is a semiconductor company ARM I don’t care if you agree or not this aggressive investment strategy looking at the trend He really does have an eye for thing like this Look

more than 95% of mobile phone chips on the market currently including Apple M chip they are all ARM architecture Son opened up his fang bite deep and acquired ARM at $32 billion Although some people thought that he overpaid but that’s how he is He is not worried of overpaying he is more afraid of making wrong investment At least for now, ARM is still going strong and become one of the pillar for SoftBank Group

Taking down ARM business was not an easy feat But the pace of his acquisition still falls far short of his investment blueprint Actually in 2010 he made an important announcement SoftBank’s vision for the next 30 years This is also a very important piece shown on SoftBank’s official website.

Based on some of his recent interviews, I will briefly summarize if for you Masayoshi Son raised the perspective to the height of mankind If you want to know how SoftBank should develop in the next 30 years then you need to know how the human will develop in the next 300 years He believed that in a matter of decades computers will overtake human brains in all aspects and that Singularity will appear and at that time

the society will undergo earth-shaking changes Masayoshi Son hopes to become the head of industry in advance through investment layout and welcome the arrival of singularity ChatGPT is so popular these days does it make you feel like this singularity is not that far ahead We’ll not talk about singularity let’s continue with Masayoshi Son He wants to invest from this height and perspective So you see How could he settle with just a telco business or with ARM

He wanted to lay out technological progress for all mankind This is why he attempted to create a robot called Pepper and bought Boston Dynamics But he himself feels that with SoftBank's current financial resources it’s difficult to achieve such grand vision Therefore in 2017 in order to realise his vision he decided to establish a venture capital fund A $100 billion fund One of the largest technology venture capital funds in the world and invested in Alibaba

He named this fund as Vision Fund Well you cant just have vision right you need to have money so he thought of the ultra-rich Saudi Crown Prince MBS Here’s another famous scene in Masayoshi Son’s life He met with the crown prince he said I have a $1 trillion gift for your highness would your highness be interested?

MBS was of course interested Son, what do you mean by this?

With a grin he said, you just need to give me $100 billion and I can invest and turn it to $1 trillion They looked each other in the eyes and laughed Lin embellished the story a little bit Anyway, Masayoshi Son and the Saudi prince talked for 45 minutes and settled for a $45 billion investment Some of you might not have an idea how much is $45 billion This amount of money

is enough to be listed in global top 10 hedge fund Of course, the Saudi prince is not so easily fooled On one hand, he has investment needs on another he has taken a fancy to on’s successful investment experience Of $1 trillion Saudi prince make up nearly half of it So the remaining $55 billion is actually pretty easy to get Masayoshi Son also dropped by UAE and managed to get another $15 billion SoftBank contributed $28 billion

and then he also looked for Apple Qualcomm Foxconn and managed to scrap together $100 billion Just like that The wildest tech fund in human history has started SoftBank has since entered a new era of investment For someone as aggressive as him once he has his hand on the $100 billion do you expect him to slowly searching for opportunity and investment Clearly not Masayoshi Son swept across emerging tech markets around the world For fund this size

there’s no need for any trade-off because there’s only so many unicorn Once you aim for those with potential growth just invest in it Although his vision was one of humanity talking from high ground but when it comes to actual investment he still invested in what’s popular Some companies became popular because he invested in them Imagine on a normal track a company would get finance and develop normally but once you are being aimed by Masayoshi Son

here comes Vision Fund You only need $50 million?

NO I’ll give you $500 million and be your largest shareholder I’ll give you a year spend all those money and occupy the market otherwise I’ll invest in your competitors Moreover, Softbank's style is relatively dominant after investment it has several board seats to control the strategic development of the company That is I want you to Dream Big Go International Big ideas Globalization and rapid expansion as soon as possible Masayoshi Son knew that emerging market like internet

is winner-take-all What he wanted to do is be the market leader in the fastest way possible and get listed This forced the entire track to enter the model of throwing and burning money to capture the market Within 3 years, he invested $80 billion on over 80 companies Famous ones like Uber WeWork Coupang Grab ZhongAn Insurance, etc Then Masayoshi Son felt that $100 billion is far from enough Here comes Vision Fund 2 Vision Fund 2

to raise another $100 billion But because the first Vision Fund was too aggressive and the investments was too controversial Vision Fund 2 was unable to get much capital from external investor He forked out $50 billion out of his own pocket For Vision Fund 2 the investment style is more restrained he didn’t spend as before He invested in companies that are still in early phase Other than these 2 Vision Fund In 2019 Masayoshi Son established a

$7.3 billion Latin American fund These three funds together become the Softbank Group’s main business segment and it’s also the most famous We've been talking a lot about SoftBank's business investments Let’s summarise it SoftBank Group with over 250 employees managing multiple subsidiaries First is telco sector like what we mentioned SoftBank Corp and Japan most trendy chatting app LINE there’s also T-Mobile

The stake in Deutsche Telekom These are all their telco business A lot of people might wonder You said that SoftBank business is mainly on investment so why do they have 6 trillion yen of sales per year?

Most of this is actually generated by this telco business Although the revenue is all generated by the telco business But the market value of the telco business is only slightly over ten percent of their overall revenue Another big sector in SoftBank is ARM, semi-conductor business That’s right ARM is a big part of SoftBank He bought ARM at great cost with 100% holding Another big part of SoftBank is Alibaba In 2022, SoftBank sold nearly

half of its Alibaba shares but now still possess about 15% The biggest part of SoftBank is the two Vision Fund and Latin America Fund and that make up the investment sector We can only count those that is out of SoftBank and not the entire Fund From the market value of the portfolio it is about $70 billion the rest are small businesses and companies You see here the telco business is actually quite stable

so the stock price performance is less volatile the movement of SoftBank's share price You can look at it as Vision Fund plus Alibaba plus ARM but ARM is not listed so if there’s no big news from ARM then SoftBank is equal to Vision Fund plus Alibaba So Alibaba is closely related to SoftBank share price That's why You can roughly view SoftBank as an investment company And what about the results of its investment?

At least for now not so good This is mainly because of a few unsuccessful cases The most infamous one is WeWork This is maybe because he wanted to replicate his investment on Jack Ma So he trusted his intuition on the founder The founder of WeWork Adam Neumann He is very radical and a maniac Son met with him for a short while and felt that this man is unusual

he could be the next Jack Ma so Son decided to invest $4.4 billion Before he left, he told Neumann I think you are not manic enough Then Neumann become more manic spending money all over the world but WeWork was in trouble Their public listing was blocked The market finds it grossly overvalued and it had serious debt problems In order to save WeWork SoftBank had to fork out another $9.5 billion that basically bought the entire WeWork

It finally made it to stock market but the market value is only $1.5 billion SoftBank had spent over $10 billion it’s basically wasted Masayoshi Son admitted that this is one of his most unsuccessful investment Another unsuccessful investment also Vision Fund largest investment DiDi In 2021 DiDi was finally listed finally can earn some money but something happened and it was delisted

Cost the Vision Fund about $10 billion Actually there are many successful and unsuccessful investment of SoftBank I won’t be listing them here For investment like WeWork it’s okay to lose money but more importantly is its impact on the image of SoftBank and Masayoshi Son is huge People began to question Masayoshi Son’s investment philosophy They no longer trust him Some even think that he is just a gambler So if you want to calculate SoftBank share price

If you counted in Alibaba, Vision Fund, ARM SoftBank Corp you’ll have to take half off What does it mean?

If the market value is $100 if it’s in Masayoshi Son’s hand it’ll become $50 That's how it is Well this is because the market think he is uncontrollable you’ll never know if he is investing or gambling For example in 2020 There was a mysterious buyer in the market The buyer spent $4 billion to buy some tech stocks like Apple, Tesla, Amazon, Microsoft buy call options on these companies $4 billion in call options

is a very large volume It stirred up rumours in the whole market This mysterious buyer was being called as NASDAQ Whale NASDAQ Whale Later it was discovered that the Whale is SoftBank, Masayoshi Son this call option is actually betting on the future of the companies For example, the trend of its stock price within half a year If it rises sharply within half a year then the buyer will make a lot of money

If it doesn't rise or it doesn't rise much then the money is gone When this broke out The shareholders of SoftBank was shocked On the surface he said looking forward to human development for the next 300 years But now he is buying short term options What is he trying to do isn’t that like gambling It doesn’t matter whether this time he win or lose The main thing is that he is uncontrollable

The collapse of concept stocks in mid-2022 add to that the plummeting of Japanese yen All of these make life very difficult for the Vision Fund Even compared to similar funds they are at the bottom 10% So SoftBank had to downsize, sell off Alibaba stock or repurchase their own stock to stabilize shareholders, stabilize the market, and stabilize banks In November 2022, Masayoshi Son announced his gradual divestment of the company's business Currently focusing on helping ARM go public

Actually I think from the beginning of Vision Fund with that large amount of capital and rapid investment he is not investing on Alpha instead he is investing on Beta Meaning to say, it’s hard to catch a good company and get excess earnings Just casting the net if the market rise, it’ll rise; if the market fall, it’ll fall And Softbank's style is even more radical They also invest in riskier companies higher Beta

So when the market is good it’ll rise For example in 2021 when Doordash /Coupang went public SoftBank's yield went up When the market fell in 2022 SoftBank's yield also fell A $100 billion fund riding on roller coaster very thrilling Alright let’s look back Masayoshi Son had his ups and downs His previous successes was it luck or was it skill Is he a great investor or is he just a gambler I think you have the

answer in your heart This person certainly has great courage and insight Otherwise, which gambler can be Japan richest man for so many years And if you watch his interview you’ll find him quite humorous His aggressive investment strategy is not very reasonable from the perspective of risk management So there must be some luck involves here as well In our world heroes are judged by success or failure In the two years where he loses money

there were a lot of people criticising him If in another few years where it’s bull market for tech stocks then it’s only a matter of time for SoftBank and Masayoshi Son to get back on top But I guess with Masayoshi Son's character he’ll definitely go All in again he’d probably come up with $500 billion fund