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SoftBank 'preparing to launch second Vision Fund' to fuel tech investments

Hasan Chowdhury
SoftBank's $100bn Vision Fund has seen returns of 62pc from a total of 71 investments.  - AFP

SoftBank is poised to unveil a second investment vehicle modelled on its $100bn (£80bn) Vision Fund, in a move that could see the Japanese conglomerate fuel a new wave of investments in the global tech sector .

The launch of a new fund is expected as early as this week, with current backers such as Saudi Arabia’s Public Investment Fund and Abu Dhabi’s sovereign wealth fund Mubadala Investment expected to be onboard, sources told Bloomberg.

New investors are due to participate along with other investors from the initial fund, a person familiar with the matter said, as the company has been considering a range of options to raise money.

SoftBank launched its first Vision Fund in 2016 after signing a deal with Saudi Arabia’s Mohammed bin Salman to create the world’s biggest buyout fund, though the company's ties to the Kingdom's money have faced some scrutiny after the crown prince became embroiled in the murder of journalist Jamal Khashoggi last year.

The fund, headquartered in London, has gone on to pour almost $70bn into some of the world’s most valuable start-ups, including WeWork and Uber, which went public earlier this year in a blockbuster initial public offering, as well as the acquisition of British chipmaker Arm.

Its investment activity has shaken up an already hot market for tech investing, allowing start-ups to raise billions in private capital instead of going public, but has raised fears about overblown valuations. A second fund would be likely to raise similar concerns.

Masayoshi Son, the enigmatic founder and chief executive of SoftBank, has previously expressed his desire to launch a new fund worth $100bn every two to three years to take advantage of developments in frontier technologies such as artificial intelligence, though details around the new fund are yet to be finalised.

Last month, Mr Son revealed that the first Vision Fund had made the company a 62pc return from a total of 71 investments.

Saudi Arabia’s sovereign wealth fund is believed to be preparing an investment similar in size to its $45bn pledge to the first Vision Fund , with SoftBank likely to plough in a similar amount of cash. The company was previously reported to be in talks about raising more cash for its first Vision Fund.

A SoftBank spokesperson declined to comment on the matter.