SoftBank sells early stage VC arm to entity led by Taizo Son

SOFTBANK Group is selling its early-stage venture capital arm SoftBank Ventures Asia after suffering billions of dollars in losses from failed startup bets.

The Japanese tech investor said it plans to sell SoftBank Ventures Asia – which helped SoftBank scout promising startups over the last decade – to an entity led by Singapore-based Mistletoe founder Taizo Son, the younger brother of SoftBank founder Masayoshi Son. 

The Seoul-based venture capital arm, which has about US$2 billion in assets under management, has bought stakes in companies including South Korean car-sharing startup Socar, Indonesian social commerce platform Super and Singapore-based online shopping rewards app ShopBack.

SoftBank Ventures Asia has made initial investments that later led to bigger deals by SoftBank’s billions-wielding Vision Fund, as in the case of Singapore-based used car marketplace Carro, in which SoftBank’s Vision Fund II led a US$360 million investment in 2021. Other examples include Nigerian fintech app Opay, South Korea-based metaverse platform Zepeto and Japanese sneaker marketplace Soda.

The Edgeof, Taizo Son’s new venture capital entity set up last month, will acquire SoftBank Ventures Asia for an undisclosed sum by year-end, SoftBank said in a release on Wednesday (Apr 12). Mistletoe, the entrepreneur’s existing venture capital firm, will help the entity discover and support startups from the early to growth stages, it said.

The two brothers have partnered on deals in the past, with SoftBank buying Finnish gamemaker Supercell Oy in 2013 with funding from gamemaker GungHo Entertainment, then led by the younger Son. The elder Son has also used SoftBank shares as collateral for loans to support Taizo Son’s business ventures. 

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The Japanese conglomerate, which has deployed more than US$144 billion in hundreds of companies since 2017, reported a net loss of US$5.9 billion in the December quarter after its Vision Fund segment shouldered big write-downs on money-losing startups. BLOOMBERG