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SoftBank's Nvidia Stake Is Reportedly Worth $4 Billion

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TechCrunch·techcrunch.com/2017/05/24/softbanks-nvidia-stake-is-repor...

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Good(3)

Good quality. Reputable source with community review or editorial standards, but less rigorous than peer-reviewed venues.

Rating inherited from publication venue: TechCrunch

This 2017 TechCrunch article covers SoftBank's $4B investment in Nvidia and the Vision Fund's AI focus, relevant to AI governance and compute investment trends as SoftBank's CEO explicitly cited superintelligent AI as motivation for the fund.

Metadata

Importance: 22/100news articlenews

Summary

SoftBank acquired a $4 billion, 4.9% stake in Nvidia as part of its ~$100 billion Vision Fund strategy focused on AI. CEO Masayoshi Son cited belief in the rise of superintelligent AI within 30 years as motivation for the fund. The Vision Fund aims to take 20-40% stakes in AI-related companies to influence strategy.

Key Points

  • •SoftBank acquired a $4B (4.9%) stake in Nvidia, making it the fourth-largest investor in the chip maker.
  • •The Vision Fund, with $93B initial commitments from Apple, Qualcomm, and Foxconn, focuses heavily on AI investments.
  • •CEO Masayoshi Son cited belief in superintelligent AI rising within 30 years as the core motivation for the fund.
  • •Nvidia's GPUs are described as foundational infrastructure for the current AI market explosion.
  • •SoftBank's Vision Fund strategy targets 20-40% ownership stakes to gain board seats and strategic influence.

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When SoftBank announced the first close of its Vision Fund this weekend  — securing an initial commitment of $93 billion from investors including Apple, Qualcomm and Foxconn —   it also quietly disclosed it had taken a stake in Nvidia.

 Bloomberg  is today reporting the size of that stake is $4 billion, for 4.9 percent of the company, which it says would make SoftBank the fourth largest investor in the chip maker.

 
 
 
 

 
 
 
 

 Albeit, not necessarily for much longer: A line in the PR for the Vision Fund close on Saturday notes that the Vision Fund will have the right to acquire “certain investments already acquired (or agreed to be acquired)” by the SoftBank Group — with Nvidia being listed as one of those investments, along with a 24.99 percent stake in chip designer Arm (which SoftBank acquired last year  for ~$31 billion). Although SoftBank of course retains its own ties to the Vision Fund and the fund’s investments.

 A SoftBank spokesman declined to confirm the amount of its investment in Nvidia or to comment on Bloomberg’s report.

 As we wrote recently , Nvidia’s GPUs have arguably become the bedrock underlying the current AI market explosion. And AI is one of the core areas of focus for SoftBank’s Vision Fund. Indeed, CEO Masayoshi Son set out his personal conviction earlier this year that the next 30 years will see the  rise of superintelligent AI — saying this underpins his “hurry” to raise the ~$100 billion fund. So a chunky Nvidia investment meshes with his view of tomorrow’s world.

 Even so, SoftBank has been spreading a lot of cash around lately. Other recent confirmed investments include $1.4 billion in  Indian fintech unicorn Paytm ; lead investor in  virtual reality Improbable Worlds ‘ $502 million raise; $5 billion in  China’s Uber-killer Didi Chuxing ; and a fresh $1.7 billion in  global connectivity company OneWeb , after also investing $1 billion  last year .

 Some of these stakes may well move into the Vision Fund imminently, as the Nvidia stake and a chunk of ARM reportedly have. The fund has also been linked to a potential investment in WeWork , among others.

 
 
 
 
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