Masayoshi Son: Betting big and winning


This is second in a 10-part series on influential figures in the Heisei Era, which began in 1989 and will end when Emperor Akihito abdicates in April. In Heisei, Japan was roiled by economic excess and stagnation, as well as a struggle for political and social reform. This series explores those who left their imprint along the way.

There’s a well known anecdote about Masayoshi Son, the maverick billionaire founder and chief executive of SoftBank Group Corp. and the man behind the world’s largest technology investment fund.

Back in 1981, a 24-year-old Son had launched a software distribution startup with two part-time employees in a cramped office in Fukuoka. Lore has it that one morning he stood on a makeshift podium to deliver an impassioned speech to his staff about how the company would eventually grow to be among the world’s giants, counting revenue in the trillions of yen.

The two part-timers, thinking their boss was out of his mind, were out the door shortly thereafter.

Some 38 years on, SoftBank has evolved into a global telecommunications and internet conglomerate worth ¥10.8 trillion, and Son’s penchant for pursuing out-of-the-box ideas appears as strong as ever as he looks to craft a connected future run by computers far more “intelligent” than humans.

Now 61, Son is already a legend in Japan, where comic books depict the rags-to-riches story of a third-generation Korean-Japanese from a poor neighborhood who climbed his way up to become one of the nation’s richest men. Outside his homeland, he is known for buying the then-No. 3 U.S. telecommunications firm Sprint Corp. for $22 billion in 2013, and British chip designer ARM Holdings PLC for $32 billion in 2016, making the largest tech acquisition in European history.

Now, as the Heisei Era draws to an end, Son is in the driver’s seat of his most ambitious project yet: a $100 billion technology investment fund known as the SoftBank Vision Fund that counts Saudi Arabia among its partners and serves as a vehicle for Son to propel his company to the forefront of emerging technologies like artificial intelligence, robotics and the internet of things.

“I make investments based on a vision,” Son said during an earnings conference Wednesday. “I believe the SoftBank Vision Fund is the first of its kind to be making nonstop, coordinated, vision-based investments of this scale. It’s a completely new animal.”

As if $100 billion wasn’t enough, Son told Bloomberg Businessweek last year that he plans to raise a fresh $100 billion fund every few years as smaller Silicon Valley investors struggle to keep up with the unprecedented scale and pace of the Vision Fund’s investments.

The acquisitive company already has a sprawling investment portfolio covering hundreds of companies, including significant stakes in Chinese e-commerce giant Alibaba Group Holding Ltd. and Japanese internet portal Yahoo Japan Corp. Since the Vision Fund began investing, it has also acquired large stakes in shared-office provider WeWork Cos Inc., ride-hailing behemoth Uber Inc. and workplace messaging app Slack, to name a few.

SoftBank Corp. Chairman Masayoshi Son shakes hands with Saudi Arabian Crown Prince Mohammed bin Salman after signing an agreement in New York last March.
SoftBank Corp. Chairman Masayoshi Son shakes hands with Saudi Arabian Crown Prince Mohammed bin Salman after signing an agreement in New York last March. | BLOOMBERG

Not everything is going as planned, however.

SoftBank’s newly reformed domestic telecoms unit, following a four-way merger in 2015, listed its shares on the Tokyo Stock Exchange in December in what became Japan’s largest initial public offering. But they plunged on the first day of trading and have remained below the IPO price ever since. Son has also said the killing of Saudi journalist Jamal Khashoggi, allegedly ordered by the kingdom’s crown prince, Mohammed bin Salman, could have an impact on the $100 billion fund, to which Saudi Arabia’s PIF contributed $45 billion.

In the meantime, U.S. regulators are reviewing a proposed takeover of Sprint, now No. 4, by No. 3 carrier T-Mobile US after Son struggled for years to turn around its operations — a deal that would significantly decrease SoftBank’s stake in the combined T-Mobile unit. What’s more, decades of risk-taking has also made SoftBank one of Japan’s most heavily indebted firms.

But taking bold risks and challenging established norms are Son’s signature traits, said technology writer Hitoshi Sato.

“He’s also known for furious clashes with regulators and authorities,” he said, recalling the time he threatened to set himself on fire over internet access rights. “He’s one of a kind.”

Born in 1957 to a Korean immigrant family in sparsely populated Saga Prefecture, Son flew to California when he was 16, and, after finishing up his high school requirements, spent two years at a local college before transferring to the University of California, Berkeley, where he majored in economics. There, he invented an electronic pocket translator he sold to Sharp Corp. for ¥100 million — capital he used to launch his first company before returning to Japan after graduation.

Billionaire Masayoshi Son, chairman of SoftBank Corp., smiles at a Tokyo news conference in February 2016 as a picture from his younger days is displayed on a screen behind him.
Billionaire Masayoshi Son, chairman of SoftBank Corp., smiles at a Tokyo news conference in February 2016 as a picture from his younger days is displayed on a screen behind him. | BLOOMBERG

Son forged his career by betting big and early when sensing significant shifts in technological trends.

In 1995, SoftBank bought Ziff-Davis Publishing Co., publisher of PC Week magazine. In what has become a Silicon Valley legend, the publisher’s chief executive introduced Son to Jerry Yang, founder of a then-fledgling search-engine company called Yahoo Inc. SoftBank invested $100 million in Yahoo, taking a one-third stake.

One of Son’s most pivotal moments came during the 2000 dot-com crash, when the collapse in tech stocks wiped out SoftBank’s market cap, leaving it on the verge of bankruptcy. Son bounced back in 2001 with an audacious move: offering cut-rate broadband Internet access.

The gambit caused SoftBank losses for several years but ultimately turned a profit, bringing affordable internet access to Japan along the way.

In 2006, Son then loaded the company up with debt to buy the Japanese arm of U.K.-based Vodafone for ¥1.75 trillion, and with aggressive price cuts and an exclusive deal to introduce the iPhone to Japan in 2008, transforming it into one of Japan’s top three mobile phone carriers — a cash cow he would use to fund further SoftBank investments.

Satoru Kikuchi, an analyst at SMBC Nikko Securities, said Son stands out for his strong vision of the future and his flexibility in pursuing what he believes will be game-changing technologies.

“Take AI or the internet — he predicted that these technologies will be changing the world, so he shared that vision with his employees and steered the company in that direction,” he said. “This kind of vision-based management has been quite rare among Japanese firms.”

SoftBank Corp. chief Masayoshi Son poses with a product utilizing specially adapted Oakley sunglasses for audio portability during a promotional event in Tokyo in January 2007.
SoftBank Corp. chief Masayoshi Son poses with a product utilizing specially adapted Oakley sunglasses for audio portability during a promotional event in Tokyo in January 2007. | BLOOMBERG

Son likes to think big. In 2010 he laid out SoftBank’s strategy for the next three decades — and his vision for the next 300 years, a span during which he predicted humans would eventually evolve to live till 200 and communicate via telepathy.

Within 30 years, he said SoftBank would grow to be worth ¥200 trillion and have some 5,000 partnerships.

Former aides have said Son always aims for an industry’s biggest players when considering acquisitions. At the same time, he often describes his investment methodology as intuitive and based on gut instincts, like when he famously decided to invest in Alibaba’s Jack Ma five minutes after meeting him.

“Son really places emphasis on how passionate entrepreneurs are and whether they share a similar vision with him,” said Takayuki Kamaya, Son’s former secretary and executive general manager of corporate strategy and planning at Rizap Group Inc.

With an investment portfolio spanning the globe, Son is constantly on the move, flying across continents in his private jet.

While known for his tireless energy and late-night conference calls, shareholders have questioned how long he can maintain such a busy lifestyle. SoftBank lists “unforeseen situations concerning key members of management,” especially Son, as a business risk on its website.

Son is also keenly aware of a potential succession problem. When he was 19, he laid out a life plan that saw him complete his business in his 50s and hand it over to someone from the next generation in his 60s. He’s already 61.

In 2016, after former Google Inc. executive Nikesh Arora, his hand-picked successor, abruptly stepped down, Son said he planned to stay at the helm of SoftBank for another five to 10 years.

And with the Vision Fund deploying investments at breakneck speed, there’s no indication Son will let go of the steering wheel anytime soon.

“I’m full of motivation and full of dreams,” he said.

Did you know . . .

  • Masayoshi Son personally donated a whopping ¥10 billion to victims of the March 2011 earthquake and tsunami. Takayuki Kamaya, Son’s secretary at the time, recalls he was asked to research how much overseas celebrities donated during disasters of a similar scale, and said he suggested that around ¥1 billion appeared to be the average. “Upon hearing the figure, Son said, ‘Let’s add another zero,’ and bumped up the sum tenfold,” he said.
  • In 2015, SoftBank began selling Pepper, a humanoid robot billed as the world’s first capable of understanding and reacting to human emotions. The 121-cm white plastic robot can still be seen greeting guests at retail stores and restaurants. Son has said he personally oversaw the design of the robot, which bears a resemblance to its creator, who routinely pokes fun at his balding pate.
  • Since 2007 SoftBank has been airing popular commercials based on the adventures of a fictional family whose father is a white dog, an unlikely patriarch in an otherwise normal family. The iconic dog, Kai, died last year and was replaced by sons Kaito and Kaiki.

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