As tech slumps, SoftBank sells venture capital unit to Singapore-based firm run by Masayoshi Son’s brother
SoftBank sells ones venture capital arms, based in South Korea SoftBank Ventures Asia (SBVA), to The Edgeof, a Singaporean investment company, according to the two companies.
Financial terms of the deal were not disclosed, but the Singaporean venture capital firm aims to complete the acquisition this year.
Last month, the younger brother of SoftBank CEO Masayoshi Son Son of Taizo And Atsushi Tairageneral manager of Mistletoe, founded The Edgeof “with the aim of transforming the startup ecosystem across Asia by creating an enabling environment for αStartups”. They define so-called “αStartups” as startups with a mission to solve the world’s fundamental problems with cutting-edge technology, according to the company’s statement.
The acquisition comes after SoftBank and its Vision Fund posted massive losses amid the tech crisis and macroeconomic downturn. In February, SoftBank said its investment vehicles were showing a loss of nearly $6 billion in the quarter that ended in December, marking its fourth consecutive quarterly loss. Last May, the Japanese tech giant said in an earnings call that it would cut start-up investments by 50-75% through March 2023.
SoftBank Ventures Asia has approximately $2 billion in assets under management (AUM) and has invested in a host of portfolios across Asia, including South Korea’s home interior app OHousethe Japanese sneaker resale platform A SODAthe indonesian cloud cooking start-up Delicious and hyper-local social commerce enterprise Great.
Some of the portfolio companies the Seoul-based venture capital firm invested in led to larger investments from SoftBank’s Vision Fund a few years later. These include Tokopedia, an Indonesia-based e-commerce platform that received funding from SBVA in 2014 and SoftBank Vision Fund in 2018; Iyuno, a provider of translated subtitles and other media localization services, which raised funds from SBVA and Vision Fund in 2018 and 2021, respectively; and Singaporean cross-selling startup Carro, which also took over from SBVA And Vision Fund. Nigerian fintech Opay is another example that has captured capital from both SBVA and Vision Fund.
“We are thrilled to begin this new journey with The Edgeof,” JP Lee, CEO of SoftBank Ventures Asia, said in a statement. “By joining forces, SBVA will be able to leverage its expertise, knowledge and network to support visionary entrepreneurs in their endeavors and enable them to have a lasting global impact that transcends Asia.”
The two founders, Son and Taira, already created their venture capital firm, Mistletoe, in 2014, which has invested in 250 startups worldwide. The existing venture capital firm will work with The Edgeof to help uncover “game-changing” startups, he says. The Edgeof will unveil a new brand identity once the acquisition agreement is completed, according to the company.
“We are confident that our collective strengths and resources will spark a new era of breakthrough technologies and solutions, establishing us as a leading influence in the development and expansion of αStartups around the world,” Son said.