Masayoshi Son is not known for half measures. The SoftBank founder’s career has been defined by bold bets, each one seemingly more ambitious than the last. His recent decision to cash out his entire five point eight billion dollar NVIDIA stake to go all-in on artificial intelligence surprised the business world on Tuesday, but perhaps it should not have. At this point, it is almost more surprising when the sixty-eight-year-old Son does not push his chips to the center of the table.
Consider that during the late 1990s dot-com bubble, Son’s net worth soared to approximately seventy-eight billion dollars by February 2000, briefly making him the richest person in the world. Then came the dot-com implosion months later. He lost seventy billion dollars personally, which at the time was the largest financial loss by any individual in history, as SoftBank’s market capitalization plummeted ninety-eight percent from one hundred eighty billion dollars to just two point five billion dollars.
But amid that downturn, Son made what would become his most legendary bet, a twenty million dollar investment in Alibaba in 2000. The story goes that the decision was made after just a six-minute meeting with Jack Ma. That stake would eventually grow to be worth one hundred fifty billion dollars by 2020, transforming him into one of the venture industry’s most celebrated figures and funding his comeback.
That Alibaba success has often made it harder to see when Son has stayed too long at the table. When he needed capital to launch his first Vision Fund in 2017, he did not hesitate to seek forty-five billion dollars from Saudi Arabia’s Public Investment Fund, long before taking Saudi money became acceptable in Silicon Valley. After journalist Jamal Khashoggi was murdered in October 2018, Son condemned the killing as horrific and deeply regrettable but insisted SoftBank could not turn its back on the Saudi people, maintaining the firm’s commitment to managing the kingdom’s capital. In fact, the Vision Fund actually increased its dealmaking soon after.
That did not turn out so well. A big bet on Uber generated paper losses for years. Then came WeWork. Son overrode his lieutenants’ objections, fell in love with founder Adam Neumann, and assigned the co-working company a dizzying valuation of forty-seven billion dollars in early 2019 after making several previous investments. But WeWork’s IPO plans collapsed after it published a famously troubling S-1 filing. The company never fully recovered, ultimately costing SoftBank eleven point five billion dollars in equity losses and another two point two billion dollars in debt. Son reportedly later called it a stain on his life.
But Son has been mounting another comeback for years, and Tuesday will undoubtedly be remembered as an important moment in his turnaround tale. It will likely be recalled as the day SoftBank sold all thirty-two point one million of its NVIDIA shares, not to diversify its bets but instead to double down elsewhere. This includes a planned thirty billion dollar commitment to OpenAI and a reported hope to participate in a one trillion dollar AI manufacturing hub in Arizona.
If selling that position gives Son some heartburn, that is understandable. At approximately one hundred eighty-one dollars and fifty-eight cents per share, SoftBank exited just fourteen percent below NVIDIA’s all-time high of two hundred twelve dollars and nineteen cents, which is a strong result. That is remarkably close to peak valuation for such a huge position. Still, the move marks SoftBank’s second complete exit from NVIDIA, and the first one was exceedingly costly. In 2019, SoftBank sold a four billion dollar stake in the company for three point six billion dollars, shares that would now be worth more than one hundred fifty billion dollars.
The move also rattled the market. As of this writing, NVIDIA shares are down nearly three percent following the disclosure, even as analysts emphasize that the sale should not be seen as a cautious or negative stance on NVIDIA, but rather reflects SoftBank needing capital for its AI ambitions.
Wall Street cannot help but wonder if Son sees something right now that others do not. Judging by his track record, maybe he does, and that ambiguity is all investors have to go on.