Hey Masayoshi Son, I have a bridge to sell you

If Apple TV+ wants to give its “WeCrashed” series a second season, it could tell the story of WeWork enabler Masayoshi Son and call it “ICrashed.”

Personally, I found the series about WeWork creator Adam Neumann spotty and unsatisfying. Fun and suspenseful at the same time, but above all it served as a showcase for stars Jared Leto and Anne Hathaway to inhabit two eccentrics baiting investors.

Nor could SoftBank’s son, who couldn’t have been happy with the way he was portrayed. No venture capitalists fell for what Neumann was selling, anything. And no one has done more to grease the wheels of WeWork and shield Neumann from liability to its early investors than the $100 billion man from Japan.

Even if we don’t get a Son-focused “ICrashed” season, the events of the past few months already offer a glimpse of what might be in the script.

Back in March, as viewers watched Kim Eui-sung play Son, the real one wrapped up a truly appalling exercise. The mega tech fund that led Neumann to target Son in the first place lost more than $20 billion in the year ended March, the worst performance on record. And that swing from a sizable profit the previous year tells a bigger story.

Investors aren’t exactly freaking out, in part because they’ve seen this show before. They know the next episode will involve accelerated stock buyback plans and Son’s talk of “defensive driving” to steer the company away from even bigger losses in the future. For example, Son’s team has set aside $22.4 billion to ensure covered bond buybacks for fiscal years 2022 and 2023.

What these upcoming attractions don’t tell us, however, is exactly what Son’s Vision Funds 1 and 2 will do. The world’s largest venture capital deal says it could cut 50% or more investments in startups. While this is terrible news for budding unicorns everywhere, it raises questions about the mission of the Son’s Vision Fund project going forward.

We know the origin story. Son’s journey to WeWork infamy began with an excellent return on investment dating back to 2000. Back then, Son bought into the vision of an obscure and charismatic English professor in Hangzhou. The $20 million Son gave to Jack Ma was worth almost $60 billion when the Alibaba Group went public in 2014.

In 2016, Son decided to make repeating that magic SoftBank’s raison d’être. Yet getting financial lightning to strike again and again is easier said than done. Between his two signature funds, Son has deployed over $130 billion in investment capital across a bewildering array of startups around the world.

For too many of them, Son’s team arguably overpaid. This turned Son into something of a one-man unicorn rating bubble machine.

Really, sometimes I’m tempted to call the Son team and ask them if they want to buy one of the bridges in my Tokyo neighborhood. All I would have to do is find some justification for calling it a tech game. It was Son who handed billions of dollars to Neumann that helped position office-sharing company WeWork as the next Apple.

Ironically, Son now chooses to tuck his horns. One might think of an investor who revels in the comparisons we sometimes make in the media between him and Warren Buffett. Isn’t now, when tech stocks are plunging, the time to binge on undervalued companies?

We can debate what Son thinks here. Saying that he now plans to be “more careful when we invest new money,” Son could be trying to calm the nerves of SoftBank investors. It’s one thing for Son to say he hopes history will remember him as a “crazy guy who bet on the future.” It’s another thing for today’s investors to worry about whether that’s true.

Or did the market’s sharp sell-off and Vision Fund’s losses in WeWork, Uber, Oyo Hotels and others cause Son to question his investment compass?

The bottom line is that SoftBank Group is worth, according to Reuters, less than half the paper value of its net assets. The question is, is the discount at which SoftBank shares are trading here to stay or just a stumble on the path to another Alibaba-like bargain?

It’s anyone’s guess, maybe Son too. In the meantime, Masa-san, I have a bridge I’d like to sell.

About Wendy Hall

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