David Corbin from Tech in Asia joined us for an in depth discussion on SoftBank, one of the most exciting companies in Asia. We started with the organizational structure of the company and offered some perspectives on her charismatic founder, Masoyoshi San and his potential successor, Nikesh Arora. We also discussed SoftBank’s foray into US with Sprint, their venture into robotics: the Pepper robot; and finally the company’s successes in venture capital and private equity in amassing one of the most amazing portfolio of investments from Alibaba, Yahoo! Japan to Coupang, Kuaidi-Didi, Olacabs, Grabtaxi, Legendary Pictures and many more. We also discussed the impact of SoftBank Group in Asia and US and whether it is the “Berkshire Hathaway” in technology investments globally.
Here are the interesting notes and links to the discussion (with timestamps included):
- David Corbin (@CorbinDB, LinkedIn, Tech In Asia)
- A quick recap of our experience in Rise Conference 2015. [0:44]
- History of Softbank Group: [2:44]
- A Japanese MNC started in 1981 with a present market capitalization of US$66.05B. A telecommunications and Internet corporation, with operations in broadband, fixed-line telecommunications, e-commerce, Internet, technology services, finance, media and marketing, and other businesses. (Reference: Softbank Wikipedia entry)
- Interesting comparison: SoftBank (Bloomberg Data) Market Capitalisation 8.3T Yen as compared to NTT Docomo (11.44T), KDDI (9T) and Rakuten (2.79T). Note: T = trillion.
- Comparison of SoftBank against NTT Docomo and KDDI in mobile phone coverage.
- Softbank organizational structure: [5:31]
- Masoyoshi San (Founder, CEO of Softbank, Chairman)
- Nikesh Arora’s ascension as Vice Chairman.
- SoftBank’s Board of Directors: Jack Ma (Alibaba Group), Tadashi Yanai (Fast Retailing aka Uniqlo) and Mark Schwartz (Goldman Sachs).
- The significance of bringing someone external into the Japanese corporation and the insights into Softbank’s company culture.
- Businesses and Q1 earnings in 2015: [11:29]
- General results of Q1 2015 earnings for Softbank Group: Sales Revenue: 1.9 to 2.1T Yen (10% YoY growth), EBIT: 319.4B Yen to 343.6B Yen (8% YoY growth). Reference: SoftBank Investor Relations [11:42]
- What are the most interesting observations coming from Q1 2015? [12:12]
- Telecommunications and Broadband businesses: Sprint, and the problems Sprint have in trying to merge with T-Mobile in the US.
- What will be Softbank’s play with Sprint given the failure of merger with T-Mobile? [14:18]
- Robotics: The Robot Pepper and its impact to the Japanese society. [18:25]
- Venture Capital & Private Equity: [28:30]
- Is Softbank the “Berkshire Hathaway” of technology investments given their portfolio strategy? [28:41]
- Putting the money into companies in the emerging markets: Coupang (US$1B), Snapdeal (US$627M), Didi-Kuaidi (US$600M), GrabTaxi (US$250M), OlaCabs (US$210M), Housing.com (US$90M), Tokopedia (US$100M), OyoRooms (US$100M).
- Other companies worthy of mention: Alibaba, SuperCell, Gungho and Legendary Pictures.
- Recently it has also invested in renewable energies in India.
- The Impact of Softbank to US and Asia: [36:01]
- Bringing Apple iPhone into the Japanese market: breaking the NTT Docomo and KDDI’s hold of featured phones.
- Successful backed entrepreneurs and joint ventures with companies: Jack Ma of Alibaba (Softbank stake of 34% now worth US$58B) and Yahoo! Japan.
- Successful VCs in US outside Silicon Valley who are related to Softbank: Brad Feld (managing director, Softbank Venture Capital from 1997 to 2001), Fred Wilson (Union Square Ventures – in Flatiron Partners with Softbank as the LP)
- Final Note: Tech in Asia Japan 2015 Conference.
Producer’s Note and Disclosure: David Corbin works for Tech In Asia and it is invested by SoftBank. The conversation we have on SoftBank totally adheres to their statement of ethics.