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SoftBank would cut startup funding by half this year as losses cross $13 billion

SoftBank would cut startup funding by half this year as losses cross $13 billion
Business1 min read
Japanese investment giant SoftBank on Thursday reported a huge net loss of 1.708 trillion yen ($13.14 billion) for the year ending March 31, saying that it would be forced to cut startup funding by more than half this year.

The conglomerate also reported its biggest-ever quarterly net loss, 2.1 trillion yen ($16.2 billion) for the January-March quarter, reports Nikkei Asia.

SoftBank also reported a historic $27 billion loss to its Vision Funds for the full year, owing to heavy losses in investments in tech companies like Coupang and Didi Global.

SoftBank invested $2.5 billion in the January-March quarter, considerably lower than $10.4 billion it spent in the previous quarter.

When it comes to startups, Softbank invested more than $46 billion in startups last fiscal year.

SoftBank CEO Masayoshi Son said that compared to last year, "the amount of new investments (in startups) will be half or could be as small as a quarter".

The company's shares tumbled 8 per cent on Thursday ahead of the results, its lowest in nearly two months.

"Other poor performers included Singaporean ride-hailing company Grab, US food delivery firm DoorDash and Indian payments group Paytm, which together lost close to $5 billion over the quarter, according to Redex Research analyst Kirk Boodry's estimates," reported the Financial Times.

"The investment environment remains challenging, dominated by fast-rising inflation, increasingly complex geopolitical risk and a global energy shock," SoftBank said.

SoftBank's $100 billion Vision Fund was launched in 2017 and is backed by Saudi Arabia and Abu Dhabi.

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