The Vision Fund led by SoftBank CEO Masayoshi Son decided to sell its shares of Wag, a dog- walking agency. The fund recorded its worst performance in the third quarter of this year since its launch in 2016 due to failed investments in WeWork and Uber. The investment in Wag is another case added to the list of Son’s failed investments. The serious decline of the Vision Fund’s performance seems to have created a vicious cycle by affecting the rest of the group.
CNN reported on Tuesday (local time) that the Vision Fund, which invested 300 million U.S. dollars in Wag last year, came to a decision to sell about half of its shares back to the dog-walking startup, indicating Son’s giving up on the Wag investment. A board position held by a SoftBank executive has also become vacant as well. “The news highlights the remarkable downfall of a startup that once appeared poised to be tech's next Big Thing,” says CNN.
SoftBank Group recorded over 700-billion-yen loss in the third quarter of this year alone due to the Vision Fund’s loss of 970.2 billion yen over the same period. The group’s main businesses – mobile phone and telecommunications – are relatively doing well to cover some of the fund’s loss but within limits.
“CEO Son is an expert in accounting, not the IT sector, such as artificial intelligence,” said Aera, a Japanese weekly newsmagazine, reflecting increasing question marks about Son’s investment skills.
“The key is to recover WeWork’s performance,” another economic newsweekly Weekly Dongyang Economy pointed. “It needs to prove to the financial market and investors that it is not a simple real estate company by transforming its services.”
Son’s confidence is still strong even in this situation. “I feel terrible about such a disappointing performance. I am examining my past decisions,” said Son at a press briefing on Friday. He added, however, “I will not be discouraged by the poor investment performance though. The Vision Fund 2 will be launched as planned.” He emphasized, “No company wins 100%.”