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How billionaire Masa Son is shaking up Silicon Valley

By News Express on 02/08/2018

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•Masayoshi Son
•Masayoshi Son

Not far from the storied venture capital firms on Sand Hill Road, there’s a palatial estate where Masayoshi Son, Silicon Valley’s newest kingmaker, shapes the future. Reaching him requires driving into a leafy enclave filled with mansions overlooking Palo Alto before passing through a gated entrance into a sprawling compound where waiting attendants escort you inside.

Startup founders fortunate enough to earn an audience with Son, a 60-year old billionaire with a global network and vast funds, recall being led down a hallway lined with artwork to make the pitch of a lifetime. Some were ushered into a large conference room with an enormous table, spotless marble floors and ornate woodwork. Others found themselves in a small side room illuminated by chandeliers waiting for the meeting to begin. Eventually they met Son in an intimate sitting room where a two-seater couch faces a couple of chairs and a small coffee table.

Matt Barnard remembers time moving slowly in that side room as he awaited his chance to convince a man he described as “larger than life” to bet on his indoor farming startup, Plenty. To help make his case, Barnard brought along a seven-foot tower of mustard greens and bok choy grown by his startup. It was just tall enough, it turned out, to whack one of the chandeliers. “How perfect,” Barnard said. “I walk into this immaculate and impressive home and manage to almost break a chandelier.”

Son’s fund would go on to lead a $200 million investment round in Plenty after the meeting.

Barnard wasn’t the only one to have an anxiety-inducing moment in the house. Mohit Aron, founder and CEO of the data storage startup Cohesity, remembers Son staying silent throughout much of his pitch. When Son did speak, it was to ask Aron how much bigger he thought the company might really grow with an infusion of capital. Aron told him it could one day capture much of the world’s data.

Son pondered that pitch for 30 seconds before saying “OK” and shaking Aron’s hand, sealing a deal to lead a $250 million investment round in the startup. The deal done, Son led Aron to the front door and bid him goodbye. “He is a man of few words,” Aron says. “He doesn’t say much. He will just shake hands and that’s it.”
The rise, fall and rise of Mr. Internet

Son has always had a penchant for making deals. As a student studying economics at UC-Berkeley forty years ago, he convinced Forrest Mozer, a professor who had invented a talking calculator for the blind, to join him in building a pocket translator.

“It surprised me,” Mozer told CNN recently. “Here’s this young, little kid coming into my office with a business plan that really made a lot of sense. I went home and told my wife that I just met this guy who is going to own Japan someday. It turned out I was more right than I thought.”

Son sold the device to Sharp in a deal he said netted him “close to $1 million” -- an early win for the young entrepreneur. “It was clear if you spent an hour a day with him that his mind was all on business,” Mozer says.

Son returned to Japan after graduating from Berkeley in 1980 and founded SoftBank --the name is short for “bank of software”-- in 1981. It focused on distributing software developed by other companies, before branching into computer trade shows and tech magazines. From the start, Son focused on “how he could help change society with technology,” said the longtime SoftBank employee.

By the mid-90s, it seemed clear that answering that question meant investing in online companies. In what could be seen as a precursor to its activities today, SoftBank pumped billions into hundreds of internet startups. Some, like Yahoo and Alibaba, paid off handsomely, helping overshadow losses from notable flops like Kozmo and Webvan. Son bet so heavily on online ventures that people took to calling him “Mr. Internet.”

Son’s net worth soared accordingly, only to collapse when the bubble burst. He is widely reported to have seen his paper wealth fall by $70 billion in 2000. “One year before that, my personal net worth was increasing $10 billion per week. For three days, I became richer than Bill Gates,” Son told Bloomberg TV last year. “Before I told anybody else, our stock started crashing… We almost went bankrupt. Somehow. I survived.”

SoftBank declined to make Son available for this article.

Son started rebuilding immediately. “When something like that happens he doesn’t sit back and sulk and become inward looking,” the longtime SoftBank employee said. Son looked to new opportunities, including investing in broadband services in the early 2000s, acquiring Sprint for $20 billion in 2013 and buying multiple robotics companies in 2017 -- among them Alphabet’s Boston Dynamics, which builds robots that run, jump and climb stairs. More than a decade after the Dot Com bubble burst, SoftBank reaped the financial rewards of the early Alibaba deal. When the Chinese e-commerce company went public in 2014, SoftBank’s $20 million investment was worth nearly $75 billion.

Mr. Internet was back, and more ambitious than ever.

“He likes to joke he has had more failures than anyone else, but has learned from all of them,” says Chris Lane, an analyst with Bernstein who tracks SoftBank. “Most people still admire his track record, and the amazing success he has had despite these setbacks.”

•Excerpted from CNN report

Source News Express

Posted 02/08/2018 12:10:33 PM

 

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