Valuations in Softbank's Vision Fund Portfolio Hammered by China Regulatory Action

Ride-hailing app Didi Global listed in New York (NYSE:DIDI) but valuations were impacted by China regulatory action (investigation from the Cyberspace Administration of China), aimed at policing the huge datasets that Didi has access to, given its dominant market position in China. This has led to speculation of of a possible delisting.

Vision Fund CFO Navneet Govil (MBA, MEng from Cornell) has asserted the China thesis remains strong. Navneet former roles include SVP of Finance and Strategic Pricing at CA Technologies (which was acquired by Broadcom in July 2018).

Porfolio managers, such as Joshua Crabb of Robeco (part of ORIX Europe), have commented we are now in an age of unprecedented regulatory scrutiny over Tech not limited to China.

$12.7bn annual operating loss for SoftBank driven by Vision Fund

SoftBank has reported a 1.36 trillion yen loss ($12.7bn) in line with its forecasts. These losses, which are the worst ever for SoftBank, have been driven largely by the $100bn Vision Fund, as a result of valuations e.g. WeWork, Uber, dipping in the wave of Covid-19. Alibaba Founder Jack Ma has also resigned from its board. Son invested $20m in Alibaba in 2000, a bet that paid big when Alibaba went public in 2014.