Uber is SoftBank’s No. 1 bet in the world, CEO Khosrowshahi says

Uber CEO Dara Khosrowshahi said SoftBank’s head “doesn’t throw good money after bad” and that the company and its financial backer’s interests …

Uber CEO Dara Khosrowshahi said SoftBank‘s head “doesn’t throw good money after bad” and that the company and its financial backer’s interests are aligned as the Japanese conglomerate rolls out another megafund.

Khosrowshahi, appearing on CNBC’s “Squawk on the Street, ” said Uber and SoftBank CEO Masayoshi Son are on the same page as the SoftBank’s Vision Fund 2 prepares to invest in companies that could become competitors with the ride-hailing giant.

“I think that Masa is a businessman. He doesn’t throw good money after bad. When he puts in money into companies, it’s because he believes in them and he thinks they’re going to be category leaders. We are their single largest investment on a global basis, so I think our interests and Masa’s interests are very much aligned,” Khosrowshahi told CNBC’s David Faber and Jim Cramer.

SoftBank launched its second megafund last month, contributing $38 billion of its own money. The fund is expected to total $108 billion and will invest in technology companies working with artificial intelligence.

This new round of investments could increase competition for Uber, which is trying to expand offerings such as food delivery service UberEats as it works toward profitability.

“The eats market continues to be very competitive,” Khosrowshahi said. “There’s a lot of capital coming into the category, because it’s growing, and I think eats is going to be a battle this year and next year.”

A new round of investments in startups could expand the total market for Uber’s services and be beneficial for the company, even if it creates competition, Khosrowshahi said.

“They know everybody, they understand the markets, and I’m very, very happy to have them as an investor, and I consider Softbank a very good actor in this marketplace. They’re going to put money against the markets, but that’s going to expand the markets, and we have been one of the cheap beneficiaries of that,” Khosrowshahi said.

Uber missed analyst expectations on the top and bottom lines in its first quarterly report since its initial public offering, sending its shares tumbling. The transportation company lost $5.2 billion in the quarter, due in part to stock-based compensation.

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SoftBank backs C2FO as it shifts its gaze to Vision Fund II

Existing investors Temasek and Union Square Ventures also participated. The company raised a $100 million Series F in February 2018 and was …
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The Vision Fund is at it again.

C2FO, an enterprise working capital marketplace provider, has banked $200 million in a round led by the SoftBank Vision Fund. Existing investors Temasek and Union Square Ventures also participated. The company raised a $100 million Series F in February 2018 and was reportedly valued around $813 million in 2015, per PitchBook data. Over 300,000 businesses across 173 countries utilize C2FO’s platform.

Founded in 2008, the Kansas-based B2B company facilitates earlier repayment of vendor invoices. It provides lines of credit for a supplier’s unpaid invoices in exchange for the vendor receiving a discount on the invoice’s total. C2FO also established a partnership with Euler Hermes in February to offer insurance that protects companies’ receivables from nonpayment.

Improving cash flow for businesses may be a lucrative opportunity for investors. Brex, which provides a credit card geared specifically toward startups, scored a $100 million Series C extension with a $2.6 billion valuation in June. This was a massive jump from the company’s $220 million valuation after a $50 million Series B in April 2018, signaling increased VC interest in the business of commercial funding.

SoftBank’s next steps

C2FO’s funding announcement comes alongside new details surrounding SoftBank’s Vision Fund II. On Wednesday, SoftBank said it would start investing out of its second mega-fund as early as next month, on the condition that its first Vision Fund becomes 85% invested, per reports. That fund was 68% invested at the end of June, according to Axios.

The Tokyo-based telecom giant will put $38 billion toward its second fund. Apple, Microsoft, Mizuho Bank and others are expected to participate, for an anticipated total of around $108 billion. Saudi Arabia’s Public Investment Fund and Mubadala are also said to be in talks to contribute, with those commitments being in addition to the $108 billion total, according to The Wall Street Journal.

As Vision Fund II revs up, it remains to be seen how a new assortment of limited partners could potentially influence the criteria of companies that could receive funding.

Featured image via MIKI Yoshihito/CC BY 2.0

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C2FO Lands $200M For Dynamic Discounting Tech

7), SoftBank Vision Fund led the funding, while existing backers Temasek and Union Square Ventures also participated. The company said it aims to …

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C2FO, an online loan marketplace that connects businesses with invoice financing, has announced $200 million in new funding as it looks to expand with small and medium-sized firms.

According to a press release on Wednesday (Aug. 7), SoftBank Vision Fund led the funding, while existing backers Temasek and Union Square Ventures also participated. The company said it aims to grow globally and expand its customer base beyond large, multinational corporates to connect companies of all sizes with working capital for their unpaid invoices.

“We invested in C2FO because we think their disruptive innovation offers a solution to an industry that has traditionally lacked cost-efficient alternatives for businesses of all sizes looking to free up cash quickly,” said SoftBank Investment Advisers Managing Partner Akshay Naheta in a statement. “We believe the company’s platform provides maximum value for buyers and suppliers and are excited by the company’s vision to become the global exchange for working capital.”

The company offers early invoice payments at a discount, accounts receivable financing and other working capital products for companies that are matched to investors via a proprietary algorithm. According to C2FO, as of today, an average of more than $1 billion in funding is matched to business borrowers each week.

The new funding follows a $100 million round announced last year, provided by Allianz X and Mubadala Investment Company, among other existing backers. C2FO’s focus on small businesses comes after the company published research last year showing that small businesses continue to face significant market uncertainty, despite a strengthening economy and improved access to capital.

In February, C2FO announced a partnership with Euler Hermes to combine trade finance insurance with the working capital solution, enabling businesses on the platform to augment their risk protection against unpaid invoices. Euler Hermes’ Single Invoice Cover Product is available to C2FO clients, enabling businesses to optimize their credit terms and acquire insurance on single invoices.

SoftBank’s AI-Focused Vision Fund 2 May Actually Be Dangerous for AI

… venture capital going into AI companies globally, per calculations by The Wall Street Journal and the MoneyTree report from PwC and CB Insights.
Masayoshi Son

Masayoshi Son, chairman and CEO of SoftBank Group Corp. Alessandro Di Ciommo/NurPhoto via Getty Images

Common sense tells us that when something grows too fast, it’s usually not a good thing. And that’s exactly what the bubbly space of artificial intelligence looks like right now.

In the past five years, the number of privately-owned AI companies that received venture capital funding have grown more than 500%, and the average funding size has almost tripled. And despite industry insiders’ repeated warning of a forming “AI bubble,” the frontrunners in this cash-pumping game have shown no signs of slowing down.

SEE ALSO: What Microsoft’s $1 Billion Investment in OpenAI Could Achieve

Last month, Japanese investment powerhouse SoftBank Group, which turned Silicon Valley upside down in 2017 and 2018 with its $100 billion Vision Fund, announced that it was ready to launch a second Vision Fund and already had $108 billion secured from upstream investors.

Unlike the first Vision Fund, which touched private companies in a wide range of industries, the Vision Fund 2 will focus exclusively on AI companies.

At $108 billion, that commitment would be equivalent to the total VC dollars raised by U.S. companies in all industries last year and five times the amount of venture capital going into AI companies globally, per calculations by The Wall Street Journal and the MoneyTree report from PwC and CB Insights.

While it’s one thing to have the money ready to fuel an emerging technology like AI, it quite another to know whether the pace of technological advancement will actually catch up with investors’ untamed enthusiasm.

Riding a wave of media craze over AI, businesses increasingly label themselves as AI companies to woo customers as well as investors.

“It’s very clear that [AI] has become a marketing thing,” Philipp Gerbert, a Germany-based AI expert with Boston Consulting Group, said in a recent interview with the Journal.

Earlier this year, a study of roughly 3,000 companies in Europe found that only half of the self-described AI companies actually had valuable AI technology. Similar findings were seen in China, too, where A.I. was thought to be a core component in the Chinese government’s “Made in China 2025” mission. Former Google executive-turned-venture capitalist Kai-Fu Leetold local media that he’d seen extreme cases such as an underwear manufacturer branding itself as an AI company, which he said was “abnormal.”

That said, SoftBank founder and CEO Masayoshi Son is too much of an optimist to be distracted by those worries.

“Within 30 years, definitely, things will be flying,” Son told CNBC in March. “Things will be running much faster without accident. We will be living much longer, much healthier. The diseases that we could not solve in the past will be cured.”

Also speaking to the Journal, San Francisco-based entrepreneur Chris Nicholson, CEO of deep learning startup Skymind, said he’s excited about the technological progress SoftBank’s new mega fund could bring about, but he’s doubtful on how fairly AI companies would be valued from a business standpoint.

“Now we have $100 billion that are set to chase and support AI, and they obviously won’t be investing in Google and Microsoft. So this will create new centers of AI progress. And that’s healthy,” he said. “I have no doubt this new fund will accelerate the development of AI. The question is, who is going to value these startups higher than SoftBank? What’s the exit plan?”

SoftBank’s AI-Focused Vision Fund 2 May Actually Be Dangerous for AI

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SoftBank Vision Fund leads $200 mln round for C2FO

SoftBank Vision Fund led the round with participation from return backers Temasek and Union Square Ventures. In addition to the funding, Nahoko …

C2FO, a market for working capital, has closed $200 million in funding. SoftBank Vision Fund led the round with participation from return backers Temasek and Union Square Ventures. In addition to the funding, Nahoko Hoshino will join the C2FO’s board of directors on behalf of SoftBank Investment Advisers.

Source: Press Release