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It took two full decades, but shares of SoftBank — the operator of the world's largest technology-focused venture capital fund — have recovered to levels not seen since February 2000.

Shares climbed yesterday after SoftBank's Vision Fund posted its largest-ever quarterly profit of $8 billion.

Saved By An IPO Harvest
CEO Masayoshi Son displayed some serious moxie at the presentation.

With a PowerPoint slide depicting a goose laying golden eggs (each representing a SoftBank investment) and the tune of Tchaikovsky’s “The Nutcracker March” playing in the background, Son claimed, "investment is rhythm."

Capping off a turbulent 2020, Son focused on the large successes:

  • Uber and DoorDash, two companies that have benefitted from food delivery uptick during the pandemic, were the primary drivers behind the latest returns.
  • Vision Fund CFO Navneet Govil says he expects the streak to continue with several other portfolio company IPOs lined up this year including South Korean e-commerce group Coupang.

The Vision Fund's results are the culmination of a remarkable turnaround: in 2019 SoftBank reported a record $12.7 billion annual loss after the fund made several bad bets, including pouring $18.5 billion into WeWork.

Do Not Follow This North Star: The strong performance was hampered by Masayoshi Son himself, who frittered away $2.7 billion with ill-timed derivatives bets at the company's "SB Northstar" trading unit.

The Takeaway: While SoftBank is giving up most of its derivative bets, it will retain holdings in Silicon Valley titans Facebook and Amazon. Maybe it’s Son’s way of saying he should stick to golden eggs.

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Well, That Was Fast

Masa Son wastes no time getting back to wheeling and dealing (and maybe self-dealing).