SoftBank plans vision fund staff cuts of at least 20%

By Min Jeong Lee, Peter Elstrom and Anto Antony

SoftBank Group Corp. is planning to cut at least 20 per cent of staff at its loss-churning Vision Fund operation, following public pledges from Masayoshi Son to reduce headcount at the world’s biggest tech investor, according to people familiar with the matter.

The Tokyo-based company will slash a minimum of 100 positions and may announce the job cuts as early as this month, said the people, asking not to be named as the information is not public. The cuts will mostly be in the UK, US and China operations, which have the most headcount, said the people. The Vision Fund unit had about 500 employees including Latin America funds staff.

Son, the self-made billionaire founder of the group, had said in August he plans widespread cost-cutting at his conglomerate and the Vision Fund investment arm after a record $23 billion loss. Most of the losses came from a plunge in the valuations of portfolio companies, including South Korea Coupang Inc. and DoorDash Inc. SoftBank also reported a $6 billion foreign exchange loss because of the weaker yen.

Executives are still debating how extensive the cuts should be, with some calling for cuts as high as 50 per cent, according to one person.

“As Masa said at our most recent earnings, we are reviewing the organization size and structure. However, nothing has been decided yet,” a company representative said in an email.

Senior and junior employees in both front and back offices are being scrutinized to an extent never seen before, the people said. The US has 200 people including Latam staff, the UK has 150 people while China has 50 people, according to another person.

Son had said last month that he would review “everything” for potential cuts without any “sacred cows.”

“The loss is the biggest in our corporate history and we take it very seriously,” he said at the time. “We have to resort to big cost-cutting efforts at Vision Fund. The cost cutting efforts will have to include a reduction in head count - something I’ve made up my mind to do.”

Rajeev Misra, who helped Son set up the initial Vision Fund with almost $100 billion in 2017, is stepping down from his roles as a corporate officer and executive vice president at SoftBank, the company said in a statement on Wednesday. He will continue to oversee the first Vision Fund’s existing investments, while Son has said he will take over the management of new investments under the second Vision Fund.

Son, who turned 65 in August, has been taking on increasing responsibility at the company he founded 40 years ago. Chief Operating Officer Marcelo Claure left earlier this year, while former Chief Strategy Officer Katsunori Sago resigned in 2021.

The Japanese entrepreneur has told investors that he is taking defensive steps to navigate his way through a brutal tech downturn. SoftBank said last month that it had raised more than $17 billion by selling forward contracts on Alibaba Group Holding Ltd., the Chinese e-commerce company that made Son’s reputation as a startup investor.

Son also said SoftBank has begun talks to sell asset manager Fortress Investment Group, acquired for $3.3 billion in 2017. To bolster SoftBank’s share price, Son unveiled a fresh program to buy back as much as 400 billion yen of its own stock.

Son is trying to wait out the technology slump so that he can pull off a successful initial public offering for Arm Ltd., the chip designer that SoftBank bought for $32 billion. The CEO is planning an initial public offering for Arm next year and has said he aims to make the offering the biggest-ever for a chip company.

--With assistance from Giles Turner and Takahiko Hyuga.