Investing in tech is, by definition, a risky endeavor, given the high failure rate of new enterprises. But SoftBank CEO Masayoshi Son, whose tolerance for risk has always been unusually high, is doubling down on his personal exposure. Son revealed on Tuesday that he plans to invest $2.6 billion personally in the company’s Vision Fund 2, which he will apparently finance by borrowing against his SoftBank stake.
Some see the potential for conflicts in Son’s “co-investment” plan, as he called it, although in one sense it is admirable. It’s not unheard of for principals at venture capital and other investment firms to put their own money at risk when their firms are making investments. The approach ensures the people deciding on the investments have skin in the game and (theoretically) treat other people’s money as carefully as they treat their own. But this is a little different. Firstly, Vision Fund 2 hasn’t raised outside money, unlike the first Vision Fund. So Son is investing alongside money that only SoftBank itself put in.