SoftBank uses ‘capital as a weapon’ and competitors don’t know how to react, says legendary tech investor Bill Gurley.
SoftBank has gained a reputation for picking winners and pumping capital into them to choke off the competition. The Japanese company, led by Masayoshi Son,in July that it's launching its second mega fund focused on tech companies creating artificial intelligence. The new fund stands at around $108 billion, according to SoftBank, with the firm planning to contribute $38 billion.
While Benchmark is investing in capital-intensive businesses, Gurley said he likes industries that are less exposed to price competition, like social media. When it comes to companies that require constant cash, you have to consider whether to take SoftBank's money, even if you don't want it. "If you're on the boards of these companies, choosing not to engage is ceding the field," Gurley said. "So I think it's one of the toughest things a board has ever had to analyze. Any board in the history of business, no one's faced this."
Appearing alongside Gurley on "Halftime Report," Brad Gerstner, the founder of Altimeter Capital, said, "I hope they shelf the idea for Vision 2." Gerstner said SoftBank is poised to continue "what I think is a dangerous game of investing in competitor companies and pitting them against one another."
"SoftBank's a huge investor in DoorDash, they're a huge investor in Uber, those two are smashing it out," Gerstner said. "It's leading to huge burns. I don't think that's a net positive for Silicon Valley, I don't think it's a net positive for those companies, I don't think it's a net positive for SoftBank."
Brasil Últimas Notícias, Brasil Manchetes
Similar News:Você também pode ler notícias semelhantes a esta que coletamos de outras fontes de notícias.
SoftBank's 'capital as a weapon' strategy creates a huge challenge for corporate boards, says Bill GurleyPrice competition fueled by SoftBank's investments makes for 'one of the toughest things a board has ever had to analyze,' Benchmark's Bill Gurley said.
Consulte Mais informação »
House passes $300M bill requiring carbon monoxide detectors in public housingJUST IN: US House passes $300M bill requiring carbon monoxide detectors in public housing; follows an NBCNews investigation that exposed lack of protections.
Consulte Mais informação »
California Gov. Gavin Newsom Signs Vaccine Bill Restricting Medical ExemptionsThe new law is expected to make it more difficult for parents to opt their children out of immunizations.
Consulte Mais informação »
McConnell backs short-term spending bill to avert shutdown“A major focus of the Senate this month will be ... passing a temporary continuing resolution for the outstanding parts of the government," McConnell says.
Consulte Mais informação »
Brexit Delay Bill Made Law, Speaker John Bercow Resigns Ahead Of Parliament ShutdownA 'rebel alliance' of British MPs have rushed through a law that will prevent Prime Minister Boris Johnson from taking the U.K. out of the European Union without a trade deal.
Consulte Mais informação »