Softbank to lay off 15 per cent of staff at Vision Fund arm
Softbank is set to cut 15 per cent of jobs at the investment arm which manages its $100bn Vision Fund, following a series of misplaced bets which damaged its overall value.
The Vision Fund, which is responsible for taking major stakes on behalf of Softbank in tech startups such Wework and Uber, has a global staff of approximately 500 people.
The cuts could begin as early as this week, according to reports by Bloomberg and the Financial Times. They will mark the first major round of layoffs since Softbank Investment Associates (SBIA) was established in 2016 to manage the Fund, which is based in London.
The move comes in spite of a decision to double the annual salary of the Vision Fund’s head Rajeev Misra last month to more than $15m.
SBIA has grown rapidly, adding around 400 of its staff in the last two years. One insider told the Financial Times that the cuts are an attempt to refocus the arm, with two SBIA managing directors being reassigned to roles at Softbank.
The Fund’s dismal performance led Softbank to report its largest yearly loss on record in March, forcing the Japanese tech giant to revisit plans for a second Vision Fund.
Its bet on Wework was particularly problematic for the Fund, with Softbank’s chief executive Masayoshi Son calling the move “foolish” last month. The firm is reported to have invested around $19bn in Wework, with the latter’s valuation dropping from $47bn ahead of its botched market debut last year to $2.9bn in March.
However Softbank’s share price had seen a revival in recent weeks, rising 99 per cent to date since hitting a four-year low following the announcement.
A Softbank spokesperson declined to comment.