SoftBank Bets Big On America, $100 Billion Deal Under Trump

In a major economic boost for the United States, President-elect Donald Trump has secured a $100 billion investment commitment from Japan’s SoftBank Group, a move that is expected to create 100,000 jobs across key emerging industries like artificial intelligence (AI) and technology.

The announcement, made on Monday, December 16, marks a doubling of SoftBank’s previous funding pledge following Trump’s first presidential victory in 2016.

The deal was revealed during an event at Trump’s Mar-a-Lago resort, where he was joined by SoftBank CEO Masayoshi Son. Addressing the press, Trump exuded optimism, stating, “We’re going to go full prosperity and to build the greatest economy the world has ever seen, just as we had just a short time ago.”

SoftBank And Trump’s Vision

Masayoshi Son, expressed strong confidence in Trump’s leadership and the American economy, explaining his decision to double down on investments.

“My confidence level [in] the economy of the United States has tremendously increased with his victory,” Son said.

The connection between Trump and the Japan-based investment giant dates back to Trump’s first term. In 2016, shortly after Trump’s election victory, Masayoshi Son pledged a $50 billion investment aimed at supporting American startups and creating 50,000 jobs.

The move reflected Son’s belief in Trump’s pro-business stance and the growth potential of the U.S. economy. The commitment ultimately exceeded expectations, with the total investment reaching approximately $75 billion, according to reports.

“This is double of last time because I say, ‘Oh, President Trump is a double-down president, I’m going to have to double down,’ $100 billion and 100,000 jobs,” Son said during the announcement.

In a lighthearted moment, Trump playfully urged Son to increase the commitment further to $200 billion. While Son stood firm on his $100 billion pledge, he hinted at the possibility of even larger investments in the future.

A Focus on AI and Emerging Technologies

SoftBank’s $100 billion investment will target areas that are critical for the future of technology, particularly AI, data centers, and semiconductor manufacturing. Son has long been a proponent of AI-driven innovation, describing it as a transformative force for the global economy.

“A gold rush of intelligence has arrived. The one who goes fastest will win,” Son remarked during SoftBank World 2024, indicating the company’s aggressive push toward AI and related industries.

SoftBank Group, known for its bold investments, operates the Vision Fund, a $100 billion venture capital fund backed heavily by Saudi Arabia’s Public Investment Fund. While the Vision Fund has had its share of successes, it also faced high-profile setbacks, such as a $4.6 billion loss from its investment in WeWork in 2019.

To mitigate such risks moving forward, SoftBank has shifted its focus toward more strategic, long-term investments in AI and critical infrastructure, areas that align with growing global demand and offer more stable returns.

Trump’s Push for Economic Growth

The investment comes as President-elect Trump reiterates his commitment to driving economic growth and job creation during his second term.

Trump recently announced plans to fast-track permitting for companies investing over $1 billion in the United States, signaling a business-friendly approach to attract large-scale investments. This policy is expected to significantly benefit AI and tech sectors, aligning perfectly with SoftBank’s focus on emerging technologies such as artificial intelligence, semiconductor manufacturing, and data centers.

The SoftBank deal is also expected to play a crucial role in Trump’s broader economic agenda, which aims to revitalize industries, spur innovation, and reduce unemployment. Hence, prioritizing AI and other cutting-edge technologies, the investment aligns with global trends while strengthening America’s competitive edge in the tech-driven economy of the future.

What Companies Does SoftBank Own?

SoftBank Group, is a Japanese holding company that has transformed from a software distributor into a global investment powerhouse.

Through its venture capital funds, SoftBank invests in public and private companies across industries like software, robotics, telecommunications, real estate, and e-commerce.

It is most well-known for its SoftBank Vision Fund, the world’s largest venture capital fund focused on technology businesses. SoftBank also ranks as one of Japan’s largest publicly traded companies and manages capital for global investors, including Middle Eastern sovereign wealth funds.

Notable SoftBank Investments

Over the years, SoftBank has made several high-profile investments—some immensely successful and others less so.

Here’s a look at some of its most prominent current and past holdings –

1. Alibaba

SoftBank’s most successful investment to date is its $20 million stake in Alibaba in 2000. By the time Alibaba went public in 2014, the investment was worth $60 billion. As of March 2024, SoftBank still owns 29.5% of Alibaba, valued at approximately $55 billion.

2. T-Mobile

SoftBank originally invested in Sprint, which merged with T-Mobile in 2020. Following the merger, SoftBank retained a 7.4% stake in T-Mobile as of early 2024, having reduced its ownership over time.

3. Arm Holdings

SoftBank acquired semiconductor company Arm Holdings in 2016 for $32 billion. After plans to sell Arm to Nvidia for $40 billion fell through due to regulatory issues, SoftBank took Arm public in a highly anticipated 2023 IPO. SoftBank still owns 90.6% of Arm, worth well over $100 billion.

4. WeWork

SoftBank invested $4.4 billion in WeWork in 2017, with the company later going public via a SPAC in 2021. Despite significant losses and WeWork filing for bankruptcy in 2023, SoftBank retains a 46% stake in the company as of early 2024.

5. Nvidia

SoftBank holds a 0.04% stake in Nvidia, amounting to $520 million due to the company’s massive market capitalization. Nvidia’s dominance in AI-focused chips aligns with SoftBank’s emphasis on artificial intelligence investments.

6. Lemonade

SoftBank owns a 17.4% stake in Lemonade, an insurance technology company. However, the investment has struggled, with Lemonade’s shares falling 80% from SoftBank’s purchase price. Despite setbacks, Lemonade continues to grow and progress toward profitability.

7. Compass

SoftBank invested over $1 billion in real estate startup Compass in 2023. While it has sold some shares, it still holds a 21.2% stake. Compass provides real estate software for operations, client services, and customer relationship management.

8. Yahoo! Japan

SoftBank acquired Yahoo! Japan from Verizon for $1.6 billion in 2021. It remains Japan’s second-most popular search engine, behind Google.

9. Telecommunications

Beyond its venture investments, SoftBank Corporation operates a significant telecommunications business in Japan, including mobile and landline services. It owns several telecom brands and is the third-largest wireless carrier in Japan.

These positions reflect SoftBank’s diversified investment strategy across industries like AI, fintech, real estate, and robotics.

Previous SoftBank Investments

SoftBank has a long history of making significant investments, though it no longer holds stakes in all of its past ventures. The company was an early backer of several high-profile businesses, and here are some of its most notable investments:

Uber
In early 2018, SoftBank led a $9 billion investment into Uber, making it the largest shareholder in the ride-hailing giant. However, SoftBank sold $2 billion worth of Uber shares in early 2021 and exited its remaining stake by mid-2022.

Opendoor
SoftBank invested $400 million in Opendoor, a real estate technology platform, in September 2018, before its IPO. The company fully exited this investment by mid-2022.

DoorDash
Through its Vision Fund, SoftBank invested $535 million in DoorDash. While the firm has largely exited the investment, it still holds a small stake, with a reported 0.01% ownership worth about $2.3 million, according to its latest regulatory filing.

Cruise Automation
Cruise, an autonomous vehicle technology company, was majority-owned by General Motors (GM). SoftBank once held nearly 20% of the company, but GM bought out its stake in 2022 to consolidate its ownership.

Potential Future Investments for SoftBank

In recent years, SoftBank’s investment pace has slowed, largely due to profitability concerns, a shortage of suitable investment opportunities, and a series of unsuccessful ventures. However, with the resurgence of IPOs and venture investments in 2024, SoftBank may soon return to making major investments.

Venture Capital and AI Focus

Venture capital (VC) involves funding start-ups and small businesses with the expectation of long-term growth. SoftBank’s founder, Masayoshi Son, has shown particular interest in AI. Reports suggest that SoftBank may be exploring investments in AI start-ups.

Son is reportedly aiming to raise $100 billion to create a business that would collaborate with Arm and challenge Nvidia in the AI chip market. Additionally, Son has met with OpenAI’s leadership to discuss a potential investment in an AI chip venture.

While it’s uncertain what specific opportunities SoftBank will pursue next, AI-related ventures appear to be a likely focus. The company has been one of the most influential investment firms of the past two decades, with major successes like Alibaba and a number of investments that didn’t yield positive returns or resulted in losses.

Despite the challenges, SoftBank continues to hold stakes in several prominent companies and remains on the lookout for its next big opportunity.

The Last Bit

While SoftBank reportedly holds $30 billion in cash on hand, according to The Wall Street Journal, the $100 billion investment is expected to come from a mix of new funding sources, including potential contributions to the Vision Fund. Son’s ambitious plans signal his confidence not only in Trump’s leadership but also in America’s capacity to lead the next wave of technological innovation.

For Trump, this announcement marks a significant milestone in his mission to restore economic dominance and enable job creation. With SoftBank’s commitment now secured, all eyes will be on the execution of this massive investment and its impact on American industries.

“We’re going to win big,” Trump declared, reflecting the optimism surrounding the deal. Whether it’s AI, semiconductors, or other emerging technologies, the collaboration between SoftBank and the United States may just set the stage for a new era of economic growth and innovation. Will this investment truly transform America’s tech future, or is it just the beginning of even bigger moves?