SoftBank seeks up to $100B from Gulf investors for new AI fund

What's the deal? SoftBank GroupDealroom has a profile for this one. Try Dealroom → is seeking up to $100 billion from Gulf investors to fund a new wave of AI investments, the Financial Times reported, citing people familiar with the matter. Chief executive officer Masayoshi Son has held early talks with potential backers, including in the United Arab Emirates. The proposed fund would acquire companies and use AI and robotics to improve their operations.

Why now? Son is ramping up AI bets. SoftBank completed its $30 billion investment in OpenAI last week and raised $11.1 billion last month in the largest high-yield corporate bond sale globally to fund that commitment.

What's the endgame? The new vehicle would buy companies and deploy AI and machines — including from SoftBank's robotics arm, RozeDealroom has a profile for this one. Try Dealroom → — to boost operations, the FT said. SoftBank plans to take Roze public in the US.

Context: In 2017, Son secured nearly $100 billion for the first Vision Fund, much of it from Saudi Arabia's Public Investment FundDealroom has a profile for this one. Try Dealroom → and Abu Dhabi's Mubadala. That fund posted a mixed record, backing winners such as ByteDance but also high-profile failures like WeWork.

What could go wrong? Talks are early and may not result in a raise. SoftBank is also grappling with rising borrowing costs, having invested almost $65 billion in OpenAI, whose IPO has been pushed back.

The signal: Any raise would coincide with OpenAI's effort to secure another $30 billion at a valuation of around $1.4 trillion, with funds including MGXDealroom has a profile for this one. Try Dealroom → in talks to anchor the round. Nearly a decade after the first Vision Fund, Son is again turning to Gulf capital — this time to bankroll a far larger bet on AI.

Read more: Channel News Asia

Image credit: ToGa Wanderings