SoftBank chief rues selling Nvidia stake and missing out on $150 billion
Summary
Masayoshi Son calls the 2019 sale of a stake in the chip maker, a company now valued at over $3.2 trillion, “the fish that got away.”TOKYO—SoftBank Group founder Masayoshi Son on Friday lamented what turned out to be a $150 billion blunder: selling shares in Nvidia years before the chip maker became one of the world’s most valuable companies.
Son, known for some of the most successful investments in technology history, recalled one of his less-cherished moments on Friday at SoftBank Group’s annual shareholder meeting in Tokyo.
“It’s frustrating to remember the ones that I missed," Son said. “I had to tearfully sell the shares" of Nvidia, he said, because at the time SoftBank’s Vision Fund investment vehicle felt it needed to lock in returns.
“The fish that got away was big," Son said.
In 2019, the Vision Fund sold its entire 4.9% stake in Nvidia and booked a $3.3 billion return on its investment.
It seemed like a big win, since SoftBank had spent about $700 million for its stake. But Nvidia was just getting started in its rise to the top, powered by demand for its chips in artificial-intelligence applications.
This past week, Nvidia briefly became the world’s most valuable listed firm, before falling back Thursday into second place behind Microsoft. As of Thursday’s close in the U.S., Nvidia was valued at about $3.22 trillion, just behind Microsoft at $3.31 trillion.
Had SoftBank’s fund held on to its Nvidia stake, it would be worth around $160 billion today, meaning SoftBank missed out on a gain of more than $150 billion by selling in 2019.
Son said Friday he once had a plan to make Nvidia part of his technology conglomerate. The month after SoftBank bought U.K. chip designer Arm in 2016, he sat down with Nvidia Chief Executive Jensen Huang in the yard of Son’s home in California and had a four-hour talk about a potential acquisition, Son said.
“There was one theme: ‘I bought Arm. Now I want to buy you, Nvidia,’ " Son recalled.
Son wanted to acquire Nvidia and privatize the company while keeping Huang as the leader, but the deal didn’t work out, he said. An Nvidia representative declined to comment.
Son also said he planned at one point to inject funds into OpenAI, maker of AI chatbot ChatGPT, but OpenAI co-founder Sam Altman eventually chose to accept an investment from Microsoft.
In 2022, his plans to sell Arm to Nvidia also didn’t go through owing to antitrust concerns.
“There are other fish that got away but there is no point in talking about them," Son said.
Son has enjoyed many investing successes over decades, including a $20 million investment in Chinese internet company Alibaba that ultimately produced tens of billions of dollars in return.
Arm has also turned into one of Son’s greatest hits. SoftBank owns about 90% of Arm, which listed its shares in the U.S. last year and had a market value of $168 billion as of Thursday’s close.
If given a second chance to choose between Arm and Nvidia, “I would choose Arm without a second of hesitation," Son said. “I believe in the future of Arm that much."
Most smartphones use chips designed by Arm, and its designs are also going into the next generation of chips that power AI applications.
The Arm stake is currently SoftBank’s biggest asset. SoftBank’s net asset value increased by $126 billion in about a year to $214 billion as of Thursday.
Son said Friday he wanted to realize “artificial super intelligence," which he said would be 10,000 times smarter than human intelligence. He said ASI would be widely used in about 10 years, helping humans cope with disease, car accidents, wars and even a meteor crash.
“I seriously believe the reason why Masayoshi Son was born is to make ASI come true," he said.
Write to Megumi Fujikawa at megumi.fujikawa@wsj.com
