An Innovator in Japan: Masayoshi Son’s Autonomous Transportation Empire
Originally published on 7/23/2018
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Masayoshi Son, CEO of Japanese telecom-turned-conglomerate SoftBank and overall Japanese business magnate, raised some eyebrows this week for lambasting the Japanese government for its overly risk-averse stance on ride share services like Uber.
Some praised his comments, looking forward to a Japan where even the highly lobbied taxi industry is finally eaten by software. Others were critical of his laissez faire attitude and his obvious financial stake in the success of ride share companies.
In any case, there is no question that he has made waves in the cutting-edge tech world across the past few decades. Especially through introducing the $100 billion SoftBank Vision Fund, followed by what some have viewed as a maniacal shopping spree, the tech investment world has felt Son’s influence around every corner. This week, we are starting our Weekly Digest with a primer on the man of the myth, one of the modern Innovators in Japan, Masayoshi Son.
Masayoshi Son: The Man
Masayoshi was born in a small town in the south of Japan to Zainichi Korean parents, descendants of Koreans who stayed in Japan after the second world war. His family used “Yoshimoto,” a common Japanese family name, to hide their Korean heritage to avoid discrimination.
In search for better opportunities for their son, Masayoshi’s parents moved to Hakata, Fukuoka, the largest city on the island. Taking the advice of McDonald’s Japan founder, Masayoshi would eventually head to Serramonte High School in the San Francisco Bay Area as a sophomore, skip two years, and test out of high school within 2 weeks of enrollment.
After enrolling in Holy Names University, Masayoshi transferred to US Berkeley where he studied Economics and Computer Science. This is where he started his first company leasing Pac-Man and other gaming consoles to bars and college dorms. He also set up an outfit selling his very own electronic translator, which Sharp would acquire for $1 million. He then began Unison, a software development firm, selling his shares to an associate after returning to Japan, only to begin another software distributor shortly thereafter.
Masayoshi Son: The Capitalist
In 1981, frustrated with NTT’s telecom monopoly in Japan, Masayoshi founded Softbank, then a telecom operator. This company would eventually grow to $180 billion at the height of the 90s dot-com boom, making him the richest man in Japan at $78 billion in personal wealth. Unfortunately for him, all bubbles lead to a bust, and he lost $70 billion by 2004, the largest recorded amount lost by one person in Japan. Thanks to his persistence and perseverance, SoftBank rebounded, and is now the third largest telecom and internet provider.
As a leader of one of the largest telecom companies in Japan, Masayoshi also engaged in numerous acquisitions and investments into companies like Sprint, Vodafone Japan, and Alibaba, the last of which resulted in $60 billion dollars in 2014 on an investment of $20 million in 2000, a whopping 3000x return.
In 2017, Masayoshi established the SoftBank Vision Fund with investments from about 10 companies, notably SoftBank, and the Crowned Prince of Saudi Arabia Mohammad bin Salman. The mega fund, with $100 billion dollars under management, sent shockwaves across the technology venture clique as it began investing large sums of capital into late stage startups, sometimes yielding its own grandiosity as a weapon.
Anthony Tan, cofounder of Grab, a Singapore-based ride hailing service, was one of the people who experienced Masayoshi’s forceful, if not threatening gift during his first meeting with the magnate. Said Masayoshi to a reticent Tan:
“Anthony-san, you take my money. It’s good for you. It’s good for me. If you don’t take my money, not so good for you.”
Even Uber CEO Dara Khosrowshahi caved to Masayoshi’s will. According to Khosrowshahi, Masayoshi was not shy in showing his intentions to invest in Lyft if Uber did not accept the $9.3 billion injection, stating at a conference hosted by Goldman Sachs: “Rather than having their capital cannon facing me, I’d rather have their capital cannon behind me, all right?”
Masayoshi Son: The Future (Information) Transportation King?
While the Vision Fund has positions in varying industries from microchip processors (ARM Holdings, NVIDIA), to real estate (WeWork), one noticeable trend is Masayoshi’s interest in the practical application of AI and data. As of June 2018, the Vision Fund has invested in Uber, GM Cruise, and Doordash, as well as other peripheral services such as MapBox, an open source mapping platform, which can be coupled with vehicles and AI to build in strong synergies. The SoftBank Group has invested a sizable $35 billion dollars in the overall ride share space as well, implying his vision of a future where autonomous cars, networked with one another, communicate through data volumes unimaginable today.
In a 1992 article by the Harvard Business Review, Masayoshi is quote saying:
“People usually compare the computer to the head of the human being. I would say that hardware is the bone of the head, the skull. The semiconductor is the brain within the head. The software is the wisdom. And data is the knowledge…I want to be number one in the business of supplying wisdom and knowledge.”
It seems he had a clear idea of how to frame the world more than two decades ago. And now with ample cash at his disposal, the “one-man bubble-maker”may have enough influence to mold the world just as he views it.
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