SoftBank goes all-in on OpenAI, scrambling to pull together $22.5bn
Right now, it looks like the tech investment giant is willing to sell, borrow and pause almost everything else to make sure it does not miss that moment
SoftBank is in full sprint mode, trying to pull together $22.5bn for its investment in OpenAI before the end of the year. According to Reuters, citing people familiar with the situation, the Japanese conglomerate is using pretty much every lever it has, from selling assets to tapping credit lines, to meet the deadline written into its deal.
At the centre of it all is Masayoshi Son, SoftBank’s founder and chief executive, who has made OpenAI his biggest bet yet. The commitment is part of a deal struck earlier this year that valued OpenAI at about $300bn. Since then, OpenAI’s valuation has surged, with talks under way for new funding that could push it close to $900bn, according to one source. If that happens, SoftBank’s stake would look extremely smart on paper, assuming it can get the money in on time.
To raise the cash, SoftBank has already been doing some heavy lifting. It sold its entire $5.8bn stake in Nvidia, cut back its holding in T-Mobile US by about $4.8bn and reduced staff. Dealmaking at its Vision Fund has slowed to a crawl, with any investment above $50m now needing Son’s personal sign-off.
The group is also lining up other options. One is taking its payments business PayPay public. That listing was meant to happen this month, but a lengthy US government shutdown pushed it back. People close to the plans now expect the initial public offering in the first quarter of next year, potentially raising more than $20bn.
SoftBank is also looking to cash out of some other holdings, including a stake in Didi Global, the Chinese ride-hailing company that is preparing for a Hong Kong listing after being forced off US markets in 2021. On top of that, the group could draw on margin loans backed by its valuable stake in Arm Holdings, as well as bonds or short-term bridge loans.
All of this gives a sense of the pressure even the world’s biggest tech investors are under as the cost of competing in AI keeps rising. Massive data centres, specialised chips and top-tier talent are pushing budgets into territory that would have seemed unthinkable a few years ago.
OpenAI, for its part, has not yet received the remaining funding but expects SoftBank to deliver by the end of 2025, as set out in the contract. SoftBank declined to comment publicly.
For Son, the urgency is easy to understand. If OpenAI’s valuation really does triple, SoftBank’s investment could quickly become one of the most lucrative in its history. Miss the window, though, and the narrative shifts from bold vision to overreach.
