Soft Bank the famous conglomerate which gives business capital and start-up capitals to emerging businesses and start-ups around the world has suffered a loss of $4.7 billion in the WeWork debacle.
The net losses of Soft Bank for the 2nd quarter that ended in September were 700 billion yen ($6.4 billion). During the same quarter last year the company had made a profit of 526 billion yen which is very low as compared to the loss. The majority of the losses were suffered from its Vision Fund which the company has set aside to give capitals to new start-ups. The soft bank suffered came from Uber and WeWork.
On the stock markets, Uber’s shares plunged after it declared its Q2 results during which the company had suffered a net loss of $1 billion.
But Soft Bank CEO Mr Son quickly apologized for the losses and took the blame n himself for wrong decisions regarding investments. This was the first-ever quarterly loss reported by Soft Bank in a quarter in 14 years.
On its investment in WeWork, the company had to write off losses which amounted to 374.7 billion yen or $3.4 billion. It’s more shocking to hear this as Soft Bank took nearly 80%% control of the company with a fresh investment of $5 billion just two weeks ago.
The tech company was forced to pull off its IPO in September because the losses had started to go out of control and the public investors were not ready to fund more money into the business. The company had to show the door to former CEO Adam Neumann and installed Marcelo Claure as the new CEO of the company who is also Soft Bank’s operating chief.
Mr Son said that there will be no more bailouts for future startups which were funded by Soft Bank.