Softbank unveils £385m Softbank Acceleration Fund

Startup fund could launch next month with offices around the world

Softbank has launched a new global tech fund with up to $500 million (£385 million) to pour into early-stage startups.

The Japanese telecoms giant could launch the Softbank Acceleration Fund as early as next month, according to Reuters.

The new fund – a rebrand of Seoul-based SoftBank Ventures Asia – is five times the average size of similar funds raised last year, according to data provider Preqin.

While Softbank’s $100 billion Vision Fund focuses on providing cash to late-stage startups, Softbank Acceleration Fund will focus on companies at a much earlier stage of growth which are still trying to get their ideas off the ground.

SoftBank Ventures Asia plans to open offices and hire investment managers in Singapore and Shanghai. It currently has teams in Seoul, Beijing, San Francisco, and Tel Aviv.

“It’s an important signal within the Softbank Group that Softbank thinks early-stage investments are important and will make continued efforts on them,” JP Lee, the fund’s boss, told Reuters.

When he secured a green light to start the new fund last October, Softbank chief executive Masayoshi Son asked him why they should invest in early-stage startups?

Reuters said Lee replied by referring to Son’s own $20 million investment in Chinese e-commerce giant Alibaba, which is now worth $130 billion.

As well as Softbank, South Korea’s National Pension Service will back the fund, along with unnamed companies and asset managers.

The multinational’s latest move signalled its ongoing transformation from a telecoms player into a major tech investor on the international stage after investments in Uber, We Work and other firms.

In addition to the $100 billion SoftBank Vision Fund that has made big investments in firms like Uber, SoftBank announced last Thursday it was launching a $5 billion fund focused on Latin America.

Last month, Softbank Vision Fund led the largest ever fundraising for a European fintech business, raising $324 million for challenger bank OakNorth.

And Softbank is providing half the cash for a new $400 million (£310 million) London-based European tech start-up fund run by Abu Dhabi state investment company Mubdala, which will invest between $5 million and $30 million in suitable European start-ups.