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Huge SoftBank fund to invest $136b in start-ups

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SAN FRANCISCO: Japan-based SoftBank is sending tremors through the tech world with a massive new venture capital fund for investing in start-ups.

It is expected to dominate the industry so thoroughly that it is playfully referred to as a "gorilla".

The Vision Fund's US$100 billion (S$136 billion) coffers nearly equals the total amount pumped into venture capital-backed companies last year, according to market intelligence firm CB Insights, and some say it may be a game changer for Silicon Valley.

"SoftBank shows a remarkable amount of bravery, confidence and optimism to look to apply this much money in technology," said Mr Bill Maris, who started Google Ventures nearly a decade ago and runs his own California-based investment firm Section 32.

Last year, venture capital-backed firms received US$100.8 billion across 8,372 deals around the world, according to CB Insights data.

The fund is widely expected to pump some US$10 billion into ride-sharing giant Uber, which has a whopping valuation near US$70 billion. Such a deal would boost the profile of the Japanese group in Silicon Valley.

Mr Maris predicted the venture capital market will adapt to the Vision Fund, and in the end there will be more money available for entrepreneurs.

"I always think more dollars available to innovators and inventors is a good thing," he said.

"If it does shake up the market, maybe things do need to be shaken up a little bit."

SoftBank chief executive Masayoshi Son has demonstrated a strategic appreciation for bringing together start-ups with the potential to benefit one another, according to analyst Patrick Moorhead of Moor Insights & Strategy.

He likened Mr Son's style of investing to "matchmaking", targeting diverse companies that could help one another in the future.

Targets for the Vision Fund are expected to include e-commerce, ride-sharing, robotics and machine learning.

Mr Maris said: "I admire the fact (Mr Son) is doing something visionary. I imagine that is why they call it the Vision Fund. - AFP