Missed out on earning $150 billion! Masayoshi Son admits mistake: NVIDIA sold too early, missed out on a big opportunity!
At that time, Masayoshi Son believed that locking in returns was a wise move, but today, this decision is undoubtedly a huge mistake, especially after NVIDIA became the world's largest company by market capitalization
As a legendary figure in the field of technology investment, SoftBank founder Masayoshi Son gained great fame for his investments in companies like Alibaba. However, in recent years, he missed out on the big AI trend with his investments in NVIDIA and OpenAI.
On June 21st local time, at SoftBank's annual shareholders meeting, Masayoshi Son reflected on a major mistake in his investment career: selling off NVIDIA stocks too early, missing out on a potential profit of up to $150 billion.
Thinking about the things I missed, it's really frustrating. I regret selling off NVIDIA stocks.
Selling NVIDIA Early, Missing Out on $150 Billion!
It is reported that SoftBank sold off all of its 4.9% stake in NVIDIA in 2019, earning a return of $3.3 billion.
At that time, Masayoshi Son believed that locking in the returns was a wise move, as SoftBank had only invested $700 million in purchasing NVIDIA stocks.
However, in hindsight, this decision was undoubtedly a huge mistake.
Amid the artificial intelligence investment boom, NVIDIA has been thriving in the past two years and briefly became the world's most valuable public company this week. Despite falling to second place after Microsoft on Thursday, NVIDIA's market value still stands at $3.22 trillion, just slightly below Microsoft's $3.31 trillion.
If SoftBank had held onto NVIDIA, its stake would be worth $160 billion today. This means that SoftBank missed out on over $150 billion in profits by selling off NVIDIA in 2019.
Regretfully, Masayoshi Son said:
Missed out on a big fish.
Masayoshi Son revealed that he had planned to incorporate NVIDIA into SoftBank's technological portfolio and had engaged in in-depth acquisition negotiations with NVIDIA CEO Jensen Huang a month after acquiring chip design company ARM.
Masayoshi Son hoped to acquire NVIDIA and take the company private while retaining Jensen Huang as the leader, but the negotiations ultimately failed. Additionally, he had intended to sell ARM, a subsidiary of SoftBank, to NVIDIA, but this plan did not materialize due to antitrust issues.
It is worth noting that besides NVIDIA, Masayoshi Son also missed out on the rising star in artificial intelligence, OpenAI.
Masayoshi Son disclosed that he had originally planned to invest in OpenAI, but OpenAI CEO Sam Altman ultimately decided to accept investment from Microsoft.
Betting on ARM, Coming Out on Top?
Despite missing out on NVIDIA and OpenAI, Masayoshi Son's bet on ARM has been hugely successful, serving as one of his most successful investment examples.
ARM went public in the U.S. last year, with a market value of $168 billion as of Thursday's closing. ARM shares are currently SoftBank's largest asset, with SoftBank owning approximately 90% of ARM.
If given another chance to choose between ARM and NVIDIA, "I would choose ARM without hesitation," Masayoshi Son said, as ARM chips dominate the smartphone market and its designs are also entering the AI era
I have great faith in the future of ARM.
"Artificial Super Intelligence"?
Masayoshi Son also stated on Friday that SoftBank's past investments were just a warm-up for his grand ambition of ushering in the era of artificial intelligence.
He envisions that in the near future, his mission is to achieve "Artificial Super Intelligence" (ASI) - intelligence that is 10,000 times smarter than human intelligence. ASI is expected to be widely used in about 10 years, helping humanity deal with diseases, accidents, wars, and even asteroid impacts.
I firmly believe that the development of Artificial Super Intelligence is part of my life mission.
Son told shareholders earlier on Thursday that the group needs to "look for the next big bet, not afraid of whether it will succeed or fail."
After experiencing a series of painful losses, the Vision Fund entered what is known as a "defensive mode." Now, SoftBank has a strong balance sheet and billions of dollars in an "offensive" fund. SoftBank's net asset value has increased by about $126 billion in approximately a year, reaching $214 billion as of Thursday.
This aligns with comments made by SoftBank's CFO, Yoshimitsu Goto.
In May, Goto described SoftBank's loan-to-value ratio as "possibly too low, frankly, too safe." Goto stated that SoftBank needs to take on more risks, especially with the accelerated development of artificial intelligence