Report: SoftBank is facing challenges in raising $100B for Vision Fund II after facing a lukewarm response from some of the world's largest investors
KEY POINTS — In a bid to raise $100 billion for its next fund, Japanese conglomerate SoftBank has faced a lukewarm reception … Source: Wall Street Journal .
Context & Ripple Effects
This June 2019 report landed two months before SoftBank's formal launch of Vision Fund 2 with a $108B target and a $38B own commitment, and it flagged the problem that defined the fund's entire life: the world's largest institutional investors were reluctant to follow the first Vision Fund at anything like the original scale.
What came next confirmed the skepticism. The fund managed only a $2B first close in late 2019, and by early 2020 reporting suggested it would raise less than half the planned $108B, funded almost entirely by SoftBank itself — turning what was pitched as an outside-capital vehicle into a balance-sheet bet.
First-order effects
- SoftBank's fundraising timeline slips: without commitments from the large investors it counted on, the $100-108B target cannot close on schedule, forcing the firm to lean on its own $38B commitment to keep the vehicle credible.
Second-order effects
- With limited external LP money, startup founders who priced their rounds around a full-size Vision Fund II face a smaller checkbook, while rival mega-fund sponsors must pitch the same skeptical institutions SoftBank just failed to win over.
Third-order effects
- The pattern holds through the fund's life: when performance deteriorates and Vision Fund 2 sits well below its invested value, SoftBank is reduced to weighing a third fund — structurally shifting the franchise from a third-party asset manager toward SoftBank deploying its own capital, which ties conglomerate risk directly to startup valuations.
The trend: Mega-scale venture funds are proving dependent on founder capital when outside LPs balk, converting flagship vehicles like Vision Fund II into corporate balance-sheet bets whose losses flow straight back onto the sponsor.