SoftBank, which bought a 10% stake in Twilio competitor Sinch in November 2020, sells its remaining 5% stake; Sinch's stock has fallen 93% since September 2021
Japanese investor SoftBank Group Corp has sold its entire stake in Sinch AB following a share price collapse of more than 90% in the Swedish cloud-based platform provider.
Context & Ripple Effects
SoftBank's exit closes a two-year arc that began with its $690M stake in Sinch in late 2020, followed by a $1.1B round alongside Temasek at the peak of CPaaS enthusiasm. Sinch spent that capital chasing Twilio, buying interconnection provider Inteliquent for $1.14B and SMS specialist MessageMedia for $1.3B — an acquisition-led expansion whose valuation has since collapsed 93% from its September 2021 high.
The sale also fits SoftBank's broader 2022 posture: weeks earlier it had raised $22B by unwinding its Alibaba position, so exiting a beaten-down minority stake reads as part of the same cash-preservation drive rather than a verdict on messaging APIs alone.
First-order effects
- Sinch loses its highest-profile backer entirely, removing both a shareholder of last resort and the SoftBank endorsement that underpinned its fundraising and acquisition currency during the 2020-21 expansion.
Second-order effects
- Twilio, which has been posting revenue beats against consensus while its Swedish rival's stock implodes, now competes against a consolidator that must defend its Inteliquent and MessageMedia deals without growth-capital support — shifting the CPaaS contest toward profitability rather than land-grab M&A.
Third-order effects
- If the pattern holds, the 2020-21 model of API-driven communications companies scaling through debt-and-equity-funded rollups gives way to consolidation around cash-generative operators, with strategic acquirers picking up assets like Sinch's at post-collapse valuations.
The trend: SoftBank is trading growth-stage optionality for balance-sheet cash, exiting positions like Sinch and Alibaba even as it doubles down elsewhere.