Last year's murder of Saudi journalist and US resident Jamal Khashoggi, which the Saudi government has been linked to, brought an uncomfortable focus to SoftBank's open arms toward the PIF's cash. Beyond Khashoggi's murder, Saudi Arabia has frequently been denounced for human rights abuses, such as the recent controversy surrounding Absher, a mobile app that critics say allows men to track and control women's travel privileges throughout the country. The PIF contributed $45 billion to the first Vision Fund, helping to make the kingdom the single biggest backer of US startups, according to a Wall Street Journal report from October.
Saudi Arabia is said to be in talks to contribute to Vision Fund II, albeit in a reduced amount. However, in something of a pivot away from such controversy, the new fund will reportedly have a significantly more diverse field of LPs. Thus far, Apple, Microsoft, Mizuho and Standard Chartered are among those that have signed agreements to contribute to the vehicle.
SoftBank's own commitments to the second Vision Fund have been a source of conjecture, as the telecom giant looked to free up more funding. A significant reason is the still-undecided fate of the merger between Sprint, in which SoftBank holds a $19 billion stake, and T-Mobile. Should the US government approve the tie-up, SoftBank will receive a windfall via partial extinguishment of some $150 billion in debt. That liberated cash could bring SoftBank's investment in Vision Fund II as high as $50 billion, per the WSJ. In May, SoftBank also explored taking the Vision Fund public, in addition to possibly accepting a new investment to the tune of $1 billion from the sultanate of Oman and potential funding from Chinese investors.
The original Vision Fund, which held its first close in 2017, has been known for outsized investments in consumer technology and artificial intelligence, often with competitors receiving funding. For example, both DoorDash and indirectly Uber Eats, through investments in parent company Uber, have received nine- and 10-figure deals from SoftBank.
Featured image of Dotonbori district, Osaka, Japan via javarman3/iStock/Getty Images Plus