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For a CEO known for guiding tomorrow's super-trends, SoftBank's Masayoshi Son may of course miss the bigger plot sometimes.
The murder in Saudi Arabia that destroys Donald Trump's October could devastate Son's year. Everyone guesses why the US President's team is so obsequious to Saudi Crown Prince Mohammed bin Salman. The controversy surrounding the fate of Americans Washington Post the writer Jamal Khashoggi is a clear and present danger for the vision of Son.
Japan's richest man has changed the global venture capital game by investing as a roulette bettor. Some big bets here, others there; hoping that at least one will be profitable.
All this dates back to 2000, when he put $ 20 million on Jack Ma, who was going to create Alibaba, thus earning $ 50 billion to Son in 2014. These days, Son is fighting for the barriers, hoping his luck will remain alive.
The problem is that the $ 100 billion Vision Fund strategy used by Son to control disrupters is largely manufactured in Riyadh. A disproportionate amount of the fund's funds comes from a government that is just a small step away from total pariah status.
This is not, however, Saudi's only problem with Son. The other paradox is the gap between what His seeks to achieve and the comfort zone of his benefactors. It can be said that Son's greatest passion is a world without carbon. It has invested tens of billions of dollars in solar fields in Japan and is committed to earmarking hundreds of billions for the construction of such fields, from India to Southeast Asia -Is.
Yet all of this belongs to a government whose wealth, geopolitical weight, and national legitimacy depend on the very product Vision Fund seeks to eradicate.
Elon Musk also flirted with the Saudis. In August, Billionaire Tesla got into trouble claiming that he would entrust the company to an individual and secured financing.
Elon Musk dismissed as president of Tesla, but will remain CEO after a settlement of 40 million USD after tweet
When the regulators called, Musk hit the Saudis to get money. Although this did not work, Saudi ties with Musk are at odds with its desire to hasten the disappearance of fossil fuels via electric vehicles. Talk about cognitive dissonance.
And what about Son's tempting conflict of interest? Yes, the Saudi royals are talking about their willingness to diversify the oil economy. But with time, what will happen if the government headed by Mohammed bin Salman changes his mind? And if it opts for the restoration of the primacy of fossil energies? Suddenly, the petrodollars that animate the ambitions of Son are exhausted.
The chilling effect on US start-ups is another asset. And how President Trump's White House or the US Congress could react.
"Silicon Valley is closely monitoring clues that Saudi Arabia's alleged link to the alleged murder of a critical journalist could undermine the ability of the kingdom and Saudi-related investors to access top talent." and American technology start-ups, "said analyst Paul Triolo of the Eurasia group.
According to Trump, journalist Khashoggi is probably dead and the consequences for the Saudis must be serious if they are to blame
The geopolitical consequences of an already panicked global economy are also uncertain.
"The end result is that the combination of a rising oil price and the avoidance and shame of Saudi Arabia is not an optimistic combination," he said. Louis Gave of Gavekal Research. "And it is particularly bearish for the once-promising but low-cash-tech big names, who until now seemed to have found a reinforcement in the form of easy-to-obtain Saudi money (and now easily evacuated). "
The irony abounds here too. Its Vision Fund aimed to diversify SoftBank away from its telecom roots. The plan: harnessing disruptive industries and industries around the world.
What Son has forgotten, however, is one of the first rules of value investing: do not put your eggs in one basket; especially not one whose future plans are in conflict with yours.
William Pesek is a journalist and author based in Tokyo. He wrote for Bloomberg and Barron's
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