Softbank Faces Venture Capital, Investment, and Leadership Issues: Why MSPs and MSSPs Should Care
Softbank Groupone of the world’s best-known venture capital firms, is facing a period of high stress that involves potential financial losses due to continued executive departures.
At first glance, the challenges involve business- and consumer-centric technology investments. But look closer, and Softbank’s business challenges intensified just as the venture capital giant began to open its arms to the MSP software market, while also supporting cybersecurity firms that hire MSSPs.
Among the anecdotes to note:
- Turnover of executive staff: Softbank has had at least 10 senior executive departures since March 2020, putting more responsibility on the shoulders of founder Masayoshi Son as the outlook for the Japanese conglomerate grows increasingly worrisome, Bloomberg reported.
- Venture capital concerns: Softbank Vision Fund 2 could face losses “as severe as those of high-tech growth stocks”, The Wall Street Journal reported. The fund is leveraged and most of its investments are still private, the Journal noted.
Examples of Softbank investments: Cloud and cybersecurity companies that hire MSPs and MSSPs
Why should MSPs, MSSPs and channel partners care about Softbank’s business challenges?
The short answer: Vision 2 Fund investments include Cyberseason, OneTrust and Pax8, among dozens of other companies. Softbank’s business challenges don’t necessarily mean VC investments are in trouble. But it’s a safe bet that Softbank will carefully consider valuations and each startup’s march to profitability before deciding where to place its next investment bets.
Details on the VC’s latest financial performance are expected to appear over the course of Call for Softbank results on August 8, 2022. In the meantime, some of Softbank’s investments have taken proactive steps to reduce costs and move faster toward potential profitability. Examples include Cyberseason layoffs and Workforce reductions at OneTrust – both of which surfaced in June 2022. Around the same time, some of Cybereason’s channel- and MSSP-focused talent left the company.
Pax8: still growing after Softbank investment
Meanwhile, anecdotal evidence suggests Pax8 – another Softbank investment – remains in growth mode. The cloud marketplace provider for MSPs has 1,182 employees and 57 job offers listed on LinkedIn since August 5, 2022.
Pax8 raised $185 million at a $1.7 billion valuation, led by Softbank, in April 2022. Around the same time, Pax8 hired IPO veteran Puneet Pamnani as a director. financial. More recently, the company acquired cloud solutions provider Microsoft Umrellar as part of a global expansion plan.
Next, we’ll turn our attention back to Softbank and the earnings call scheduled for August 8, 2022. The chatter of that call could provide new clues to the overall health of Softbank and the venture capital dollars that are circulating (or not circulating). pas) to technology startups compatible with MSPs and MSSPs.