In the vicinity of Tokyo, a newly constructed palatial building houses an impressive array of stone sculptures depicting Roman emperors, all nestled within an expansive 18-hole golf courseThis is the realm of Masayoshi Son, the founder of SoftBank Group, a figure synonymous with ambition and high-stakes investmentFor years, he has been vocal about his belief that a revolution in artificial intelligence (AI) is imminentHowever, as the CEO of SoftBank, he has faced challenges as opportunities slipped through his fingers in this transformative technological era.

In a moment of reflection during a presentation to SoftBank investors last year, Son acknowledged the gravity of his situation, expressing, “I have achieved nothing… Am I to simply grow old and fade away?” It was a stark confession from a man who had previously positioned himself at the forefront of technological innovation.

What Son required was, in essence, a new “darling,” a catalyst to spark his resurgence in the tech arenaEnter Sam Altman, the charismatic founder of OpenAI, who has emerged as the leading figure in the AI landscapeThis partnership has the potential to reignite the momentum that has characterized Son’s career.

In an unprecedented financial maneuver, Son is gearing up to invest as much as $43 billion in Altman's OpenAI, marking what could be the largest ever investment in a start-upNegotiations indicate that SoftBank is poised to commit a staggering $40 billion to a new funding round for OpenAI, with their investment likely falling between $15 billion and $25 billionShould this deal materialize, it would elevate OpenAI's valuation to about $300 billion—nearly double what it was just a year prior—sending a powerful signal of Son's unwavering confidence in the future of artificial intelligence technology.

Moreover, insiders have revealed that SoftBank has pledged an additional $18 billion toward the Stargate project, an initiative aimed at constructing cloud computing infrastructure tailored for OpenAI’s expansive needs

Advertisements

This strategic investment not only demonstrates SoftBank’s investment intent but also reflects its broader belief in empowering AI capabilities.

As Altman touched down in Tokyo on a Thursday, the timing of this partnership could not have been betterHis company, OpenAI, had seen a cooling relationship with its largest backer and exclusive technical partner, Microsoft, over claims of insufficient cloud computing powerSimultaneously, the rise of Chinese developer DeepSeek, which has surprised the tech community with its competitive and economically accessible AI models, has spurred skepticism regarding OpenAI’s plans to develop proprietary technology aggressively.

Nevertheless, Son’s robust backing of OpenAI and Stargate ensures that even post-Microsoft’s exclusive partnership, Altman will have substantial cloud computing resources at his disposal for the upcoming yearsBy spearheading one of the largest funding rounds in Silicon Valley's history, Son is signaling his eagerness to back Altman’s ambitious plans to develop cutting-edge AI systems.

In a widely circulated email sent on the same day, Son expressed, “For all of us, the era of AI represents a once-in-a-lifetime opportunity to help build a better, safer, healthier, and more prosperous future.” This belief in the transformative power of AI underscores the collective vision shared by both men.

On that same day, during an event hosted by SoftBank in Washington, DC, Altman praised DeepSeek's technology, calling it “excellent work.” He used this moment to reflect on the competitive landscape, emphasizing the necessity for democratic AI solutions to prevailHis comments alongside Son's monetary support reflect a newly fortified commitment to remaining at the forefront of AI innovation.

Throughout the engineering and technology sectors, Son has established himself as an audacious figure known for placing high-stake betsRising to prominence in the 1990s, his penchant for risk-taking and shrewd use of debt has resulted in a rollercoaster ride of wealth accumulation

Advertisements

His early investment in Alibaba and Jack Ma is a legendary success story, while the failed $16 billion investment in WeWork and its co-founder Adam Neumann casts a long shadow over his illustrious career.

In recent years, Son's journey has not been without turbulenceHis Vision Fund, which injected a remarkable $130 billion into AI companies, yielded only moderate returnsMeanwhile, SoftBank missed early opportunities to invest in generative AI companies that have surged to prominence in the last couple of years.

However, a pivotal moment came in 2016 when Son acquired the chip design company Arm Holdings for $32 billion, marking a significant turning point for SoftBankFollowing Arm's relisting on Nasdaq in 2023, the company capitalized on the AI boom, with its stock price skyrocketing threefold, elevating the value of SoftBank’s shares to over $140 billion and providing Son with much-needed financial flexibility.

In pursuit of funding for the OpenAI and Stargate investments, reports indicate that SoftBank may leverage its stake in Arm for loansAdditionally, it stands as a possibility for SoftBank to divest assets, including stakes in T-Mobile and Deutsche Telekom, currently valued at approximately $27 billion according to FactSet estimates.

The company has already engaged in preliminary discussions with potential lenders to secure financial support for its investments in OpenAI and Stargate.

In the vibrant ecosystem of Silicon Valley, narratives of collaboration and innovation often emerge from unusual alliancesThe evolving relationship between Masayoshi Son and Sam Altman encapsulates an increasing sense of brotherhood—a shared commitment to paving the way for groundbreaking engineering advancements.

Sam Altman has emerged as one of the most charismatic and accomplished fundraisers in modern Silicon ValleyHis journey with Son began in 2017 during his reign at Y Combinator, the start-up incubatorAt that time, Altman made a trip to Tokyo to meet Son, who soon expressed interest in investing in Y Combinator’s portfolio companies

Advertisements

Yet, due to the proposed investment exceeding what the leadership deemed feasible, this partnership did not materialize.

However, as time passed, the two maintained dialogues that have since evolved to explore potential collaborations between SoftBank and OpenAIThese discussions include a collective push for global AI chip development, demonstrating their mutual interest in advancing AI technology and heralding deeper cooperation within the engineering realm.

As 2024 approaches, Son's appreciation for Altman’s vision deepensIn a speech last October, he passionately discussed OpenAI’s latest innovations, even recounting how he had consulted ChatGPT on turning 10 million yen into 1 billion yen, although he refrained from sharing the answer with his audience.

That same month, SoftBank participated in a $6.6 billion funding round for OpenAI with a $500 million investmentWhile Son had initially hoped for a larger equity stake, this move still signaled SoftBank’s steadfast support for AltmanA month later, SoftBank initiated an $1.5 billion tender offer aimed at purchasing existing shares directly from OpenAI employees.

In tandem, Son actively seeks substantial investment opportunities within the AI domainReports suggest that months prior, he decided that data centers would be a focus of investmentHe perceives that SoftBank can not only provide significant funding but also establish connections with leading technology companies to secure strategic positioning in the AI arena.

The enticement of a project dubbed “Stargate” began to take shape, designed to accommodate the needs of both SoftBank and OpenAI while heralding a new technological eraSam Altman extended an invitation to Oracle Chairman Larry Ellison to join this endeavor, while Oracle was at the time assisting OpenAI in launching a data center in Texas, bolstered by Microsoft’s strong support.

During a press conference held at the White House in January, the founders of Stargate unveiled ambitious plans, pledging $100 billion to this joint designation and setting a goal of spending upwards of $500 billion over the next four years

Advertisements

Advertisements