Analysis | Sequoia and Tiger Global Take SoftBank to the Cleaners - The Washington Post

If the fiascoes at WeWork Inc. and Greensill Bank AG were not enough, Klarna Bank AB should serve as another fine reminder that SoftBank Group Corp. is the unluckiest whale in a crowded venture capital world. Founder Masayoshi Son somehow always manages to hold the worst cards.

The Sweden-based fintech, known for its buy-now-pay-later offering, is in talks to raise about $650 million — mostly from existing investors led by Sequoia Capital. If completed, this deal would reset Klarna’s valuation to $6.5 billion, a fraction of the $45.6 billion it was priced at just a year ago in a $639 million funding round led by SoftBank. 

It is a round-down of epic scale — unless you are SoftBank. Two years ago, the $100 billion Vision Fund manager slashed its WeWork valuation to $2.9 billion from $47 billion in 2019. While the absolute dollar amount involved with Klarna is much smaller, the blow to Son’s reputation is nonetheless as damaging. The second Vision Fund will soon have to write down its Klarna stake, wiping out much of its returns. At March 31, this $56 billion fund recorded only $0.8 billion investment gains. A SoftBank Vision Fund spokesman declined to comment on the queries sent by Bloomberg Opinion. 

Washington Post


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