After WeWork, SoftBank’s Startup Bookkeeping Draws Scrutiny • Hacker News Board

Re: After WeWork, SoftBank’s Startup Bookkeeping Draws Scrutiny

#141

Post by rtpg » Fri, Nov 29, 2019, 5:05 AM UTC

johneth wrote: post #92

somebodythere wrote: post #81

Earlier quoted context omitted.

The BoJ owns 9.78% of Softbank. https://group.softbank/en/corp/irinfo/stock/ownership/ Softbank cannot borrow directly from the BoJ because it is not an actual bank. However, they recently issued bonds at a 1.38% rate: https://economictimes.indiatimes.com/markets/bonds/gone-in-1... Welcome to NIRP. Thankfully, Softbank's internal exposure to the Vision Fund is quite limited. Also, they have a sizeable liquid stake in…

> The BoJ owns 9.78% of Softbank. https://group.softbank/en/corp/irinfo/stock/ownership/ Are you sure? I just Googled 'The Master Trust Bank of Japan Ltd.' (the only listed shareholder with 9.78% ownership) and it seems to be owned by Mitsubishi Trust Bank and a bunch of other banks, and nothing to do with the BoJ...

http://www.opac1.com/bank/detail.php?bcd=5960 yeah according to this it's owned by Mitsubishi Trust, Nippon Life Insurance, Meiji Life Insurance, Touyou Trust (which became a chunk of UFJ Trust), and ... I think Deutsche Bank?

So like a bunch of fingers in this pie. A good or a bad thing depending on your perspective.

Re: After WeWork, SoftBank’s Startup Bookkeeping Draws Scrutiny

#142

Post by alexnewman » Fri, Nov 29, 2019, 5:30 AM UTC

chvid wrote: post #12

alexnewman wrote: post #2

Easy dumb money like SoftBank is the greatest enemy of innovation and progress. Just take a look at the first deck. Companies like Uber, Softbank, WeWork all having trouble with funding is an important step in our economy

Dear commenters on HN. Don't bite or spite the hand that is feeding you. The recession will come soon enough.

I don't spite or hurt SoftBank. I'm just pointing out the emperor has no clothes and is investing poorly. Bad investments by those with wealth hurt those without the most.

Re: After WeWork, SoftBank’s Startup Bookkeeping Draws Scrutiny

#143

Post by mindentropy » Fri, Nov 29, 2019, 5:32 AM UTC

Andromeda88 wrote: post #80

Traster wrote: post #8

The more I hear about this the more it looks like this entire scheme has turned into a pyramid scheme. Pouring more money into investments to try and boost the valuation. Using previous investments to invest and boost the value of new investments, guaranteeing massive loans in order to get others to invest at huge valuations. It just looks more and more like laundering money through all sorts of different mechanisms…

Check YzerGroup for a real "money laundering". They started with YzerProperty(2014 or so). Then YzerMotors (2016). Now YzerChat. These startups all involves billionaires from Dubai. Btw YzerProperty and Motors do not exist anymore.

Do you have any material on their money laundering?

Re: After WeWork, SoftBank’s Startup Bookkeeping Draws Scrutiny

#144

Post by Lucadg » Fri, Nov 29, 2019, 5:58 AM UTC

Traster wrote: post #8

The more I hear about this the more it looks like this entire scheme has turned into a pyramid scheme. Pouring more money into investments to try and boost the valuation. Using previous investments to invest and boost the value of new investments, guaranteeing massive loans in order to get others to invest at huge valuations. It just looks more and more like laundering money through all sorts of different mechanisms…

Potentially similar story at an earlier stage: Oyo, a budget hotel chain from India.

They raised 1.7 B, mostly from Softbank, and are now getting in the vacation rentals space in Europe.

Their approach is unclear. I spoke to their representatives and it seems unclear for them too.

Nothing seems to make sense in what they are doing in this vertical.

The only logical explanation seems that they are trying raise the valuation of the brand.

It could be the next WeWork.

Re: After WeWork, SoftBank’s Startup Bookkeeping Draws Scrutiny

#145

Post by lotsofpulp » Fri, Nov 29, 2019, 12:36 PM UTC

dboreham wrote: post #120

semiotagonal wrote: post #44

Earlier quoted context omitted.

I don't think a smaller number of dumb startups will have much negative impact, considering the huge numbers of highly paid employees the giant "fang companies" have.

Except when the FAANG company revenue turns out to be driven by the same fake money faucet.

What fake money faucet? The big tech companies have tons of paying customers, and tons of net income increasing at tremendous rates with tremendous moats.

Re: After WeWork, SoftBank’s Startup Bookkeeping Draws Scrutiny

#146

Post by altacc » Fri, Nov 29, 2019, 12:41 PM UTC

TaylorSwift wrote: post #19

Traster wrote: post #8

The more I hear about this the more it looks like this entire scheme has turned into a pyramid scheme. Pouring more money into investments to try and boost the valuation. Using previous investments to invest and boost the value of new investments, guaranteeing massive loans in order to get others to invest at huge valuations. It just looks more and more like laundering money through all sorts of different mechanisms…

I want to point out that a lot of these valuations are signed off by well-known accounting firms, valuation firms, and consulting firms. If it's really one big conspiracy to prop up valuations via recent financing, loans, or market comparables, then wouldn't one of these parties call it out (well, inherently a lot of these are paid by organizations to do their valuations, so true independence is a question here). Add…

The accounting firms' motivation is profit, which they derive from the customers they are auditing, so they have an incentive to be favourable to their clients. If you want to be kind to them you can call it an unconscious bias. There have been a few scandals uncovered where an accounting firm audited and approved a company which soon after went bankrupt due to bad or corrupt accounting. For example Carillion, VBS Bank & Enron.

They are also drinking the same Kool-Aid as most other people in the industry, that all this is above board and fine. There's a lot of group-thinking, and not as much objective analysis as is needed.

The blindness extends to management and the board, who all want the company to be successful. Good financial numbers are questioned a lot less than bad ones.

Re: After WeWork, SoftBank’s Startup Bookkeeping Draws Scrutiny

#147

Post by kolbe » Fri, Nov 29, 2019, 3:18 PM UTC

fogetti wrote: post #104

kolbe wrote: post #99

Earlier quoted context omitted.

This sounds mildly interesting, but you make a lot of grand claims and support none of them. I would love to read about your concerns more deeply in a longform, where all these ideas can actually be related to one another, and with support for your claims based in data and real world examples. I would suggest you do this for your own mental health, because it's not at all clear to me why the world of (let's call it)…

Well then maybe you should do the same thing first to set an example? Because what the OP describes is actually pretty much real. I would suggest you to check out Guy Standing and his research first.

OP is very specific behavior by one bank. What about Softbank marking up its own assets has anything to do with the idea that an investment philosophy spread out among thousands of times more people but with less money is even remotely covered in the article?

Re: After WeWork, SoftBank’s Startup Bookkeeping Draws Scrutiny

#148

Post by kolbe » Fri, Nov 29, 2019, 3:20 PM UTC

domnomnom wrote: post #109

kolbe wrote: post #99

Earlier quoted context omitted.

This sounds mildly interesting, but you make a lot of grand claims and support none of them. I would love to read about your concerns more deeply in a longform, where all these ideas can actually be related to one another, and with support for your claims based in data and real world examples. I would suggest you do this for your own mental health, because it's not at all clear to me why the world of (let's call it)…

Yeah dude I’ll get right on that research paper you’d obviously like to see and skip spending time with my family on thanksgiving. (That’s what you’re essentially suggesting isn’t it?)

It's more that the ideas seem pretty far fetched. And if you're about to quit your job over these ideas, my bet is that your family would prefer you to do the research instead of eating thanksgiving dinner.

Re: After WeWork, SoftBank’s Startup Bookkeeping Draws Scrutiny

#149

Post by perl4ever » Sat, Nov 30, 2019, 2:08 AM UTC

Barrin92 wrote: post #73

Traster wrote: post #8

The more I hear about this the more it looks like this entire scheme has turned into a pyramid scheme. Pouring more money into investments to try and boost the valuation. Using previous investments to invest and boost the value of new investments, guaranteeing massive loans in order to get others to invest at huge valuations. It just looks more and more like laundering money through all sorts of different mechanisms…

Agreed, and I also found it extremely hilarious that Softbank styled itself as the "300-year company", but their biggest investments are ridesharing companies, a real estate subleasing company, several eCommerce stores and so on. I mean, if you're going all-in on the future where is the biotech, pharmacology and the robots? It's not just softbank that to me looks fishy, the entire industry looks like it has drunk its…

At least you mentioned biotech. Sometimes it seems like the entire (investing) world sees the future in terms of AI, cloud computing, alternative energy, space travel, robots, cryptocurrency, etc. To me, going through all of the growth companies out there with a bottom-up approach, there's practically nothing interesting but biotech.

Re: After WeWork, SoftBank’s Startup Bookkeeping Draws Scrutiny

#150

Post by perl4ever » Sat, Nov 30, 2019, 2:12 AM UTC

paggle wrote: post #108

pkaye wrote: post #106

Earlier quoted context omitted.

> patent to cook food in a moving vehicle Also known as a food truck.

Not really. One of the characteristics of American car culture is that the land that your car occupies as it travels, or makes short deliveries, is not charged “rent.” So unlike a food truck or restaurant, where you need to pay rent for setting up the thing, if you cook and deliver food from a moving vehicle your land costs, which are some of the biggest costs of a restaurant, can be just misappropriated from the pub…

That doesn't make sense to me, even trying to absorb your point of view. A moving car has to park somewhere a lot of the time. And parking costs money that ultimately pays for scarce land, so whether or not the money-making is actually happening on the move doesn't have much to do with whether the user is free-riding.