SoftBank Vision Fund under scrutiny over Saudi ties

19 Oct 2018

Riyadh, Saudi Arabia. Image: © Hany/

SoftBank’s links to Saudi funds are being monitored closely by investors in the wake of journalist Jamal Khashoggi’s disappearance.

Update, 11.58am, 23 October 2018: SoftBank CEO Masayoshi Son has since withdrawn from the Future Investment Initiative Conference in Riyadh, Saudi Arabia.

Last week, dissident journalist and Washington Post columnist Jamal Khashoggi disappeared inside the Saudi consulate in Istanbul and is now presumed to have been murdered by intelligence agents linked to Saudi powers.

Considering Saudi Arabia is a source of major funding for many technology companies, curious people had been wondering when firms such as SoftBank and Uber would begin to distance themselves from the kingdom. This began to happen in the last number of days. Many powerful figures in the world of finance and tech, including Uber CEO Dara Khosrowshahi and Christine Lagarde, have pulled out of the Future Investment Initiative conference due to be held in the Saudi Arabian capital, Riyadh, next week.

According to The New York Times, US intelligence officials have made links between the alleged killing of Khashoggi and the de facto ruler of Saudi Arabia, Prince Mohammed bin Salman. Governments around the world are currently weighing up penalisation options, while the Saudi administration vehemently denies involvement.

SoftBank Vision Fund bankrolled by Saudi cash

One company that has notably not withdrawn from the conference slated as ‘Davos in the Desert’ is Japanese tech giant SoftBank. As the SoftBank Vision Fund is partially fuelled by billions of dollars worth of Saudi money, questions are being raised around its continued existence.

SoftBank itself has used the funding to invest in other companies such as Slack, Nvidia and DoorDash, while the Public Investment Fund of Saudi Arabia directly invested $3.5bn into Uber in 2016. The country is investing in technology as a means to diversify revenue streams as it reduces dependence on oil-based wealth.

A spokesperson for SoftBank said its CEO, Masayoshi Son, would wait for more information about Khashoggi’s fate before he pulled out of the Riyadh event. Chief operating officer at SoftBank, Marcelo Claure, said: “At this point in time, we, like most companies that have a relationship with Saudi Arabia, are watching developments and seeing where this goes. There are developments pretty much every hour these days.”

Companies have been scrutinised for accepting Saudi investment in the past, even prior to grisly reports of this incident, as they aim to reconcile their often progressive views with the Saudi government’s stance on gender and sexuality rights.

Plans for a second SoftBank Vision fund may be placed on indefinite hold as a result of growing political tensions.

US response

US treasury secretary Steven Mnuchin has pulled out of the Future Investment Initiative event while US president Donald Trump says he wants definitive answers before the country takes any serious action.

Yesterday (18 October), Trump hardened his stance, stating his belief that Khashoggi is dead. He promised “very severe” consequences if leaders are found to have ordered the killing.

Ellen Tannam was a journalist with Silicon Republic, covering all manner of business and tech subjects