
SoftBank CEO says Khashoggi killing may have impact on Saudi-backed Vision Fund - brownbat
https://www.cnbc.com/2018/11/05/softbank-ceo-masayoshi-son-breaks-silence-on-death-of-saudi-journalist.html?yptr=yahoo
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Animats
This is going to be interesting. Until recently, SoftBank was thought of as
being a Japanese operation. Now they seem to be a front for Saudi Arabia's
sovereign wealth fund.

They seem to be the world's largest source of dumb money. They keep Uber
afloat. $375M for a pizza making robot company. WeWork. Cruise. $300 million
in Wag, a dog-walking company. They do have big stakes in ARM and NVidia,
which actually make useful stuff profitably. But the investments in the last
two years have been strange.

The goal may not be profitability, but influence. The Cruise investment gives
them some pull at GM. The WeWork investment gives them some pull in the US
real estate market. The Uber investment lets them influence the future of
transportation. Those all make strategic sense for an oil power. Someone there
likes robots; they bought most of the robot companies Google dumped, plus a
few others.

[1] [https://www.recode.net/2018/2/5/16974032/this-is-where-
chart...](https://www.recode.net/2018/2/5/16974032/this-is-where-chart-
softbank-vision-fund-masayoshi-son-venture-capital)

~~~
erikpukinskis
> The goal may not be profitability, but influence.

Or money laundering?

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brohee
> Son said he had not heard of any companies saying they would not want to
> accept investments from the Vision Fund due to its relationship with Saudi
> Arabia's PIF

Anybody expected otherwise? Many Softbank investments would be in companies
that eagerly sells their users to the highest bidders, hardly paragons of
virtue...

~~~
gaius
If someone is gay working for a Softbank-backed venture then they are quite
literally helping to enrich and ensure the longevity of a regime that executes
people like them. I am genuinely surprised that this isn't considered a huge
issue in Silly Valley.

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crwalker
Weak. SoftBank has always seemed suspiciously large and cavalier. I expect
there's a venture analog to the expression "there are old pilots, and there
are bold pilots, but there are no old, bold pilots." Let's hope they stick the
WeWork landing ...

~~~
rayvy
> "there are old pilots, and there are bold pilots, but there are no old, bold
> pilots."

First time ever hearing this. What an interesting expression

~~~
mikeyouse
I've heard it with climbers and soldiers as well, seems like it works across
many fields.

~~~
crwalker
It's a simple way to express the difference between probabilities for an
ensemble of game players and probabilities for a particular player over time.

If the player is ruined, the game stops for them.

More from Taleb: [https://medium.com/incerto/the-logic-of-risk-
taking-107bf410...](https://medium.com/incerto/the-logic-of-risk-
taking-107bf41029d3)

\--edit: added "for them"

~~~
erikpukinskis
Optimal strategy is probably a curve: start compliant, follow the rules, be
conservative, then take bigger and bigger risks until you can go “all in” on a
series of risky bets, and if you aren’t obliterated dial back your risks to
favor longevity.

If you are obliterated, well, you served the population.

This is probably more psychologically palettable for men than women. Although
some women can do it for sure. Just... well at the population level it doesn’t
make nearly as much sense evolutionarily for folks with wombs to take these
kinds of risks as folks producing sperm.

~~~
singingboyo
Optimal strategy for the population, perhaps, but as an individual avoiding
'all-in' is very nice, if not always possible.

In the context of SoftBank, though, I'd expect all-ins and near all-ins to be
avoidable...

~~~
erikpukinskis
Death only hurts once, but success feels good forever. So, in that sense it’s
worth it to take the bet.

Optimality is just maximizing your upside and minimizing the window of
exposure to oblivion. I don’t think there’s any “avoid oblivion at all costs”
strategy that comes close to “court oblivion once” in terms of the total
expected utility.

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wiz21c
Sorry for my super naive question, but since 45 billions of saudi money is in
the fund and that fund is said to be 100 billions, does it mean that saudi
owns 45% of it and, consequently, more or less 45% of the stuff it funded (be
it by shares, intellectual prperty or whatever mean) ???

~~~
jartelt
The Saudis are limited partners in the fund, so they don't really have any
control over the investments. Investment decisions are left up to the general
partner, Softbank. Once the fund reaches maturity and the profits are
distributed, the Saudis would get paid (they would get close to 45% of the
fund earnings) in cash or shares in the portfolio companies.

~~~
Alex3917
> Investment decisions are left up to the general partner, Softbank.

Not necessarily, it depends on the LP agreement. It wouldn't be unusual to
have an LP agreement where investments that are more than a certain percentage
of the fund require sign off from the key LPs.

~~~
jacquesm
Not sure why you are downvoted, you are 100% correct.

~~~
Alex3917
> Not sure why you are downvoted, you are 100% correct.

Haha that's like half of my HN comments. I'm guessing that the first thing
that comes up in Google from Wikipedia, Stack Overflow, or Quora says
something different.

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onetimemanytime
I have a feeling that soon this will be forgotten. His family will get $50
million from SA and an "apology"...and within a few months to years, the world
will focus on the next horrible thing. Maybe the Saudi money will be slightly
laundered with bigger funds so "we didn't get Saudi money, the fund we got the
money from has a lot of investors" and the world will keep going. Money and
geopolitics talk.

He, a commoner, already caused a lot of problems to a soon-to-be King. If he
was in SA, he would have been charged with espionage or whatever and left to
rot in jail or beheaded, with virtually no complaints.

------
exogeny
What a soft, weak, non-stance of a stance.

~~~
dmix
I agree:

> We don’t yet know the clear understanding of the case

this is clearly bullshit, we know what happened and regardless of authority
chains it was still a normal function of the backwards Kingdom come fully to
light.

But at the same time controlling $45 billion dollars of someone's money will
make you choose your words carefully.

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milin
What a pathetic excuse of an address

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arbuge
> "At the same time, we have also accepted the responsibility to the people of
> Saudi Arabia, an obligation we take quite seriously to help them manage
> their financial resources and diversify their economy," said Son.

“So convenient a thing to be a reasonable creature, since it enables one to
find or make a reason for every thing one has a mind to do.” - Benjamin
Franklin

~~~
netsharc
Hah, indeed.

Since when is that money realistically the money of the Saudi Arabian people
anyway, it's the money of their butchering royal family.

"It is difficult to get a man to understand something, when his salary depends
upon his not understanding it!" \- Upton Sinclair

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sandworm101
What about the fact that the killing was botched? Isn't that telling of
dysfunction within the Saudi Administration?

There are professional people in this world that can handle such situations.
The Americans, the Russians, the Chinese, the all have people who can clean up
a mess well enough to keep things away from the media. But such people are
professionals. This saudi team looks more like a bunch of frat boys: well-
educated but where they are because of connections. The operations smacks of
"assassination for dummies." These people had not done this before. They
didn't have a playbook. They were inventing everything.

My point: The Saudi regime doesn't use professionals, doesn't know how to
employ experts. Instead they employ friends and family. That deficiency surely
bleeds into other areas too.

~~~
throw7
The Russians are worse to me... their botch up hit job actually killed a
british citizen. I mean, can you imagine what would happen if that happened on
u.s. soil?

~~~
brohee
The Israelis, presumably the best at this game, killed a waiter in front of
his pregnant wife in Norway in a case of mistaken identity
([https://en.wikipedia.org/wiki/Lillehammer_affair](https://en.wikipedia.org/wiki/Lillehammer_affair)),
got caught, and the consequences weren't that bad even with Norway being a
NATO member...

~~~
7000skeletons
Mossad aren't exactly known for being subtle. Just look at the way they took
out the guy they mistook Ahmed Bouchikhi for. Sure, they got their man...
along with his four bodyguards and four bystanders. Not to mention the sixteen
people injured when their bomb attack on Ali Hassan Salameh went off.

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liftbigweights
Just to play devil's advocate here. What is it that people want? Countries and
companies to stop doing business with murderous regimes and governments? Then
who is there to do business with?

Should anybody do business with the US, EU, China, Russia, etc?

It's crazy how millions are suffering in Yemen due to saudi/US/EU backed war
and yet the entire media apparatus is going crazy over one person. Makes me
wonder what's really going on here.

~~~
umeshunni
You're being brigaded/downvoted, but to answer your question - the real reason
there's manufactured outrage over this killing in the US is that Khashoggi
worked for an influential US media company (WaPo).

Otherwise, this is just a case of the Saudi administration 'taking care of'
one of their own who turned against them.

For the last few years, the Saudi regime has been kidnapping and imprisoning
others who have done the same, only with limited external reporting and even
less outrage.

BBC Newsnight had a fascinating report in this about a year ago:
[https://www.youtube.com/watch?v=r2KYQWPUbG4](https://www.youtube.com/watch?v=r2KYQWPUbG4)
[https://www.bbc.com/news/magazine-40926963](https://www.bbc.com/news/magazine-40926963)
[transcript]

