SoftBank Group’s founder, Masayoshi Son, is actively pursuing a significant expansion in the thriving artificial intelligence sector. Son is currently in the process of fundraising approximately $100 billion for a new venture, codenamed Izanagi, aimed at challenging established players like Nvidia in the AI chips domain.
The proposed venture, Izanagi, is set to collaborate with Arm, a chip design company previously spun out by SoftBank as a public entity. Despite this transition, SoftBank retains a substantial 90% ownership of Arm’s stock. To secure the substantial funding required for this endeavor, SoftBank plans to engage Middle East-based institutional investors for \(70 billion, with the remaining \)30 billion to be self-funded by the company.
While Nvidia presently dominates the AI chip market with its GPU chips, the increasing demand for AI processors presents opportunities for new entrants to offer competitive alternatives. OpenAI, led by Sam Altman, is also exploring fundraising options, with discussions underway to secure a staggering \(5 trillion to \)7 trillion for an independent AI chip project. OpenAI’s significant involvement in generative AI development positions them as a key player driving demand for advanced chips.
SoftBank’s strategic shift towards AI reflects a departure from its historical focus on investments such as Alibaba. The company’s decision to divest parts of its Alibaba stake and redirect resources towards AI initiatives aligns with its forward-looking approach. This transition comes on the heels of SoftBank’s recovery from substantial losses incurred by the Vision Fund, showcasing a renewed focus on emerging technologies like AI.
With the upcoming AI chip project, SoftBank aims to leverage Arm’s expertise and market position to capitalize on the growing demand for AI-driven technologies. The specific details of this initiative, including key partners and timelines, remain undisclosed. However, SoftBank’s strategic moves underscore its commitment to remaining at the forefront of technological innovation and market leadership in the evolving landscape of artificial intelligence.
