SoftBank has officially completed its eye-watering $40 billion investment in OpenAI, transferring the final $22-22.5 billion last week. This isn't just a big bet—it's a financial moonshot that makes their previous tech gambles look like casual poker night stakes.
To put this in perspective, we're talking about a sum roughly equivalent to the GDP of a small European nation. More than twice Microsoft's initial commitment. It values OpenAI at a pre-money valuation of $260 billion, which, frankly, made me do a double-take when I first saw the figure cross my desk.
The timing here tells its own story. SoftBank just liquidated its entire $5.8 billion stake in Nvidia—catching what many analysts consider the peak of that remarkable bull run—only to immediately redirect those funds (and much, much more) into OpenAI. I've covered tech investments for years, and this kind of high-stakes table-switching is rare even by Silicon Valley standards.
What are we to make of Masayoshi Son's strategy here?
Having watched SoftBank weather the WeWork catastrophe (remember that mess?) and other Vision Fund missteps, this represents a dramatic philosophical pivot. Gone is the spray-and-pray approach of dozens of smaller bets. In its place: a single, concentrated wager on what Son clearly believes will be the cornerstone company of the AI revolution.
Look, there's a certain internal logic if—and it's a massive if—you genuinely believe we're witnessing the birth of AGI. If OpenAI truly develops artificial general intelligence that matches or exceeds human capabilities, then maybe... just maybe... no valuation is too steep.
But let's get real for a second.
OpenAI was valued at $29 billion in early 2023. Now it's supposedly worth $260 billion pre-money. That's an 800% increase in barely a year. Has the company's actual technological progress matched this valuation explosion? Or are we watching the most expensive case of FOMO in tech history?
(I've reached out to several AI researchers who expressed skepticism about whether OpenAI's actual technical advancements justify this kind of valuation acceleration. None would speak on the record, which says something in itself.)
Then there's that bizarre corporate structure. This is a company controlled by a non-profit board that fired and rehired its CEO faster than most people change their profile pictures. The governance questions that surfaced during that November drama remain largely unresolved.
The competitive landscape isn't exactly barren, either. Google's Gemini, Anthropic's Claude, and various open-source models are gaining ground daily. OpenAI's lead—technological and commercial—isn't guaranteed to last.
What we're witnessing is essentially a $40 billion expression of technological faith. It reminds me of Son's legendary early bet on Alibaba, which ultimately made him billions. That was visionary. But it also reminds me of... well, WeWork.
History will ultimately judge whether this represents Son's greatest triumph or his most spectacular miscalculation. But you've gotta admire the clarity of vision, at least. While most investors are hedging their AI bets across dozens of companies, SoftBank has pushed all its chips into the middle of the table.
The high-stakes poker game for AI dominance continues—and SoftBank just made a raise that's forcing everyone else to sweat.
