Speaker 1: Welcome to tech Stuff. This is the story. Each week
Speaker 1: on Wednesdays, we bring you an in depth interview with
Speaker 1: someone who has a front row seat to the most
Speaker 1: fascinating things happening in tech today. We're joined by Lionel Barber, journalist,
Speaker 1: former editor in chief of The Financial Times, and the
Speaker 1: author of the book Gambling Man, The wild ride of
Speaker 1: Japan's Masayashi song Cara, I'm curious if you remember all
Speaker 1: the way back in January when President Trump announced Stargate,
Speaker 1: the multi hundred billion dollar initiative to build AI infrastructure
Speaker 1: here in the US.
Speaker 2: Oh, yes, I do. I think it was the second
Speaker 2: day of Trump's presidency.
Speaker 1: It absolutely was. And during the announcement, the President was
Speaker 1: flanked by three people. Do you remember who they were?
Speaker 2: I believe it was Sam Altman, the CEO of Open Ai,
Speaker 2: Larry Ellison, the co founder of the software giant Oracle,
Speaker 2: and then the man of the hour, Masiyoshi's son.
Speaker 1: That's right, also known by the nickname Massa or Massason.
Speaker 1: He's the one we're talking about today because, unlike Altman
Speaker 1: and Ellison, he's not really a household name in the US,
Speaker 1: and also because Lionel barbera wrote an absolutely fascinating book
Speaker 1: about him.
Speaker 2: It's true, I actually had no idea who he was,
Speaker 2: but Masa was definitely infectious that day he spoke after
Speaker 2: Larry Elson, and you couldn't help but love his self
Speaker 2: deprecating joke when a staffer set up a stool for
Speaker 2: him behind the podium.
Speaker 3: That's good, that's great, I hear it all.
Speaker 1: My guest on the story this week, Massa's biographer, Lionel Barber,
Speaker 1: remembers this moment well, and specifically the huge pledge that
Speaker 1: Massa made to the US.
Speaker 3: Masa is promising not one hundred billion dollars of investment
Speaker 3: or two hundred billion dollars of investment, five hundred billion
Speaker 3: dollars of investment in AI data centers around the States.
Speaker 3: This is the beginning of gore there is of America.
Speaker 3: This is one great example I think.
Speaker 2: Okay, but I didn't think Massa was American.
Speaker 1: It's true. He's Japanese of Korean descent. But I want
Speaker 1: to highlight this moment because I think it's a good
Speaker 1: example of his long held strategy figure out who or
Speaker 1: what is driving technology's latest trends, and then invest big,
Speaker 1: really big. As the title of Lionel Barber's book suggests
Speaker 1: Massa really is a gambling man. He's made bets on
Speaker 1: businesses with an almost reckless abandon including companies like Ali Barba,
Speaker 1: we work in Nvidia and byte Dance. Sometimes his investments
Speaker 1: are huge wins, but other times they fall flat.
Speaker 2: I'm actually really excited about this conversation because the evolution
Speaker 2: of Massa's investments in many ways mimics the evolution of
Speaker 2: technology from the nineteen eighties to today.
Speaker 1: That's right, I mean wherever innovation goes, So tutors Maslyashison
Speaker 1: and his checkbook. Most recently, actually, after we take this
Speaker 1: interview with Lionel Barber, Massa's company, SoftBank, pledged forty billion
Speaker 1: dollars to open AI's latest fundraising round. I keeped off
Speaker 1: my conversation with Lionel by asking him to start at
Speaker 1: the beginning, just taking a couple of steps back, and
Speaker 1: who is he and what is his company? Soft Bank.
Speaker 3: He is a Japanese Korean. It's very important that we
Speaker 3: just dwell on this for a couple of minutes, because
Speaker 3: that means that he's an outsider. He's not pure Japanese.
Speaker 3: His grandfather and grandmother came as economic migrants from Korea
Speaker 3: at a time when Korea was a colony of Japan,
Speaker 3: so they had a Japanese alias. They were living under cover,
Speaker 3: and then obviously had the Second World War where Koreans
Speaker 3: were treated very badly. They were forced labor, they were
Speaker 3: discriminated against. They lived in a ghetto in a shantytown,
Speaker 3: and Massa was born on the edge of that shantytown
Speaker 3: in nineteen fifty seven. So he grew up his first
Speaker 3: few years in poverty, and his father was a bootlegger,
Speaker 3: a loan shark, and then went into pachinko gambling. This underground,
Speaker 3: underworld figure made money. So Massa then said, I'm not
Speaker 3: going to go into pachinko gambling. I'm going to learn English.
Speaker 3: I'm going to be a tech entrepreneur myself, and the
Speaker 3: route to that is to come to America. So he
Speaker 3: then gets into high school, fast tracked into college, and
Speaker 3: then he does three years at Berkeley where he founds
Speaker 3: his first business, and he then goes back to Japan
Speaker 3: after six years to found SoftBank, which essentially is a
Speaker 3: software distribution business.
Speaker 1: You were the editor of the Financial Times, i think
Speaker 1: for fifteen years from two thousand and five to twenty twenty,
Speaker 1: during which time I can imagine you came across a
Speaker 1: lot of interesting people and potential subjects for a book,
Speaker 1: but you chose this subject.
Speaker 3: Why I went for a businessman who intrigued me because
Speaker 3: I've met him a couple of times and there was
Speaker 3: no Western biography of him, and he was somebody who
Speaker 3: intrigued me because of his giant risk appetite. And lastly,
Speaker 3: I thought he was a creature or a businessman who
Speaker 3: represented an age, the aged globalization, open board borderers, finance,
Speaker 3: where tech this huge influence of tech from the microchip
Speaker 3: to the internet, now artificial intelligence, and he's been associated
Speaker 3: with that for four decades. So I thought it's a
Speaker 3: good subject.
Speaker 1: What is it that you can't understand about the world
Speaker 1: of technology and how it's developed without understanding Massa?
Speaker 3: In history, Massa has been right about the grand arc
Speaker 3: of history when it comes to how technology is developed.
Speaker 3: I mean, he was early ish on the microchip. He
Speaker 3: claims to have had this epiphany where he saw a
Speaker 3: computer magazine in the mid nineteen seventies and said, oh,
Speaker 3: this is wonderful, this is amazing. By the way, that's
Speaker 3: very similar to Bill Gates's own story, so you have
Speaker 3: to wonder whether he possibly appropriated it. But I wouldn't
Speaker 3: want to cast dispersions, But I'm just saying that Bill
Speaker 3: Gates tells exactly the same story about opening the computer
Speaker 3: magazine and seeing the Intel processor. But the serious point
Speaker 3: is he understood that software was going to be a
Speaker 3: very potent force. So he decided to go into software
Speaker 3: distribution at a time when that wasn't a business in Japan.
Speaker 1: And not only that, when Japan was the world leading
Speaker 1: economy because of his hardware.
Speaker 3: Correct, they were great at hardware, but not so much software. Anyway,
Speaker 3: Massa got that right. Then he pivots to the Internet.
Speaker 3: He invests in Yahoo, he invests in Ali Baba, the
Speaker 3: great e commerce giant in China. He makes huge fortunes
Speaker 3: as a result of that. But then he pivots to
Speaker 3: mobile and mobile internet and sets up his own mobile
Speaker 3: phone business, taking on well one of the most bad
Speaker 3: companies in the world, NTT DoCoMo, the formerly state telecoms champion.
Speaker 3: And then he pivots and he talks into AI. Now
Speaker 3: on AI, he has been heralding the moment in the
Speaker 3: future where you will see singularity, where robots intelligence essentially
Speaker 3: equates or surpasses human intelligence and what that would mean.
Speaker 3: So I think he's been something of a visionary Internet
Speaker 3: profit and technology profit as well as an investor.
Speaker 1: I want to understand a bit more about Massa's relationship
Speaker 1: with the US. I mean, you said that he transferred
Speaker 1: to high school in the US, which I can't imagine
Speaker 1: how hard that must have been from Japan in a
Speaker 1: pre internet age. I mean, how on earth did he
Speaker 1: blood off?
Speaker 3: Can you imagine you've basically been in Japanese high school,
Speaker 3: you don't really speak any English, and then you go
Speaker 3: and he did a summer course for six weeks. And
Speaker 3: I think the one thing I'd say about Masa is
Speaker 3: he really does work hard. He's an incredibly focused individual.
Speaker 3: So he worked, worked, worked on his English and it
Speaker 3: got better. And then he got a break because at
Speaker 3: high school he wanted to apply for university early, and
Speaker 3: the teacher basically gave him extra time to take the exams,
Speaker 3: so he had a dictionary in front of him. They
Speaker 3: went to the local exam board, and you know, because
Speaker 3: he was quite bright, so he did very well in
Speaker 3: things like maths, But can you imagine taking an English exam. Anyway,
Speaker 3: he finished sort of somewhere near midnight, and he got through,
Speaker 3: and he got to a place called Holy Names, and
Speaker 3: then he transferred to UC Berkeley, where he majored in economics.
Speaker 3: It shows an immense determination and resourcefulness.
Speaker 1: You mentioned he was Korean Japanese, grew up facing enormous prejudice,
Speaker 1: decided not to use the Japanese name that his family
Speaker 1: had adopted it, rather to use his Korean name, even
Speaker 1: though he didn't speak Korean. A huge believer in the
Speaker 1: future of technology and technological development, why did he leave
Speaker 1: UC Berkeley to go back to Japan rather than just
Speaker 1: trying to make his fortune in the US.
Speaker 3: Well, he gave a promise to his mother and to
Speaker 3: his parents, his father that he would come back. He
Speaker 3: also had to promise that he wouldn't marry I'm sorry listeners,
Speaker 3: that he wouldn't marry an American girl, that he had
Speaker 3: to come back and get married in Japan. And he
Speaker 3: also promised, he didn't keep that he would do all
Speaker 3: studies and no business, because actually he did some studies
Speaker 3: and he did business.
Speaker 1: And did he found soft Bank. As soon as he
Speaker 1: got back to Japan.
Speaker 3: He spent almost a year trying to figure out what
Speaker 3: to do. And its important story how he made his
Speaker 3: first fortune at Berkeley by developing an electronic speech translator,
Speaker 3: where he worked with a man I discovered, Professor Forrest Moser,
Speaker 3: who was the original inventor of this speech translator. Anyway,
Speaker 3: they turned it into a commercial product and sold it
Speaker 3: to Sharp. He did make money from that, but he
Speaker 3: wasn't sure what to do when he went back to Japan,
Speaker 3: and he thought about Pachinko, then he said no, And
Speaker 3: then he came on this idea of software distribution, which
Speaker 3: was a completely new business.
Speaker 1: What does that mean? Does that mean to sending CDs around?
Speaker 1: And what does software distribution mean?
Speaker 3: Well, in those days they didn't have CDs. I mean
Speaker 3: we're talking in sort of nineteen eighty one two, so
Speaker 3: little boxes. And essentially this man Mase, I mean, he
Speaker 3: is the most amazing networker you've ever seen. He met everybody,
Speaker 3: He met the boss of Samsung when he was only
Speaker 3: twenty five years old. Twenty four years old, he's meeting
Speaker 3: these people are incredible. Bill Gates remembers him. And essentially
Speaker 3: Gates was trying to sell software in Japan. He didn't
Speaker 3: choose Maso as his partner. But you had to have
Speaker 3: a relationship with the developer, but then crucially a relationship
Speaker 3: with the retailer. And he was the middleman. But you
Speaker 3: really had to crack the retailing system. And what he
Speaker 3: did by that is he went to an exhibition, didn't
Speaker 3: sell very much stuff, but kind of said softback is
Speaker 3: going to take over the world. And he got a
Speaker 3: big break by one of the major retailers sent their
Speaker 3: boss around to see him, and you know, there's this guy,
Speaker 3: he's only twenty four years old, and he does the deal,
Speaker 3: and so he cracks the retail system but also acts
Speaker 3: as a bridge between America and Japan. It's clever.
Speaker 1: After the break, Massa becomes the richest man in the world. Briefly,
Speaker 1: stay with us, welcome back. Recently, I spoke with Lionel Barber,
Speaker 1: author of Gambling Man, the Wild Ride of Japan's Masi
Speaker 1: Ashi Son about the legendary tech investor, and I wanted
Speaker 1: to know how Massa became the world's richest man back
Speaker 1: in the early two thousands. So there's a moment, a
Speaker 1: very brief period where he is the richest man in
Speaker 1: the world. What is that moment? And what is the
Speaker 1: basis of his fortune.
Speaker 3: Well, in Japan, he did very well on the software
Speaker 3: distribution side. But then there's the bubble, real estate bubble crashes,
Speaker 3: the banking systems underwater, there's low interest rates, strong yen,
Speaker 3: and so what he does is he pivots back to
Speaker 3: the United States and starts buying some assets. So he
Speaker 3: gets into telemarketing. He buys amazingly this computer magazine publishing business,
Speaker 3: Ziff Davis. He gets into buying Condex.
Speaker 1: The trade fair Condext is like a predecessor to the
Speaker 1: Consumer Electronics Show.
Speaker 3: Absolutely, it was the computer trade fair when PCs ruled
Speaker 3: the world. This was the trade fair you had to
Speaker 3: go to. It was owned by the formidable Trump supporter,
Speaker 3: Sheldon Adelson, I should say Sheldon Adulson sold the trade
Speaker 3: fair Condex to Mussa for eight hundred and fifty million dollars. Basically,
Speaker 3: the business is peaking, but Massa thinks he's hit pay
Speaker 3: dirt because he's now the impresario where he can meet everybody, right,
Speaker 3: and he's got a I think.
Speaker 1: He described it as a map and a compass to
Speaker 1: the USA.
Speaker 3: There you go, that's what it was. But he's the
Speaker 3: he's mister big he's running the trade show. Very shortly afterwards,
Speaker 3: he hears about this company called Yahoo, which many people
Speaker 3: might not think is so great now and it's all
Speaker 3: been superseded by Google, but believe me, in nineteen ninety six,
Speaker 3: ninety seven, ninety eight, ninety nine, Yahoo was the deal.
Speaker 3: Massa got in early and by investing he got forty percent.
Speaker 3: And I tell the story about how he outmuscled the
Speaker 3: legendary Sequoia investor, my Moritz and Sequoia, you know, Cirrus
Speaker 3: VC firm.
Speaker 1: He was just able to be more aggressive than Soil.
Speaker 3: He was more aggressive and he essentially Jerry Yang, the
Speaker 3: co founder of Yahoo, gave me two and a half
Speaker 3: hours of his time to talk about this and about
Speaker 3: his relationship with Massa going back to ninety five ninety six,
Speaker 3: and he says Massas that you need one hundred million,
Speaker 3: I'll give you a hundred million, and Jerry An says, well,
Speaker 3: we don't need one hundred million, and Massa says, everybody
Speaker 3: needs one hundred million re tarlets. Everybody needs a hundred million,
Speaker 3: And he then says, if you don't take it, I'll
Speaker 3: give it to the competition. And by the way, he
Speaker 3: does that all the time. He really does threaten people.
Speaker 3: If you don't take my money, I'm going to give
Speaker 3: it to the competitor. So he banks that investment. Forty
Speaker 3: percent of Yahoo Yahoo stock is going through the roof,
Speaker 3: and then he's able to sell a little bit of
Speaker 3: stock and make a load of money. And people look
Speaker 3: at that and say, well, he's got the money. So
Speaker 3: he invests in about four hundred companies and then obviously.
Speaker 1: Literally the richest man in the world for three.
Speaker 3: Days February fifteenth, note that date. So this was a
Speaker 3: lot about Yahoo, but also the dot com bubble, so
Speaker 3: mass is seen as the center there, and for three
Speaker 3: days he is the richest man in the world, Richer
Speaker 3: than Warren Buffett, richer than Rupert Murdoch, you name it.
Speaker 3: And then it all goes pop.
Speaker 1: But the amazing thing is, I think the timeline is
Speaker 1: that he makes his Ali Barbar investment very shortly before
Speaker 1: the dot com crash, right, So in a sense, just
Speaker 1: as his fortunes are beginning to wane as the richest
Speaker 1: man in the world, he's made what some regard as
Speaker 1: one of the greatest technology investments of all time.
Speaker 3: Now, it's really interesting that you've honed in on this
Speaker 3: question of timing. You're dead right invests in. He's in
Speaker 3: a speed dating session in Beijing, and again I described
Speaker 3: this story where he's he's just meeting all these Chinese
Speaker 3: tech companies and he sees Jack ma and he smells
Speaker 3: the horse flesh. He thinks this is really the guy,
Speaker 3: and after barely fifteen minutes, he says, I want to invest.
Speaker 3: I've spoken to two other people in that meeting in
Speaker 3: Beijing in ninety nine. They all said, no, Masa, that's
Speaker 3: not the right thing, and he insisted and he got
Speaker 3: it right now. I also spoke about for the book
Speaker 3: to Joe Sai, who's now chairman Ali Baba, who is
Speaker 3: the co founder with Jack maher and Joe Sai said,
Speaker 3: you know, we were really lucky to get that investment
Speaker 3: because with the dot com crash, Ali Baba could have
Speaker 3: been really hurt. So I think it's really interesting that
Speaker 3: Masa made that deal at that time, that it helped him,
Speaker 3: but it also helped Ali Baba.
Speaker 1: There's an excerpt of your book in wid magazine, and
Speaker 1: I think you mentioned one of your favorite stories from
Speaker 1: the book is one which has to do with Massa
Speaker 1: Steve Jobs and an early hint about the future of
Speaker 1: the iPhone.
Speaker 3: The consequential meeting that you're referring to, where Massa, and
Speaker 3: this is by Massa's account, comes up with an idea
Speaker 3: for what we all now now is the iPhone, which
Speaker 3: essentially is not just a music player but can do
Speaker 3: other things, and.
Speaker 1: It's Massa comes up with the same.
Speaker 3: Yes, he has the idea, but Steve Jobs says, well,
Speaker 3: very interesting, Massa. Because Massa then draws a drawing I
Speaker 3: love writing this because it's so funny, and Massa insists
Speaker 3: he wrote this drawing, and Steve Shall says, I don't
Speaker 3: need your shitty drawing. I'm working on something myself like that,
Speaker 3: and ma says, oh, oh, well tell me about it.
Speaker 3: He goes no, no, anyway. Massa then claims that he says, well,
Speaker 3: I want exclusive distribution of this new thing, and he
Speaker 3: claims Steve Jobs agreed because he liked Masa and of
Speaker 3: course this was hugely consequential. It was massively important. Massa's
Speaker 3: just trying to set up a mobile phone business and
Speaker 3: he gets this wonder product. The only problem with the
Speaker 3: story and I wouldn't wish to challenge it too much,
Speaker 3: but I mean it is nearly three years ahead of launch.
Speaker 3: Massa also says, by the way, that in that period
Speaker 3: he came up with ideas like emoticons and other features
Speaker 3: of the iPhone. I think it's fair to say, because
Speaker 3: Masa is fascinated by technology, that he did have some
Speaker 3: new ideas about going beyond the iPod to think about
Speaker 3: the iPhone. I think I give him some credit for that.
Speaker 3: But did he invent or did he kind of coinvent
Speaker 3: the iPhone? Well, we'll have to ask Steve Jobs, won't we.
Speaker 1: He did secure distribution of the iPhone in Japan, which
Speaker 1: was a major boost for his business.
Speaker 3: Well, it was absolutely critical because Massa had bought Vodaphone Japan.
Speaker 3: Now that was the also ran mobile phone business in Japan.
Speaker 3: The only thing going for it was that it had
Speaker 3: David Beckham in its marketing campaign. Otherwise it was pretty undistinguished.
Speaker 3: And Massad had a huge amount of money nearly twenty
Speaker 3: billion dollars, huge leveraged bid. So he needed given he
Speaker 3: was going to create his own brand, SoftBank Mobile, he
Speaker 3: needed a great product and you know what, the iPhone
Speaker 3: was the wonder product. So all credit to him forgetting it.
Speaker 3: And beating out Japanese competition.
Speaker 1: Coming up, Massa continues to make big bets on the
Speaker 1: tech industry. What went so right and what went so wrong?
Speaker 1: After the break Welcome back, We're diving into the amazing
Speaker 1: story of Masashi's son, both the highs and the lows,
Speaker 1: from his successful Yahoo and Ali Barba deals to the
Speaker 1: acquisition of Condex, a trade fair with a bloated price tag,
Speaker 1: but which likely led to some of the most important
Speaker 1: connections in the tech industry. What Master is most well
Speaker 1: known for maybe SoftBank's Vision Fund. Founded in twenty seventeen.
Speaker 1: The one hundred billion dollar venture capital fund has had
Speaker 1: a major impact on tech, and I wanted to hear
Speaker 1: from Massa's biographer, Lionel Barber, about how the Vision Fund
Speaker 1: came to be.
Speaker 3: Mass has always wanted to be an investor. He can
Speaker 3: be an operator, but it's a little bit boring compared
Speaker 3: to the thrill of investing. So round about twoenty twelve thirteen,
Speaker 3: he pivots away from becoming the world's greatest telecom operator
Speaker 3: because by the way, he was sizing up that bid
Speaker 3: for Sprint, which was successful, linking that to SoftBank Mobile.
Speaker 3: He says, I want to be a global investor, I
Speaker 3: need a front guy. So he hires Nick esch Aura
Speaker 3: from Google to be his number two and potential successor.
Speaker 3: That doesn't end well, but around this time he says,
Speaker 3: what we need is to create something of scale in
Speaker 3: venture investing, and I want to do something that is
Speaker 3: bigger than anything. So remember VC funds in the mid
Speaker 3: teens that probably five billion was the ceiling for what
Speaker 3: people thought was feasible. But Massa then says, well, I
Speaker 3: think we should be bigger than that, and I think
Speaker 3: the money he gets introduced some introductions is in the Gulf,
Speaker 3: in the Sovereign Wealth Fund Saudi Arabia United Arab Emirates.
Speaker 3: This is where some money is, so why don't we
Speaker 3: go there? And I describe how he's on this trip
Speaker 3: with his bankers and he suddenly turns twenty billion dollars
Speaker 3: into one hundred billion dollars for the fund. They can't
Speaker 3: believe it, but essentially that the important point is there's
Speaker 3: a convergence of interest between Massa, who wants a lot
Speaker 3: of money to invest and get in with the latest
Speaker 3: technology companies, and the Crown Prince of Saudi Arabia, who
Speaker 3: wants to get into the tech eco system and you know,
Speaker 3: diversify his countries, the Desert Kingdom's economy away from oil.
Speaker 3: So he's prepared to put up money, huge amounts of
Speaker 3: money to do that. And that's what happens. And you know,
Speaker 3: it's a roller coaster ride. Some bets are not bad.
Speaker 3: It's not so distinguished, but not a disaster. But it
Speaker 3: certainly blew away the competition and high as everybody would knows.
Speaker 3: I mean, the impact on valuations was tremendous and it
Speaker 3: set off an arms race in venture fund investing.
Speaker 1: What was the vision that he laid out for the
Speaker 1: Vision Fund to NBS and his investors other investors in the.
Speaker 3: Gulf, I am the man to introduce you to the
Speaker 3: most cutting edge technology companies in the world. I am
Speaker 3: the man who understands the application of technology which will
Speaker 3: help modernize your country. I will be part of.
Speaker 1: That talk about some of the investments, because I think
Speaker 1: open Ai, Nvidia might Dance were in there, but so
Speaker 1: were we work even when the whole world thought that
Speaker 1: this was a losing bet, and as I kept doubling down.
Speaker 3: Yes, because he said to colleagues, and I report this
Speaker 3: in the book that everybody said I was wrong about
Speaker 3: Ali Barber, and I was stuck with Ali Barber, and
Speaker 3: I turned one hundred million dollars into one hundred and
Speaker 3: thirty billion dollars billion by the way, with a B.
Speaker 3: So the more you tell me that I'm wrong about
Speaker 3: Adam Newman and we work, the more I say, now
Speaker 3: I'm sticking with him. It's one of his faults. His
Speaker 3: weaknesses is that he falls for founders. If he thinks
Speaker 3: one is the greatest, he kind of encourages them to
Speaker 3: think even bigger. And I was talking to one of
Speaker 3: the soft Bank executives asking them, well, describe this relationship,
Speaker 3: and he said to me, it's very simple. It was
Speaker 3: like feeding a monkey alcohol. That was Massa's relationship with
Speaker 3: Adam Newman.
Speaker 1: How do you explain how he got it so right
Speaker 1: in some cases and so wrong in others.
Speaker 3: Well, you've mentioned some very important investments like byte Dance
Speaker 3: and also in VideA. We got to mention Arm, the
Speaker 3: UK based designer of advanced semiconductor chips, very important company,
Speaker 3: bought that cash thirty two billion in two thousand and
Speaker 3: sixteen and then put part of that in the Vision Fund.
Speaker 3: He did invest in in Nvidia and he held it
Speaker 3: for a while, but then Odea. He had five percent
Speaker 3: of in VideA, but he sold. This could have been
Speaker 3: the Ali Barber investment, but he didn't stay with it.
Speaker 3: And he makes a joke about it now, But that
Speaker 3: was a big miss now overall in the Vision Fund,
Speaker 3: I think what happened. There's an adage in Wall Street
Speaker 3: that you can make a load of money on a
Speaker 3: small amount of money, but trying to make a load
Speaker 3: of money on a load of money is much harder
Speaker 3: to get the returns. And also discipline completely broke down.
Speaker 3: I mean, it's mad. People are being rated according to
Speaker 3: how much money they were putting through the door. Massa
Speaker 3: was seeing people and you know, handing out money. That
Speaker 3: this hilarious story of Herman Marula of imagined. He goes
Speaker 3: to Tokyo and he's hoping, he's hoping, above hope that
Speaker 3: he can get fifty million dollars from Massa and Massa says, no,
Speaker 3: you take five hundred million dollars. Herman Marula doesn't know
Speaker 3: what to do with the money. So it's mad. And
Speaker 3: I've talked to people around Martha and people who are
Speaker 3: involved in the process, and they do say, you know
Speaker 3: there were too many ship burgers. Excuse my language again.
Speaker 1: I mean, I guess the other metaphor you use is
Speaker 1: force feeding.
Speaker 3: So yes, force feeding, thinking that you can get growth
Speaker 3: by turbo charging the tech companies with just money, and
Speaker 3: obviously that doesn't work. It depends on the found It
Speaker 3: depends is there a serious business plan. You know, companies
Speaker 3: don't need that money per se that amount of money.
Speaker 3: And also, by the way, it's not venture fund capital really,
Speaker 3: I know he describes it as such, but if it's
Speaker 3: venture fund, you don't do what you do with we
Speaker 3: work well, you keep putting money in. When it's hugely
Speaker 3: loss making and blown up up, you let it go
Speaker 3: and move on to the next thing. So I think
Speaker 3: all the discipline broke down and it ended in huge
Speaker 3: amount of tears when COVID came. I suppose one last PostScript,
Speaker 3: which is very relevant to today, is that Massa claimed
Speaker 3: to be investing in AI companies. But these were like
Speaker 3: dot com companies from twenty years before that had the
Speaker 3: dot com moniker, but they weren't the real deal, and
Speaker 3: they certainly weren't deep AI like Nvidia.
Speaker 1: How much do you know about how that sort of
Speaker 1: Stargate moment came together, and can you help us understand
Speaker 1: between Massa, Larry Ellison, Sam and Donald Trump, what is
Speaker 1: each person's role in Stargate.
Speaker 3: I've been trying to put this together, Arson. I don't
Speaker 3: claim to have the full story, but here are some
Speaker 3: important parts. The first is Massa's on his back flat
Speaker 3: out after he loses a load of money during COVID.
Speaker 3: He then comes back briefly because everybody's enthusiastic about tech.
Speaker 3: Then there's another correction post to the Ukraine War, and
Speaker 3: he goes essentially serving penance in private in Tokyo. He's
Speaker 3: grounded because he can't travel because of COVID. But what
Speaker 3: he's doing is plotting his comeback, and he's thinking, what
Speaker 3: assets do I have which would allow me to play
Speaker 3: a big role in the next phase of the technological revolution?
Speaker 3: And yes it is AI and he says, well, one
Speaker 3: thing I have is ARM, the designer of these super chips.
Speaker 3: And he says, well, we're going to monetize that more.
Speaker 3: But what can I do to leverage Arm? He tried
Speaker 3: to do a merger within video, but the regulators turn
Speaker 3: him down. Now what he then says is, oh my God,
Speaker 3: I've just tried chat GPT. This really is an amazing product.
Speaker 3: I've got to meet Sam Altman. I've met him before,
Speaker 3: but I need to persuade him to take my money. Well,
Speaker 3: I understand that, actually that didn't come across straight away.
Speaker 3: They did not. They weren't big buddies, and Sam sort
Speaker 3: of gid I didn't need your money. I don't need this.
Speaker 3: I don't need five billion, ten billion or even more
Speaker 3: that you're offering. At that time. Sam Altman is buddy
Speaker 3: buddies with Microsoft because they're supplying a lot of the
Speaker 3: computing power. But Microsoft, they say, well, we don't want
Speaker 3: to be overly reliant on Sam Altman for the next
Speaker 3: phase of artificial intelligence, in the race to artificial general intelligence,
Speaker 3: we need our own capacity. So there's a bit of
Speaker 3: a sort of shifting balance of power there. So that
Speaker 3: means Sam Altman, he's saying, I need more computing power
Speaker 3: at this point. Larry Ellison, because he's a neighbor of
Speaker 3: Trump's in Florida, does have a data center plant he
Speaker 3: wants to build. It's in Abilene, Texas, and he's looking
Speaker 3: at that. He's got lots of money, but he's also
Speaker 3: got computing power, and he also wants to get into
Speaker 3: the AI super AI race, so there's a connection.
Speaker 1: What does this moment mean to him in that case
Speaker 1: where his view of what's to come seems to be
Speaker 1: playing out.
Speaker 3: Well, he's a very happy person. And that's why he's
Speaker 3: wearing that big smile next to Donald Trump, because he
Speaker 3: was on his back in the early part of this
Speaker 3: decade because he lost so much money on the Vision Fund.
Speaker 3: So he feels vindicated. He feels I'd be in the
Speaker 3: right side of history. I was right in essence about
Speaker 3: how the Internet was going to have a profound, a
Speaker 3: huge revolutionary impact on the economy and society. And now
Speaker 3: it's going to be AI, and I am a profit vindicated.
Speaker 1: I guess he's the gambling man, not you. But I mean,
Speaker 1: if you had to make a bet on how Stargate
Speaker 1: will play out for him, it will this be another
Speaker 1: triumph for another wash.
Speaker 3: I think it'd be better than a wash. I'm not
Speaker 3: quite prepared to say that it would be a triumph
Speaker 3: in terms of massive returns for him and his investors.
Speaker 3: I wouldn't be as confident as that. I've already talked
Speaker 3: to a couple of investors who say, well, we'll come
Speaker 3: in at the beginning on Stargate and then we'll sell
Speaker 3: down some of our holdings to realize the money because
Speaker 3: the valuations were not sure about. I think he wants
Speaker 3: to write his part in history. He wants to be
Speaker 3: part of this next jump to artificial in gel and intelligence,
Speaker 3: and that's what I report in my book. In my
Speaker 3: last interview, he talked about that legacy just to close.
Speaker 1: I mean, the other thing people think about when they
Speaker 1: think about legacy is succession, which hasn't always been an
Speaker 1: easy thing for Massa to plan. Do you have any
Speaker 1: sense of succession plans?
Speaker 3: The answer to that is nope. He did talk about
Speaker 3: stepping down when he was sixty, but now he says
Speaker 3: he's fulfilled and he's going to make history. And I
Speaker 3: think the succession involves him being carried out in a
Speaker 3: box and then who knows what happens to SoftBank then
Speaker 3: will it be broken up? When asked about succession, he says, well,
Speaker 3: I don't have any sons, so somebody was too polite
Speaker 3: not to point out that, you know, well, you do
Speaker 3: have two daughters, but they're very much in the background
Speaker 3: and they're not involved. Directly in the business. So it's
Speaker 3: there are one or two talented Japanese executives who could
Speaker 3: take over the gotto son the finance directors of a
Speaker 3: very strong executive, but nobody is like Masa and soft
Speaker 3: Bank would not be soft Bank without Masoci song.
Speaker 1: Lionel, thank you. I really enjoyed that conversation, and Gratefulty
Speaker 1: for shedding so much light on this fascinating character.
Speaker 3: Thank you, os It's a great pleasure. And thank you
Speaker 3: for reading the book and asking such good questions. Thank you.
Speaker 1: That's it for this week for tech Stuff. I'm Asva Loosha.
Speaker 1: This episode was produced by Eliza Dennis and Victoria Dominguez.
Speaker 1: It was executive produced by Me, Karen Price and Kate
Speaker 1: Osborne for Kaleidoscope and Katria Novel for iHeart Podcasts. Jack
Speaker 1: Insley mixed this episode and Kyle Murdock theme song. Join
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