Speaker 1: Hi everyone, it's Brad. A few months ago we brought
Speaker 1: you an episode about the life of the Japanese billionaire
Speaker 1: Masa Yoshi Sun and his latest project, a ninety three
Speaker 1: billion dollar investment fund called the Vision Fund. It's hard
Speaker 1: to overstate the kind of impact that so much money
Speaker 1: is already having on the tech industry. So if you
Speaker 1: haven't heard that episode, I strongly recommend you go back
Speaker 1: and listen. Now. This week we're bringing you a special
Speaker 1: conversation with the man himself. Massa, as he's known in
Speaker 1: the industry, recently spoke to David Rubinstein, the co founder
Speaker 1: and co CEO of the private equity firm the Carlyle Group.
Speaker 1: Their conversation was part of David's series on Bloomberg Television
Speaker 1: called Peer to Peer Conversations, and was taped on September
Speaker 1: nine in front of a live audience. There's some real
Speaker 1: jail ms and insights in this interview, like how Massa,
Speaker 1: at only aged sixteen, convinced the head of McDonald's Japan
Speaker 1: to meet with him. Please enjoy. You are clearly one
Speaker 1: of the world's most successful technology investors in one of
Speaker 1: the world's most successful businessmen. Let me start by asking
Speaker 1: you about a fund that you are now raising, the
Speaker 1: Vision Fund. It's supposed to be a fund of a
Speaker 1: hundred billion dollars. Now, that would be the biggest fund
Speaker 1: ever raised. So when you told people you were going
Speaker 1: to raise a hundred billion dollar fund, did they tell
Speaker 1: you you were a little crazy? Well, some people said
Speaker 1: you had a meeting with a man who was the
Speaker 1: deputy Crown Prince of Saudi Arabia who's now the Crown
Speaker 1: Prince of Saudi Arabia. And as I understand the story,
Speaker 1: you went in and in one hour you convinced him
Speaker 1: to invest forty five billion dollars. No, no, it's not
Speaker 1: too okay, forty five minutes, forty five villion? That okay, sorry, okay,
Speaker 1: I apologize. In other words, if you had one one
Speaker 1: billion dollars pub minute, what could you have said? That
Speaker 1: was that persuasion to get fortyllion in one meeting? Well, actually,
Speaker 1: I said, you came to Tokyo as the first time
Speaker 1: I wanna. I want to give you a gift. I
Speaker 1: want to give you a massive gift, Tokyo gift, a trillion.
Speaker 1: That a gift. And he opened up his eyes. I said, okay,
Speaker 1: now it's interesting, all right. So I woke up him
Speaker 1: and said, here is how we can give you a
Speaker 1: I can give you a trillion. That a gift you
Speaker 1: invest hundred billion. That as to my fun, I give
Speaker 1: you a trillion dollars. But what is sh it that
Speaker 1: you told people? What was the vision that you actually
Speaker 1: gave them? So one vision which is single reality. Singularity
Speaker 1: is the concept that the computing power computers artificial intelligence
Speaker 1: surpassed mankind's brains. The singularity is the concept The word
Speaker 1: means that is the point at which a computer becomes
Speaker 1: smarter than a human brain. Yes, today already computer is
Speaker 1: smarter than mankind for chess, or goal or weather forecast.
Speaker 1: To some expert systems, computers already smarter. But in thirty
Speaker 1: years most of the subject that we are thinking, they
Speaker 1: will be smarter than us. That's might believe. Let's go
Speaker 1: back and talk about your upbringing a bit. So you
Speaker 1: are of Korean descent. Your grandfather came from Korea and
Speaker 1: moved to Japan many years ago, and your parents were
Speaker 1: born in Japan. Did you suffer discrimination growing up in Japan? Yes,
Speaker 1: I had some experience, but I fear now it was good.
Speaker 1: You know, that made me, you know, stronger to work harder. Ah,
Speaker 1: So I had to prove that I am not different
Speaker 1: from any other guys, you know, not inferior, it's sane.
Speaker 1: So I had to work harder to prove the value.
Speaker 1: Your family adopted a Japanese name at one point. Well, actually,
Speaker 1: in Japan there was a some period Japanese government forced
Speaker 1: every Korean to change to Japanese name. So it was
Speaker 1: not their intention that we had to had to change.
Speaker 1: I had to change. That made me even more harder
Speaker 1: because I was feeling that I was hiding something. It
Speaker 1: was even tougher. You did not grow up in Tokyo. Um.
Speaker 1: You grew up in a relatively small town is that right?
Speaker 1: In in Japan, in the southern the southern part of Japan.
Speaker 1: So at one point is said that you were very
Speaker 1: interested in meeting the head of McDonald's. And why were
Speaker 1: you interested in me in the head of McDonald's. Did
Speaker 1: you like McDonald's food or you just what was it?
Speaker 1: He wrote the book and that book became the best seller.
Speaker 1: I was so impressed and said, oh my god, this
Speaker 1: is great, and the guy who wrote about it must
Speaker 1: be great. So how old were you when you wanted
Speaker 1: to meet him sixteen sixteen, So you you managed to
Speaker 1: get a meeting with him. I called his his assistant
Speaker 1: and long distance called back then it was so expensive.
Speaker 1: I made almost hundred goals, sixty goals and say, you
Speaker 1: know this is my name, I'm a student, and could
Speaker 1: you ask him to spend me shared me sometime and
Speaker 1: could you ask him? And she said, oh, I will try,
Speaker 1: but he's not going to meet with a student. I said, well,
Speaker 1: don't decide by yourself. Let him decide. Okay. So I
Speaker 1: I spoke with with the assistant, different assistants so many times,
Speaker 1: and they don't give me the right answer. So I said, okay,
Speaker 1: this is waste of my telephone bill. So I flew
Speaker 1: into Tokyo and I said I came because they the
Speaker 1: phone call became becoming more expensive than a ticket. So
Speaker 1: what happened? And I said, tell him exactly the way.
Speaker 1: I said. You don't have to look at me, you
Speaker 1: don't have to talk to me. You can keep on
Speaker 1: walking whatever you're doing. I just want to see his
Speaker 1: face for three minutes. So I'm not bothering him. I
Speaker 1: just I'm so impressed and respect him. I want to
Speaker 1: see him and if if you tell him that I'm
Speaker 1: not going to bother him, time is money. He says,
Speaker 1: I'm not gonna damage his life. She actually asked, and
Speaker 1: he said, okay, okay. Actually he spent fifteen minutes with
Speaker 1: me talking face to face. He gave you some advice,
Speaker 1: which was to learn. Yeah, I asked him, what business
Speaker 1: should I do? Computer? That's the one. If I were
Speaker 1: you at u Age at this time of the you know, ah,
Speaker 1: this is don't look at the past industry, look at
Speaker 1: the future industry. That's the one. Computer industry. That's the
Speaker 1: one you should focus. If I were you, that's the one.
Speaker 1: So I said, wow, great. Next, well, here Massa Yoshi
Speaker 1: son talked about one daily made, which many people consider
Speaker 1: to be the most successful investment ever. Okay, we're back.
Speaker 1: Let's go back to David Rubinstein and Massa Yoshi's son.
Speaker 1: One of the investments you made is considered by many
Speaker 1: people to be the most successful investment in the history
Speaker 1: of mankind. You invested roughly twenty million dollars in Ali Baba,
Speaker 1: and at the time it went public it was worth
Speaker 1: roughly ninety billion dollars. So twenty million to ninety billion
Speaker 1: is a return up at four thousand. Now Jack ma
Speaker 1: is a very distinguished individual now now one of the
Speaker 1: most successful entrepreneurs in the world. What is it that
Speaker 1: made you feel this was worth putting in twenty million dollars. Well,
Speaker 1: he had no business plan and zitto revenue, h employees
Speaker 1: maybe thirty five forty employees. But his eyes was very strong, strong, strong,
Speaker 1: shining eyes. Um I could tell from the way he talked,
Speaker 1: the way he looked at he has a calisuma. He
Speaker 1: has a leadership. So his business model was wrong. It's
Speaker 1: the way he talked, the way you know he can
Speaker 1: bring you know, young Chinese people following him. Before Yahoo
Speaker 1: was so famous. You made an early investment which was
Speaker 1: spectacularly successful. How did you hear of Yahoo? Yeah? Yeahhoo.
Speaker 1: Us was still private, fifteen employees, and I convinced Jerrian
Speaker 1: to take hundred million dollars of our investment. So at
Speaker 1: the time we negotiate, we agree. They grew from fifteen
Speaker 1: to thirty five people, thirty thirty five people, and we
Speaker 1: invest hundred million dollars two own and actually went I
Speaker 1: po and made a great were done. And at the
Speaker 1: same time I convinced him to start to inventure both
Speaker 1: jaff of Japan. Well, we put one point two million dollars.
Speaker 1: They put upon eight million, two million dollars start up,
Speaker 1: kept up. Now, let's talk about one big mistake you
Speaker 1: made overall and obviously very successful in almost everything you've touched,
Speaker 1: but you were making a lot of internet investments around
Speaker 1: the turn of the century. Around your two thousand one
Speaker 1: the market went down in the in the in the
Speaker 1: tech crash, and it is said that you personally lost
Speaker 1: seventy billion dollars of net worth, the greatest loss that
Speaker 1: any human being has ever suffered financially. So how did
Speaker 1: you feel losing seventy billion dollars of net worth? Why? Yeah?
Speaker 1: Before that, actually my net was personal net was was
Speaker 1: increasing ten billion dot per week. For three days. I
Speaker 1: became richer than Bitry Gates. Wow, what was that that
Speaker 1: upset him? Or? No? Before I talked to anybody else,
Speaker 1: you know, stop stop crossing? Uh So in in six
Speaker 1: months after that, our share price went done n So
Speaker 1: we all almost went bankrupt and somehow I survived. You
Speaker 1: rebuilt your business, and among the things you did while
Speaker 1: you bought some very well known companies. So you bought
Speaker 1: voter phones, uh Mobile, telephone business in Japan at that time.
Speaker 1: I said, now is the time to go next days,
Speaker 1: which is the internet will become mobile internet. So I
Speaker 1: had to either get the license from the government for
Speaker 1: the spectrum or acquire bother from Japan. And first I
Speaker 1: applied for the license to the government and the government
Speaker 1: said no, there is no more spectrum. I actually sued
Speaker 1: the government and uh, you know, for one big fight.
Speaker 1: But then then the both up on Japan became available
Speaker 1: twenty billion dollars. I had two billion dollars, so eighteen
Speaker 1: billion dollars shot. So where'd you get the money? So
Speaker 1: I convinced the bank you know that the vote up
Speaker 1: on Japan, I'm going to turn around and become successful
Speaker 1: and become great cash flow, believe me and lend me money.
Speaker 1: And they did. They did, and it turned out to
Speaker 1: be very successful. Recently, you did the biggest investment you've
Speaker 1: ever made in a company called a r M, which
Speaker 1: is Farm, which is a semiconductor manufacturer based in London.
Speaker 1: Why did you spend thirty one billion dollars buying a
Speaker 1: semiconductor manufacturer when many people think that that's not the future.
Speaker 1: It's actually study four billion that yeah, it's not a manufacturer,
Speaker 1: it's a design design house. They design all the chip
Speaker 1: chip set. They have nine market share for any smart
Speaker 1: phone that you're have in your pocket. Is arm has
Speaker 1: nine market share. Right in next twenty years, it's gonna
Speaker 1: be they're gonna ship one trillion chips. Design for one
Speaker 1: trillion chips. So I said, this is this is the company.
Speaker 1: This is nobody can live in the on the earth
Speaker 1: anymore without chip. Chipp is everywhere in the car, you know,
Speaker 1: the fuserator everywhere. So if if chip is something that
Speaker 1: everybody needs, and if there is one company has nine
Speaker 1: market share, there must be a value. They're not monetizing
Speaker 1: well enough. But if I own it, we can managize
Speaker 1: as much better. So that's my belief. So I think
Speaker 1: it's the company is gonna be more valuable than Google.
Speaker 1: It's not available. It's private company now. Now in the future.
Speaker 1: You are a big believer in robots. It is your view.
Speaker 1: I guess artificial intelligence is a good thing and ultimately
Speaker 1: will not hurt humanity. Is that correct? So you don't
Speaker 1: worry that the robots could become so smart they could
Speaker 1: wipe out humanity as some people worry. Yeah, there is
Speaker 1: a danger of that. There's a danger. But if you
Speaker 1: look at the mankind history, people were killing each other
Speaker 1: with many battles different among different tribes and rays and
Speaker 1: so on. But today's world, we don't have that kind
Speaker 1: of things everyday life. We are more civilized. So when
Speaker 1: the what super intelligence go beyond mankind's intelligence and they say, well,
Speaker 1: fighting is the not efficient way of living. The harmony
Speaker 1: is better. It's more social. So we were gonna live
Speaker 1: in harmony. And they think about us, they help us,
Speaker 1: and they try to amuse us and have a good
Speaker 1: love each other. What gives you the greatest pleasure in
Speaker 1: the world. Well, the thing is, you know, I have
Speaker 1: a vision. I have a vision of singilorarity that's really coming.
Speaker 1: So we create a vision fun, right, we go and
Speaker 1: change the world together and create a better world, better
Speaker 1: world for for human living. Ah, So that excite me.
Speaker 1: You know what is thinking about what is the future?
Speaker 1: What is the how we can change the life of
Speaker 1: people for the better humanity? Right, and so that people
Speaker 1: don't need to die for unnecessary reasons like having accident
Speaker 1: or having the disease or having the disaster to protect
Speaker 1: human from all those you know, Uh, sadness. It's a
Speaker 1: good thing, right, So imagining those things and investing and
Speaker 1: create a group and having great product, great solution is exciting.
Speaker 1: And now today you've come back and you're have enormous
Speaker 1: net worth by any human standards, one of the richest
Speaker 1: men in the world. What you do with all this money, Well,
Speaker 1: I haven't decided what to do. I haven't decided, But
Speaker 1: you're sixty years old. Now you've got to decide at
Speaker 1: some point. Deciding how to spend with respect is more
Speaker 1: difficult than making money. That was a headache I had
Speaker 1: when I when I, you know, became so richest me
Speaker 1: in the world, you had the headache and you lost
Speaker 1: that headache. Now you've got it again, right. Do you
Speaker 1: have any plans to keep doing this for a ten
Speaker 1: years or twenty years? Yeah. In my age of nineteen,
Speaker 1: I created fifty years my life plan, and in my
Speaker 1: age of sixties, from between sixty and sixty nine, I
Speaker 1: would decide my successor and have my success keep on
Speaker 1: running it. So in my next ten years I have
Speaker 1: to do that. But even after I find a success
Speaker 1: and give him a baton to run as a captainship,
Speaker 1: I would probably stay working with him coaching him. And uh,
Speaker 1: you know, as long as I live, probably I cannot
Speaker 1: give forget about this excitement. Your parents are still alive,
Speaker 1: they must be extremely proud of you. Well there, they
Speaker 1: act very proud of me, and they're very happy. We're
Speaker 1: a happy family. And you know we don't live together,
Speaker 1: but they called me occasionally. And and you know, my
Speaker 1: dad is funny guy. He he has a unique idea,
Speaker 1: crazy idea and he always called me and said, Massa,
Speaker 1: I got an idea, you have to do this. He
Speaker 1: knows everything I'm doing. And uh, he's he's very creative,
Speaker 1: very smart, and he talked about business to me all
Speaker 1: the time. Now, you are Japanese and but you have
Speaker 1: careeran descent, but you're different than most Japanese business people
Speaker 1: who were very um, consensus oriented, not maybe as entrepreneurial
Speaker 1: as you are. Has that been a challenge for you
Speaker 1: and building up your business in Japan? Yeah, lots of challenge,
Speaker 1: but the uniqueness is actually good. You know, if the
Speaker 1: pack of other people this way, I am unique, I
Speaker 1: have more opportunities. So the difficulty can, if you flip over,
Speaker 1: become the advantage. So a final question, if you can
Speaker 1: live your life over extraordinary story. Is there anything you
Speaker 1: would do differently than you've done? I may, but this
Speaker 1: is the life I'm enjoying so much that I would
Speaker 1: love to do it again. Ah. I was so lucky.
Speaker 1: I was so close to, you know, fall down from
Speaker 1: the cliff. So I don't know I can do it twice.
Speaker 1: But but this is definitely exciting life. I'm having fun.
Speaker 1: And that's it for this week's Decrypted. Thanks for listening.
Speaker 1: We always like to hear what you think of the show.
Speaker 1: Send us an email at Decrypted at Bloomberg got net
Speaker 1: or on Twitter. I'm at Bradstone and if you have
Speaker 1: it already, please take a moment to rate and review
Speaker 1: us on Apple Podcasts. It really helps new listeners find
Speaker 1: our show. This episode was produced by Pea Gudkari, Liz Smith,
Speaker 1: and Magnus Hendrickson. The David Rubinstein Show, which provided excerpts
Speaker 1: for our podcast, was produced by Matthew Saul. You can
Speaker 1: watch the full interview at Bloomberg dot com. Just look
Speaker 1: for the David Rubinstein Show on our main navigation bar.
Speaker 1: We'll see you next week.