Softbank Dives Headfirst Into Ai: Billion-Dollar Bet On Stargate Project

SoftBank’s Latest AI Gambit: A High-Risk, High-Reward Strategy

The world watches as OpenAI and Elon Musk engage in a drama unfolding over the AI game. Meanwhile, SoftBank, a Japanese conglomerate with a reputation for taking risks on high-growth startups, has announced plans to invest $19 billion in the White House’s proposed AI Stargate Project.

This move comes just days after the company reported a staggering net loss of nearly $2.4 billion for its fiscal third quarter. Despite the setback, SoftBank remains committed to its vision of becoming a leader in AI and robotics. The company’s founder, Masayoshi Son, has been open about his desire to shift from “defense mode” and take on more riskier investments.

This strategy is already paying off, with SoftBank having invested heavily in several high-profile startups. Skild AI, a robot brain building startup that recently secured a $300 million Series A investment led by Coatue, Lightspeed Venture Partners, and Jeff Bezos through his Bezos Expeditions, is one notable example. The deal valued Skild at $1.5 billion.

SoftBank has also made significant investments in other AI-related startups. Wayve, a self-driving car startup that raised approximately $1.1 billion; Perplexity, an AI-powered search startup that secured a $500 million Series D investment; and Glean, an AI-based search engine software developer that received a $260 million Series E investment.

SoftBank’s track record suggests it has a keen eye for opportunity. The company’s Vision Fund has already made several successful investments, including a strategic partnership with Wiz, a cloud security startup valued at $12 billion.

However, not all of SoftBank’s past investments have been successful. The company’s famed Vision Fund unit lost about $2 billion as shares of companies like Coupang and Didi fell, highlighting the risks involved in investing in high-growth startups.

Despite this, SoftBank remains committed to its AI strategy, with plans to invest further in the White House’s proposed AI Stargate Project. SSI, an AI research lab co-founded by OpenAI’s former chief scientist Ilya Sutskever, preparing to raise another $1 billion in funding at a valuation of $30 billion, focus on developing safe artificial intelligence systems is a timely reminder of the importance of responsible AI development.

As SoftBank continues to invest in AI startups, its strategy will be fascinating to watch. With billions of dollars on the line, the stakes are high, but the potential rewards could be significant.