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SoftBank

SoftBank makes $100m bet on Miami as next US tech hub

Conglomerate ready to spend again after recent wins led by DoorDash IPO

"We couldn't not be part of" the shift to Miami, SoftBank Group Chief Operating Officer Marcelo Claure said Jan. 28. (Photo courtesy of Valerie Abbott/ucumari photography)

NEW YORK -- SoftBank Group will invest $100 million in Miami startups, Chief Operating Officer Marcelo Claure said Thursday, amid talk of the Florida city as the next American technology hub.

"We couldn't not be part of it," Claure, who is also CEO of SoftBank Group International, said at Bloomberg's The Year Ahead 2021 conference after first unveiling the investment plans with Miami Mayor Francis Suarez on Twitter live.

Claure's announcement comes as Miami is increasingly discussed in tech circles as an alternative to the traditional hub of the San Francisco Bay Area.

"I would say this is the beginning," Claure told Bloomberg Television anchor Emily Chang. Everything starts with small first steps, he added, "and I think today we're making baby steps to make sure that Miami will be a player in the tech ecosystem."

The bullishness on the city signals a renewed confidence from the Japanese conglomerate, which had been badly bruised before the pandemic by portfolio holding WeWork's botched attempt at an initial public offering.

SoftBank wrapped up 2020 stronger than the company had started it. Just last month, food delivery startup DoorDash brought billions of dollars in gains to SoftBank, which grew a $680 million investment into a $10 billion stake.

More companies in SoftBank's portfolio are eyeing public debuts in 2021. These include Chinese ride-hailing operator Didi Chuxing, which has begun discussions on listing in Hong Kong this year, Reuters has reported.

The Vision Fund -- SoftBank's $100 billion megafund, a key part of Chairman and CEO Masayoshi Son's 300-year investment thesis -- are making bets "that are changing the world," Claure said at the Bloomberg event.

Companies that SoftBank invests in will be "the next winners of the next years and the next decades," he said.

"Our strategy hasn't changed pre-pandemic, during the pandemic, and post pandemic," he said: making bets on companies that use data and artificial intelligence to disrupt traditional business models.

SoftBank did go on a big asset sale last year to build a roughly $80 billion cash pile, both to prepare "for the worst-case scenario" of the pandemic and to create dry powder for investment opportunities, Son said in November.

In a move to diversify its investments, SoftBank has also begun trading publicly listed, more established tech companies.

The $100 million it has now committed to Miami could come from its Vision Fund, the Latin American fund, the Opportunity Fund or SoftBank Group's balance sheet, according to Claure.

Prominent venture capitalists including Peter Thiel have bought mansions in the city, which has been trying to woo technology companies with business-friendly policies. Some tech workers have also been trying out life in the beach city now that the pandemic has made telecommuting more common. But Miami's startup scene is still in its relative infancy.

The amount invested there could end up "much larger" than $100 million, Claure said.

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