SoftBank founder Masayoshi Son is no stranger to India. In just two years since he pledged to invest $10 billion in the country over a decade, the South Korea-born Japanese businessman has ploughed in over a fifth of that amount, mostly into the internet and solar power sectors.
Now, with an ambitious wish to give away a million electric cars, Son is turning his attention to clean–technology and manufacturing, both of which are regarded as central to the development agenda of prime minister Narendra Modi.
In an exclusive interview with The Economic Times, Son, Japan’s wealthiest man, discussed his Indian portfolio and the rising threat faced by his two biggest bets — online marketplace Snapdeal and ride-hailing app Ola — while reiterating his confidence in the Indian internet economy and his willingness to be a long-term player. Edited excerpts:
How was your meeting with the prime minister Narendra Modi?
Can you give us a sense of what you discussed with the PM?
I first met with the PM in Tokyo two years ago. I told him I would like to invest $10 billion in India. I told him in that meeting that I am a man who keeps my word. We will definitely invest $10 billion; we have already invested $2 billion in India and most likely I will overachieve my commitment. The internet investment will continue, our solar investment will continue. I will invest (in developing 20 GW) in the 100-GW solar vision that the PM has announced. We have already started building our first solar initiative which will be up and running soon. We will continue to increase our efforts on solar.
I see a lot of issues that the PM, my friends and people in India, say about pollution. The PM has announced a vision that by 2030 all new shipment of cars should be electric vehicles. I totally agree with the vision, and want to support and contribute by showing an early example. I have a wish, it is not a commitment yet, to contribute at least one-million electric vehicles to (ride hailing app) Ola drivers for free.
In what time-frame will you make this happen?
I don’t know. As I said this is not a commitment yet, but a wish. This wish will come true if a lot of relevant people contribute — the local government, central government, electric vehicle vendors and also Ola itself, which is our investee company.
Imet Bhavish (Bhavish Aggarwal is the cofounder of Ola), and asked, ‘Do you agree with it?’ He said, fantastic! He has a wish to bring five-million skilled jobs to Indian society by training professional drivers. If those five-million professional drivers get training, at least I would like to provide one-million electric vehicles for free.
Will these EVs be manufactured in India?
We will make in India, which will accelerate the electric-vehicle programme for society. Today there are not enough charging stations, so what happens if the battery dries up? That is the infrastructure issue. The cost of the vehicle is still too much. So many of these efforts should come together. But if they do, the output will be better air. That’s my wish, whether it comes true or not depends on multiple parties involved.
Will you invest in a vehicle manufacturer or set up your own facility?
No. I am not necessarily interested in investing in a manufacturer. We can buy from them. I am open to any vendors who would like to participate in this programme.
We are hearing more nationalistic rhetoric across the world, what impact will this have on global business, SoftBank, for instance, manages a large-global fund?
I don’t see any downturn in our sector, only a lot of growth opportunities. I don’t get associated with (these) questions… I just see a lot of opportunities in front of me. We just announced a $100-billion fund, so we are going to continue to invest.
You have said that you will exceed the target of $10-billion investments in India, what makes you say that?
Just one-million electric vehicles alone would exceed $10 billion. And 20 GW solar is much more than $10 billion. Then we will invest more in the internet companies. So at least some of them will surpass $10 billion.
There has been a lull in new investments after you first came in 2014? How do you rate the quality of ideas?
This is still the beginning, and it’s a good beginning. It’s a long journey. There will be good times and there will be bad times, but SoftBank is always there.
How do you define the current phase in India?
There will be few ups and downs but it is still a very early stage. My passion never fades out.
Do you believe that you have backed the right entrepreneurs in India? Ola faces tough competition from Uber, and Snapdeal is third in the market dominated by Flipkart and Amazon?
This is still the beginning of a long journey. Our family guys are very talented, with great passion and commitment. I would continue to support them. Whether they have big success or not, depends on many other things — themselves, competition, luck and many other things. But I will continue to support. If there are any other entrepreneurs who impress me, we are always open to invest in new opportunities also.
How do you rate the progress you have seen in past two years?
I think the mobile-internet infrastructure is still not good enough, the access is slow and not ubiquitous. But good competition has started. So there will be improvement in infrastructure and that is the reason why internet startups will have a good growth ahead.
This competition you are referring to is the launch of Reliance Jio?
Businesses take time to build out as you said, what targets have you set then? How much time will you give a Snapdeal for instance?
I have continued to support Alibaba for 15 years, and we haven’t sold much. We still keep significant portion in Alibaba and I meet Jack Ma almost every month. friendship and partnership, which continues. So I have a long journey with partners; some of them may not grow good enough but there are many others who will have great successes. I am just looking forward to a great outcome.
In case of internet investments do you see enough opportunities?
I consider this as the information revolution which has just begun, and it is a 100-year journey. If you look at the US, there are still new heroes coming up every 2-3 years. So other companies will continue to have opportunities; that is my view.
Are there opportunities that Indian entrepreneurs must take? What are the opportunities that you will tell them to seize?
Think big, think disruptive, execute with full passion. If the model is right there is no limit to resources.
Out of the Indian portfolio which company are you happy with the most?
Difficult to answer.
Ola is raising money in a down round. Were you surprised by that?
As I said, if I would support this kind of big initiative (electric vehicles for Ola drivers) does that mean I am sceptical about the success of Ola? If I were sceptical I would not be having that kind of a wish or discussion.
Do you see a difference between the Chinese and Indian internet entrepreneurs?
Fundamentally there is no difference, just a time lag. In the early stages of internet in Japan, many said that Japanese and Americans are different. There are10 reasons why Japanese internet is not taking off. I said none of them are right, it’s just a time lag. And of course Japanese internet took off.
And there were 10 other reasons why Chinese internet is different, and I said none of them are right, just a time lag. And I was right. I would say again that there are no unique reasons why internet in India will not take off, just a time lag.
How similar or different are the Chinese and Indian internet economies?
10 years ago China’s GDP was the same as India’s GDP. Can you believe that’s the case? China seems to be so big, so far away. If you think about that fact, then there are two possibilities. 10 years later, India would be as big as China today. The other possibility could be that India will not be able to catch up. But I would bet on the bright side of India.
How much of SoftBank’s $100-billion fund will you invest in India?
At least $10 billion will be invested in India as committed. I never change my word.