There are all sorts of ways large corporate entities attempt to weaponise capital, quite apart from throwing a ton of money at the founders of unproven start-ups. While WeWork became a cautionary tale, some of SoftBank’s other investments, including TikTok’s owner, ByteDance or British chip design firm ARM Holdings, made it a fair bit of money.
A recurring theme of this column has been the use of “capital as a weapon” by global tech giants to prevent emerging challengers from acquiring scale. One company often cited for weaponising capital isn’t a cash-rich Silicon Valley tech behemoth but SoftBank Group.
The Japanese investment holding firm famously parlayed a US$20 million ($25.6 million) investment in the then-fledgling Chinese e-commerce player Alibaba Group in 2000 into a stake worth nearly US$240 billion at its peak, then spent years trying to use some of the proceeds as a weapon, ploughing billions into tech start-ups like co-working space operator WeWork Inc that spectacularly imploded.
