SoftBank was able to raise the money from the New York State Common Retirement Fund, and has had a number of previous successes in the state. SoftBank previously invested in Buddy Media, which sold to Salesforce for $800 million last year, and the Huffington Post, which sold to AOL in 2011 for $315 million. The Common Retirement Fund had benefited from these exits as well, and SoftBank currently has 32 active investments in New York.
The fact that SoftBank was able to raise this money from the government means, of course, that taxpayers are funding the company’s moonshots. SoftBank is no stranger to municipal-funded investment pools, as they raised a $250 million round to invest in emerging tech startups in Asia in February, but for the taxpayer’s sake, we hope the government asked for higher interest rates than the 2.5% they received on the Tesla investment.
In 2012, New York State had backed 42 venture funds with about $3.57 billion, and the current portfolio is valued at around $3.51 billion — meaning the state’s VC activities are currently underwater.