Are risk-taking investors like Masayoshi Son of SoftBank the mainstream or exceptions in Japan?

Japanese Stock Marketinvestorsventure capitalJapanese Economybusiness cultureEntrepreneurship
Created At: 8/8/2025Updated At: 8/17/2025
Answer (1)

Okay, let's dive into this fascinating topic.

Is a risk-taking investor like Masayoshi Son of SoftBank the norm or an exception in Japan?

In one sentence: Son is absolutely an exception, and an extremely rare one at that.

Placed within Japan's business and investment environment, he's like an F1 race car driving on regular city streets – his style is completely different.

To understand why, let's look at several aspects:

1. Japan's Mainstream Investment Culture: Stability First, Extreme Risk Aversion

You could say that for most Japanese institutional investors (like banks, insurance companies, pension funds) and individual investors, their primary goals are "capital preservation" and "pursuing stable, low returns", not "getting rich overnight".

  • Historical "Trauma": This is heavily influenced by the bursting of Japan's economic bubble in the early 1990s. That bubble wiped out the wealth of a generation, leaving deep psychological scars across society. Since then, the word "risk" has become very sensitive in Japan. People prefer to keep money in banks (even at zero interest) or buy government bonds rather than take significant risks. It's like someone who got burned once and now instinctively flinches at the sight of a flame.
  • The "Not Causing Trouble" Culture: Japanese society strongly emphasizes the group and harmony ("wa"), discouraging individualistic risk-taking. If a fund manager makes an unconventional, high-risk investment that fails, they not only face financial losses but also immense social and professional pressure, seen as "causing trouble for everyone." Therefore, the safest choice is to "do what everyone else does" and invest in stable large companies.
  • Mainstream Investment Targets: Consequently, the mainstream approach in the Japanese stock market is investing in large blue-chip companies like Toyota, Sony, and Mitsubishi, seeking stable annual dividends and slow growth. Son's approach of investing tens of billions of dollars in money-losing, unprofitable startups seems, to traditional Japanese investors, borderline insane.

2. Son's "Outlier" Characteristics

Son's style is the complete opposite; he's more like a Silicon Valley adventurer.

  • Betting on "Vision": Traditional investors look at financial statements, P/E ratios, and cash flow. Son looks at what the world will look like in 10 or 20 years. When he invested in Alibaba, Jack Ma was still scrambling for funding, and the company was far from profitable. He bet on the mega-trend that "e-commerce and the internet would transform China." His current heavy bets on AI are a wager that "AI is the next industrial revolution." This kind of "vision-driven" investing requires immense boldness and belief in the future, which is exceedingly rare in Japan.
  • Staggering Leverage and Scale: SoftBank's Vision Fund is a colossal $100 billion fund, heavily utilizing debt and complex financial instruments to amplify investments. This "leveraged" risk-taking runs completely counter to Japan's mainstream "stability" culture. Of course, it also leads to extreme volatility in his portfolio – he's hailed as a genius when winning (like with Alibaba) and suffers spectacular losses when failing (like with WeWork).
  • "Outsider" Status: Son is a Zainichi Korean (third-generation Korean resident in Japan). To some extent, he has always been an "outsider" in Japanese society. This identity may have shielded him from being fully constrained by traditional Japanese corporate culture, instead giving him the courage and freedom to break conventions.

3. Is Japan Changing?

Although Son is an exception, it's worth noting that Japan's investment and startup environment is slowly evolving.

  • Government Push: The Japanese government has recognized that without risk-taking, there is no innovation, and has been actively encouraging entrepreneurship and venture capital (VC) in recent years.
  • Emergence of a New Generation: Younger Japanese are far more receptive to entrepreneurship and venture capital than their parents' generation. While Japan's VC industry size still pales in comparison to the US or China, it is steadily growing.
  • "Mini-Sons": Some younger, more risk-tolerant investors and entrepreneurs are emerging, but their scale is nowhere near Son's. They might dare to invest millions or tens of millions of dollars in early-stage companies, but they are far from being able to deploy tens or hundreds of billions to transform entire industries like Son does.

Conclusion

So, back to your question:

Masayoshi Son is not the mainstream in Japan's investment world; he is a unique "special case" or "outlier".

Japan's mainstream investment culture is conservative, stable, and risk-averse. Son, in contrast, is a global-scale adventurer who believes in high risk, high return, and betting vast amounts of capital on the future.

He is more like the extreme projection of Silicon Valley spirit within Japan, rather than a product of Japan's native investment culture.

Created At: 08-08 21:49:55Updated At: 08-10 02:27:48